Agenus
Annual Report 2018

Plain-text annual report

Morningstar® Document Research℠ FORM 10-KAGENUS INC - AGENFiled: March 18, 2019 (period: December 31, 2018)Annual report with a comprehensive overview of the companyThe information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The userassumes all risks for any damages or losses arising from any use of this information, except to the extent such damages or losses cannot belimited or excluded by applicable law. Past financial performance is no guarantee of future results. UNITED STATESSECURITIES AND EXCHANGE COMMISSIONWashington, D.C. 20549 Form 10-K ☑ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934For the fiscal year ended December 31, 2018or☐☐TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934For the transition period from toCommission File Number: 000-29089 Agenus Inc.(exact name of registrant as specified in its charter) Delaware 06-1562417(State or other jurisdiction of (I.R.S. Employerincorporation or organization) Identification No.)3 Forbes Road, Lexington, Massachusetts 02421(Address of principal executive offices, including zip code)Registrant’s telephone number, including area code:(781) 674-4400Securities registered pursuant to Section 12(b) of the Act: Common Stock, $.01 Par Value The NASDAQ Capital Market(Title of each class) (Name of each exchange on which registered)Securities registered pursuant to Section 12(g) of the Act:None Indicate by check mark if the registrant is a well-known seasoned issuer, as defined in Rule 405 of the Securities Act. Yes ☐ No ☑Indicate by check mark if the registrant is not required to file reports pursuant to Section 13 or Section 15(d) of the Act. Yes ☐ No ☑Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during thepreceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90days. Yes ☑ No ☐Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T(§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files). Yes ☑ No ☐Indicate by check mark if disclosure of delinquent filers pursuant to Item 405 of Regulation S-K (§229.405 of this chapter) is not contained herein, and will not becontained, to the best of registrant’s knowledge, in definitive proxy or information statements incorporated by reference in Part III of this Form 10-K or any amendment to thisForm 10-K. ☐Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growthcompany. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and “emerging growth company” in Rule 12b-2 of the Exchange Act. Large accelerated filer☐ Accelerated filer☑Non-accelerated filer☐ Smaller reporting company☑Emerging growth company☐ If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revisedfinancial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes ☐ No ☑The aggregate market value of voting stock held by non-affiliates of the registrant as of June 29, 2018 (the last trading day of the registrant’s second fiscal quarter of 2018)was: $194.0 million. There were 134,205,374 shares of the registrant’s Common Stock outstanding as of March 11, 2019.DOCUMENTS INCORPORATED BY REFERENCEPortions of the Registrant’s Definitive Proxy Statement relating to the 2019 Annual Meeting of Stockholders, which the registrant intends to file with the Securities andExchange Commission pursuant to Regulation 14A within 120 days after the end of the registrant’s fiscal year ended December 31, 2018, are incorporated by reference into Part IIIof this Report. Source: AGENUS INC, 10-K, March 18, 2019Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results. Source: AGENUS INC, 10-K, March 18, 2019Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results.TABLE OF CONTENTS PagePART I ITEM 1.BUSINESS 3 Our Business 3 Intellectual Property Portfolio 9 Regulatory Compliance 10 Competition 11 Employees 12 Corporate History 12 Availability of Periodic SEC Reports 13ITEM 1A.RISK FACTORS 13ITEM 1B.UNRESOLVED STAFF COMMENTS 39ITEM 2.PROPERTIES 39ITEM 3.LEGAL PROCEEDINGS 40ITEM 4.MINE SAFETY DISCLOSURES 40 PART II ITEM 5.MARKET FOR REGISTRANT’S COMMON EQUITY, RELATED STOCKHOLDER MATTERS AND ISSUER PURCHASES OFEQUITY SECURITIES 41ITEM 6.SELECTED FINANCIAL DATA 42ITEM 7.MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS 44ITEM 7A.QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK 54ITEM 8.FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA 55ITEM 9.CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND FINANCIAL DISCLOSURE 97ITEM 9A.CONTROLS AND PROCEDURES 97ITEM 9B.OTHER INFORMATION 99 PART III ITEM 10.DIRECTORS, EXECUTIVE OFFICERS AND CORPORATE GOVERNANCE 100ITEM 11.EXECUTIVE COMPENSATION 100ITEM 12.SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT AND RELATED STOCKHOLDERMATTERS 100ITEM 13.CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS, AND DIRECTOR INDEPENDENCE 100ITEM 14.PRINCIPAL ACCOUNTANT FEES AND SERVICES 100 PART IV ITEM 15.EXHIBITS AND FINANCIAL STATEMENT SCHEDULES 101ITEM 16FORM 10-K SUMMARY 107 Source: AGENUS INC, 10-K, March 18, 2019Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results.Note Regarding Forward-Looking StatementsThis Annual Report on Form 10-K and other written and oral statements the Company makes from time to time contain forward-looking statements.You can identify these forward-looking statements by the fact they use words such as “could,” “expect,” “anticipate,” “estimate,” “target,” “may,” “project,”“guidance,” “intend,” “plan,” “believe,” “will,” “potential,” “opportunity,” “future” and other words and terms of similar meaning. Forward-lookingstatements include discussion of future operating or financial performance. You also can identify forward-looking statements by the fact that they do notrelate strictly to historical or current facts. Forward-looking statements involve risks and uncertainties that could delay, divert or change any of them, andcould cause actual outcomes to differ materially. These statements relate to, among other things, our business strategy, our research and development, ourproduct development efforts, our ability to commercialize our product candidates, the activities of our licensees, our prospects for initiating partnerships orcollaborations, the timing of the introduction of products, the effect of new accounting pronouncements, our future operating results and our potentialprofitability, availability of additional capital as well as our plans, objectives, expectations, and intentions.Although we believe we have been prudent in our plans and assumptions, no assurance can be given that any goal or plan set forth in forward-lookingstatements can be achieved, and readers are cautioned not to place undue reliance on such statements, which speak only as of the date of this report. Weundertake no obligation to release publicly any revisions to forward-looking statements as a result of new information, future events or otherwise.The risks identified in this Annual Report on Form 10-K, including, without limitation, the risks set forth in Part I-Item 1A. “Risk Factors,” could causeactual results to differ materially from forward-looking statements contained in this Annual Report on Form 10-K. We encourage you to read thosedescriptions carefully. Such statements should be evaluated in light of all the information contained in this document.AIM TM, ASV TM, AgenTus TM, Agenus TM, AutoSynVax TM, PSV TM, PhosphoSynVax TM, ProphageTM, Retrocyte DisplayTM, SECANT® andStimulon® are trademarks of Agenus Inc. and its subsidiaries. All rights reserved. 2Source: AGENUS INC, 10-K, March 18, 2019Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results.PART I Item 1.BusinessOur BusinessWe are a clinical-stage immuno-oncology (“I-O”) company with a pipeline of immune modulating antibodies, cancer vaccines, adjuvants andadoptive cell therapies - dedicated to becoming a leader in the discovery and development of innovative combination therapies and committed to bringingeffective medicines to patients with cancer. Our business is designed to drive success in I-O through speed, innovation and effective combination therapies.We believe that combination therapies and a deep understanding of each patient’s cancer will drive substantial expansion of the patient populationbenefiting from current I-O therapies. In addition to a diverse pipeline, we have assembled fully integrated end-to-end capabilities including novel targetdiscovery, antibody generation, cell line development and good manufacturing practice (“GMP”) manufacturing. We believe that these fully integratedcapabilities enable us to produce novel candidates on timelines that are shorter than the industry standard. Leveraging from our science and capabilities, wehave forged important partnerships to advance our innovation. We believe the next generation of cancer treatment will build on clinically validated antibodies targeting CTLA-4 and PD-1 combined with novelimmunomodulatory agents designed to address underlying tumor immune-escape mechanisms. Our immunotherapy pipeline features vaccines, adjuvants, immunomodulatory and tumor microenvironment modifying antibodies, including ourproprietary lead antibodies, AGEN1884 (an anti-CTLA-4 of the same IgG1 subclass as Yervoy®), and AGEN2034 (an anti-PD-1 antibody). These proprietaryantibodies bind to validated targets—CTLA-4 and PD-1—and are our most advanced clinical stage combination agents with registrational potential incervical cancer. We are aiming to develop, register and launch these products with a first potential biologics license application (“BLA”) filing as early as2020 for both AGEN2034 monotherapy and combination therapy with AGEN1884 in second line cervical cancer. The overall strength of our pipeline, whichincludes potential first-in-class and best-in-class assets, is expected to drive our ability to meet individual patients’ needs.In addition to our lead programs, Agenus scientists have leveraged our internal discovery and translational platforms and powerful algorithms todevelop a pipeline of molecules that are intended to address key aspects of antitumor immunity and tumor resistance mechanism. For tumors not yet visibleto the immune system, we are leveraging our immune educating neoantigen vaccine platform, designed to target mutationally based and biochemically based(phosphorylated) neoantigens (AutoSynVax and PhosphoSynVax) to prime the immune system to attack tumors. These vaccines may be applicable forpatients where checkpoint modulating (“CPM”) antibodies alone are not sufficient to bring about tumor control. To further improve patient response rates,Agenus scientists are developing therapies intended to address mechanisms of immune evasion and therapeutic resistance. These include “multi-specific”antibodies that are designed to condition the tumor microenvironment and augment the activity of immune cells. We and our partners are on track to beginclinical trials with these assets in 2019. With this diverse pipeline, we are positioned to potentially deliver combination therapies with the goal to enhanceresponse rates and benefit patients who are unresponsive to current immunotherapies. In 2017, we formed a subsidiary, AgenTus Therapeutics, to bring innovative living drugs to cancer patients. AgenTus’ pipeline includes T cellreceptors (TCR) and chimeric antigen receptors (CAR) formulated in both autologous and allogeneic cell formats. We anticipate filing our first cell therapyIND through AgenTus and advancing our differentiated allogeneic cell format towards an IND in 2019.To succeed in I-O, innovation and speed are paramount. We are a vertically integrated biotechnology company equipped with a suite of technologyplatforms to advance from novel target identification (Retrocyte Display, SECANT, Agenus Immunogenic Platform (“AIM”), functional genomics andligandomics) through manufacturing for clinical trials of antibodies and vaccines.Our common stock is currently listed on The Nasdaq Capital Market under the symbol “AGEN.” Our VisionWe believe that combination therapies and a deep understanding of each patient’s cancer will be key drivers of success in substantially expanding thepatient population benefiting from current I-O therapies. In addition, delivering innovation with speed is critical for our future success, as drug developmenttimelines in oncology shorten while product obsolescence rates climb. We believe our fully integrated, end-to-end capabilities from novel target discovery,antibody generation, cell line development, to GMP manufacturing, together with a comprehensive portfolio consisting of antibody-based therapeutics,adjuvants and cancer vaccines, will uniquely position us to produce novel therapies on accelerated timelines. We believe that a balanced pipeline of productcandidates should focus on both validated targets as well as novel targets designed to address tumor escape mechanisms. CTLA-4 and PD-1 antagonists arerecognized as the first clinically validated immunotherapy combination. These, in combination with innovative immunomodulatory antibodies or immuneeducation vaccines, could be a focal point of the next generation of I-O combinations. Therefore, we plan to develop, register and launch our proprietaryantibodies targeting PD-1 and CTLA-4 aggressively through the clinic and expand with novel combination therapies designed to improve clinical responseand the durability of response of existing therapies.3Source: AGENUS INC, 10-K, March 18, 2019Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results.Our StrategyOur strategy is to bring innovative combination therapies for cancer patients to substantially expand the patient population benefiting from current I-O therapies. Our diverse pipeline of antibodies, vaccines and adjuvants enable us to pursue optimal combinations for optimal efficacy. We are pursuing atiered risk profile and targeting compressed timelines for regulatory filings. In 2018, we met with the FDA and expect that each of our lead anti-CTLA-4(AGEN1884) and anti-PD-1 (AGEN2034) trials are designed to support a BLA filing in second-line cervical cancer as early as 2020. We believe that we arepositioned to take advantage of accelerated pathways for approval with a relatively small number of patients and surrogate or short-term endpoints in ourtrials. In addition, we plan to pursue select indications to further expedite market entry.Our strategy for our more novel, earlier stage programs include (i) pursuit of effective I-O antibody, vaccine and cell-therapy combinations withCTLA-4 and/or PD-1 targeted antibodies as the backbone and (ii) advancement of our differentiated antibody programs such as our bispecific programs, anext generation anti-CTLA-4, and differentiated CD137 and TIGIT antibodies.Part of our strategy is to develop and commercialize some of our product candidates by continuing our existing arrangements with collaborators andlicensees and by entering into new collaborations. We are also pursuing novel financial mechanisms to support programs such as AGEN2034, including ourrecently announced launch of Biotech Electronic Security Tokens (BEST). See “Risk Factors—Risks Relating to Our Tokens.”Our AssetsOur I-O assets include antibody-based therapeutics, cancer vaccine platforms and adjuvants. Our proprietary CTLA-4 and PD-1 antagonists are inclinical development; we are one of only a few companies to have proprietary anti-CTLA-4 and anti-PD-1 antibodies in clinical combinations. To complement our portfolio of foundational CPMs, we and our partners have pre-clinical antibodies targeting tumor escape mechanisms andtherapeutic resistance. These include potential best-in-class and first-in-class assets such as our next-generation anti-CTLA-4 (AGEN1181) and TIGIT(AGEN1307), as well as CD137 (AGEN2373) and bispecific antibodies that are partnered with Gilead.Further, our neoantigen vaccine platforms include: (i) Individualized AutoSynVax™ (ASV™), which targets the unique antigens expressed by apatient’s own tumor, and (ii) off-the-shelf (or pre-manufactured) PhosphoSynVax™ (PSV™), which targets antigens expressed across patients and tumors,thereby seeking to treat broader categories of patients. Our vaccines are powered by our proprietary adjuvant, QS-21 Stimulon®. We plan to evaluate ASV incombination with checkpoint antibodies in 2019 and we are advancing preclinical development of PSV.Our proprietary QS-21 Stimulon® is believed to be one of the most potent adjuvants known. QS-21 Stimulon® is a key component in several GSKvaccines, including GSK’s Shingrix, which has demonstrated greater than 90% efficacy, as well as the first ever malaria vaccine, Mosquirix®. Shingrix salesare substantially ahead of forecasts, making additional milestones from our royalty transaction with HCR much more likely. QS-21 is being used in numerousother clinical-stage vaccines, including our own cancer vaccines. Recently, the Bill & Melinda Gates Foundation awarded us a grant to develop analternative, plant cell culture-based manufacturing process to ensure the continuous future supply of QS-21 Stimulon® adjuvant.Our Antibody Discovery Platforms and CPM ProgramsCheckpoint antibodies regulate immune response against pathogens that invade the body and are achieving positive outcomes in a number of cancersthat were untreatable only a few years ago. Two classes of checkpoint targets include:1.inhibitory checkpoints that help suppress an immune response in order to prevent excessive immune reaction resulting inundesired inflammation and/or auto-immunity, and2.stimulatory checkpoints that can enhance or amplify an antigen-specific immune response.We possess a suite of antibody discovery platforms that are designed to drive the discovery of future CPM antibody candidates. We are planning toemploy a variety of techniques to identify and optimize mono-specific and multi-specific antibody candidates, internally.Our anti-CTLA-4 and anti-PD-1 programs (AGEN1884 and AGEN2034, respectively) are in clinical trials that included a Phase 1 dose escalation withexpansion cohorts in multiple solid tumors. These molecules are now in expansion trials with both anti-PD-1 monotherapy and anti-PD-1 and anti-CTLA-4combination trials for patients with second-line cervical cancer that are designed to support one or more BLA filings as soon as 2020. In 2018, we presenteddata on our AGEN1884 and AGEN2034 programs at major oncology conferences, including the American Society of Clinical Oncology (“ASCO”)conference in June 2018 and the European Society for Medical Oncology (ESMO) congress in October 2018. In addition, we presented pre-clinical data onour Gilead-partnered anti-CD137 (AGEN2373), and our Incyte-partnered programs anti-TIM-3 and anti-LAG-3 antibodies at the American Association forCancer Research (“AACR”) conference in April 2018 and the Society for Immunotherapy of Cancer (“SITC”) conference in November 2018. Our earlyclinical data demonstrated a clinical benefit (i.e., complete response, partial response or disease4Source: AGENUS INC, 10-K, March 18, 2019Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results.stabilization) in more than 60% of patients treated with AGEN1884 and AGEN2034.As of our latest data update in the fourth quarter of 2018, we have reported the following: •We treated more than 140 patients with AGEN1884 and/or AGEN2034 and observed clinical benefit in more than 60% of them •In our AGEN2034 (anti-PD-1) monotherapy trial, 68% of evaluable patients with metastatic and/or locally advanced solid tumors experiencedclinical benefit. We presented data showing that: oAmong 38 subjects from Phase 1 of the study, three patients displayed partial response to therapy (i.e., tumors shrunk) and 23 patientsdisplayed stable disease (i.e., tumor size was unchanged) during the follow-up period (median of 191 days or 27 weeks). oIn the ongoing Phase 2 expansion portion of this study (NCT03104699) in advanced refractory cervical cancer, three out of seven(43%) of evaluable patients experienced a clinical benefit as of July 2018. Data continues to accumulate. oAGEN2034 appeared to be clinically active and well-tolerated. •In our AGEN2034 (anti-PD-1) plus AGEN1884 (anti-CTLA-4) combination trial, 63% of patients with ovarian, breast, and soft tissue sarcomasshowed clinical benefit, including an objective durable response in a patient with ovarian cancer. With respect to our novel discovery pipeline, our most advanced asset is our next generation anti-CTLA-4 antibody, an IgG1 anti-CTLA-4antagonist. Based on preclinical data, we believe that this molecule has potential advantages over competing anti-CTLA-4 molecules, including:(1) potential to induce enhanced T cell priming via the engineered Fc region, as T cell priming is a crucial step in generating potent immune responsesagainst cancer,(2) increased potential to deplete intratumoral regulatory T cells, which represent a significant barrier to successful anti-cancer immune responses,(3) better combination potential with other antitumor or immunomodulatory antibodies, vaccines, and targeted therapies and(4) potential therapeutic benefit to a wider patient population, including the estimated 40% of patients who are unlikely to fully benefit from the firstgeneration CTLA-4 therapies due to a genetic predisposition.We filed an IND for AGEN1181 in the fourth quarter of 2018 and expect to initiate clinical trials in 2019.Partnered CPM ProgramsIn December 2018, we entered into a series of agreements with Gilead Sciences, Inc. (“Gilead”) to collaborate on the development andcommercialization of up to five novel I-O therapies. Pursuant to the collaboration agreements, we received an upfront cash payment from Gilead of $120.0million following the closing in January 2019 and are eligible to receive up to an additional $1.7 billion in aggregate potential fees and milestones. Atclosing, Gilead received worldwide exclusive rights to our bispecific antibody, AGEN1423. Gilead also received the exclusive option to license exclusivelyAGEN1223, a bispecific antibody, and AGEN2373, a monospecific antibody. We recently filed INDs for AGEN1423 and AGEN1223 and are planning to filean IND for AGEN2373 in the first half of 2019. We are responsible for developing the option programs up to the option decision points, at which time Gileadmay acquire exclusive rights to the programs on option exercise. For either, but not both, of the option programs, we have the right to opt-in to share Gilead’sdevelopment and commercialization costs in the United States in exchange for a profit (loss) share on a 50:50 basis and revised milestone payments. Gileadalso received the right of first negotiation for two additional, undisclosed preclinical programs. At the closing, Gilead also purchased 11,111,111 shares ofAgenus common stock for $30.0 million pursuant to a stock purchase agreement.In January 2015, we entered into a collaboration with Incyte Corporation (“Incyte”) to discover, develop and commercialize novel immuno-therapeutics using our antibody platforms. The collaboration was initially focused on four CPM programs targeting GITR, OX40, TIM-3 and LAG-3, and inNovember 2015, we expanded the alliance by adding three novel undisclosed CPM targets. Pursuant to the terms of the original agreement, Incyte paid us$25.0 million in upfront cash. Targets under the collaboration were designated as either profit-share programs, where the parties shared all costs and profitsequally, or royalty-bearing programs, where Incyte funded all costs, and we were eligible to receive milestones and royalties. Under the original collaborationagreement, programs targeting GITR, OX40 and two of the undisclosed targets were designated as profit-share programs, while the other targets were royalty-bearing programs. For each profit-share product, we were eligible to receive up to $20.0 million in future contingent development milestones. For eachroyalty-bearing product, we were eligible to receive (i) up to $155.0 million in future contingent development, regulatory, and commercialization milestonesand (ii) tiered royalties on global net sales at rates generally ranging from 6%-12%. Concurrent with the execution of the original collaboration agreement,we and Incyte also entered into a stock purchase agreement pursuant to which Incyte purchased approximately 7.76 million shares of our common stock foran aggregate purchase price of $35.0 million. In February 2017, we and Incyte amended the terms of the original collaboration agreement to, among otherthings, convert the GITR and OX40 programs from profit-share to royalty-bearing programs with royalties on global net sales at a flat5Source: AGENUS INC, 10-K, March 18, 2019Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results.15% rate for each. In addition, the profit-share programs relating to two undisclosed targets were removed from the collaboration, with one reverting to Incyteand one to Agenus (the latter being our TIGIT antibody program), each with royalties on global net sales at a flat 15% rate. The remaining three royalty-bearing programs in the collaboration targeting TIM-3, LAG-3 and one undisclosed target remain unchanged, and there are no more profit-share programsunder the collaboration. Pursuant to the amended agreement, we received accelerated milestone payments of $20.0 million from Incyte related to the clinicaldevelopment of INCAGN1876 (anti-GITR agonist) and INCAGN1949 (anti-OX40 agonist). Concurrent with the execution of the amendment agreement, weand Incyte entered into a separate stock purchase agreement whereby Incyte purchased an additional 10 million shares of our common stock for an aggregatepurchase price of $60.0 million. Incyte advanced both INCAGN1876 (anti-GITR agonist) and INCAGN1949 (anti-OX40 agonist) into the clinic in 2016.INCAGN1876 is currently in a Phase 1/2 trial exploring its safety, tolerability, and efficacy in combination with immune therapies, ipilimumab andnivolumab, in advanced or metastatic malignancies such as advanced or metastatic endometrial cancer, gastric cancer (including stomach, esophageal, andgastroesophageal junction), and squamous cell carcinoma of the head and neck. INCAGN1949 is currently in a Phase 1/2 trial exploring its safety,tolerability, and efficacy in combination with immune therapies, ipilimumab and nivolumab, in advanced or metastatic malignancies such as advanced ormetastatic urothelial carcinoma or RCC. In 2018, Incyte initiated clinical trials for their INCAGN2385 (LAG-3) and INCAGN2390 (TIM-3) programs.In April 2014, we entered into a collaboration and license agreement with Merck to discover and optimize fully-human antibodies against twoundisclosed CPM targets. In 2016, Merck selected a lead product candidate against one of the undisclosed targets to advance into preclinical studies, andsubsequently initiated a Phase 1 clinical trial with the undisclosed antibody in August 2018. Under the terms of the agreement, Merck is responsible for allfuture product development expenses for the selected antibody candidate, and Agenus is eligible to receive up to $95.0 million in potential milestones plusroyalties on any future sales.On September 20, 2018, we, through our wholly-owned subsidiary, Agenus Royalty Fund, LLC, entered into a Royalty Purchase Agreement (the“XOMA Royalty Purchase Agreement”) with XOMA (US) LLC (“XOMA US”). Pursuant to the terms of the XOMA Royalty Purchase Agreement, XOMA USpaid us $15.0 million at closing in exchange for the right to receive 33% of the future royalties and 10% of the future milestones that we are entitled toreceive from Incyte and Merck, net of certain of our obligations to a third party and excluding the milestone we received from Incyte in the fourth quarter of2018. After taking into account our obligations under the XOMA Royalty Purchase Agreement, as of December 31, 2018, we remain eligible to receive up to$450.0 million and $85.5 million in potential development, regulatory and commercial milestones from Incyte and Merck, respectively.We also have a collaboration agreement with Recepta Biopharma SA for the development of our antibodies targeting CTLA-4 and PD-1, which givesRecepta certain rights to South American countries. We expect to continue exploring additional future collaborations.Vaccine PlatformsOur current vaccine platforms for the treatment of cancer, and potentially other indications, include our HSP based Prophage vaccine candidates, andour fully synthetic, neoantigen vaccine candidates, ASV and PSV.HSPs are a group of proteins present at high levels in most mammalian cells. Their expression is increased when cells are exposed to elevatedtemperatures or other stresses. A potential role for HSPs in regulating immune responses was revealed when it was first discovered that HSP complexespurified from cancer cells produced immunity to cancer, whereas HSP complexes purified from normal tissue did not. This discovery led to the understandingthat HSPs bind to and carry a broad sampling of the protein environment within cells, including mutant proteins that might arise from genetic mutationswithin cancer cells. It was further shown that immunization with HSP complexes purified from tumors generate both CD4 and CD8 positive T-cell immuneresponses. These activated T-cells target the cancer cells of the tumor, from which the HSP complexes were derived, for destruction. Thus, HSP complexesisolated from cancer cells may be particularly helpful in mediating successful immunization. Since HSPs are expressed in all tumor cells, the approach ofimmunizing with the HSP complexes isolated from a particular tumor may be broadly applicable to a variety of cancer types. We believe that we pioneeredthe use of gp96, an HSP, purified from a patient’s own tumor tissue, as a way to make I-O vaccine candidates. Prophage Vaccine CandidatesOur early vaccine technology, Prophage (HSPPC-96), is an autologous cancer vaccine therapy derived from cancer tissues that are surgically removedfrom an individual patient designed to contain a broad sampling of potentially antigenic mutant proteins to educate the patient’s immune system to seek outand destroy cancer. To date, more than 1,000 patients have been treated with Prophage. Data reported at ASCO in 2015 demonstrated that patients with newlydiagnosed GBM (ndGBM) with lower immune suppression (measured by peripheral PD-L1 expression) had an improved response to vaccine. To furtherexplore these findings, we announced a Phase 2 clinical trial collaboration with the National Cancer Institute (“NCI”) to evaluate Prophage in combinationwith pembrolizumab (Keytruda®). The trial is being conducted by the Brain Tumor Trials Collaborative (“BTTC”), led by Dr. Mark Gilbert, Chief of theNeuro-Oncology Branch at the NCI Center for Cancer Research with product provided by Agenus and Merck. The trial is ongoing. 6Source: AGENUS INC, 10-K, March 18, 2019Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results. Neoantigen Vaccine PlatformsOur neoantigen vaccine platforms include: (i) individualized AutoSynVax™ (ASV™), which targets the unique antigens expressed by a patient’s owntumor, and (ii) off-the-shelf (or pre-manufactured) PhosphoSynVax™ (PSV™), which targets antigens expressed across patients and tumors, potentiallyenabling us to treat broader categories of patients.Our neoantigen vaccines are designed with unique features, intending to confer important advantages: (1) proprietary methods to develop an effectiveand relevant “Blueprint” of immunogenic neoantigens for each patient; (2) HSPs to efficiently deliver neoantigens to the right immune cells to activate ananti-cancer immune response. Our proprietary linker technology is designed to enable efficient neoantigen loading for a robust cancer specific immuneresponse with significantly less peptide; and (3) QS-21 Stimulon® adjuvant, a potent immune stimulator now in GSK’s commercial shingles vaccine,Shingrix.Mutation-based neo-epitopes, which will form the basis for the immunogens used in ASV, appear to be almost always particular to a given patient.Therefore, ASV is a largely individualized vaccine product candidate. With a small amount of a patient’s tumor as a sample, our ASV program is designed toutilize next generation sequencing technologies coupled with complex bioinformatics algorithms to identify mutations in a tumor’s DNA and RNA. Oncethese mutations have been identified, we plan to manufacture synthetic peptides encoding these neoepitopes, load these peptides on to our recombinantHSP70 and deliver a fully synthetic polyvalent vaccine to the patient. This program is based on the hypothesis that the HSP70 platform would shuttle themutated peptides to sites where they could be recognized by the immune system and elicit a cytotoxic and helper T cell response in patients with cancer.Biochemically based neoantigens, such as those arising from dysregulated phosphorylation of various proteins in malignant cells, can serve as a tumorfingerprint across a broad histology of tumors. Through our acquisition of PhosImmune, we have a portfolio of proprietary phosphorylated antigenic targetsthat can be used for therapeutic development. PSV is a vaccine candidate designed to induce immunity against this novel class of tumor specific neoepitopesknown as Phosphopeptides (“PTTs”). PSV is intended to induce cellular immunity to abnormal phosphopeptide neoepitopes that are characteristic of thesevarious forms of cancer. We believe PTTs are among the most promising candidates for anti-cancer immunity, as patients with PTT immunity have beenshown to have better outcomes than those without PTT immunity. We have amassed a proprietary library of more than 2,000 PTTs. Many of these PTTs areshared among many cancer patients and across multiple tumor types. We are using these PTTs for developing multiple off-the-shelf vaccines. PSV is based onour vaccine platform and includes our proprietary QS-21 Stimulon adjuvant and heat-shock protein backbone. We are developing multiple indication-specific PSV offerings, with lead programs in acute myeloid leukemia (AML) and colorectal cancer (CRC). By leveraging our proprietary vaccine platformwhich has already demonstrated clinical safety and immunogenicity, we intend to advance at least one PSV formulation into the clinic in 2019. QS-21 Stimulon AdjuvantQS-21 Stimulon is an adjuvant, which is a substance added to a vaccine or other immunotherapy that is intended to enhance an immune response tothe target antigens. QS-21 Stimulon is a natural product, a triterpene glycoside, or saponin, purified from the bark of the Chilean soapbark tree, Quillajasaponaria. QS-21 Stimulon has the ability to stimulate an antibody-mediated immune response and has also been shown to activate cellular immunity. It hasbecome a key component in the development of investigational preventive vaccine formulations across a wide variety of diseases. These studies have beencarried out by academic institutions and pharmaceutical companies in the United States and internationally. A number of these studies have shown QS-21Stimulon to be significantly more effective in stimulating immune responses than aluminum hydroxide or aluminum phosphate, the adjuvants mostcommonly used in approved vaccines in the United States today. In January 2019, we announced that the Bill & Melinda Gates Foundation awarded us agrant to develop an alternative, plant cell culture-based manufacturing process to ensure the continuous future supply of QS-21 Stimulon adjuvant. Partnered QS-21 Stimulon ProgramsIn 2006, we entered into a license agreement and a supply agreement with GSK for the use of QS-21 Stimulon (the “GSK License Agreement” and the“GSK Supply Agreement,” respectively). In 2009, we entered into an Amended and Restated Manufacturing Technology Transfer and Supply Agreement (the“Amended GSK Supply Agreement”) under which GSK has the right to manufacture all of its requirements of commercial grade QS-21 Stimulon. GSK isobligated to supply us, or our affiliates, licensees, or customers, certain quantities of commercial grade QS-21 Stimulon for a stated period of time. In March2012, we entered into a First Right to Negotiate and Amendment Agreement amending the GSK License Agreement and the Amended GSK SupplyAgreement to clarify and include additional rights for the use of QS-21 Stimulon (the “GSK First Right to Negotiate Agreement”). In addition, we grantedGSK the first right to negotiate for the purchase of Agenus or certain of our assets, which expired in March 2017. As consideration for entering into the GSKFirst Right to Negotiate Agreement, GSK paid us an upfront cash payment of $9.0 million, $2.5 million of which was creditable toward future royaltypayments. We refer to the GSK License Agreement, the Amended GSK Supply Agreement and the GSK First Right to Negotiate Agreement collectively as theGSK Agreements. In 2017, we received a final milestone payment of $1.0 million from GSK and are no longer entitled to any additional milestone paymentsunder the GSK Agreements. Under the terms of the Agreement, we are generally entitled to receive a 2% royalty on net sales of prophylactic vaccines for aperiod of 10 years after the first commercial sale of a resulting GSK product, which was triggered with GSK’s first commercial sale of Shingrix in 2017.Notably, we have already monetized and sold this entire royalty stream as discussed in more detail below.7Source: AGENUS INC, 10-K, March 18, 2019Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results.The GSK License and Amended GSK Supply Agreements may be terminated by either party upon a material breach if the breach is not cured within the timespecified in the respective agreement. The termination or expiration of the GSK License Agreement does not relieve either party from any obligation whichaccrued prior to the termination or expiration. Among other provisions, the license rights granted to GSK survive expiration of the GSK License Agreement.The license rights and payment obligations of GSK under the Amended GSK Supply Agreement survive termination or expiration, except that GSK's licenserights and future royalty obligations do not survive if we terminate due to GSK's material breach unless we elect otherwise. We do not incur clinicaldevelopment costs for products partnered with GSK.In September 2015, we monetized a portion of the royalties associated with the GSK License Agreement to an investor group led by Oberland CapitalManagement for up to $115.0 million in the form of a non-dilutive royalty transaction. Under the terms of a note purchase agreement with the investor group(the “Note Purchase Agreement”), we received $100.0 million at closing for which the investors had the right to receive 100% of our worldwide royaltiesunder the GSK License Agreement on sales of GSK’s Shingrix and malaria (RTS,S) prophylactic vaccine products that contain our QS-21 Stimulon adjuvantto pay down principle and interest. In November 2017, and pursuant to the Note Purchase Agreement, we received an additional $15.0 million in cash fromthe investors based on the approval of Shingrix by the FDA. Pursuant to the terms of this transaction, we retained the right to receive all royalties from GSKafter all principal, interest and other obligations were satisfied under the Note Purchase Agreement. The Note Purchase Agreement also allowed us to buyback the loan and extinguish the notes early under pre-specified terms, which we did in January 2018.In January 2018, we sold 100% of all royalties we were entitled to receive from GSK to Healthcare Royalty Partners III, L.P. and certain of its affiliates(collectively, “HCR”) and used the proceeds to extinguish the debt under the Note Purchase Agreement. HCR paid approximately $190.0 million at closingfor the royalty rights, of which approximately $161.9 was used to extinguish the prior notes, yielding us approximately $28.0 million in net proceeds. We arealso entitled to receive up to $40.35 million in milestone payments from HCR based on sales of GSK’s vaccines as follows: (i) $15.1 million upon reaching$2.0 billion last-twelve-months net sales any time prior to 2024 and (ii) $25.25 million upon reaching $2.75 billion last-twelve-months net sales any timeprior to 2026. We would owe a reverse milestone payment of approximately $25.9 million to HCR in 2021 if neither of the following sales milestones areachieved: (i) 2019 sales of the GSK vaccines exceed $1.0 billion or (ii) 2020 sales of the GSK vaccines exceed $1.75 billion (the “Rebate Payment”). As partof the transaction, we provided a guaranty for the potential Rebate Payment and secured the obligation with substantially all of our assets pursuant to asecurity agreement, subject to certain customary exceptions and excluding all assets necessary for AgenTus Therapeutics, Inc. In February 2019, GSKreported that Shingrix sales for 2018, its first full year on the market, were over $1.0 billion. ManufacturingManufacturing CPM AntibodiesIn December 2015, we acquired an antibody manufacturing pilot plant in Berkeley, CA from XOMA Corporation (“XOMA”), which we refer to as“Agenus West.” A team of former XOMA employees with valuable chemistry, manufacturing and controls experience joined us and continue to operate thefacility. In addition, in February 2017, we amended our collaboration with Incyte, transferring manufacturing responsibilities for all antibodies under thecollaboration to them. This includes antibodies targeting GITR, OX40, TIM-3, LAG-3 and one undisclosed target. We have transferred the manufacturingknow how to Incyte to support these endeavors and allow Agenus to focus on the manufacture of antibodies for some of our own CPM programs and those ofexisting and potential third-party collaborators. Since the acquisition of Agenus West, we have made significant improvements in the plant, and addedadditional headcount increasing both scale and capacity. Agenus West is currently producing antibody drug substance for our lead programs. We have beenable to deliver clinical grade material from research cell banks in approximately four months, which we believe to be three to four times faster than theindustry average. Agenus West utilizes cutting-edge technology platforms, enabling us to be self-reliant and giving us the advantage of manufacturing speed,cost efficiency, operational flexibility and manufacturing technology transfer to commercial scale partners—all with desired product quality, with theultimate goal of benefiting patients.Manufacturing Cancer VaccinesWe manufacture our cancer vaccine candidates in our Lexington, MA facility.Each Prophage vaccine is manufactured using a patient’s own tumor. After the patient undergoes surgery to remove cancerous tumor tissue, the tumoris shipped frozen in a specially designed kit provided by us to our Lexington, Massachusetts facility. The turnaround time from the date of surgery todelivery of vaccine is approximately three to four weeks, which generally fits well with the patient’s recovery time from surgery.ASV and PSV vaccine candidates are manufactured using HSP70 loaded with synthetic peptide synthesized by approved manufacturers. The sequenceof the peptides is determined by sequencing and analysis of patient and tumor DNA and RNA and run through complex algorithms by our bioinformaticsgroup who have specialized knowledge of the attributes required to elicit immune responsiveness. This process takes several weeks, after which themanufactured vaccine undergoes extensive quality testing, including sterility testing, which takes a further two weeks.8Source: AGENUS INC, 10-K, March 18, 2019Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results.We have established, within a single facility, well-defined, cost efficient vaccine manufacturing under GMPs, including bioanalytical, quality controland quality assurance, logistics, distribution and supply chain management. After manufacturing, Prophage and ASV vaccine candidates are tested andreleased by our analytical and quality systems staff. The quality control organization performs a series of release assays designed to ensure that the productmeets all applicable specifications. Our quality assurance staff also reviews manufacturing and quality control records prior to batch release in an effort toassure conformance with current GMP (“cGMP”) as mandated by the FDA and foreign regulatory agencies.Our manufacturing staff is trained and routinely evaluated for conformance to rigorous manufacturing procedures and quality standards. Thisoversight is intended to ensure compliance with FDA and foreign regulations and to provide consistent vaccine output. Our quality control and qualityassurance staff is similarly trained and evaluated as part of our effort to ensure consistency in the testing and release of the product, as well as consistency inmaterials, equipment and facilities.QS-21 StimulonExcept in the case of GSK, we have retained worldwide manufacturing rights for QS-21 Stimulon, and we have the right to subcontract manufacturingfor QS-21 Stimulon. In addition, under the terms of our agreement with GSK, upon request by us, GSK is committed to supply certain quantities ofcommercial grade QS-21 Stimulon to us and our licensees for a fixed period of time.Intellectual Property PortfolioWe seek to protect our technologies through a combination of patents, trade secrets and know-how, and we currently own, co-own or have exclusiverights to approximately 25 issued United States patents and approximately 75 issued foreign patents. We also own, co-own or have exclusive rights toapproximately 35 pending United States patent applications and approximately 180 pending foreign patent applications. We may not have rights in allterritories where we may pursue regulatory approval for our product candidates.Through various acquisitions, we own, co-own, or have exclusive rights to a number of patents and patent applications directed to various methodsand compositions, including methods for identifying therapeutic antibodies and product candidates arising out of such entities’ technology platforms. Inparticular, we own patents and patent applications relating to our Retrocyte Display technology platform, a high throughput antibody expression platform forthe identification of fully-human and humanized monoclonal antibodies. This patent family is projected to expire between 2029 and 2031. We own, co-own,or have exclusive rights to patents and patent applications directed to various methods and compositions, including a patent directed to methods foridentifying phosphorylated proteins using mass spectrometry. This patent is projected to expire in 2023. In addition, as we advance our research anddevelopment efforts with our institutional and corporate collaborators, we are seeking patent protection for certain newly identified therapeutic antibodiesand product candidates. We can provide no assurance that any of our patents, including the patents that we acquired or in-licensed, will have commercialvalue, or that any of our existing or future patent applications, including the patent applications that were acquired or in-licensed, will result in the issuanceof valid and enforceable patents. Our issued patents covering Prophage vaccine and methods of use thereof, alone or in combination with other agents,expired or will expire at various dates between 2015 and 2024. In particular, our issued U.S. patents covering Prophage composition of matter expired in2015. In addition, our issued patents covering QS-21 Stimulon composition of matter expired in 2008. We continue to explore means of extending the lifecycle of our patent portfolio.Various patents and patent applications have been exclusively licensed to us by the following entities:University of VirginiaIn connection with our acquisition of PhosImmune in December 2015, we obtained exclusive rights to a portfolio of patent applications and oneissued patent relating to PTTs under a patent license agreement with the University of Virginia (“UVA”). The UVA license gives us exclusive rights todevelop and commercialize the PTT technology. Under the license agreement, we will pay low to mid-single digit running royalties on net sales of PTTproducts, and a modest flat percentage of sublicensing income. In addition, we may be obligated to make milestone payments of up to $2.7 million for eachindication of a licensed PTT product to complete clinical trials and achieve certain sales thresholds. The term of the UVA license agreement ends when thelast of the licensed patents expires or becomes no longer valid. The UVA license agreement may be terminated as follows: (i) by UVA in connection with ourbankruptcy or cessation of business relating to the licensed technology, (ii) by UVA if we commit a material, uncured breach or (iii) by us for ourconvenience on 180 days written notice.Ludwig Institute for Cancer ResearchOn December 5, 2014, our wholly-owned subsidiary, Agenus Switzerland Inc. (formerly known as 4-Antibody AG) (“4-AB”), entered into a licenseagreement with the Ludwig Institute for Cancer Research Ltd. (“Ludwig”), which replaced and superseded a prior agreement entered into between the partiesin May 2011. Pursuant to the terms of the license agreement, Ludwig granted 4-AB an exclusive, worldwide license under certain intellectual property rightsof Ludwig and Memorial Sloan Kettering Cancer Center arising from the prior agreement to further develop and commercialize GITR, OX40 and TIM-3antibodies. On January 25, 2016, we and 4-AB entered into a second license agreement with Ludwig, on substantially similar terms, to develop CTLA-4 andPD-19Source: AGENUS INC, 10-K, March 18, 2019Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results.antibodies. Pursuant to the December 2014 license agreement, 4-AB made an upfront payment of $1.0 million to Ludwig. The December 2014 licenseagreement also obligates 4-AB to make potential milestone payments of up to $20.0 million for events prior to regulatory approval of licensed GITR, OX40and TIM-3 products, and potential milestone payments in excess of $80.0 million if such licensed products are approved in multiple jurisdictions, in morethan one indication, and certain sales milestones are achieved. Under the January 2016 license agreement, we are obligated to make potential milestonepayments of up to $12.0 million for events prior to regulatory approval of CTLA-4 and PD-1 licensed products, and potential milestone payments of up to$32.0 million if certain sales milestones are achieved. Under each of these license agreements, we and/or 4-AB will also be obligated to pay low to mid-singledigit royalties on all net sales of licensed products during the royalty period, and to pay Ludwig a percentage of any sublicensing income, ranging from a lowto mid-double digit percentage depending on various factors. During the year ended December 31, 2017, we paid a percentage of sublicensing incometotaling $2.0 million to Ludwig under the license agreements. No payments were made during the year ended December 31, 2018. The license agreementsmay each be terminated as follows: (i) by either party if the other party commits a material, uncured breach; (ii) by either party if the other party initiatesbankruptcy, liquidation or similar proceedings; or (iii) by 4-AB or us (as applicable) for convenience upon 90 days’ prior written notice. The licenseagreements also contain customary representations and warranties, mutual indemnification, confidentiality and arbitration provisions.University of Connecticut Health CenterIn May 2001, we entered into a license agreement with the University of Connecticut Health Center (“UConn”) which was amended in March 2003and June 2009. Through the license agreement, we obtained an exclusive, worldwide license to patent rights resulting from inventions discovered under aresearch agreement that was effective from February 1998 until December 2006. The term of the license agreement ends when the last of the licensed patentsexpires in 2028 or becomes no longer valid. UConn may terminate the agreement: (1) if, after 30 days written notice for breach, we continue to fail to makeany payments due under the license agreement, or (2) we cease to carry on our business related to the patent rights or if we initiate or conduct actions in orderto declare bankruptcy. We may terminate the agreement upon 90 days written notice. We are required to make royalty payments on any obligations createdprior to the effective date of termination of the license agreement. Upon expiration or termination of the license agreement due to breach, we have the right tocontinue to manufacture and sell products covered under the license agreement which are considered to be works in progress for a period of six months. Thelicense agreement contains aggregate milestone payments of approximately $1.2 million for each product we develop covered by the licensed patent rights.These milestone payments are contingent upon regulatory filings, regulatory approvals, and commercial sales of products. We have also agreed to payUConn a royalty on the net sales of products covered by the license agreement as well as annual license maintenance fees beginning in May 2006. Royaltiesotherwise due on the net sales of products covered by the license agreement may be credited against the annual license maintenance fee obligations. Underthe March 2003 amendment, we agreed to pay UConn an upfront payment and to make future payments for each patent or patent application with respect towhich we exercised our option under the research agreement. As of December 31, 2018, we had paid approximately $1.0 million to UConn under the licenseagreement. The license agreement gives us complete discretion over the commercialization of products covered by the licensed patent rights but also requiresus to use commercially reasonable diligent efforts to introduce commercial products within and outside the United States. If we fail to meet these diligencerequirements, UConn may be able to terminate the license agreement.Regulatory ComplianceGovernmental authorities in the United States and other countries extensively regulate the pre-clinical and clinical testing, manufacturing, labeling,storage, record keeping, advertising, promotion, export, marketing and distribution, among other things, of our investigational product candidates. In theUnited States, the FDA under the Federal Food, Drug, and Cosmetic Act, the Public Health Service Act and other federal statutes and regulations, subjectpharmaceutical products to rigorous review.In order to obtain approval of a new product from the FDA, we must, among other requirements, submit proof of safety and efficacy as well as detailedinformation on the manufacture and composition of the product. In most cases, this proof entails extensive pre-clinical, clinical, and laboratory tests. Beforeapproving a new drug or marketing application, the FDA may also conduct pre-licensing inspections of the company, its contract research organizationsand/or its clinical trial sites to ensure that clinical, safety, quality control, and other regulated activities are compliant with Good Clinical Practices (“GCP”),or Good Laboratory Practices (“GLP”), for specific non-clinical toxicology studies. The FDA may also require confirmatory trials, post-marketing testing, andextra surveillance to monitor the effects of approved products, or place conditions on any approvals that could restrict the commercial applications of theseproducts. Once approved, the labeling, advertising, promotion, marketing, and distribution of a drug or biologic product must be in compliance with FDAregulatory requirements.In Phase 1 clinical trials, the sponsor tests the product in a small number of patients or healthy volunteers, primarily for safety at one or more doses.Phase 1 trials in cancer are often conducted with patients who have end-stage or metastatic cancer. In Phase 2, in addition to safety, the sponsor evaluates theefficacy of the product in a patient population somewhat larger than Phase 1 trials. Phase 3 trials typically involve additional testing for safety and clinicalefficacy in an expanded population at geographically dispersed test sites. The FDA may order the temporary or permanent discontinuation of a clinical trialat any time.The sponsor must submit to the FDA the results of pre-clinical and clinical testing, together with, among other things, detailed information on themanufacture and composition of the product, in the form of a new drug application (“NDA”), or in the case of10Source: AGENUS INC, 10-K, March 18, 2019Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results.biologics, a BLA. In a process that can take a year or more, the FDA reviews this application and, when and if it decides that adequate data are available toshow that the new compound is both safe and effective for a particular indication and that other applicable requirements have been met, approves the drug orbiologic for marketing.Whether or not we have obtained FDA approval, we must generally obtain approval of a product by comparable regulatory authorities of internationaljurisdictions prior to the commencement of marketing the product in those jurisdictions. We are also subject to cGMP, GCP, and GLP compliance obligationsand are subject to inspection by international regulatory authorities. International requirements may in some circumstances be more rigorous than U.S.requirements and may require additional investment in manufacturing process development, non-clinical studies, clinical studies, and record-keeping that arenot required for U.S. regulatory compliance or approval. The time required to obtain this approval may be longer or shorter than that required for FDAapproval and can also require significant resources in time, money and labor.Under the laws of the United States, the countries of the European Union and other nations, we and the institutions where we sponsor research aresubject to obligations to ensure the protection of personal information of human subjects participating in our clinical trials. We have instituted proceduresthat we believe will enable us to comply with these requirements and the contractual requirements of our data sources. The laws and regulations in this areaare evolving, and further regulation, if adopted, could affect the timing and the cost of future clinical development activities.We are also subject to regulation under the Occupational Safety and Health Act, the Toxic Substances Control Act, the Resource Conservation andRecovery Act, and other current and potential future federal, state, or local regulations. Our research and development activities involve the controlled use ofhazardous materials, chemicals, biological materials, various radioactive compounds, and for some experiments we use recombinant DNA. We believe thatour procedures comply with the standards prescribed by local, state, and federal regulations; however, the risk of injury or accidental contamination cannotbe completely eliminated. We conduct our activities in compliance with the National Institutes of Health Guidelines for Recombinant DNA Research.Additionally, the U.S. Foreign Corrupt Practices Act (“FCPA”), prohibits U.S. corporations and their representatives from offering, promising,authorizing or making payments to any foreign government official, government staff member, political party or political candidate in an attempt to obtain orretain business abroad. The scope of the FCPA includes interactions with certain healthcare professionals in many countries. Other countries have enactedsimilar anti-corruption laws and/or regulations.CompetitionCompetition in the pharmaceutical and biotechnology industries is intense. Many pharmaceutical or biotechnology companies have products on themarket and are actively engaged in the research and development of products for the treatment of cancer.Many competitors have substantially greater financial, manufacturing, marketing, sales, distribution, and technical resources, and more experience inresearch and development, clinical trials, and regulatory matters, than we do. Competing companies developing or acquiring rights to more efficacioustherapeutic products for the same diseases we are targeting, or which offer significantly lower costs of treatment, could render our products noncompetitive orobsolete. See Part I-Item 1A. “Risk Factors-Risks Related to our Business-Our competitors may have superior products, manufacturing capability, selling andmarketing expertise and/or financial and other resources.”Academic institutions, governmental agencies, and other public and private research institutions conduct significant amounts of research inbiotechnology, medicinal chemistry and pharmacology. These entities have become increasingly active in seeking patent protection and licensing revenuesfor their research results. They also compete with us in recruiting and retaining skilled scientific talent.The CPM landscape is crowded with several competitors developing assets against a number of targets. Development plans are spread out acrossvarious indications and lines of therapy, either alone or in combination with other assets. Competitors range from small cap to large cap companies, withassets in pre-clinical or clinical stages of development. Therefore, the landscape is dynamic and constantly evolving. We and our partners have CPMantibody programs, currently in clinical stage development targeting PD-1, CTLA-4, GITR, OX40, TIM-3 and LAG-3. We are aware of many companies thathave antibody-based products on the market or in clinical development that are directed to the same biological targets as these programs, including, withoutlimitation, the following: (1) BMS markets ipilimumab, an anti-CTLA-4 antibody, and nivolumab, an anti-PD-1 antibody, and is developing additionalantagonists to LAG-3 and TIM-3. BMS also has next generation anti-CTLA-4 antibodies in the clinic, which may be competitive to our next generation anti-CTLA-4 program, (2) Merck has an approved anti-PD-1 antibody, as well as anti-CTLA-4 and LAG-3 antagonists and an anti-GITR agonist in clinicaldevelopment, (3) Regeneron has an approved anti-PD-1 antibody as well as antibodies targeting CTLA-4 and LAG-3 in preclinical or early clinicaldevelopment, (4) AstraZeneca has an approved anti PD-L1 antibody, as well as an anti-CTLA-4 (using a different isotype, an IgG2 isotype) targetingantibody in the clinic, (5) Pfizer has an approved anti-PD-L1 (with Merck KgaA) as well as anti-PD-1, and anti-OX40 antibodies in clinical development, and(6) Roche/Genentech has an approved anti-PD-L1 antibody. Besides these PD-1 and PD-L1 antibodies that were approved in the U.S., we are also aware ofcompetitors with approved PD-1 agents in ex-US geographies such as China. These include Innovent Biologics and Shanghai Junshi Biosciences. We arealso aware of other competitors with PD-1/PD-L1 agents in clinical development, including but not limited to, AbbVie, Arcus11Source: AGENUS INC, 10-K, March 18, 2019Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results.Biosciences, Boehringer Ingelheim, Tesaro, Beigene, Eli Lilly, Jiangsu HengRui Medicine, Macrogenics/Incyte, CytomX/BMS, Novartis, Symphogen,Jounce Therapeutics, Gilead Sciences, Janssen, CBT Pharmaceuticals/Genor Biopharma, Checkpoint Therapeutics, CStone Pharmaceuticals, LivzonMabPharm Inc, Suzhou Alphamab, Mabspace Biosciences, Henlix Biotech Inc., Akeso Biopharma and CSPC ZhongQi Pharmaceutical Technology. We arealso aware of competitors with pre-clinical antibodies against PD-1 or PD-L1. In addition, we are aware of competitors with clinical stage antibodies againstGITR, OX40, LAG-3, TIM-3 as well as our earlier stage programs such as TIGIT and CD137. As outlined above, some of these include, but are not limited to,BMS, Pfizer, Novartis, Merck, Tesaro, Regeneron, Eli Lilly, OncoMed, Boehringer Ingelheim, Potenza, Arcus Biosciences, GlaxoSmithKline, AbbVie, LeapTherapeutics and Symphogen. Additionally, we are aware of competitors developing preclinical assets and bispecifics against each of the above targets.There is no guarantee that our antibody product candidates will be able to compete with our competitors’ antibody products and product candidates.We are conducting both single arm and combination trials in second line cervical cancer. We are aware that Merck’s PD-1 antagonist, Keytruda, hasbeen approved in advanced cervical cancer. We are also aware of industry sponsored clinical trials, including exploratory studies that are underway in thissetting. Clinical stage competitors include, but are not limited to, Regeneron (anti-PD-1), Ono Pharmaceuticals and BMS (anti-PD-1 alone or in combinationwith agents against other checkpoint targets), Seattle Genetics and Genmab (antibody drug conjugate targeting Tissue Factor), Iovance Biotherapeutics(autologous TILs), Genor Biopharma and Lee Pharmaceuticals. Additionally, we are aware of other early stage clinical trials testing alternate checkpointtargets in cervical cancer patients. These include, but are not limited to, OX40 +/- CD137 agonists (Pfizer) and anti-PD-1 + anti-ICOS (GSK/Merck).We have autologous vaccine programs in development including our Prophage vaccine in clinical development for GBM. We are aware of othertherapeutic options in GBM that could compete with our vaccine, including but not limited to the following: Merck markets temozolomide for treatment ofpatients with ndGBM and refractory astrocytoma. Other companies are developing vaccines for the treatment of patients with ndGBM, including, but notlimited to Northwest Biotherapeutics (DC-Vax), Mimivax Inc. (SurVaxM) and Annias Immunotherapeutics (CMV Vaccine). Other companies may begindevelopment programs as well. We are advancing our neoantigen vaccine, AutoSynVax, in solid tumors. There are companies advancing individualized orsynthetic vaccine technologies and/or patient-specific medicine techniques that compete with our HSP based vaccines such as: Neon Therapeutics, GritstoneOncology, Advaxis/Amgen, BioNTech, Moderna/Merck, Genocea Biosciences, ISA Pharmaceuticals, Nouscom, EpiVax Inc., and Vaccibody.In addition, and prior to regulatory approval, if ever, our vaccines and our other product candidates may compete for access to patients with otherproducts in clinical development, with products approved for use in the indications we are studying, or with off-label use of products in the indications weare studying. We anticipate that we will face increased competition in the future as new companies enter markets we seek to address and scientificdevelopments surrounding immunotherapy and other traditional cancer therapies continue to accelerate.We are aware of compounds that claim to be comparable to QS-21 Stimulon that are being used in clinical trials. Several other vaccine adjuvants are indevelopment or in use and could compete with QS-21 Stimulon for inclusion in vaccines. These adjuvants may include but are not limited to: (1)oligonucleotides, under development by Pfizer, Idera, and Dynavax, (2) MF59, under development by Novartis, (3) IC31, under development by Intercell(now part of Valneva), and (4) MPL, under development by GSK. In the past, we have provided QS-21 Stimulon to other entities under materials transferarrangements. In at least one instance, it is possible that this material was used unlawfully to develop synthetic formulations and/or derivatives of QS-21. Inaddition, companies such as Adjuvance Technologies, Inc., CSL Limited, and Novavax, Inc., as well as academic institutions and manufacturers of saponinextracts, are developing saponin adjuvants, including derivatives and synthetic formulations. These sources may be competitive to our ability to executefuture partnering and licensing arrangements involving QS-21 Stimulon. The existence of products developed by these and other competitors, or otherproducts of which we are not aware, or which other companies may develop in the future, may adversely affect the marketability of products developed orsold using QS-21 Stimulon.We are also aware of a third party that manufactures pre-clinical material purporting to be comparable to QS-21 Stimulon. The claims being made bythis third party may create marketplace confusion and have an adverse effect on the goodwill generated by us and our partners with respect to QS-21Stimulon. We are also aware of at least two additional manufacturers of QS-21. Any diminution of this goodwill may have an adverse effect on our ability tocommercialize future products, if any, incorporating this technology, either alone or with a third party.EmployeesAs of February 28, 2019, we had 294 employees, of whom 90 were PhDs and three were MDs. None of our employees are subject to a collectivebargaining agreement. We believe that we have good relations with our employees.Corporate HistoryAntigenics L.L.C. was formed as a Delaware limited liability company in 1994 and was converted to Antigenics Inc., a Delaware corporation, inFebruary 2000 in conjunction with our initial public offering of common stock. On January 6, 2011, we changed our name from Antigenics Inc. to AgenusInc.12Source: AGENUS INC, 10-K, March 18, 2019Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results.Availability of Periodic SEC ReportsOur Internet website address is www.agenusbio.com. We make available free of charge through our website our annual reports on Form 10-K, quarterlyreports on Form 10-Q, current reports on Form 8-K, and amendments to those reports filed or furnished pursuant to Section 13(a) or 15(d) of the SecuritiesExchange Act of 1934, as amended (“Exchange Act”), as soon as reasonably practicable after we electronically file such material with, or furnish suchmaterial to, the Securities and Exchange Commission (the “SEC”). The contents of our website are not part of, or incorporated into, this document. Inaddition, we regularly use our website to post information regarding our business, product development programs and governance, and we encourageinvestors to use our website, particularly the information in the sections entitled “Financial” and “News,” as sources of information about us.The SEC maintains an Internet site that contains reports, proxy and information statements, and other information regarding issuers that fileelectronically with the SEC at www.sec.gov.The contents of the websites referred to above are not incorporated into this filing. Further, our references to the URLs for these websites are intendedto be inactive textual references only. Item 1A.Risk FactorsOur future operating results could differ materially from the results described in this Annual Report on Form 10-K due to the risks and uncertaintiesdescribed below. You should consider carefully the following information about risks below in evaluating our business. If any of the following risks actuallyoccur, our business, financial conditions, results of operations and future growth prospects would likely be materially and adversely affected. In thesecircumstances, the market price of our common stock would likely decline.We cannot assure investors that our assumptions and expectations will prove to be correct. Important factors could cause our actual results to differmaterially from those indicated or implied by forward-looking statements. See “Note Regarding Forward-Looking Statements” in this Annual Report on Form10-K. Factors that could cause or contribute to such differences include those factors discussed below.Risks Related to our BusinessIf we incur operating losses for longer than we expect, or we are not able to raise additional capital, we may be unable to continue our operations, orwe may become insolvent.Our net losses for the years ended December 31, 2018, 2017, and 2016, were $162.0 million, $120.7 million, and $127.0 million, respectively. Weexpect to incur additional losses over the next several years as we continue to research and develop our technologies and pursue partnering opportunities,regulatory strategies, commercialization, and related activities. Furthermore, our ability to generate cash from operations is dependent on the success of ourlicensees and collaboration partners, as well as the likelihood and timing of new strategic licensing and partnering relationships and/or successfuldevelopment and commercialization of product candidates, including through our antibody programs and platforms, our vaccine programs, and our saponin-based vaccine adjuvants.On December 31, 2018, we had $53.1 million in cash and cash equivalents. We believe that, based on our current plans and activities, including$150.0 million of additional funding we received in connection with our transactions with Gilead subsequent to December 31, 2018, our cash on-hand willbe sufficient to satisfy our liquidity requirements for more than one year from when these financial statements were issued.To date, we have financed our operations primarily through the sale of equity and debt securities. In order to finance future operations, we will berequired to raise additional funds in the capital markets, through arrangements with collaboration partners or from other sources. Additional financing maynot be available on favorable terms, or at all. If we are unable to raise additional funds when we need them or if we incur operating losses for longer than weexpect, we may not be able to continue some or all of our operations, or we may become insolvent. We also may be forced to license or sell technologies toothers under agreements that are on unfavorable terms or allocate to third parties substantial portions of the potential value of these technologies.There are a number of factors that will influence our future capital requirements, including, without limitation, the following: •the number and characteristics of the product candidates we and our partners pursue; •our and our partners’ ability to successfully develop, manufacture, and commercialize product candidates; •the scope, progress, results and costs of researching and developing our future product candidates and conducting pre-clinical and clinicaltrials;13Source: AGENUS INC, 10-K, March 18, 2019Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results. •the timing of, and the costs involved in, obtaining regulatory approvals for our and our licensees’ product candidates; •the cost of manufacturing; •our ability to establish and maintain strategic partnerships, licensing or other arrangements and the financial terms of such arrangements; •the costs involved in preparing, filing, prosecuting, maintaining, defending and enforcing our intellectual property rights; •the costs associated with any successful commercial operations; and •the timing, receipt and amount of sales of, or royalties on, our future products and those of our partners, if any.General economic conditions in the United States economy and abroad may have a material adverse effect on our liquidity and financial condition,particularly if our ability to raise additional funds is impaired. The ability of potential patients and/or health care payers to pay for our future products, if any,could also be adversely impacted, thereby limiting our potential revenue. In addition, any negative impacts from any deterioration in the credit markets onour collaboration partners could limit potential revenue from our product candidates.Our obligations to HCR and the holders of our 2015 Subordinated Notes could materially and adversely affect our liquidity.In January 2018, we and our wholly-owned subsidiary, Antigenics LLC (“Antigenics”), entered into a Royalty Purchase Agreement with HCR,pursuant to which HCR purchased 100% of Antigenics’ worldwide rights to receive royalties from GSK on sales of GSK’s vaccines containing our QS-21Stimulon adjuvant. As consideration for the purchase of the royalty rights, HCR paid $190.0 million at closing, less certain transaction expenses. Of theclosing proceeds, approximately $161.9 million was used to redeem Antigenics’ $115.0 million principal amount of notes issued pursuant to the NotePurchase Agreement with Oberland Capital SA Zermatt LLC, and we retained approximately $28.0 million of net proceeds. Antigenics is also entitled toreceive up to $40.35 million in milestone payments based on sales of GSK’s vaccines as follows: (i) $15.1 million upon reaching $2.0 billion last-twelve-months net sales any time prior to 2024 and (ii) $25.25 million upon reaching $2.75 billion last-twelve-months net sales any time prior to 2026. Antigenicswill owe approximately $25.9 million to HCR in 2021 if neither of the following sales milestones are achieved: (i) 2019 sales of GSK’s vaccines exceed$1.0 billion or (ii) 2020 sales of GSK’s vaccines exceed $1.75 billion (the “Rebate Payment”). As part of the transaction, we provided a guaranty for thepotential Rebate Payment and secured the obligation with substantially all of our assets pursuant to a security agreement. If GSK’s sales do not achieve eitherof the relevant milestones and we are obligated to make the Rebate Payment, our liquidity could be materially and adversely affected.In February 2015, we exchanged senior subordinated promissory notes that we issued in 2013 for new senior subordinated promissory notes in theaggregate principal amount of $5.0 million with annual interest at 8%, and we issued an additional $9.0 million principal amount of such notes (the “2015Subordinated Notes”). The 2015 Subordinated Notes were originally due February 2018, and in March 2017, we amended the 2015 Subordinate Notes toextend the maturity date to February 2020. The 2015 Subordinated Notes include default provisions that allow for the acceleration of the principal paymentof the 2015 Subordinated Notes in the event we become involved in certain bankruptcy proceedings, become insolvent, fail to make a payment of principalor (after a grace period) interest on the 2015 Subordinated Notes, default on other indebtedness with an aggregate principal balance of $13.5 million or moreif such default has the effect of accelerating the maturity of such indebtedness, or become subject to a legal judgment or similar order for the payment ofmoney in an amount greater than $13.5 million if such amount will not be covered by third-party insurance. If we default on the 2015 Subordinated Notesand the repayment of such indebtedness is accelerated, our liquidity could be materially and adversely affected.If we do not have sufficient cash on hand to pay the Rebate Payment when due, or to otherwise service our 2015 Subordinated Notes, we may berequired, among other things, to: •seek additional financing in the debt or equity markets; •refinance or restructure all or a portion of our indebtedness; •sell, out-license, or otherwise dispose of assets; and/or •reduce or delay planned expenditures on research and development and/or commercialization activities.Such measures might not be sufficient to enable us to make principal and interest payments. In addition, any such financing, refinancing, or sale ofassets might not be available on favorable terms, if at all.14Source: AGENUS INC, 10-K, March 18, 2019Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results.Our AGEN2034 and AGEN1884 antibody programs are in potential registrational studies, and there is no guarantee that we will be successful inadvancing these through clinical development on our desired timeline, if at all, or that we will be able to commercialize them successfully.Our anti-PD-1 and anti-CTLA-4 programs (AGEN2034 and AGEN1884, respectively) are in clinical trials that included a Phase 1 dose escalation withexpansion cohorts in multiple solid tumors. These molecules are now in expansion trials with both anti-PD-1 monotherapy and anti-PD-1 and anti-CTLA-4combination trials for patients with second-line cervical cancer that are designed to support one or more Biologic License Application (“BLA”) filings assoon as 2020. If approved, we intend to commercialize these assets in 2021. These timelines are aggressive and subject to various factors outside of ourcontrol, including patient accrual rates for our clinical trials. If our trials are unable to accrue patients at the rate we expect, we are unlikely to hit ouranticipated timelines and our business and financial prospects could be materially adversely affected. In addition, in order to file a BLA and seek acceleratedapproval, we must also launch a confirmatory trial and have it be substantially underway at that time. We have not yet initiated a confirmatory trial. There isno guarantee that we will be able to file a BLA in 2020, if at all.We have previously presented early data on these programs at major oncology conferences that demonstrated a clinical benefit (i.e., completeresponse, partial response or disease stabilization) in more than 60% of patients treated with AGEN1884 and AGEN2034. Even though we have observedpositive results to date, they may not necessarily be predictive of the final results of the trials or future clinical trials. Many companies in the pharmaceutical,biopharmaceutical and biotechnology industries have suffered significant setbacks in clinical trials after achieving positive results, and we cannot be certainthat we will not face similar setbacks.Even if AGEN2034 and/or AGEN1884 are approved, there is no guarantee that we will be able to successfully commercialize them or penetrate anycommercial markets. We are initially targeting cervical cancer, which is a small subset of the overall market. We intend to use proceeds from our sales of anyBiotech Electronic Security Tokens to expand the development and commercial potential of AGEN2034, but there is no guarantee that we will sell sufficienttokens, if any, to do so. See “Risk Factors—Risks Relating to Our Tokens—There is no assurance that we will sell a sufficient number of tokens, if any, tomeet our business or financial goals.”Our other antibody programs are in early stage development, and there is no guarantee that we or our partners will be successful in advancingantibody product candidates into and through clinical development.Our additional antibody programs are currently in early stage development, and many of our antibody programs are pre-clinical. Even if our pre-clinical studies or our and/or our partners’ clinical trials produce positive results, they may not necessarily be predictive of the results of future clinical trials.Many companies in the pharmaceutical, biopharmaceutical and biotechnology industries have suffered significant setbacks in clinical trials after achievingpositive results in pre-clinical development or earlier clinical trials, and we cannot be certain that we will not face similar setbacks. These setbacks have beencaused by, among other things, pre-clinical findings made while clinical trials were underway or safety or efficacy observations made in clinical trials,including adverse events. Moreover, pre-clinical and clinical data are often susceptible to varying interpretations and analyses, and many companies thatbelieved their product candidates performed satisfactorily in pre-clinical studies and clinical trials nonetheless failed to obtain regulatory approval. If we andour partners fail to produce positive results in clinical trials of antibodies, our business and financial prospects would be materially adversely affected.Although we are striving to file a number of INDs to advance novel antibodies, cell therapy candidates, and neoantigen vaccine combinations into theclinic, there is no guarantee that we will be able to do so on that timeline, if at all. Our stated timelines are aggressive and subject to various risks, includingresource constraints. If we are unable to advance novel candidates into the clinic as planned due to resource constraints or otherwise, our business andpartnering prospects could be materially adversely affected.We have undergone significant growth across multiple locations over the past few years, and are focusing on further enhancing core areas andcapabilities as we move toward commercialization. In addition, we have consolidated certain sites while expanding others to focus on our core prioritiesand future needs. We may encounter difficulties in managing these growth and/or consolidation efforts, either of which could disrupt our operations.Since our acquisition of Agenus Switzerland Inc., formerly known as 4-Antibody AG (“4-AB”) in February 2014, we have more than tripled ourheadcount, in part through various acquisitions and the expansion of our research and development activities both nationally and internationally. While wehave restructured our organization over the past few years, we expect to continue increasing our headcount in certain core areas as we continue to build ourdevelopment, manufacturing and commercialization capabilities and integrate our acquired technology platforms. To manage these organizational changes,we must continue to implement and improve our managerial, operational and financial systems and continue to recruit, train and retain qualified personnel. Ifour management is unable to effectively manage our growth, our expenses may increase more than expected, our timelines may be delayed, our ability togenerate revenue could be reduced, and we may not be able to implement our business strategy.15Source: AGENUS INC, 10-K, March 18, 2019Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results.As part of our efforts to optimize efficiency across our organization, we closed our Jena, Germany office in 2016 and consolidated these operations inthe United Kingdom and Switzerland. In 2017, we completed a reduction in force in our Lexington, MA facility, which included certain members of ourmanagement, in line with our prioritization efforts, and we closed our office in Basel, Switzerland and transferred our research and development assets andcapabilities there to the United Kingdom. If these transition efforts prove to be unsuccessful, or if we identify management or operational gaps in connectionwith our changes, it could cause delays in discovery timelines and increased costs for certain of our internal and partnered programs, which also could havean adverse effect on our business, financial condition and results of operations. We are still in the process of liquidating 4-AB and transferring intellectualproperty rights from Switzerland to the United States or elsewhere. There could be adverse tax consequences resulting from this migration of intellectualproperty rights, which could have an adverse effect on our business and operations.Our synthetic Heat Shock Protein (“HSP”) peptide-based platform is in early stage development, and there is no guarantee that a product candidatewill progress from this platform.In June 2014, we reported positive results from a Phase 2 trial with HerpVTM, a vaccine candidate for genital herpes from our synthetic HSP peptide-basedplatform. The Phase 2 trial met its formal endpoints, subjects were not followed long enough to determine whether the magnitude of the effect on viral loadwould be sufficient to significantly reduce the incidence, severity, or duration of herpetic lesions or reduce the risk of viral transmission. Although we havenot advanced this program into a Phase 3 trial, we initiated our ASV synthetic cancer vaccine program based on our prior findings with this platform. Weinitiated our first clinical trial for our first AutoSynVax product candidate in 2017 and reported safety and immunogenicity of the vaccine atCIMT2018. Although we are planning to initiate a combination trial with ASV and one or more of our antibodies, the timeline is uncertain and there is noguarantee that we will be able to do so at all. Furthermore, it is possible that research and discoveries by others will render any product candidate from thisplatform as obsolete or noncompetitive.We may not be able to advance clinical development or commercialize our cancer vaccine candidates or realize any benefits from these programs.The probability of future clinical development efforts leading to marketing approval and commercialization of Prophage vaccines is highly uncertain.Prophage vaccines have been in clinical development for over 16 years, including multiple Phase 1 and 2 trials in eight different tumor types as well asrandomized Phase 3 trials in metastatic melanoma and adjuvant renal cell carcinoma. To date, the only marketing approval for Prophage is in Russia wherecommercialization of the approved product was unsuccessful. All of our currently planned trials involving Prophage are intended to be sponsored by thirdparties, and there is no guarantee that they will occur at all.Our current clinical trial plans with Prophage vaccines entail one government sponsored IND in which we provide support and product supply. Forthird-party sponsored trials, we lack the ability to control trial design, timelines, tumor tissue procurement and data availability. For example, in January2017, we announced a clinical trial collaboration with the National Cancer Institute (“NCI”), whereby the NCI is conducting a double-blind, randomizedcontrolled Phase 2 trial to evaluate the effect of Prophage vaccine in conjunction with Merck’s pembrolizumab on the overall survival rate of patients withnewly diagnosed glioblastoma (“ndGBM”). In addition, the Phase 2 trial of Prophage vaccine in combination with bevacizumab in patients with surgicallyresectable recurrent glioma that was being conducted under the sponsorship of the Alliance for Clinical Trials in Oncology, a cooperative group of the NCI,has been closed. Our other cancer vaccine programs (ASV and PSV) are in Phase 1 and pre-clinical development, respectively, and there is no guarantee thatthey will successfully advance in and through the clinic. ASV also utilizes QS-21 Stimulon, and any inability or delay in securing adequate supplies of theadjuvant could have an adverse impact on the program or otherwise delay timelines. Current and future studies may eventually be terminated due to, amongother things, slow enrollment, lack of probability that they will yield useful translational and/or efficacy data, lengthy timelines, or the unlikelihood thatresults will support timely or successful regulatory filings.Changes in our manufacturing strategies, manufacturing problems, or increased demand may cause delays, unanticipated costs, or loss of revenuestreams within or across our programs.Our antibody programs will require substantial manufacturing development and investment to progress. We are currently progressing a portfolio ofantibody programs that are at different stages of development. If these efforts are delayed or do not produce the desired outcomes, this will cause delays indevelopment timelines and increased costs, which may cause us to limit the size and scope of our efforts and studies. In 2015, we secured our own antibodymanufacturing capabilities with the purchase of a manufacturing pilot plant from XOMA Corporation (“XOMA”), and we expect this facility to supply uswith antibody drug substance requirements through clinical proof-of-concept studies. We will also need to develop or secure later phase and/or commercialmanufacturing capabilities for larger, registrational studies or any commercial supply requirements. For the programs for which we will produce our own drugsubstance, we will continue to rely on third parties for fill-finish services and other parts of the manufacturing process. These services include the storage andmaintenance of our drug substance during all stages of the16Source: AGENUS INC, 10-K, March 18, 2019Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results.manufacturing process. While we maintain insurance to cover certain potential losses, there is no guarantee that our insurance coverage will be adequate.Furthermore, we currently rely on contract manufacturing organizations (“CMOs”) and contract research organizations (“CROs”) to support some of ourexisting antibody programs. Our dependence on external CMOs for the manufacture of certain antibodies results in intrinsic risks to our performance,timelines, and costs of our accelerated development plans, and which could divert resources away from our antibody programs and/or lead to delays in thedevelopment of our product candidates. In the event that our antibody programs require progressively larger production capabilities, our options for qualifiedCMOs may become more limited.To date, we have manufactured our Prophage vaccines in our Lexington, MA facility. Manufacturing of the Prophage vaccines is complex, andvarious factors could cause delays or an inability to supply the vaccine. Deviations in the processes controlling manufacture or deficiencies in size or qualityof source material could result in production failures. Specific vulnerabilities in the process may exist in tumor types in which quality or quantity of tissue islimited. In addition, regulatory bodies may require us to make our manufacturing facility a single product facility. In such an instance, we would no longerhave the ability to manufacture Prophage vaccines in addition to other product candidates in our current facility.We have given our corporate QS-21 Stimulon licensee, GSK, manufacturing rights for QS-21 Stimulon for use in their product programs. We haveretained the right to manufacture QS-21 for ourselves and third parties, although no other such programs are anticipated to bring us substantial revenues inthe near future, if ever. Although we have the right to secure certain quantities of QS-21 from GSK and we have some internal supply in-house, we currentlydo not have an alternative long-term supply partner for this adjuvant.Our ability to efficiently manufacture our product candidates is contingent, in part, upon our own, and our CMOs’, ability to ramp up production in atimely manner without the benefit of years of experience and familiarity with the processes, which we may not be able to adequately transfer. We currentlyrely upon and expect to continue to rely upon third parties, potentially including our collaborators or licensees, to produce materials required to support ourproduct candidates, pre-clinical studies, clinical trials, and any future commercial efforts. A number of factors could cause production interruptions at eitherour manufacturing facility or the facilities of our CMOs or suppliers, including equipment malfunctions, labor or employment retention problems, naturaldisasters, power outages, terrorist activities, or disruptions in the operations of our suppliers. Alternatively, there is the possibility we may have excessmanufacturing capacity if product candidates do not progress as planned.As mentioned above, reliance on third-party manufacturers entails risks to which we would not be subject if we manufactured all of our productcandidates ourselves, including reliance on the third party for regulatory compliance, the possibility of breach of the manufacturing agreement by the thirdparty because of factors beyond our control, and the possibility of termination or non-renewal of the agreement by the third party, based on its own businesspriorities, at a time that is costly or inconvenient for us.Biopharmaceutical manufacturing is also subject to extensive government regulation. Components of a finished therapeutic product approved forcommercial sale or used in late-stage clinical trials must be manufactured in accordance with current good manufacturing practices. These regulations governmanufacturing processes and procedures (including record-keeping) and the implementation and operation of quality systems to control and assure thequality of investigational products and products approved for sale. Our facilities and quality systems and the facilities and quality systems of some or all ofour third-party contractors must pass a pre-approval inspection for compliance with the applicable regulations as a condition of regulatory approval of aproduct candidate. In addition, facilities are subject to on-going inspections and routine audits, and minor changes in manufacturing processes may requireadditional regulatory approvals and audits, either of which could cause us to incur significant additional costs, set-backs or delays and eventual loss ofrevenue.Risks associated with doing business internationally could negatively affect our business.We currently have research and development operations in the United Kingdom, and we expect to pursue pathways to develop and commercialize ourproduct candidates in both U.S. and non-U.S. jurisdictions. Various risks associated with foreign operations may impact our success. Possible risks of foreignoperations include fluctuations in the value of foreign and domestic currencies, requirements to comply with various jurisdictional requirements such as dataprivacy regulations, disruptions in the import, export, and transportation of patient tumors and our products or product candidates, the product and serviceneeds of foreign customers, difficulties in building and managing foreign relationships, the performance of our licensees or collaborators, geopoliticalinstability, unexpected regulatory, economic, or political changes in foreign and domestic markets, including without limitation any resulting from theUnited Kingdom’s withdrawal from the European Union or our current political regime, and limitations on the flexibility of our operations and costs imposedby local labor laws. 17Source: AGENUS INC, 10-K, March 18, 2019Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results.Our competitors may have superior products, manufacturing capability, selling and marketing expertise and/or financial and other resources.Our product candidates and the product candidates in development by our collaboration partners may fail because of competition from majorpharmaceutical companies and specialized biotechnology companies that market products, or that are engaged in the development of product candidates andfor the treatment cancer. Many of our competitors, including large pharmaceutical companies, have greater financial and human resources and moreexperience than we do. Our competitors may: •develop safer or more effective therapeutic drugs or therapeutic vaccines and other products; •establish superior intellectual property positions; •discover technologies that may result in medical insights or breakthroughs, which render our drugs or vaccines obsolete, possibly before theygenerate any revenue, if ever; •adversely affect our ability to recruit patients for our clinical trials; •solidify partnerships or strategic acquisitions that may increase the competitive landscape; •develop or commercialize their product candidates sooner than we commercialize our own, if ever; or •implement more effective approaches to sales and marketing and capture some of our potential market share.There is no guarantee that our product candidates will be able to compete with potential future products being developed by our competitors.The CPM landscape is crowded with several competitors developing assets against a number of targets. Development plans are spread out acrossvarious indications and lines of therapy, either alone or in combination with other assets. Competitors range from small cap to large cap companies, withassets in pre-clinical or clinical stages of development. Therefore, the landscape is dynamic and constantly evolving. We and our partners have CPMantibody programs, currently in clinical stage development targeting PD-1, CTLA-4, GITR, OX40, TIM-3 and LAG-3. We are aware of many companies thathave antibody-based products on the market or in clinical development that are directed to the same biological targets as these programs, including, withoutlimitation, the following: (1) BMS markets ipilimumab, an anti-CTLA-4 antibody, and nivolumab, an anti-PD-1 antibody, and is developing additionalantagonists to LAG-3 and TIM-3. BMS also has next generation anti-CTLA-4 antibodies in the clinic, which may be competitive to our next generation anti-CTLA-4 program, (2) Merck has an approved anti-PD-1 antibody, as well as anti-CTLA-4 and LAG-3 antagonists and an anti-GITR agonist in clinicaldevelopment, (3) Regeneron has an approved anti-PD-1 antibody as well as antibodies targeting CTLA-4 and LAG-3 in clinical development, (4)AstraZeneca has an approved anti PD-L1 antibody, as well as an anti-CTLA-4 targeting antibody in the clinic, (5) Pfizer has an approved anti-PD-L1 (withMerck KgaA) as well as anti-PD-1, and anti-OX40 antibodies in clinical development, and (6) Roche/Genentech has an approved anti-PD-L1 antibody.Besides these PD-1 and PD-L1 antibodies that were approved in the U.S., we are also aware of competitors with approved PD-1 agents in ex-U.S. geographiessuch as China. These include Innovent Biologics and Shanghai Junshi Biosciences. We are also aware of other competitors with PD-1/PD-L1 agents inclinical development, including but not limited to AbbVie, Arcus Biosciences, Boehringer Ingelheim, Tesaro, Beigene, Eli Lilly, Jiangsu HengRui Medicine,Macrogenics/Incyte, CytomX/BMS, Novartis, Symphogen, Jounce Therapeutics, Gilead Sciences, Janssen, CBT Pharmaceuticals/Genor Biopharma,Checkpoint Therapeutics, CStone Pharmaceuticals, Livzon MabPharm Inc, Suzhou Alphamab, Mabspace Biosciences, Henlix Biotech Inc., AkesoBiopharma and CSPC ZhongQi Pharmaceutical Technology. We are also aware of competitors with pre-clinical antibodies against PD-1 or PD-L1. Inaddition, we are aware of competitors with clinical stage antibodies against GITR, OX40, LAG-3, TIM-3 as well as our earlier stage programs such as TIGITand CD137. As outlined above, some of these include, but are not limited to, BMS, Pfizer, Novartis, Merck, Tesaro, Regeneron, Eli Lilly, OncoMed,Boehringer Ingelheim, Potenza, Arcus Biosciences, GlaxoSmithKline, AbbVie, Leap Therapeutics and Symphogen. Additionally, we are aware of competitorsdeveloping preclinical assets and bispecifics against each of the above targets. There is no guarantee that our antibody product candidates will be able tocompete with our competitors’ antibody products and product candidates.We are conducting both single arm and combination trials in second line cervical cancer. We are aware that Merck’s PD-1 antagonist, Keytruda, hasbeen approved in advanced cervical cancer. We are also aware of industry sponsored clinical trials, including exploratory studies, that are underway in thissetting. Clinical stage competitors include, but are not limited to, Regeneron (anti-PD-1), Ono Pharmaceuticals and BMS (anti-PD-1 alone or in combinationwith agents against other checkpoint targets), Seattle Genetics and Genmab (antibody drug conjugate targeting Tissue Factor), Iovance Biotherapeutics(autologous TILs), Genor Biopharma and Lee Pharmaceuticals. Additionally, we are aware of other early stage clinical trials testing alternate checkpointtargets in cervical cancer patients. These include, but are not limited to, OX40 +/- CD137 agonists (Pfizer) and anti-PD-1 + anti-ICOS (GSK/Merck). We have autologous vaccine programs in development including our Prophage vaccine in clinical development for GBM. We are aware of othertherapeutic options in GBM that could compete with our vaccine, including but not limited to the following: Merck18Source: AGENUS INC, 10-K, March 18, 2019Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results.markets temozolomide for treatment of patients with ndGBM and refractory astrocytoma. Other companies are developing vaccines for the treatment ofpatients with ndGBM, including, but not limited to, Northwest Biotherapeutics (DC-Vax), Mimivax Inc. (SurVaxM) and Annias Immunotherapeutics (CMVVaccine). Other companies may begin development programs as well. We are advancing our neoantigen vaccine, AutoSynVax, in solid tumors. There arecompanies advancing individualized or synthetic vaccine technologies and/or patient-specific medicine techniques that compete with our HSP basedvaccines such as: Neon Therapeutics, Gritstone Oncology, Advaxis/Amgen, BioNTech, Moderna/Merck, Genocea Biosciences, ISA Pharmaceuticals,Nouscom, EpiVax Inc., and Vaccibody.In addition, and prior to regulatory approval, if ever, our vaccines and our other product candidates may compete for access to patients with otherproducts in clinical development, with products approved for use in the indications we are studying, or with off-label use of products in the indications weare studying. We anticipate that we will face increased competition in the future as new companies enter markets we seek to address and scientificdevelopments surrounding immunotherapy and other traditional cancer therapies continue to accelerate.We are aware of compounds that claim to be comparable to QS-21 Stimulon that are being used in clinical trials. Several other vaccine adjuvants are indevelopment or in use and could compete with QS-21 Stimulon for inclusion in vaccines. These adjuvants may include but are not limited to: (1)oligonucleotides, under development by Pfizer, Idera, and Dynavax, (2) MF59, under development by Novartis, (3) IC31, under development by Intercell(now part of Valneva), and (4) MPL, under development by GSK. In the past, we have provided QS-21 Stimulon to other entities under materials transferarrangements. In at least one instance, it is possible that this material was used unlawfully to develop synthetic formulations and/or derivatives of QS-21. Inaddition, companies such as Adjuvance Technologies, Inc., CSL Limited, and Novavax, Inc., as well as academic institutions and manufacturers of saponinextracts, are developing saponin adjuvants, including derivatives and synthetic formulations. These sources may be competitive to our ability to executefuture partnering and licensing arrangements involving QS-21 Stimulon. The existence of products developed by these and other competitors, or otherproducts of which we are not aware, or which other companies may develop in the future, may adversely affect the marketability of products developed orsold using QS-21 Stimulon.We are also aware of a third party that manufactures pre-clinical material purporting to be comparable to QS-21 Stimulon. The claims being made bythis third party may create marketplace confusion and have an adverse effect on the goodwill generated by us and our partners with respect to QS-21Stimulon. We are also aware of at least two additional manufacturers of QS-21. Any diminution of this goodwill may have an adverse effect on our ability tocommercialize future products, if any, incorporating this technology, either alone or with a third party.Failure to realize the anticipated benefits of our strategic acquisitions and licensing transactions could adversely affect our business, operations andfinancial condition.An important part of our business strategy has been to identify and advance a pipeline of product candidates by acquiring and in-licensing productcandidates, technologies and businesses that we believe are a strategic fit with our existing business. Since we acquired 4-AB in 2014, we have completednumerous additional strategic acquisitions and licensing transactions. The ultimate success of these strategic transactions entails numerous operational andfinancial risks, including: •higher than expected development and integration costs; •difficulty in combining the technologies, operations and personnel of acquired businesses with our technologies, operations and personnel; •exposure to unknown liabilities; •difficulty or inability to form a unified corporate culture across multiple office sites both nationally and internationally; •inability to retain key employees of acquired businesses; •disruption of our business and diversion of our management’s time and attention; and •difficulty or inability to secure financing to fund development activities for such acquired or in-licensed product candidates, technologies orbusinesses.We have limited resources to integrate acquired and in-licensed product candidates, technologies and businesses into our current infrastructure, andwe may fail to realize the anticipated benefits of our strategic transactions. Any such failure could have an adverse effect on our business, operations andfinancial condition.19Source: AGENUS INC, 10-K, March 18, 2019Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results.Failure to enter into and/or maintain significant licensing, distribution and/or collaboration agreements in a timely manner and on favorable terms tous may hinder or cause us to cease our efforts to develop and commercialize our product candidates, increase our development timelines, and/or increaseour need to rely on partnering or financing mechanisms, such as sales of debt or equity securities, to fund our operations and continue our current andanticipated programs.As previously noted, our ability to advance our antibody programs depends in part on collaboration agreements such as our collaborations withGilead and Incyte. In addition, from time to time we engage in efforts to enter into licensing, distribution and/or collaboration agreements with one or morepharmaceutical or biotechnology companies to assist us with development and/or commercialization of our other product candidates. If we are successful inentering into such agreements, we may not be able to negotiate agreements with economic terms similar to those negotiated by other companies. We may not,for example, obtain significant upfront payments, substantial royalty rates or milestones. If we fail to enter into any such agreements in a timely manner or atall, our efforts to develop and/or commercialize our product candidates may be undermined. In addition, if we do not raise funds through any suchagreements, we will need to rely on other financing mechanisms, such as sales of debt or equity securities, to fund our operations. Such financingmechanisms, if available, may not be sufficient or timely enough to advance our programs forward in a meaningful way in the short-term.Because we rely on collaborators and licensees for the development and commercialization of certain of our product candidate programs, theseprograms may not prove successful, and/or we may not receive significant payments from such parties.Part of our strategy is to develop and commercialize many of our product candidates by continuing or entering into arrangements with academic,government, or corporate collaborators and licensees. Our success depends on our ability to negotiate such agreements on favorable terms and on the successof the other parties in performing research, pre-clinical and clinical testing, completing regulatory applications, and commercializing product candidates. Ourresearch, development, and commercialization efforts with respect to antibody candidates from our technology platforms are, in part, contingent upon theparticipation of institutional and corporate collaborators. For example, in February 2015, we began a broad collaboration with Incyte to pursue the discoveryand development of antibodies, and in December 2018 we entered into a partnership with Gilead relating to five of our antibody programs. Furthermore, wehave a collaboration arrangement with Recepta for CTLA-4 and PD-1, giving Recepta rights to certain South American countries and requiring us to agreeupon development plans for these product candidates. Disagreements or the failure of either party to perform satisfactorily could have an adverse impact onthese programs.The Brain Tumor Trials Collaborative, through the NCI, is sponsoring a Phase 2 clinical trial of our Prophage vaccine candidate in combination withMerck’s pembrolizumab in patients with glioma. When our licensees or third-party collaborators sponsor clinical trials using our product candidates, wecannot control the timing of enrollment, data readout, or quality of such trials or related activities. Development activities for our collaboration programs may fail to produce marketable products due to unsuccessful results or abandonment of theseprograms, failure to enter into future collaborations or license agreements, or the inability to manufacture product supply requirements for our collaboratorsand licensees. Several of our agreements also require us to transfer important rights and regulatory compliance responsibilities to our collaborators andlicensees. As a result of these collaboration agreements, we will not control the nature, timing, or cost of bringing these product candidates to market. Ourcollaborators and licensees could choose not to, or be unable to, devote resources to these arrangements or adhere to required timelines, or, under certaincircumstances, may terminate these arrangements early. They may cease pursuing product candidates or elect to collaborate with different companies. Inaddition, these collaborators and licensees, outside of their arrangements with us, may develop technologies or products that are competitive with those thatwe are developing. From time to time, we may also become involved in disputes with our collaborators or licensees. Such disputes could result in theincurrence of significant expense, or the termination of collaborations. We may be unable to fulfill all of our obligations to our collaborators, which mayresult in the termination of collaborations. As a result of these factors, our strategic collaborations may not yield revenue. Furthermore, we may not be able toenter into new collaborations on favorable terms or at all. Failure to generate significant revenue from collaborations could increase our need to fund ouroperations through sales of debt or equity securities and would negatively affect our business prospects.Our internal computer systems, or those of our third-party CROs, CMOs, licensees, collaborators or other contractors or consultants, may fail or suffersecurity breaches, which could result in a material disruption in our business and operations or could subject us to sanctions and penalties that could havea material adverse effect on our reputation or financial condition.Despite the implementation of security measures, our internal computer systems and those of our current and future CROs, CMOs, licensees,collaborators and other contractors and consultants are vulnerable to damage from computer viruses, unauthorized access, natural disasters, terrorism, war andtelecommunication and electrical failures. Potential vulnerabilities can also be exploited from inadvertent or intentional actions of our employees, third-party vendors, business partners, or by malicious third parties. Attacks of this nature are increasing in their frequency, levels of persistence, sophistication andintensity, and are being conducted by sophisticated and organized groups and individuals with a wide range of motives (including, but not limited to,industrial espionage)20Source: AGENUS INC, 10-K, March 18, 2019Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results.and expertise, including organized criminal groups, “hacktivists,” nation states and others. In addition to the extraction of sensitive information, such attackscould include the deployment of harmful malware, ransomware, denial-of-service attacks, social engineering and other means to affect service reliability andthreaten the confidentiality, integrity and availability of information. In addition, the prevalent use of mobile devices increases the risk of data securityincidents. While we are not aware of any such material system failure, accident or security breach to date, if such an event were to occur and causeinterruptions in our operations, it could result in a material disruption of our development programs and our business operations. For example, the loss ofclinical trial data from completed, on-going or future clinical trials could result in delays in our regulatory approval efforts and significant costs to recover orreproduce the data. Likewise, we rely on third parties to manufacture certain of our drug candidates and conduct clinical trials, and similar events relating totheir computer systems could also have a material adverse effect on our business. To the extent that any disruption or security breach were to result in a lossof, or damage to, our data or applications, or inappropriate disclosure of confidential or proprietary information, we could incur liabilities and the furtherdevelopment and commercialization of our product candidates could be delayed. We do not maintain cyber liability insurance, and would therefore have nocoverage for any losses resulting from any data security incident.We use and store customer, vendor, employee and business partner and, in certain instances patient, personally identifiable information in the ordinarycourse of our business. We are subject to various domestic and international privacy and security regulations, including but not limited to the HealthInsurance Portability and Accountability Act of 1996 (“HIPAA”), which mandates, among other things, the adoption of uniform standards for the electronicexchange of information in common healthcare transactions, as well as standards relating to the privacy and security of individually identifiable healthinformation, which require the adoption of administrative, physical and technical safeguards to protect such information. In addition, many states haveenacted comparable laws addressing the privacy and security of health information, some of which are more stringent than HIPAA. Failure to comply withthese standards, or a computer security breach or cyber-attack that affects our systems or results in the unauthorized release of proprietary or personallyidentifiable information, could subject us to criminal penalties and civil sanctions, and our reputation could be materially damaged, and our operations couldbe impaired. We may also be exposed to a risk of loss or litigation and potential liability, which could have a material adverse effect on our business, resultsof operations and financial condition.We are highly reliant on certain members of our management team. In addition, we have limited internal resources and if we fail to recruit and/orretain the services of key employees and external consultants as needed, we may not be able to achieve our strategic and operational objectives.Garo H. Armen, Ph.D., the Chairman of our Board of Directors and our Chief Executive Officer who co-founded the Company in 1994, is integral tobuilding our company and developing our technology. If Dr. Armen is unable or unwilling to continue his relationship with Agenus, our business may beadversely impacted. We have an employment agreement with Dr. Armen, and he plays an important role in our day-to-day activities. We do not carry a keyemployee insurance policy for Dr. Armen or any other employee.Our future growth success depends to a significant extent on the skills, experience and efforts of our executive officers and key members of our clinicaland scientific staff. We face intense competition for qualified individuals from other pharmaceutical, biopharmaceutical and biotechnology companies, aswell as academic and other research institutions. We may be unable to retain our current personnel or attract or assimilate other highly qualified managementand clinical personnel in the future on acceptable terms. The loss of any or all of these individuals could harm our business and could impair our ability tosupport our collaboration partners or our growth generally. If our management is unable to effectively manage our growth, our expenses may increase morethan expected, our ability to generate revenue could be reduced and we may not be able to implement our business strategy.We intend to advance our cell therapy business through our subsidiary, AgenTus Therapeutics, eventually with separate funding. Moving intellectualproperty assets into AgenTus Therapeutics in foreign jurisdictions could have adverse tax consequences, and there is no guarantee that we will be able toattract external funding. Moreover, even if the business is funded, there is no guarantee that it will be successful.We are currently in the process of pursuing external funding and partnership opportunities to advance AgenTus Therapeutics, but Agenus is currentlyfunding such operations. There is no guarantee that external funding will be available. If funding is available, there is no guarantee that it will be onattractive or acceptable terms, or that it will be adequate to advance the business to an inflection point for additional funding, including any potential initialpublic offering. Similarly, there is no guarantee that partnership opportunities will be available on attractive terms, if at all. If external funding is notavailable, we may be forced to either retire these programs or continue to use internal resources to advance them. In addition, our cell therapy assets are pre-clinical. Even if adequate funding and partnership opportunities are available, there is no guarantee that we will be successful in advancing one or moreproduct candidates into and through clinical development. In addition, most of the efforts being made on behalf of AgenTus Therapeutics are being led by aseparate AgenTus chief executive officer, utilizing Agenus’ management team and internal G&A resources. The current structure could distract managementand divert Agenus resources from Agenus’ own core pipeline and programs.21Source: AGENUS INC, 10-K, March 18, 2019Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results.The cell therapy assets necessary to enable AgenTus Therapeutics are currently owned or controlled by Agenus in the United States and Switzerland.In connection with capitalizing AgenTus Therapeutics, these assets will be transferred or licensed to new legal entities within the United States and Europeand potentially others. Transferring these assets or licensing them on an exclusive basis would require that taxes be paid based on the fair market value of theassets. While we expect to have adequate net operating losses to offset any tax liabilities, there is no guarantee that this will be the case in all relevantjurisdictions. Moreover, we have previously disclosed our interest in potentially issuing a tax-free dividend to Agenus’ stockholders in the form of stock ofAgenTus Therapeutics. There is no guarantee that any such dividend will be tax-free or that it will be issued at all, or the timing thereof. If we issue adividend in the form of stock, there could be adverse tax consequences for certain of our stockholders.Calamities, power shortages or power interruptions could disrupt our business and materially adversely affect our operations.If a natural disaster, power outage or other event occurred that prevented us from using all or a significant portion of our facilities, that damagedcritical infrastructure (such as our manufacturing facility) or that otherwise disrupted operations, it may be difficult or, in certain cases, impossible for us tocontinue certain activities, such as for example our manufacturing capabilities, for a substantial period of time. We own an antibody pilot plantmanufacturing facility and lease additional office space in Berkeley, CA. This location is in an area of seismic activity near active earthquake faults. Anyearthquake, terrorist attack, fire, power shortage or other calamity affecting our facilities or those of third parties upon whom we depend may disrupt ourbusiness and could have a material adverse effect on our business, results of operations, financial condition and prospects. The disaster recovery and businesscontinuity plans we have in place currently are limited and are unlikely to prove adequate in the event of a serious disaster or similar event. We may incursubstantial expenses and delays as a result of the limited nature of our disaster recovery and business continuity plans, which could have a material adverseeffect on our business. We are dependent upon our collaboration with Gilead to further develop and commercialize certain of our antibody programs. If we or Gilead fail toperform as expected, the potential for us to generate future revenues under the collaboration could be significantly reduced, the development and/orcommercialization of these antibodies may be terminated or substantially delayed, and our business could be adversely affected.In December 2018, we entered into a series of agreements with Gilead to collaborate on the development and commercialization of up to five novel I-O therapies. Pursuant to the collaboration agreements, Gilead received (i) worldwide exclusive rights to AGEN1423, a bispecific antibody, (ii) the exclusiveoption to license exclusively AGEN1223, a bispecific antibody, and AGEN2373, a monospecific antibody, and (iii) the right of first negotiation for twoadditional, undisclosed programs. Gilead has the exclusive right to develop and commercialize AGEN1423, and we are eligible to receive potentialdevelopment and commercial milestones of up to $552.5 million in the aggregate, as well as tiered royalty payments on aggregate net sales ranging from thehigh single digit to mid-teen percent, subject to certain reductions under certain circumstances. Accordingly, the timely and successful completion by Gileadof clinical development and commercialization activities will significantly affect the timing and amount of any milestones or royalties we may receive forthis program. Gilead’s activities will be influenced by, among other things, the efforts and allocation of resources by Gilead, which we cannot control. Withrespect to the option programs, we are responsible for developing each program up to the option decision point, at which time Gilead may acquire exclusiverights to each program on option exercise. During the option period, we are eligible to receive milestones of up to $30.0 million in the aggregate. If Gileadexercises an option, it would be required to pay an upfront license exercise fee of $50.0 million for each option that is exercised. Following any optionexercise, we would be eligible to receive additional development and commercial milestones of up to $520.0 million in the aggregate for each such optionprogram, as well as tiered royalty payments on aggregate net sales ranging from the high single digit to mid-teen percent, subject to certain reductions undercertain circumstances. For either, but not both, of the option programs, we will have the right to opt-in to share Gilead’s development and commercializationcosts in the United State for such option program in exchange for a profit (loss) share on a 50:50 basis and revised milestone payments. There is no guaranteethat we will receive any fees, milestones or royalties from Gilead. If Gilead does not exercise its option for either of the option programs, there is no guaranteethat we will be able to advance any such program ourselves or with another partner. If we wanted to partner either of the programs that are subject to a right offirst negotiation with a third party other than Gilead, such discussions could be delayed and ultimately terminated as a result of Gilead’s right of firstnegotiation. Accordingly, we may not be able to partner either of these programs with a third party other than Gilead on attractive terms, if at all.We are dependent upon our collaboration with Incyte to further develop, manufacture and commercialize antibodies against certain targets. If we orIncyte fail to perform as expected, the potential for us to generate future revenues under the collaboration could be significantly reduced, the developmentand/or commercialization of these antibodies may be terminated or substantially delayed, and our business could be adversely affected.In February 2017, we amended the terms of our collaboration agreement with Incyte to, among other things, convert the GITR and OX40 programsfrom profit-share programs, where we and Incyte shared all costs and profits on a 50:50 basis, to royalty-bearing22Source: AGENUS INC, 10-K, March 18, 2019Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results.programs, where Incyte funds 100% of the costs and we are eligible for potential milestones and royalties. In addition, the profit-share programs relating toTIGIT and one undisclosed target were removed from the collaboration, with TIGIT reverting to Agenus and the undisclosed target reverting to Incyte, eachwith a potential 15% royalty to the other party on any global net sales. The remaining three royalty-bearing programs in the collaboration targeting TIM-3,LAG-3 and one undisclosed target remain unchanged, and there are no more profit-share programs under the collaboration. For each program in thecollaboration, we serve as the lead for pre-clinical development activities through the filing of an IND, and Incyte has exclusive rights and all decision-making authority for manufacturing, clinical development and commercialization. Accordingly, the timely and successful completion by Incyte of clinicaldevelopment and commercialization activities will significantly affect the timing and amount of any royalties or milestones we may receive under thecollaboration agreement. In addition, in March 2017 we transferred manufacturing responsibilities to Incyte for antibodies under that collaboration. Anydelays or weaknesses in the ability of Incyte to successfully manufacture could have an adverse impact on those programs. Incyte’s activities will beinfluenced by, among other things, the efforts and allocation of resources by Incyte, which we cannot control. If Incyte does not perform in the manner weexpect or fulfill its responsibilities in a timely manner, or at all, the clinical development, manufacturing, regulatory approval, and commercialization effortsrelated to antibodies under the collaboration could be delayed or terminated. There can be no assurance that any of the development, regulatory or salesmilestones will be achieved, or that we will receive any future milestone or royalty payments under the collaboration agreement. In September 2018, we soldto XOMA (US) LLC a portion of the royalties and milestones we are entitled to receive from Incyte.In addition, our collaboration with Incyte may be unsuccessful due to other factors, including, without limitation, the following: •Incyte may terminate the agreement or any individual program for convenience upon 12 months’ notice; •Incyte has control over the development of assets in the collaboration; •Incyte may change the focus of its development and commercialization efforts or prioritize other programs more highly and, accordingly,reduce the efforts and resources allocated to our collaboration; •Incyte may choose not to develop and commercialize antibody products, if any, in all relevant markets or for one or more indications, if at all;and •If Incyte is acquired during the term of our collaboration, the acquirer may have competing programs or different strategic priorities that couldcause it to reduce its commitment to our collaboration.If Incyte terminates our collaboration agreement, we may need to raise additional capital and may need to identify and come to agreement withanother collaboration partner to advance certain of our antibody programs. Even if we are able to find another partner, this effort could cause delays in ourtimelines and/or additional expenses, which could adversely affect our business prospects and the future of our antibody product candidates under thecollaboration.Comprehensive tax reform legislation could adversely affect our business and financial condition.On December 22, 2017, President Trump signed into law the “Tax Cuts and Jobs Act” (the “TJCA”) that significantly reformed the Internal RevenueCode of 1986, as amended. The TCJA, among other things, includes changes to U.S. federal tax rates, imposes significant additional limitations on thedeductibility of interest and net operating loss carryforwards, allows for the expensing of capital expenditures, and puts into effect the migration from a“worldwide” system of taxation to a territorial system. Our net deferred tax assets and liabilities were revalued at the newly enacted U.S. corporate rate. Wedid not recognize any tax expense in the year of enactment as our net deferred tax assets have a full valuation allowance recorded. We continue to examinethe impact this tax reform legislation may have on our business. The impact of this tax reform is uncertain and could be adverse.Risks Related to Regulation of the Biopharmaceutical IndustryThe drug development and approval process is uncertain, time-consuming, and expensive.Drug development, including non-clinical testing and clinical development, and the process of obtaining regulatory approvals for new therapeuticproducts, is lengthy, expensive, and uncertain. For example, as of December 31, 2018, we had spent more than 20 years and $809.2 million on our researchand development programs. The development and regulatory approval processes also can vary substantially based on the therapeutic area, type, complexity,and novelty of the product. We must provide regulatory authorities with manufacturing, product characterization, and pre-clinical and clinical datademonstrating that our product candidates are safe and effective before they can be approved for commercial sale. It may take us many years to complete ourtesting, and failure can occur at any stage. Results of pre-clinical studies do not necessarily predict clinical results, and promising results in early clinicalstudies might not be confirmed in later studies. Any pre-clinical or clinical test may fail to produce results satisfactory to regulatory authorities for manyreasons, including but not limited to emerging manufacturing or control issues, limitations of pre-clinical assessments, difficulties to enroll a sufficientnumber of patients, changing therapeutic landscape or failure to prospectively identify the benefit/risk profile of the new product. Pre-clinical and clinicaldata can be interpreted in different ways, which could delay, limit, or prevent23Source: AGENUS INC, 10-K, March 18, 2019Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results.regulatory approval. Negative or inconclusive results from a pre-clinical study or clinical trial, adverse medical events during a clinical trial, or safety issuesemerging with products of the same class of drug could require additional studies or cause a program to be terminated, even if other studies or trials relatingto the program are successful. We or the FDA, other regulatory agencies, or an institutional review board may suspend or terminate human clinical trials atany time on various grounds.The timing and success of a clinical trial is dependent on obtaining and maintaining sufficient cash resources, successful production of clinical trialmaterial, enrolling sufficient patients in a timely manner, avoiding or mitigating serious or significant adverse patient reactions, and demonstrating efficacyof the product candidate in order to support a favorable risk versus benefit profile, among other considerations. The timing and success of our clinical trials,in particular, are also dependent on clinical sites and regulatory authorities accepting each trial’s protocol, statistical analysis plan, product characterizationtests, and final clinical results. In addition, regulatory authorities may request additional information or data that is not readily available. Delays in ourability to respond to such requests would delay, and failure to adequately address concerns would prevent, our commercialization efforts. We haveencountered in the past, and may encounter in the future, delays in initiating trial sites and enrolling patients into our clinical trials. Future enrollment delayswill postpone the dates by which we expect to complete the impacted trials and the potential receipt of regulatory approval. There is no guarantee we willsuccessfully initiate and/or complete our clinical trials.Delays or difficulties in obtaining regulatory approvals or clearances for our product candidates may: •adversely affect the marketing of any products we or our licensees or collaborators develop; •impose significant additional costs on us or our licensees or collaborators; •diminish any competitive advantages that we or our licensees or collaborators may attain; •limit our ability to receive royalties and generate revenue and profits; and •adversely affect our business prospects and ability to obtain financing.Delays or failures in our receiving regulatory approval for our product candidates in a timely manner may result in us having to incur additionaldevelopment expense and subject us to having to secure additional financing. As a result, we may not be able to commercialize them in the time frameanticipated, and our business will suffer.Even if we or our partners receive marketing approval for our product candidates, such product approvals could be subject to restrictions orwithdrawals. Regulatory requirements are subject to change. Further, even if we or our partners receive marketing approval, we may not receive sufficientcoverage and adequate reimbursement for our products.Regulatory authorities generally approve products for particular indications. If an approval is for a limited indication, this limitation reduces the sizeof the potential market for that product. Product approvals, once granted, are subject to continual review and periodic inspections by regulatory authorities.Our operations and practices are subject to regulation and scrutiny by the United States government, as well as governments of any other countries in whichwe do business or conduct activities. Later discovery of previously unknown problems or safety issues, and/or failure to comply with domestic or foreignlaws, knowingly or unknowingly, can result in various adverse consequences, including, among other things, possible delay in approval or refusal to approvea product, warning letters, fines, injunctions, civil penalties, recalls or seizures of products, total or partial suspension of production, refusal of thegovernment to renew marketing applications, complete withdrawal of a marketing application, corrective action requirements, and/or criminal prosecution,withdrawal of an approved product from the market, and/or exclusion from government health care programs. Such regulatory enforcement could have adirect and negative impact on the product for which approval is granted and could have a negative impact on the approval of any pending applications formarketing approval of new drugs or supplements to approved applications.Because we operate in a highly regulated industry, regulatory authorities could take enforcement action against us in connection with our licensees’or collaborators’, and/or our business and marketing activities for various reasons. For example, the Foreign Corrupt Practices Act prohibits U.S. companiesand their representatives from offering, promising, authorizing, or making payments to foreign governmental officials for the purpose of obtaining orretaining business abroad.From time to time, new legislation is passed into law that could significantly change the statutory provisions governing the approval, manufacturing,and marketing of products regulated by the FDA and other foreign health authorities. Additionally, regulations and guidance are often revised orreinterpreted by health agencies in ways that may significantly affect our business and our products. It is impossible to predict whether further legislativechanges will be enacted, or whether regulations, guidance, or interpretations will change, and what the impact of such changes, if any, may be. For example,the Patient Protection and Affordable Care Act and the Health Care and Education Affordability Reconciliation Act of 2010 (collectively the “ACA”),enacted in March 2010, substantially changed the way healthcare is financed by both governmental and private insurers, and significantly impacted thepharmaceutical industry. With regard to pharmaceutical products, among other things, ACA is expected to expand, increase, and change the methodologyregarding industry rebates for drugs covered under Medicaid programs; impose an annual, nondeductible fee on any entity that manufactures or importsspecific branded prescription drugs and biologic agents, apportioned among those entities24Source: AGENUS INC, 10-K, March 18, 2019Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results.according to market share in certain government healthcare programs; expand eligibility criteria for Medicaid programs by, among other things, allowingstates to offer Medicaid coverage to certain individuals with income at or below 133% of the federal poverty level; expand the entities eligible for discountsunder the Public Health Service pharmaceutical pricing program; create a new Patient Centered Outcomes Research Institute to oversee, identify priorities in,and conduct comparative clinical effectiveness research, along with funding for such research; and make changes to the coverage requirements under theMedicare D program. Significant legislative changes to the ACA also appear possible in the 115th U.S. Congress under the Trump Administration.We expect both government and private health plans to continue to require healthcare providers, including healthcare providers that may one daypurchase our products, to contain costs and demonstrate the value of the therapies they provide. Even if our product candidates are approved, the commercialsuccess of our products will depend substantially on the extent to which they are covered by third-party payors, including government health authorities andprivate health insurers. In the United States, no uniform policy of coverage and reimbursement for products exists among third-party payors, and coverageand reimbursement for products can differ significantly from payor to payor. If coverage and reimbursement are not available, or reimbursement is availableonly to limited levels, we or our collaborators may not be able to successfully commercialize our product candidates.New data from our research and development activities, and/or resource considerations could modify our strategy and result in the need to adjust ourprojections of timelines and costs of programs.Because we are focused on novel technologies, our research and development activities, including our nonclinical studies and clinical trials, involvethe ongoing discovery of new facts and the generation of new data, based on which we determine next steps for a relevant program. These developments canoccur with varying frequency and constitute the basis on which our business is conducted. We make determinations on an ongoing basis as to which of thesefacts or data will influence timelines and costs of programs. We may not always be able to make such judgments accurately, which may increase the costs weincur attempting to commercialize our product candidates. We monitor the likelihood of success of our initiatives and we may need to discontinue funding ofsuch activities if they do not prove to be commercially feasible, due to our limited resources.We may need to successfully address a number of technological challenges in order to complete development of our product candidates. Moreover,these product candidates may not be effective in treating any disease or may prove to have undesirable or unintended side effects, toxicities, or othercharacteristics that may preclude our obtaining regulatory approvals or prevent or limit commercial use.Risks Related to Intellectual Property RightsIf we are unable to obtain and enforce patent protection for our product candidates and related technology, our business could be materially harmed.We rely upon a combination of patents, trade secret protection and confidentiality agreements to protect the intellectual property related to ourproduct candidates and technology. Any disclosure to or misappropriation by third parties of our confidential proprietary information could enablecompetitors to duplicate or surpass our technological achievements, eroding our competitive position in the market. Our patent applications may not result inissued patents, and, even if issued, the patents may be challenged and invalidated. Moreover, our patents and patent applications may not be sufficientlybroad to prevent others from practicing our technologies or developing competing products. We also face the risk that others may independently developsimilar or alternative technologies or may design around our proprietary property.Issued patents may be challenged, narrowed, invalidated or circumvented. In addition, court decisions may introduce uncertainty in the enforceabilityor scope of patents owned by biotechnology companies. The legal systems of certain countries do not favor the aggressive enforcement of patents, and thelaws of foreign countries may not allow us to protect our inventions with patents to the same extent as the laws of the United States. Because patentapplications in the United States and many foreign jurisdictions are typically not published until 18 months after filing, or in some cases not at all, andbecause publications of discoveries in scientific literature lag behind actual discoveries, we cannot be certain that we were the first to make the inventionsclaimed in our issued patents or pending patent applications, or that we were the first to file for protection of the inventions set forth in our patents or patentapplications. As a result, we may not be able to obtain or maintain protection for certain inventions. Therefore, the enforceability and scope of our patents inthe United States and in foreign countries cannot be predicted with certainty and, as a result, any patents that we own, or license may not provide sufficientprotection against competitors. We may not be able to obtain or maintain patent protection from our pending patent applications, from those we may file inthe future, or from those we may license from third parties. Moreover, even if we are able to obtain patent protection, such patent protection may be ofinsufficient scope to achieve our business objectives.25Source: AGENUS INC, 10-K, March 18, 2019Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results.Patent terms may be inadequate to protect our competitive position on our product candidates for an adequate amount of time. Patents have a limitedlifespan. In the United States, the natural expiration of a patent is generally 20 years after its effective filing date. Various extensions may be available;however, the life of a patent, and the protection it affords, is limited. Without patent protection for our product candidates, we may be open to competitionfrom biosimilar or generic versions of our product candidates. Furthermore, the product development timeline for biotechnology products is lengthy and it ispossible that our issued patents covering our product candidates in the United States and other jurisdictions may expire prior to commercial launch. Forexample, if we encounter delays in our development efforts, including our clinical trials, the period of time during which we could market our productcandidates under patent protection could be reduced.Our strategy depends on our ability to identify and seek patent protection for our discoveries. This process is expensive and time consuming, and weand our current or future licensors or licensees may not be able to file and prosecute all necessary or desirable patent applications at a reasonable cost or in atimely manner or in all jurisdictions where protection may be commercially advantageous. It is also possible that we or our current licensors or licensees, orany future licensors or licensees, may not identify patentable aspects of inventions made in the course of development and commercialization activities intime to obtain patent protection on them. Therefore, these and any of our patents and applications may not be prosecuted and enforced in a manner consistentwith the best interests of our business. Defects of form in the preparation or filing of our patents or patent applications may exist, or may arise in the future, forexample with respect to proper priority claims, inventorship, etc. If we or our current licensors or licensees, or any future licensors or licensees, fail toestablish, maintain or protect such patents and other intellectual property rights, such rights may be reduced or eliminated. If our current licensors orlicensees, or any future licensors or licensees, are not fully cooperative or disagree with us as to the prosecution, maintenance or enforcement of any patentrights, such patent rights could be compromised. If there are material defects in the form or preparation of our patents or patent applications, such patents orapplications may be invalid and unenforceable. Despite our efforts to protect our proprietary rights, unauthorized parties may be able to obtain and useinformation that we regard as proprietary. The issuance of a patent does not ensure that it is valid or enforceable, so even if we obtain patents, they may not bevalid or enforceable against third parties. In addition, the issuance of a patent does not give us the right to practice the patented invention. Third parties mayhave blocking patents that could prevent us from marketing our own patented product and practicing our own patented technology. Any of these outcomescould impair our ability to prevent competition from third parties, which may have an adverse impact on our business.The patent landscapes in the fields of antibody, vaccine, adjuvant and adoptive cell therapy development, manufacture and commercialization arecrowded. For example, we are aware of third party patents directed to methods for identifying and producing therapeutic products such as antibodies,vaccines, adjuvants and adoptive cell therapies. We are also aware of third party patents directed to products targeting numerous antigens for which we alsoseek to identify, develop, and commercialize products. For example, some patents claim products based on competitive binding with existing products, someclaim products based on specifying sequence or other structural information, and some claim various methods of discovery, production, or use of suchproducts.These or other third-party patents could impact our freedom to operate in relation to our technology platforms, as well as in relation to developmentand commercialization of products identified by us as therapeutic candidates. As we discover and develop our candidates, we will continue to conductanalyses of these third-party patents to determine whether we believe we might infringe them, and if so, whether they would be likely to be deemed valid andenforceable if challenged. If we determine that a license for a given patent or family of patents is necessary or desirable, there can be no guarantee that alicense would be available on favorable terms, or at all. Inability to obtain a license on favorable terms, should such a license be determined to be necessaryor desirable, could, without limitation, result in increased costs to design around the third-party patents, delay product launch, or result in cancellation of theaffected program or cessation of use of the affected technology.Third parties may also seek to market biosimilar versions of any approved products. Alternatively, third parties may seek approval to market their ownproducts similar to or otherwise competitive with our products. In these circumstances, we may need to defend and/or assert our patents, including by filinglawsuits alleging patent infringement. In any of these types of proceedings, a court or agency with jurisdiction may find our patents invalid and/orunenforceable. Even if we have valid and enforceable patents, these patents still may not provide protection against competing products or processessufficient to achieve our business objectives.We own, co-own or have exclusive rights to approximately 25 issued United States patents and approximately 75 issued foreign patents. We also own,co-own or have exclusive rights to approximately 35 pending United States patent applications and approximately 180 pending foreign patent applications.However, our patents may not protect us against our competitors. Our patent positions, and those of other biopharmaceutical, pharmaceutical andbiotechnology companies, are generally uncertain and involve complex legal, scientific, and factual questions. The standards which the United States Patentand Trademark Office (“USPTO”) uses to grant patents, and the standards which courts use to interpret patents, are not always applied predictably oruniformly and can change, particularly as new technologies develop. Consequently, the level of protection, if any, that will be provided by our patents if weattempt to enforce them and they are challenged, is uncertain. In addition, the type and extent of patent claims that will be issued to us in the future isuncertain. Any patents that are issued may not contain claims that permit us to stop competitors from using similar technology.26Source: AGENUS INC, 10-K, March 18, 2019Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results.Through our acquisitions of 4-AB, PhosImmune and certain assets of Celexion, we own, co-own, or have exclusive rights to a number of patents andpatent applications directed to various methods and compositions, including methods for identifying therapeutic antibodies and product candidates arisingout of such entities’ technology platforms. In particular, we own patents and patent applications relating to our Retrocyte DisplayTM technology platform, ahigh throughput antibody expression platform for the identification of fully-human and humanized monoclonal antibodies. This patent family is projected toexpire between 2029 and 2031. Through our acquisition of PhosImmune, we own, co-own, or have exclusive rights to patents and patent applicationsdirected to various methods and compositions, including a patent directed to methods for identifying phosphorylated proteins using mass spectrometry. Thispatent is projected to expire in 2023. We also own patents and patent applications relating to the SECANT® platform, a platform used for the generation ofnovel monoclonal antibodies. This patent family is projected to expire between 2028 and 2029. In addition, as we advance our research and developmentefforts with our institutional and corporate collaborators, we are seeking patent protection for newly identified therapeutic antibodies and product candidates.We can provide no assurance that any of our patents, including the patents that we acquired or in-licensed in connection with our acquisitions of 4-AB,PhosImmune and certain assets of Celexion, will have commercial value, or that any of our existing or future patent applications, including the patentapplications that we acquired or in-licensed in connection with our acquisitions of 4-AB, PhosImmune and certain assets of Celexion, will result in theissuance of valid and enforceable patents.Our issued patents covering Prophage vaccine and methods of use thereof, alone or in combination with other agents, expired or will expire at variousdates between 2015 and 2024. In particular, our issued U.S. patents covering Prophage composition of matter expired in 2015. In addition, our issued patentscovering QS-21 Stimulon composition of matter expired in 2008. We continue to explore means of extending the life cycle of our patent portfolio.The patent position of biopharmaceutical, pharmaceutical or biotechnology companies, including ours, is generally uncertain and involves complexlegal and factual considerations. The standards which the USPTO and its foreign counterparts use to grant patents are not always applied predictably oruniformly and can change. There is also no uniform, worldwide policy regarding the subject matter and scope of claims granted or allowable inbiopharmaceutical, pharmaceutical or biotechnology patents. The laws of some foreign countries do not protect proprietary information to the same extent asthe laws of the United States, and many companies have encountered significant problems and costs in protecting their proprietary information in theseforeign countries. Outside the United States, patent protection must be sought in individual jurisdictions, further adding to the cost and uncertainty ofobtaining adequate patent protection outside of the United States. Accordingly, we cannot predict whether additional patents protecting our technology willissue in the United States or in foreign jurisdictions, or whether any patents that do issue will have claims of adequate scope to provide competitiveadvantage. Moreover, we cannot predict whether third parties will be able to successfully obtain claims or the breadth of such claims. The allowance ofbroader claims may increase the incidence and cost of patent interference proceedings, opposition proceedings, post-grant review, inter partes review, and/orreexamination proceedings, the risk of infringement litigation, and the vulnerability of the claims to challenge. On the other hand, the allowance of narrowerclaims does not eliminate the potential for adversarial proceedings and may fail to provide a competitive advantage. Our issued patents may not containclaims sufficiently broad to protect us against third parties with similar technologies or products or provide us with any competitive advantage.We may become involved in lawsuits to protect or enforce our patents, which could be expensive, time consuming and unsuccessful.Third parties may infringe or misappropriate our intellectual property, including our existing patents, patents that may issue to us in the future, or thepatents of our licensors or licensees to which we have a license. As a result, we may be required to file infringement claims to stop third-party infringement orunauthorized use. Further, we may not be able to prevent, alone or with our licensors or licensees, misappropriation of our intellectual property rights,particularly in countries where the laws may not protect those rights as fully as in the United States.If we or one of our licensors or licensees were to initiate legal proceedings against a third party to enforce a patent covering our product candidates,the defendant could counterclaim that the patent covering our product candidates is invalid and/or unenforceable. In patent litigation in the United States,defendant counterclaims alleging invalidity and/or unenforceability are commonplace, and there are numerous grounds upon which a third party can assertinvalidity or unenforceability of a patent.In addition, within and outside of the United States, there has been a substantial amount of litigation and administrative proceedings, includinginterference and reexamination proceedings before the USPTO or oppositions and other comparable proceedings in various foreign jurisdictions, regardingpatent and other intellectual property rights in the biopharmaceutical industry. Notably, the Leahy-Smith America Invents Act, or the American Invents Act(“AIA”), introduced new procedures, including inter partes review and post grant review. These procedures may be used by competitors to challenge thescope and/or validity of our patents, including those patents perceived by our competitors as blocking entry into the market for their products, and theoutcome of such challenges.27Source: AGENUS INC, 10-K, March 18, 2019Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results.Even after they have been issued, our patents and any patents which we license may be challenged, narrowed, invalidated or circumvented. If ourpatents are invalidated or otherwise limited or will expire prior to the commercialization of our product candidates, other companies may be better able todevelop products that compete with ours, which could adversely affect our competitive business position, business prospects and financial condition.The following are non-exclusive examples of litigation and other adversarial proceedings or disputes that we could become a party to involving ourpatents or patents licensed to us: •we or our collaborators may initiate litigation or other proceedings against third parties to enforce our patent rights; •third parties may initiate litigation or other proceedings seeking to invalidate patents owned by or licensed to us or to obtain a declaratoryjudgment that their product or technology does not infringe our patents or patents licensed to us; •third parties may initiate opposition proceedings, post-grant review, inter partes review, or reexamination proceedings challenging the validityor scope of our patent rights, requiring us or our collaborators and/or licensors or licensees to participate in such proceedings to defend thevalidity and scope of our patents; •there may be a challenge or dispute regarding inventorship or ownership of patents currently identified as being owned by or licensed to us; •the USPTO may initiate an interference or derivation proceeding between patents or patent applications owned by or licensed to us and thoseof our competitors, requiring us or our collaborators and/or licensors or licensees to participate in an interference or derivation proceeding todetermine the priority of invention, which could jeopardize our patent rights; or •third parties may seek approval to market biosimilar versions of our future approved products prior to expiration of relevant patents owned byor licensed to us, requiring us to defend our patents, including by filing lawsuits alleging patent infringement.These lawsuits and proceedings would be costly and could affect our results of operations and divert the attention of our managerial and scientificpersonnel. There is a risk that a court or administrative body could decide that our patents are invalid or not infringed by a third party’s activities, or that thescope of certain issued claims must be further limited. An adverse outcome in a litigation or proceeding involving our own patents could limit our ability toassert our patents against these or other competitors, affect our ability to receive royalties or other licensing consideration from our licensees, and may curtailor preclude our ability to exclude third parties from making, using and selling similar or competitive products. An adverse outcome may also put our pendingpatent applications at risk of not issuing, or issuing with limited and potentially inadequate scope to cover our product candidates. The outcome followinglegal assertions of invalidity and unenforceability is unpredictable. With respect to the validity question, for example, we cannot be certain that there is noinvalidating prior art, of which we and the patent examiner were unaware during prosecution. Additionally, it is also possible that prior art of which we areaware, but which we do not believe affects the validity or enforceability of a claim, may, nonetheless, ultimately be found by a court of law or anadministrative panel to affect the validity or enforceability of a claim, for example, if a priority claim is found to be improper. If a defendant were to prevailon a legal assertion of invalidity and/or unenforceability, we could lose at least part, and perhaps all, of the patent protection on our relevant productcandidates. Such a loss of patent protection could have a material adverse impact on our business.Furthermore, because of the substantial amount of discovery required in connection with intellectual property litigation or administrativeproceedings, there is a risk that some of our confidential information could be compromised by disclosure. In addition, during the course of litigation oradministrative proceedings, there could be public announcements of the results of hearings, motions or other interim proceedings or developments or publicaccess to related documents. If investors perceive these results to be negative, the market price for our common stock could be significantly harmed. Any ofthese occurrences could adversely affect our competitive business position, business prospects, and financial condition.Intellectual property rights do not necessarily address all potential threats to our competitive advantage. The degree of future protection for ourproprietary rights is uncertain because legal means afford only limited protection and may not adequately protect our rights or permit us to gain or keep ourcompetitive advantage. For example: •others may be able to develop a platform that is similar to, or better than, ours in a way that is not covered by the claims of our patents; •others may be able to make compounds that are similar to our product candidates but that are not covered by the claims of our patents; •we might not have been the first to make the inventions covered by patents or pending patent applications; •we might not have been the first to file patent applications for these inventions;28Source: AGENUS INC, 10-K, March 18, 2019Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results. •any patents that we obtain may not provide us with any competitive advantages or may ultimately be found invalid or unenforceable; or •we may not develop additional proprietary technologies that are patentable.Our commercial success depends significantly on our ability to operate without infringing the patents and other proprietary rights of third parties.Our success will depend in part on our ability to operate without infringing the proprietary rights of third parties. Other entities may have or obtainpatents or proprietary rights that could limit our ability to make, use, sell, offer for sale or import our future approved products or impair our competitiveposition. In particular, the patent landscapes around the discovery, development, manufacture and commercial use of our product candidates are crowded.Third parties may have or obtain valid and enforceable patents or proprietary rights that could block us from developing product candidates using ourtechnology. Our failure to obtain a license to any technology that we require may materially harm our business, financial condition and results of operations.Moreover, our failure to maintain a license to any technology that we require may also materially harm our business, financial condition, and results ofoperations. Furthermore, we would be exposed to a threat of litigation.In the biopharmaceutical industry, significant litigation and other proceedings regarding patents, patent applications, trademarks and otherintellectual property rights have become commonplace. The types of situations in which we may become a party to such litigation or proceedings include: •we or our collaborators may initiate litigation or other proceedings against third parties seeking to invalidate the patents held by those thirdparties or to obtain a judgment that our products or processes do not infringe those third parties’ patents; •if our competitors file patent applications that claim technology also claimed by us or our licensors or licensees, we or our licensors or licenseesmay be required to participate in interference, derivation or other proceedings to determine the priority of invention, which could jeopardizeour patent rights and potentially provide a third party with a dominant patent position; •if third parties initiate litigation claiming that our processes or products infringe their patent or other intellectual property rights, we and ourcollaborators will need to defend against such proceedings; and •if a license to necessary technology is terminated, the licensor may initiate litigation claiming that our processes or products infringe ormisappropriate their patent or other intellectual property rights and/or that we breached our obligations under the license agreement, and weand our collaborators would need to defend against such proceedings.These lawsuits would be costly and could affect our results of operations and divert the attention of our management and scientific personnel. There isa risk that a court would decide that we or our collaborators are infringing the third party’s patents and would order us or our collaborators to stop theactivities covered by the patents. In that event, we or our collaborators may not have a viable alternative to the technology protected by the patent and mayneed to halt work on the affected product candidate or cease commercialization of an approved product. In addition, there is a risk that a court will order us orour collaborators to pay the other party damages. An adverse outcome in any litigation or other proceeding could subject us to significant liabilities to thirdparties and require us to cease using the technology that is at issue or to license the technology from third parties. We may not be able to obtain any requiredlicenses on commercially acceptable terms or at all. Any of these outcomes could have a material adverse effect on our business.The biopharmaceutical industry has produced a significant number of patents, and it may not always be clear to industry participants, including us,which patents cover various types of products or methods of use. The coverage of patents is subject to interpretation by the courts, and the interpretation isnot always uniform or predictable. If we are sued for patent infringement, we would need to demonstrate that our products or methods either do not infringethe patent claims of the relevant patent or that the patent claims are invalid, and we may not be able to do this. Proving invalidity is difficult. For example, inthe United States, proving invalidity requires a showing of clear and convincing evidence to overcome the presumption of validity enjoyed by issuedpatents. Even if we are successful in these proceedings, we may incur substantial costs and divert management’s time and attention in pursuing theseproceedings, which could have a material adverse effect on us. If we are unable to avoid infringing the patent rights of others, we may be required to seek alicense, defend an infringement action or challenge the validity of the patents in court. Patent litigation is costly and time consuming. We may not havesufficient resources to bring these actions to a successful conclusion. In addition, if we do not obtain a license, develop or obtain non-infringing technology,fail to defend an infringement action successfully or have infringed patents declared invalid, we may incur substantial monetary damages, encountersignificant delays in bringing our product candidates to market and be precluded from manufacturing or selling our product candidates.29Source: AGENUS INC, 10-K, March 18, 2019Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results.The cost of any patent litigation or other proceeding, even if resolved in our favor, could be substantial. Some of our competitors may be able tosustain the cost of such litigation and proceedings more effectively than we can because of their substantially greater resources. Uncertainties resulting fromthe initiation and continuation of patent litigation or other proceedings could have a material adverse effect on our ability to compete in the marketplace.Patent litigation and other proceedings may also absorb significant management time. If we fail to comply with our obligations under our intellectual property licenses with third parties, we could lose license rights that are important toour business.We are currently party to various intellectual property license agreements. These license agreements impose, and we expect that future licenseagreements may impose, various diligence, milestone payment, royalty, insurance and other obligations on us. These licenses typically include an obligationto pay an upfront payment, yearly maintenance payments and royalties on sales. If we fail to comply with our obligations under the licenses, the licensorsmay have the right to terminate their respective license agreements, in which event we might not be able to market any product that is covered by theagreements. Termination of the license agreements or reduction or elimination of our licensed rights may result in our having to negotiate new or reinstatedlicenses with less favorable terms, which could adversely affect our competitive business position and harm our business.If we are unable to protect the confidentiality of our proprietary information, the value of our technology and products could be adversely affected.In addition to patent protection, we also rely on other proprietary rights, including protection of trade secrets, and other proprietary information. Tomaintain the confidentiality of trade secrets and proprietary information, we enter into confidentiality agreements with our employees, consultants,collaborators and others upon the commencement of their relationships with us. These agreements require that all confidential information developed by theindividual or made known to the individual by us during the course of the individual’s relationship with us be kept confidential and not disclosed to thirdparties. Our agreements with employees and our personnel policies also provide that any inventions conceived by the individual in the course of renderingservices to us shall be our exclusive property. However, we may not obtain these agreements in all circumstances, and individuals with whom we have theseagreements may not comply with their terms. Thus, despite such agreement, such inventions may become assigned to third parties. In the event ofunauthorized use or disclosure of our trade secrets or proprietary information, these agreements, even if obtained, may not provide meaningful protection,particularly for our trade secrets or other confidential information. To the extent that our employees, consultants or contractors use technology or know-howowned by third parties in their work for us, disputes may arise between us and those third parties as to the rights in related inventions. To the extent that anindividual who is not obligated to assign rights in intellectual property to us is rightfully an inventor of intellectual property, we may need to obtain anassignment or a license to that intellectual property from that individual, or a third party or from that individual’s assignee. Such assignment or license maynot be available on commercially reasonable terms or at all.Adequate remedies may not exist in the event of unauthorized use or disclosure of our proprietary information. The disclosure of our trade secretswould impair our competitive position and may materially harm our business, financial condition and results of operations. Costly and time-consuminglitigation could be necessary to enforce and determine the scope of our proprietary rights, and failure to maintain trade secret protection could adverselyaffect our competitive business position. In addition, others may independently discover or develop our trade secrets and proprietary information, and theexistence of our own trade secrets affords no protection against such independent discovery.As is common in the biopharmaceutical industry, we employ individuals who were previously or concurrently employed at research institutionsand/or other biopharmaceutical, biotechnology or pharmaceutical companies, including our competitors or potential competitors. We may be subject toclaims that these employees, or we, have inadvertently or otherwise used or disclosed trade secrets or other proprietary information of their former employers,or that patents and applications we have filed to protect inventions of these employees, even those related to one or more of our product candidates, arerightfully owned by their former or concurrent employer. Litigation may be necessary to defend against these claims. Even if we are successful in defendingagainst these claims, litigation could result in substantial costs and be a distraction to management.Obtaining and maintaining our patent protection depends on compliance with various procedural, documentary, fee payment and other requirementsimposed by governmental patent agencies, and our patent protection could be reduced or eliminated for non-compliance with these requirements.Periodic maintenance fees, renewal fees, annuity fees and various other governmental fees on patents and/or applications will be due to the USPTOand various foreign patent offices at various points over the lifetime of our patents and/or applications. We have systems in place to remind us to pay thesefees, and we rely on our outside counsel or service providers to pay these fees when due. Additionally, the USPTO and various foreign patent offices requirecompliance with a number of procedural, documentary, fee payment and other similar provisions during the patent application process. We employ reputablelaw firms and other professionals to30Source: AGENUS INC, 10-K, March 18, 2019Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results.help us comply, and in many cases, an inadvertent lapse can be cured by payment of a late fee or by other means in accordance with rules applicable to theparticular jurisdiction. However, there are situations in which noncompliance can result in abandonment or lapse of the patent or patent application, resultingin partial or complete loss of patent rights in the relevant jurisdiction. If such an event were to occur, it could have a material adverse effect on our business.In addition, we are responsible for the payment of patent fees for patent rights that we have licensed from other parties.If any licensor of these patents does not itself elect to make these payments, and we fail to do so, we may be liable to the licensor for any costs andconsequences of any resulting loss of patent rights.Changes in U.S. patent law could diminish the value of patents in general, thereby impairing our ability to protect our product candidates.Obtaining and enforcing patents in the biopharmaceutical industry involves both technological and legal complexity, and therefore, is costly, time-consuming and inherently uncertain. In addition, the United States has enacted and implemented wide-ranging patent reform legislation. Further, recent U.S.Supreme Court rulings have either narrowed the scope of patent protection available in certain circumstances or weakened the rights of patent owners incertain situations. In addition to increasing uncertainty with regard to our ability to obtain patents in the future, this combination of events has createduncertainty with respect to the value of patents, once obtained.For our U.S. patent applications containing a claim not entitled to priority before March 16, 2013, there is a greater level of uncertainty in the patentlaw. In September 2011, AIA was signed into law. The AIA includes a number of significant changes to U.S. patent law, including provisions that affect theway patent applications are prosecuted and also affect patent litigation. The USPTO has developed regulations and procedures to govern administration ofthe AIA, and many of the substantive changes to patent law associated with the AIA. It is not clear what other, if any, impact the AIA will have on theoperation of our business. Moreover, the AIA and its implementation could increase the uncertainties and costs surrounding the prosecution of our patentapplications and the enforcement or defense of our issued patents, all of which could have a material adverse effect on our business and financial condition.An important change introduced by the AIA is that, as of March 16, 2013, the United States transitioned to a “first-inventor-to- file” system fordeciding which party should be granted a patent when two or more patent applications are filed by different parties claiming the same invention. A thirdparty that files a patent application in the USPTO after that date but before us could therefore be awarded a patent covering an invention of ours even if wehad made the invention before it was made by the third party. This requires us to be cognizant going forward of the time from invention to filing of a patentapplication. Furthermore, our ability to obtain and maintain valid and enforceable patents depends on whether the differences between our technology andthe prior art allow our technology to be patentable over the prior art. Since patent applications in the United States and most other countries are confidentialfor a period of time after filing, we cannot be certain that we were the first to either (i) file any patent application related to our product candidates or (ii)invent any of the inventions claimed in our patents or patent applications.Among some of the other changes introduced by the AIA are changes that limit where a patentee may file a patent infringement suit and providingopportunities for third parties to challenge any issued patent in the USPTO. This applies to all of our U.S. patents, even those issued before March 16, 2013.Because of a lower evidentiary standard in USPTO proceedings compared to the evidentiary standard in United States federal court necessary to invalidate apatent claim, a third party could potentially provide evidence in a USPTO proceeding sufficient for the USPTO to hold a claim invalid even though the sameevidence would be insufficient to invalidate the claim if first presented in a district court action. Accordingly, a third party may attempt to use the USPTOprocedures to invalidate our patent claims that would not have been invalidated if first challenged by the third party as a defendant in a district court action.We may be subject to claims that our employees, consultants or independent contractors have wrongfully used or disclosed confidential information ofthird parties.We may have received confidential and proprietary information from third parties. In addition, we employ individuals who were previously employedat other biopharmaceutical, biotechnology or pharmaceutical companies. We may be subject to claims that we or our employees, consultants or independentcontractors have inadvertently or otherwise improperly used or disclosed confidential information of these third parties or our employees’ former employers.Further, we may be subject to ownership disputes in the future arising, for example, from conflicting obligations of consultants or others who are involved indeveloping our product candidates. We may also be subject to claims that former employees, consultants, independent contractors, collaborators or otherthird parties have an ownership interest in our patents or other intellectual property. Litigation may be necessary to defend against these and other claimschallenging our right to and use of confidential and proprietary information. If we fail in defending any such claims, in addition to paying monetarydamages, we may lose our rights therein. Such an outcome could have a material adverse effect on our business. Even if we are successful in defendingagainst these claims, litigation could result in substantial cost and be a distraction to our management and employees.31Source: AGENUS INC, 10-K, March 18, 2019Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results.We may not be able to protect our intellectual property rights throughout the world.Filing, prosecuting and defending patents on our product candidates in all countries throughout the world would be prohibitively expensive. Therequirements for patentability may differ in certain countries, particularly developing countries. For example, China has a heightened requirement forpatentability, and specifically requires a detailed description of medical uses of a claimed drug. In addition, the laws of some foreign countries do not protectintellectual property rights to the same extent as laws in the United States. Consequently, we may not be able to prevent third parties from practicing ourinventions in all countries outside the United States. Competitors may use our technologies in jurisdictions where we have not obtained patent protection todevelop their own products and, further, may export otherwise infringing products to territories where we have patent protection, but enforcement oninfringing activities is inadequate. These products may compete with our product candidates, and our patents or other intellectual property rights may not beeffective or sufficient to prevent them from competing.Many companies have encountered significant problems in protecting and defending intellectual property rights in foreign jurisdictions. The legalsystems of certain countries, particularly certain developing countries, do not favor the enforcement of patents and other intellectual property protection,particularly those relating to biopharmaceuticals, which could make it difficult for us to stop the infringement of our patents or marketing of competingproducts in violation of our proprietary rights generally. Proceedings to enforce our patent rights in foreign jurisdictions could result in substantial costs anddivert our efforts and attention from other aspects of our business, could put our patents at risk of being invalidated or interpreted narrowly and our patentapplications at risk of not issuing, and could provoke third parties to assert claims against us. We may not prevail in any lawsuits that we initiate and thedamages or other remedies awarded, if any, may not be commercially meaningful. In addition, certain countries in Europe and certain developing countries,including India and China, have compulsory licensing laws under which a patent owner may be compelled to grant licenses to third parties. In thosecountries, we may have limited remedies if our patents are infringed or if we are compelled to grant a license to our patents to a third party, which couldmaterially diminish the value of those patents. This could limit our potential revenue opportunities. Accordingly, our efforts to enforce our intellectualproperty rights around the world may be inadequate to obtain a significant commercial advantage from the intellectual property that we own or license.Finally, our ability to protect and enforce our intellectual property rights may be adversely affected by unforeseen changes in foreign intellectual propertylaws.Risks Related to LitigationWe may face litigation or regulatory investigations that could result in substantial damages and may divert management’s time and attention from ourbusiness.From time to time we may become a party to legal proceedings, claims and investigations that arise in the ordinary course of business such as, but notlimited to, patent, employment, securities, commercial and environmental matters. While we currently believe that the ultimate outcome of any of theseproceedings will not have a material adverse effect on our financial position, results of operations, or liquidity, litigation is subject to inherent uncertainty.Furthermore, litigation and regulatory investigations consume both cash and management attention.We maintain property and general commercial insurance coverage as well as errors and omissions insurance policies. This insurance coverage may notbe sufficient to cover us for all potential claims or a claim may be made for which we are not covered by insurance, in which case the damages could have amaterial and adverse effect on the business.If we or our employees fail to comply with laws or regulations, it could adversely impact our reputation, business and stock price.We are exposed to the risk of employee fraud or other misconduct. Misconduct by employees could include intentional and/or negligent failures tocomply with FDA regulations, to provide accurate information to the FDA, to comply with manufacturing standards we have established, to comply withfederal and state health care fraud and abuse, transparency, and/or data privacy and security laws and regulations, to report financial information or dataaccurately or to disclose unauthorized activities to us. In particular, sales, marketing and business arrangements in the healthcare industry are subject toextensive laws and regulations intended to prevent fraud, kickbacks, self-dealing and other abusive practices; to promote transparency; and to protect theprivacy and security of patient data. These laws and regulations may restrict or prohibit a wide range of pricing, discounting, marketing and promotion, salescommission, customer incentive programs and other business arrangements.While we have adopted a corporate compliance program, we may not be able to protect against all potential issues of noncompliance. Efforts to ensurethat our business complies with all applicable healthcare laws and regulations will involve substantial costs. It is possible that governmental authorities willconclude that our business practices may not comply with current or future statutes, regulations, or case law involving applicable laws and regulations.32Source: AGENUS INC, 10-K, March 18, 2019Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results.Employee misconduct could also involve the improper use or disclosure of information obtained in the course of clinical trials, which could result inregulatory sanctions and serious harm to our reputation. In addition, during the course of our operations, our directors, executives and employees may haveaccess to material, nonpublic information regarding our business, our results of operations or potential transactions we are considering. We may not be able toprevent a director, executive or employee from trading in our common stock on the basis of, or while having access to, material, nonpublic information. If adirector, executive or employee was to be investigated, or an action was to be brought against a director, executive or employee for insider trading, it couldhave a negative impact on our reputation and our stock price. Such a claim, with or without merit, could also result in substantial expenditures of time andmoney, and divert the attention of our management team.Product liability and other claims against us may reduce demand for our products and/or result in substantial damages.We face an inherent risk of product liability exposure related to testing our product candidates in human clinical trials and manufacturing antibodiesin our Berkeley, CA facility and may face even greater risks if we ever sell products commercially. An individual may bring a product liability claim againstus if one of our product candidates causes, or merely appears to have caused, an injury. Product liability claims may result in: •regulatory investigations; •injury to our reputation; •withdrawal of clinical trial volunteers; •costs of related litigation; •substantial monetary awards to plaintiffs; and •decreased demand for any future products.We manufacture the Prophage vaccines from a patient’s cancer cells, and medical professionals must inject the vaccines into the same patient fromwhich they were manufactured. A patient may sue us if a hospital, a shipping company, or we fail to receive the removed cancer tissue or deliver that patient’svaccine. We do not have any other insurance that covers loss of or damage to the Prophage vaccines or tumor material, and we do not know whether suchinsurance will be available to us at a reasonable price or at all. We have limited product liability coverage for use of our product candidates. Our productliability policy provides $10.0 million aggregate coverage and $10.0 million per occurrence coverage. This limited insurance coverage may be insufficientto fully cover us for future claims.We are also subject to laws generally applicable to businesses, including but not limited to, federal, state and local wage and hour, employeeclassification, mandatory healthcare benefits, unlawful workplace discrimination and whistle-blowing. Any actual or alleged failure to comply with anyregulation applicable to our business or any whistle-blowing claim, even if without merit, could result in costly litigation, regulatory action or otherwiseharm our business, results of operations, financial condition, cash flow and future prospects.If we do not comply with environmental laws and regulations, we may incur significant costs and potential disruption to our business.We use or may use hazardous, infectious, and radioactive materials, and recombinant DNA in our operations, which have the potential of beingharmful to human health and safety or the environment. We store these hazardous (flammable, corrosive, toxic), infectious, and radioactive materials, andvarious wastes resulting from their use, at our facilities pending use and ultimate disposal. We are subject to a variety of federal, state, and local laws andregulations governing use, generation, storage, handling, and disposal of these materials. We may incur significant costs complying with both current andfuture environmental health and safety laws and regulations. In particular, we are subject to regulation by the Occupational Safety and Health Administration,the Environmental Protection Agency, the Drug Enforcement Agency, the Department of Transportation, the Centers for Disease Control and Prevention, theNational Institutes of Health, the International Air Transportation Association, and various state and local agencies. At any time, one or more of theaforementioned agencies could adopt regulations that may affect our operations. We are also subject to regulation under the Toxic Substances Control Actand the Resource Conservation Development programs.Although we believe that our current procedures and programs for handling, storage, and disposal of these materials comply with federal, state, andlocal laws and regulations, we cannot eliminate the risk of accidents involving contamination from these materials. Although we have a workers’compensation liability policy, we could be held liable for resulting damages in the event of an accident or accidental release, and such damages could besubstantially in excess of any available insurance coverage and could substantially disrupt our business.33Source: AGENUS INC, 10-K, March 18, 2019Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results.Risks Related to our Common StockProvisions in our organizational documents could prevent or frustrate attempts by stockholders to replace our current management.Our certificate of incorporation and bylaws contain provisions that could make it more difficult for a third party to acquire us without the consent ofour Board of Directors. Our certificate of incorporation provides for a staggered board and removal of directors only for cause. Accordingly, stockholders mayelect only a minority of our Board at any annual meeting, which may have the effect of delaying or preventing changes in management. In addition, underour certificate of incorporation, our Board of Directors may issue additional shares of preferred stock and determine the terms of those shares of stock withoutany further action by our stockholders. Our issuance of additional preferred stock could make it more difficult for a third party to acquire a majority of ouroutstanding voting stock and thereby effect a change in the composition of our Board of Directors. Our certificate of incorporation also provides that ourstockholders may not take action by written consent. Our bylaws require advance notice of stockholder proposals and director nominations and permit onlyour president or a majority of the Board of Directors to call a special stockholder meeting. These provisions may have the effect of preventing or hinderingattempts by our stockholders to replace our current management. In addition, Delaware law prohibits a corporation from engaging in a business combinationwith any holder of 15% or more of its capital stock until the holder has held the stock for three years unless, among other possibilities, the board of directorsapproves the transaction. Our Board of Directors may use this provision to prevent changes in our management. Also, under applicable Delaware law, ourBoard of Directors may adopt additional anti-takeover measures in the future.Our stock has historically had low trading volume, and its public trading price has been volatile.During the period from our initial public offering on February 4, 2000 to December 31, 2018, and the year ended December 31, 2018, the closing priceof our common stock has fluctuated between $1.59 (or $0.27 pre-reverse stock split) and $315.78 (or $52.63 pre-reverse stock split) per share and $1.59 and$6.04 per share, respectively. The average daily trading volume for the year ended December 31, 2018 was approximately 1,538,510 shares, while theaverage daily trading volume for the year ended December 31, 2017 was approximately 1,174,002. The market may experience significant price and volumefluctuations that are often unrelated to the operating performance of individual companies. In addition to general market volatility, many factors may have asignificant adverse effect on the market price of our stock, including: •continuing operating losses, which we expect over the next several years as we continue our development activities; •announcements of decisions made by public officials or delays in any such announcements; •results of our pre-clinical studies and clinical trials or delays in anticipated timing; •delays in our regulatory filings or those of our partners; •announcements of new collaboration agreements with strategic partners or developments by our existing collaboration partners; •announcements of acquisitions; •announcements of technological innovations, new commercial products, failures of products, or progress toward commercialization by ourcompetitors or peers; •failure to realize the anticipated benefits of acquisitions; •developments concerning proprietary rights, including patent and litigation matters; •publicity regarding actual or potential results with respect to product candidates under development; •quarterly fluctuations in our financial results, including our average monthly cash used in operating activities; •variations in the level of expenses related to any of our product candidates or clinical development programs; •additions or departures of key management or scientific personnel; •conditions or trends in the biopharmaceutical, biotechnology and pharmaceutical industries generally; •other events or factors, including those resulting from war, incidents of terrorism, natural disasters or responses to these events; •changes in accounting principles;34Source: AGENUS INC, 10-K, March 18, 2019Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results. •general economic and market conditions and other factors that may be unrelated to our operating performance or the operating performance ofour competitors, including changes in market valuations of similar companies; and •sales of common stock by us or our stockholders in the future, as well as the overall trading volume of our common stock.In the past, securities class action litigation has often been brought against a company following a significant decline in the market price of itssecurities. This risk is especially relevant for us because many biopharmaceutical, biotechnology and pharmaceutical companies experience significant stockprice volatility.The trading market for our common stock will depend in part on the research and reports that securities or industry analysts publish about us or ourbusiness. If one or more of the analysts who covers us downgrades our stock, or publishes inaccurate or unfavorable research about our business, our stockprice would likely decline. If one or more of these analysts ceases coverage of us or fails to publish reports on us regularly, demand for our stock coulddecrease, which could cause our stock price and trading volume to decline.The sale of a significant number of shares could cause the market price of our stock to decline.The sale by us or the resale by stockholders of a significant number of shares of our common stock could cause the market price of our common stockto decline. As of March 11, 2019, we had 134,205,374 shares of common stock outstanding. All of these shares are eligible for sale on Nasdaq, althoughcertain of the shares are subject to sales volume and other limitations. We have filed registration statements to permit the sale of approximately 31,200,000shares of common stock under our equity incentive plans, and to permit the sale of 1,500,000 shares of common stock under our 2015 Inducement EquityPlan. We have also filed registration statements to permit the sale of approximately 167,000 shares of common stock under our Employee Stock PurchasePlan, to permit the sale of 425,000 shares of common stock under our Directors’ Deferred Compensation Plan, to permit the sale of approximately 31,100,319shares of common stock pursuant to various private placement agreements and to permit the sale of up to 50,000,000 shares of our common stock pursuant toour At Market Issuance Sales Agreement. As of the date of filing, an aggregate of approximately 63,749,000 of these shares remained available for sale. InOctober 2018, we completed a private placement of 18,459 shares of Series C-1 convertible preferred stock, convertible into 18,459,000 shares of commonstock. The resale of all 18,459,000 shares of common stock underlying the 18,459 shares of Series C-1 convertible preferred stock was registered with theSEC pursuant to a Registration Statement on Form S-3 filed with the SEC on November 8, 2018 and declared effective on December 10, 2018. As part of ourcollaboration with Gilead, we completed a private placement of 11,111,111 shares of common stock in January 2019, the resale of which must be registeredwith the SEC by December 2019. In connection with our acquisition of 4-AB in February 2014, we are obligated to make contingent milestone payments tothe former shareholders of 4-AB, payable in cash or shares of our common stock at our option, as follows (i) $10.0 million upon our market capitalizationexceeding $750.0 million for 30 consecutive trading days prior to the earliest of (a) February 12, 2024, (b) the sale of 4-AB or (c) the sale of Agenus and(ii) $10.0 million upon our market capitalization exceeding $1.0 billion for 30 consecutive trading days prior to the earliest of (a) February 12, 2024, (b) thesale of 4-AB or (c) the sale of Agenus. In connection with our acquisition of PhosImmune in December 2015, we issued 1,631,521 shares of our commonstock to the shareholders of PhosImmune and other third parties having a fair market value of approximately $7.4 million at closing. In addition, we may beobligated in the future to pay certain contingent milestones payments, payable at our election in cash or shares of our common stock of up to $35.0 million inthe aggregate. If we elect to pay any of these contingent milestones in shares, we are obligated to file registration statements covering any such shares. Themarket price of our common stock may decrease based on the expectation of such sales.As of December 31, 2018, warrants to purchase approximately 2,900,000 shares of our common stock with a weighted average exercise price per shareof $4.52 were outstanding.As of December 31, 2018, options to purchase 18,613,822 shares of our common stock with a weighted average exercise price per share of $4.15 wereoutstanding. These options are subject to vesting that occurs over a period of up to four years following the date of grant. As of December 31, 2018, we had10,083,270 vested options and 2,213,967 non-vested shares outstanding.As of December 31, 2018, our outstanding shares of Series A-1 Convertible Preferred Stock were convertible into 333,333 shares of our common stock.As of December 31, 2018, our outstanding shares of Series C-1 Convertible Preferred Stock were convertible into 18,459,000 shares of our commonstock. In February 2019, holders of shares of Series C-1 Convertible Preferred Stock converted a portion of such shares into 3,000,000 shares of our commonstock.Any Biotech Electronic Security Tokens (the “Tokens”) we issue will be convertible into common stock in the event AGEN2034 is not approved forcommercial sale by the FDA before December 31, 2021, which would dilute our shareholders. If the price per share of our common stock at the time ofconversion, based on a trailing weighted average, is $10 or less, a holder of Tokens35Source: AGENUS INC, 10-K, March 18, 2019Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results.would be permitted to convert 10 Tokens for 1 share of common stock. If the price per share is above $10, a holder would be permitted to convert 10 Tokensinto a fraction of share of common stock with a value of $10. The Company will retain the right to pay cash upon conversion, rather than deliver shares.We may issue additional common stock, preferred stock, restricted stock units, or securities convertible into or exchangeable for our common stock.Furthermore, substantially all shares of common stock for which our outstanding stock options or warrants are exercisable are, once they have beenpurchased, eligible for immediate sale in the public market. The issuance of additional common stock, preferred stock, restricted stock units, or securitiesconvertible into or exchangeable for our common stock or the exercise of stock options or warrants would dilute existing investors and could adversely affectthe price of our securities. In addition, such securities may have rights senior to the rights of securities held by existing investors.We do not intend to pay cash dividends on our common stock and, consequently your ability to obtain a return on your investment will depend onappreciation in the price of our common stock.We have never declared or paid any cash dividend on our common stock and do not intend to do so in the foreseeable future. We currently anticipatethat we will retain future earnings for the development, operation and expansion of our business. Therefore, the success of an investment in shares of ourcommon stock will depend upon any future appreciation in their value. There is no guarantee that shares of our common stock will appreciate in value ormaintain their current value.Failure to maintain effective internal controls in accordance with Section 404 of the Sarbanes-Oxley Act of 2002 and to comply with changingregulation of corporate governance and public disclosure could have a material adverse effect on our operating results and the price of our common stock.The Sarbanes-Oxley Act of 2002 and rules adopted by the SEC and Nasdaq have resulted in significant costs to us. In particular, our efforts to complywith Section 404 of the Sarbanes-Oxley Act of 2002 and related regulations regarding the required assessment of our internal control over financial reporting,and our independent registered public accounting firm’s audit of internal control over financial reporting, have required commitments of significantmanagement time. We expect these commitments to continue.Our internal control over financial reporting (as defined in Rules 13a-15 of the Exchange Act) is a process designed to provide reasonable assuranceregarding the reliability of financial reporting and the preparation of our consolidated financial statements for external purposes in accordance with U.S.GAAP. Because of its inherent limitations, internal control over financial reporting may not prevent or detect all deficiencies or weaknesses in our financialreporting. While our management has concluded that there were no material weaknesses in our internal control over financial reporting as of December 31,2018, our procedures are subject to the risk that our controls may become inadequate because of changes in conditions or as a result of a deterioration incompliance with such procedures. No assurance is given that our procedures and processes for detecting weaknesses in our internal control over financialreporting will be effective.Changing laws, regulations and standards relating to corporate governance and public disclosure, are creating uncertainty for companies. Laws,regulations and standards are subject to varying interpretations in some cases due to their lack of specificity, and as a result, their application in practice mayevolve over time as new guidance is provided, which could result in continuing uncertainty regarding compliance matters and higher costs caused byongoing revisions to disclosure and governance practices. If we fail to comply with these laws, regulations and standards, our reputation may be harmed, andwe might be subject to sanctions or investigation by regulatory authorities, such as the SEC. Any such action could adversely affect our operating results andthe market price of our common stock.Risks Related to our TokensThere is no assurance that we will sell a sufficient number of tokens, if any, to meet our business or financial goals.In February 2019, we announced the launch of our Tokens, which we intend to issue in accordance with Regulation D of the Securities Act of 1933, asamended (the “Securities Act”) and pursuant to a private placement offering memorandum (the “Offering”). We announced an anticipated closing date inMarch 2019 and the possibility for us to raise up to a maximum of $100 million in the Offering. As of the date of this filing, we have not closed on the sale ofany Tokens. The Tokens are being offered by us on a “best efforts basis,” meaning that there is no assurance that any or all of the offered Tokens will be soldand we can elect in our discretion not to issue any Tokens for any reason. In addition, we may sell Tokens in multiple rounds, and there can be no assurancethat even if we issue tokens in an initial round that we will initiate or complete one or more subsequent rounds.36Source: AGENUS INC, 10-K, March 18, 2019Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results.We intend to use any proceeds of the Offering to fund continued commercial manufacturing, commercialization readiness and clinical development activitiesfocused on combinations of AGEN2034 with other therapies and in indications beyond cervical cancer. If we are unable to raise adequate funds in theOffering, our ability to expand development opportunities for AGEN2034 may be limited. If the Offering does not result in substantial proceeds, it couldhave a material adverse effect on our ability to fund these objectives and carry out our related business plans. If we were unable to obtain adequate fundingfrom other sources, we would be required to make decisions about which businesses and projects to fund, and we might be required to decrease or eliminateexpenditures that we believe would have been advisable.There is no assurance that purchasers of our Tokens will receive a return on their investment.Pursuant to the terms of the Offering, each Token will entitle its holder (each, a “Tokenholder”) to receive certain payments following the firstcommercial sale in the U.S. of AGEN2034, if it receives applicable regulatory approvals. The Tokens are highly speculative and any return on an investmentin the Tokens is contingent upon numerous circumstances, many of which (including legal and regulatory conditions) are beyond our control. There is noassurance that purchasers will realize any return on their investments or that their entire investments will not be lost.If the Company is successful in commercializing AGEN2034, a significant portion of the net sales of such product in the U.S. will be paid toTokenholders until the Tokenholders are paid the full amount to which they are entitled pursuant to their purchase agreement. As a result, the Company maynot receive the full amount of net sales of such product for an extended period of time, if ever.Following an initial holding period, we intend to transfer the Tokens from a book-entry ledger to the blockchain, which utilizes technologies that areunproven.Following the holding period required by Rule 144 under the Securities Act for restricted securities, we intend to the transfer the record ownershipof Tokens from book-entry ledger maintained by a transfer agent to the blockchain. There can be no assurance that we will be able to make such transfer duetechnical or other limitations, and the ownership of the Tokens may continue to be recorded in a book-entry ledger indefinitely, which could adverselyimpact their adoption and liquidity. In the event that the Tokens are transferred to the blockchain, Tokenholders will be relying upon technologies that are new and unproven.The Tokens and their underlying blockchain may not function as intended, or might not be capable of completion, implementation or adoption for manyreasons, including technological defects or the inability to scale as contemplated. Any failures of the smart contract to operate as expected may result inunintended transactions that cannot be reversed, and Tokenholders may have more limited remedies than are available in the traditional securities markets. Inaddition, these technologies are quickly changing and adapting, so the Tokens and their underlying technology could also become outdated or obsolete,particularly if there is a lack of interest in ongoing technological support for the Tokens. Moreover, we have not yet selected which blockchain to utilize, andthere could be increased security risk with one blockchain over another, as well as potential vulnerability of some blockchains to a “51% attack” that couldresult in tampering with the ledger information. There can be no assurance that the selected blockchain will perform as intended once the Tokens aretransferred.We have not identified all the persons that we will need to provide services and functions critical to the maintenance of the Tokens and no assurancecan be given that we will be able to engage all necessary persons on acceptable terms, if at all.We need to identify and recruit additional qualified personnel with backgrounds in developing and distributing blockchain ledger technologies tomaintain Tokens. We have not identified all the persons that we will need to engage to provide services and functions critical to maintain the Tokens. Wecannot assure that we will be able to engage all such persons with the necessary expertise on the terms acceptable to us, or at all. Further, there can be noassurance given that if we are able to engage such service providers that they will be able to provide the services and functions meeting our specificationsand requirements. If we fail to identify and engage all such service providers or personnel, or if the providers fail to satisfy our specifications andrequirements, it could have a material adverse effect on our ability to develop and maintain the Tokens and related technology successfully.There is currently no trading market for the Tokens, and a trading market may never develop.There is currently no trading market available for the Tokens and no suitable platform pursuant to which Tokenholders may transfer or resell theirTokens (such a marketplace, a “Designated Marketplace”). Peer-to-peer trading will not be permitted unless and until Tokenholders are notified otherwise byus and informed of the requirements to do so. We are aware of certain Alternative Trading Systems (“ATSs”) that intend to facilitate secondary trading ofsecurity tokens, such as tZero and Templum, but we cannot provide any assurances as to whether any such ATS will become and remain operational andfacilitate trading of the Tokens. Even if an ATS becomes and remains operational, there is no guarantee that there will be a sufficient number of Tokensoutstanding to facilitate a liquid market. As a result, Tokenholders should be prepared to hold their Tokens indefinitely. In the event that the Tokens remainun-tradable indefinitely, the value of the Tokens could be materially adversely affected.37Source: AGENUS INC, 10-K, March 18, 2019Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results.We do not expect there to be any market makers to develop a trading market in the Tokens in the near future.Most securities that are publicly traded in the U.S. have one or more broker-dealers acting as “market makers” for the security. A market maker is afirm that stands ready to buy and sell the security on a regular and continuous basis at publicly quoted prices. In the event that a Designated Marketplace iscreated or developed, we do not believe that the Tokens will have any market makers at that time, which could contribute to a lack of liquidity in the Tokens,and could have a material adverse effect on holders’ ability to trade the Tokens. We cannot provide any assurances as to if or when we will be able to appointany market makers for the Tokens that are satisfactory to us.The prices of digital assets have been extremely volatile and the Tokens may be subject to significant price volatility.The prices of digital assets have historically been subject to dramatic fluctuations and are highly volatile, and the market price of the Tokens may alsobe highly volatile. Several factors may influence the market price, if any, of the Tokens, including, but not limited to: •the ability of the Tokens to trade in a secondary market, if at all; •the availability of a Designated Marketplace or other trading platform for digital assets; •global digital asset and security token supply; •global digital asset demand, the security of online digital asset exchanges and digital wallets that hold digital assets, the perception thatthe use and holding of digital assets is safe and secure and the regulatory restrictions on their use; •changes in the software, software requirements or hardware requirements underlying the Tokens; •changes in the rights, obligations, incentives or rewards for the various Tokenholders; •interruptions in service from or failures of major digital asset and security token exchanges on which digital assets and security tokensare traded; •investment and trading activities of large purchasers, including private and registered funds, that may directly or indirectly invest insecurities tokens or other digital assets; •regulatory measures, if any, that affect the use of digital assets and security tokens such as the Tokens; and •expectations among digital assets participants that the value of security tokens or other digital assets will soon change.A decrease in the price of a single digital asset may cause volatility in the entire digital asset and security token industry and may affect other digitalassets including the Tokens. Such volatility in the price of the Tokens may result in significant loss over a short period of time.Tokenholders will generally not have voting rights and will generally have no ability to influence our decisions.Tokenholders will have no voting rights except as required by Delaware law. As a result, except with respect to matters required to be submitted toTokenholders under Delaware law, all matters submitted to stockholders will be decided by the vote of holders of our capital stock entitled to vote thereon,which shall not include the Tokens. As a result, Tokenholders will have no ability to elect directors or, except with respect to matters required to be submittedto Tokenholders under Delaware law, to determine the outcome of any other matters submitted to a vote of our stockholders.We do not expect to pay any dividends on the Tokens.Dividends will not be paid with respect to the Tokens. 38Source: AGENUS INC, 10-K, March 18, 2019Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results.Issuances by us of additional securities, whether in traditional or token format, could affect ownership and voting rights over us. In addition, theissuance of preferred shares, or options or warrants to purchase those preferred shares, could negatively impact the value of the Tokens as the result ofpreferential dividend rights, conversion rights, redemption rights and liquidation provisions granted to the stockholders of such preferred shares.From time to time, we may issue in public or private sales additional securities to third party investors. Such securities may provide holders withownership and voting rights that could provide the holders thereof with substantial influence over the Company and its operations. Any preferred shares thatmay be issued shall have such rights, preferences, privileges and restrictions as may be designated from time-to-time by our board, including preferentialdividend rights, voting rights, conversion rights, redemption rights and liquidation provisions. There cannot be any assurance that we will not issue preferredsecurities with rights and preferences that are more beneficial than those provided to Tokenholders.The Tokens will be subject to complex and evolving U.S. and foreign laws and regulations regarding privacy, technology, data protection and othermatters. Many of these laws and regulations are subject to change and uncertain interpretation, and could result in claims, increased cost of operations orotherwise harm our business.The Tokens will be subject to a variety of laws and regulations in the U.S. and abroad, including user privacy, blockchain technology, broker dealer,data protection and intellectual property, among others. Foreign data protection, privacy, broker dealer and other laws and regulations are often morerestrictive than those in the U.S. These U.S. federal and state and foreign laws and regulations are constantly evolving and can be subject to significantchange. In addition, the application and interpretation of these laws and regulations are often uncertain.The risk of our being found in violation of these or other laws and regulations in connection with the Tokens is further increased by the fact that manyof them have not been fully interpreted by the regulatory authorities or the courts and are open to a variety of interpretations. Any action brought against usfor violation of these or other laws or regulations, even if we successfully defend against it, could cause us to incur significant legal expenses and divert ourmanagement’s attention from the operation of our business. If our operations are found to be in violation of any of these laws and regulations, we may besubject to any applicable penalty associated with the violation, including civil and criminal penalties, damages and fines, we could be required to refundpayments received by us, and we could be required to curtail or cease our operations. Any of the foregoing consequences could seriously harm our businessand our financial results. These existing and proposed laws and regulations can be costly to comply with and can result in negative publicity, increase ouroperating costs, require significant management time and attention, and subject us to claims or other remedies, including fines or demands that we modify orceases existing practices. In addition, due to the novelty of the Tokens and the uncertain and evolving laws and regulations that apply, insuranceunderwriters may be unwilling to provide coverage for claims relating to the Tokens on terms acceptable to us, if at all. Any claims related to the Tokens orthe Offering could have a material adverse effect on our current and future business.The Staff of the SEC’s Division of Enforcement and other regulatory agencies are conducting investigations regarding offerings of securities similar tothe Tokens.Recently, the Division of Enforcement of the SEC and other regulatory agencies have undertaken investigations of offerings of securities similar to theTokens. Should the SEC or other agency choose to investigate the Offering or Token trading more generally, such investigations could result in delay of theOffering, negative publicity for us, and may have a material adverse effect on our current and future business. Item 1B.Unresolved Staff CommentsNone. Item 2.PropertiesWe lease our manufacturing, research and development, and corporate offices in Lexington, Massachusetts occupying approximately 82,000 squarefeet. This lease agreement terminates in August 2023 with an option to renew for one additional ten-year period.During December 2012 we entered into a commercial lease for approximately 5,600 square feet of office space in New York, New York for use ascorporate offices that terminates in May 2020.We also lease research and office facilities in Cambridge, United Kingdom. This lease terminates in November 2025.In December 2015, we acquired a manufacturing facility with approximately 24,000 square feet in Berkeley, California to be used in the productionand manufacture of antibody product candidates. In December 2015, we also entered into a commercial lease in39Source: AGENUS INC, 10-K, March 18, 2019Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results.Berkeley, California for approximately 10,900 square feet to be used for corporate offices which expires in December 2020. We also have a sublease inBerkeley, California for parking that expires in May 2020.We believe substantially all of our property and equipment is in good condition and that we have sufficient capacity to meet our current operationalneeds. We do not anticipate experiencing significant difficulty in retaining occupancy of any of our manufacturing or office facilities and will do so throughlease renewals prior to expiration or through replacing them with equivalent facilities. Item 3.Legal ProceedingsWe are not party to any material legal proceedings. Item 4.Mine Safety DisclosuresNot applicable. 40Source: AGENUS INC, 10-K, March 18, 2019Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results.PART II Item 5.Market for Registrant’s Common Equity, Related Stockholder Matters and Issuer Purchases of Equity SecuritiesOur common stock is currently listed on The Nasdaq Capital Market under the symbol “AGEN.” As of March 4, 2019, there were 389 holders of recordand 25,576 beneficial holders of our common stock.We have never paid cash dividends on our common stock, and we do not anticipate paying any cash dividends in the foreseeable future. We currentlyintend to retain future earnings, if any, for the future operation and expansion of our business. Any future payment of dividends on our common stock will beat the discretion of our Board of Directors and will depend upon, among other things, our earnings, financial condition, capital requirements, level ofindebtedness, and other factors that our Board of Directors deem relevant.Stock PerformanceThe following graph shows the cumulative total stockholder return on our common stock over the period spanning December 31, 2013 to December31, 2018, as compared with that of the Nasdaq Stock Market (U.S. Companies) Index and the Nasdaq Biotechnology Index, based on an initial investment of$100 in each on December 31, 2013. Total stockholder return is measured by dividing share price change plus dividends, if any, for each period by the shareprice at the beginning of the respective period and assumes reinvestment of dividends.This stock performance graph shall not be deemed “filed” with the SEC or subject to Section 18 of the Exchange Act, nor shall it be deemedincorporated by reference in any of our filings under the Securities Act of 1933, as amended (the “Securities Act”).COMPARISON OF CUMULATIVE TOTAL RETURN OF AGENUS INC.,NASDAQ STOCK MARKET (U.S. COMPANIES) INDEXAND NASDAQ BIOTECHNOLOGY INDEX 12/31/2013 12/31/2014 12/31/2015 12/31/2016 12/31/2017 12/31/2018 Agenus Inc. 100.00 150.38 171.97 156.06 123.48 90.15 NASDAQ Stock Market (U.S. Companies) Index 100.00 113.40 119.89 128.89 165.29 158.87 NASDAQ Biotechnology Index 100.00 131.57 149.42 117.02 141.66 128.45 41Source: AGENUS INC, 10-K, March 18, 2019Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results. Item 6.Selected Financial DataWe have derived the condensed consolidated balance sheet data set forth below as of December 31, 2018 and 2017, and the condensed consolidatedstatement of operations data for each of the years in the three-year period ended December 31, 2018, from our audited consolidated financial statementsincluded elsewhere in this Annual Report on Form 10-K.You should read the selected condensed consolidated financial data in conjunction with “Management’s Discussion and Analysis of FinancialCondition and Results of Operations,” our consolidated financial statements, and the notes to our consolidated financial statements included elsewhere inthis Annual Report on Form 10-K.Changes in cash, cash equivalents, and short-term investments, total current assets, total assets, total current liabilities, long-term debt andstockholders’ (deficit) equity in the periods presented below include the effects of the receipt of net proceeds from our debt offerings, equity offerings, royaltymonetization transactions, the exercise of stock options, and employee stock purchases that totaled approximately $291.2 million, $81.5 million, $3.4million, $220.4 million, and $57.0 million in the years ended December 31, 2018, 2017, 2016, 2015, and 2014, respectively. For the Year Ended December 31, 2018 2017 2016 2015 2014 (in thousands except per share data) Condensed Consolidated Statement of Operations Data: Revenue $36,784 $42,877 $22,573 $24,817 $6,977 Operating expenses: Research and development (124,600) (116,125) (94,971) (70,444) (22,349)General and administrative (37,340) (33,741) (33,126) (28,370) (21,250)Contingent purchase price consideration fair value adjustment 1,335 3,188 (1,953) (6,704) (6,699)Operating loss (123,822) (103,801) (107,477) (80,701) (43,321)Loss on early extinguishment of debt (10,767) — — — — Non-operating income (expense) (2,183) 1,977 (2,202) (5,968) 2,096 Interest expense, net (25,273) (18,868) (17,316) (6,599) (1,261)Loss before taxes (162,044) (120,692) (126,995) (93,268) (42,486)Income tax benefit (1) — — — 5,387 — Net loss (162,044) (120,692) (126,995) (87,881) (42,486)Dividends on Series A-1 convertible preferred stock (207) (206) (204) (203) (204)Less: net loss attributable to non-controlling interest (2,352) — — — — Net loss attributable to Agenus Inc. common stockholders $(159,899) $(120,898) $(127,199) $(88,084) $(42,690)Net loss attributable to Agenus Inc. common stockholders per common share, basic and diluted $(1.44) $(1.23) $(1.46) $(1.13) $(0.71)Weighted average number of Agenus Inc. common shares outstanding, basic and diluted 110,772 98,415 87,070 78,212 59,754 As of December 31, 2018 2017 2016 2015 2014 (in thousands) Condensed Consolidated Balance Sheet Data: Cash, cash equivalents and short-term investments $53,054 $60,187 $76,437 $171,668 $40,224 Total current assets 74,808 73,554 91,312 184,095 42,670 Total assets 136,401 138,402 156,986 242,228 74,527 Total current liabilities 68,062 56,438 40,851 28,934 9,229 Long-term debt, less current portion 13,212 142,385 130,542 114,326 4,769 Series C-1 convertible preferred stock 39,879 — — — — Total stockholders' (deficit) equity (174,546) (75,816) (39,126) 70,728 23,018 (1)Given our history of incurring operating losses, no income tax benefit has been recognized in our consolidated statements of operations for the yearsended December 31, 2018, 2017, 2016, and 2014 because of the loss before income taxes, and the need to recognize a valuation allowance on theportion of our deferred tax assets which will not be offset by the reversal of deferred42Source: AGENUS INC, 10-K, March 18, 2019Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results.tax liabilities. For the year ended December 31, 2015, we recognized an income tax benefit as a result of the deferred tax liabilities recognized inconnection with the PhosImmune and XOMA antibody manufacturing facility acquisitions. 43Source: AGENUS INC, 10-K, March 18, 2019Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results.Item 7.Management’s Discussion and Analysis of Financial Condition and Results of OperationsOverviewAgenus Inc. (including its subsidiaries, collectively referred to as “Agenus,” the “Company,” “we,” “us,” and “our”) is a clinical-stage immuno-oncology (“I-O”) company with a pipeline of immune modulating antibodies, cancer vaccines, adjuvants and adoptive cell therapies dedicated to becominga leader in the discovery and development of innovative combination therapies and committed to bringing effective medicines to patients with cancer. Ourbusiness is designed to drive success in I-O through speed, innovation, and effective combination therapies. In addition to a diverse pipeline we haveassembled fully integrated capabilities including novel target discovery, antibody generation, cell line development, and good manufacturing practice(“GMP”) manufacturing We believe that these fully integrated capabilities enable us to produce novel candidates on timelines that are shorter than theindustry standard. Leveraging from our science and capabilities we have forged important partnerships to advance our innovation.We are developing a comprehensive I-O portfolio driven by the following platforms and programs, which we intend to utilize individually and incombination: •our antibody discovery platforms, including our Retrocyte Display™, SECANT® yeast display, and phage display technologies designed todrive the discovery of future CPM antibody candidates; •our antibody candidate programs, including our CPM programs; •our vaccine programs, including Prophage™, AutoSynVax™ and PhosphoSynVax ™; •our saponin-based vaccine adjuvants, principally our QS-21 Stimulon® adjuvant, or QS-21 Stimulon; and •our cell therapy subsidiary, AgenTus Therapeutics, which is designed to drive the discovery of future adoptive cell therapy, or “living drugs”(CAR-T and TCR) programs.We assess development, commercialization and partnering strategies for each of our product candidates periodically based on several factors,including pre-clinical and clinical trial results, competitive positioning and funding requirements and resources. We are currently advancing our proprietaryanti-CTLA-4 and anti-PD-1 antibodies in trials that are designed to be registrational and to support one or more BLA filings as soon as 2020.We have formed collaborations with companies such as Incyte Corporation (“Incyte”), Merck Sharpe & Dohme (“Merck”) and Recepta Biopharma SA(“Recepta”). Through these alliances, as well as our own internal programs, we currently have more than a dozen antibody programs in pre-clinical or clinicaldevelopment, including our anti-CTLA-4 and anti-PD-1 antibody programs (both partnered with Recepta for certain South America territories) and anti-GITRand anti-OX40 antibody programs (both partnered with Incyte). In February 2017, we amended our collaboration agreement with Incyte to, among otherthings, convert the GITR and OX40 programs from profit-share to royalty-bearing programs, and there are no longer any profit-share programs remainingunder the collaboration. Pursuant to the amended agreement, we received accelerated milestone payments of $20.0 million from Incyte related to the clinicaldevelopment of INCAGN1876 (anti-GITR agonist) and INCAGN1949 (anti-OX40 agonist). Concurrent with the execution of the amendment, we and Incytealso entered into the Stock Purchase Agreement whereby Incyte purchased an additional 10 million shares of our common stock at $6.00 per share, resultingin additional proceeds of $60.0 million to us. On September 20, 2018, we, through our wholly-owned subsidiary, Agenus Royalty Fund, LLC, entered into aRoyalty Purchase Agreement (the “XOMA Royalty Purchase Agreement”) with XOMA (US) LLC (“XOMA”). Pursuant to the terms of the XOMA RoyaltyPurchase Agreement, XOMA paid us $15.0 million at closing in exchange for the right to receive 33% of the future royalties and 10% of the future milestonesthat we are entitled to receive from Incyte and Merck, net of certain of our obligations to a third party and excluding the next milestone that we expect toreceive from Incyte. After taking into account our obligations under the XOMA Royalty Purchase Agreement, as of December 31, 2018, we remain eligible toreceive up to $450.0 million and $85.5 million in potential development, regulatory and commercial milestones from Incyte and Merck, respectively.In December 2018, we entered into a series of agreements with Gilead Sciences, Inc. (“Gilead”) to collaborate on the development andcommercialization of up to five novel I-O therapies. Pursuant to the collaboration agreements, we received an upfront cash payment from Gilead of $120.0million following the closing in January 2019 and are eligible to receive up to an additional $1.7 billion in aggregate potential fees and milestones. Atclosing, Gilead received worldwide exclusive rights to our bispecific antibody, AGEN1423. Gilead also received the exclusive option to license exclusivelyAGEN1223, a bispecific antibody, and AGEN2373, a monospecific antibody. We recently filed INDs for AGEN1423 and AGEN1223 and are planning to filean IND for AGEN2373 in the first half of 2019. We are responsible for developing the option programs up to the option decision points, at which time Gileadmay acquire exclusive rights to the programs on option exercise. For either, but not both, of the option programs, we have the right to opt-in to share Gilead’sdevelopment and commercialization costs in the United States in exchange for a profit (loss) share on a 50:50 basis and revised milestone payments. Gileadalso received the right of first negotiation for two additional,44Source: AGENUS INC, 10-K, March 18, 2019Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results.undisclosed preclinical programs. At the closing, Gilead also purchased 11,111,111 shares of Agenus common stock for $30.0 million pursuant to a stockpurchase agreement.In addition to our antibody platforms and CPM programs, we are also advancing a series of vaccine programs to treat cancer. In January 2017, weannounced a clinical trial collaboration with the National Cancer Institute (“NCI”), which is a double-blind, randomized controlled Phase 2 trial that isevaluating the effect of our autologous vaccine candidate, Prophage, in combination with pembrolizumab (Keytruda®, Merck & Co., Inc. (“Merck”)) inpatients with newly diagnosed glioblastoma. Under this collaboration, we are supplying Prophage, Merck is supplying pembrolizumab and the NCI andBrain Tumor Trials Collaborative member sites are recruiting patients and conducting the trial.Our QS-21 Stimulon adjuvant is partnered with GlaxoSmithKline (“GSK”) and is a key component in multiple GSK vaccine programs. These programsare in various stages, with the most advanced being GSK’s shingles vaccine, Shingrix. In 2015, we monetized a portion of the future royalties we werecontractually entitled to receive from GSK from sales of its shingles and malaria vaccines through a Note Purchase Agreement (“NPA”) and received netproceeds of approximately $78 million. In October 2017, GSK’s shingles vaccine was approved in the United States by the FDA and granted marketingauthorization in Canada by Health Canada, and in November 2017, we exercised our option to issue the $15.0 million in additional notes in accordance withthe terms of the NPA. In January 2018, we entered into a Royalty Purchase Agreement with Healthcare Royalty Partners III, L.P. and certain of its affiliates(together, “HCR”), pursuant to which HCR purchased 100% of our worldwide rights to receive royalties from GSK on GSK’s sales of vaccines containing ourQS-21 Stimulon adjuvant. We used the majority of the upfront proceeds from HCR to redeem all of the notes issued pursuant to the NPA, resulting in netproceeds to us of approximately $28.0 million at closing. We do not incur clinical development costs for products partnered with GSK. Pursuant to ouragreement with HCR, we are entitled to receive up to $40.35 million in milestone payments based on GSK’s sales of Shingrix as follows: (i) $15.1 millionupon reaching $2.0 billion last-twelve-months net sales any time prior to 2024 and (ii) $25.25 million upon reaching $2.75 billion last-twelve-months netsales any time prior to 2026. We are also obligated to pay HCR approximately $25.9 million in 2021 if neither of the following Shingrix sales milestones areachieved: (i) 2019 sales exceed $1.0 billion or (ii) 2020 sales exceed $1.75 billion. GSK began selling Shingrix commercially in the fourth quarter of 2017.In February 2019, GSK reported that Shingrix sales for 2018, its first full year on the market, were over $1.0 billion.Our business activities include product research and development, intellectual property prosecution, manufacturing, regulatory and clinical affairs,corporate finance and development activities, and support of our collaborations. Our product candidates require clinical trials and approvals from regulatoryagencies, as well as acceptance in the marketplace. Part of our strategy is to develop and commercialize some of our product candidates by continuing ourexisting arrangements with academic and corporate collaborators and licensees and by entering into new collaborations.In October 2017, we announced the launch of a subsidiary that is advancing our cell therapy business, AgenTus Therapeutics. The subsidiary isfocused on the discovery, development, and commercialization of breakthrough “living drugs” to advance cures for cancer patients. AgenTus Therapeuticslicenses intellectual property assets from Agenus and has its own management and governance.Our common stock is currently listed on The Nasdaq Capital Market under the symbol “AGEN.”Our research and development expenses for the years ended December 31, 2018, 2017, and 2016, were $124.6 million, $116.1 million, and $95.0million, respectively. We have incurred significant losses since our inception. As of December 31, 2018, we had an accumulated deficit of $1.18 billion.To date, we have financed our operations primarily through the sale of equity and debt securities. We believe that, based on our current plans andactivities, including additional funding we received in connection with our transactions with Gilead subsequent to December 31, 2018, our cash on-hand willbe sufficient to satisfy our liquidity requirements for more than one year from when these financial statements were issued. We may attempt to raise additionalfunds by: (1) pursuing collaboration, out-licensing and/or partnering opportunities for our portfolio programs and product candidates with one or more thirdparties, (2) renegotiating third party agreements, (3) selling assets, (4) securing additional debt financing and/or (5) selling equity securities. Satisfying long-term liquidity needs may require the successful commercialization and/or substantial out-licensing or partnering arrangements for our antibody discoveryplatforms, CPM antibody programs, and HSP-based vaccines. Our long-term success will also be dependent on the successful identification, development andcommercialization of potential other product candidates, each of which will require additional capital with no certainty of timing or probability of success. Ifwe incur operating losses for longer than we expect, and/or we are unable to raise additional capital, we may become insolvent and be unable to continue ouroperations.Historical Results of OperationsYear Ended December 31, 2018 Compared to the Year Ended December 31, 2017Research and development revenue45Source: AGENUS INC, 10-K, March 18, 2019Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results.We recognized research and development (“R&D”) revenue of approximately $19.5 million and $42.7 million during the years ended December 31,2018 and 2017, respectively. R&D revenues for the year ended December 31, 2018, primarily consisted of fees earned under our Collaboration Agreementwith Incyte, including $10.0 million related to the recognition of milestones and $4.1 million related to the reimbursement of development costs, which havedecreased due to the stage of the programs under the collaboration, and $4.0 million related to the recognition of a milestone under our license agreementwith Merck. R&D revenues for the year ended December 31, 2017, also primarily consisted of fees earned under our Collaboration Agreement with Incyteincluding $20.0 million related to the acceleration of milestone payments and $14.6 million related to the reimbursement of development costs in addition to$4.0 million related to the recognition of a milestone under our license agreement with Merck, $1.0 million related to the recognition of a milestone underour license agreement with GSK. During the years ended December 31, 2018 and 2017, we recorded revenue of $1.3 million and $3.1 million, respectively,from the amortization of deferred revenue. See Notes 2 and 14 to our Consolidated Financial Statements for additional discussion of our revenues, includingthe adoption of ASC 606 during the first quarter of 2018.Non-cash royalty revenue related to the sale of future royaltiesIn January 2018, we sold 100% of our worldwide rights to receive royalties from GSK on sales of GSK’s vaccines containing our QS-21 Stimulonadjuvant to HCR. As described in Note 18 to our Consolidated Financial Statements, this transaction has been recorded as a liability that amortizes over theestimated life of our Royalty Purchase Agreement with HCR. As a result of this liability accounting, even though the royalties are remitted directly to HCR,we record these royalties from GSK as revenue. During the year ended December 31, 2018, we recognized approximately $17.3 million in non-cash royaltyrevenue related to our agreement with GSK.Research and development expenseResearch and development expense include the costs associated with our internal research and development activities, including compensation andbenefits, occupancy costs, clinical manufacturing costs, contract research organization costs, costs of consultants, and related administrative costs. Researchand development expense increased 7% to $124.6 million for the year ended December 31, 2018 from $116.1 million for the year ended December 31, 2017.Increased expenses in the year ended December 31, 2018 primarily relate to a $7.3 million increase in third-party services and other related expenses largelyrelating to the advancement of our antibody programs and a $3.0 million increase in expenses attributable to the activities of our subsidiaries, AgenTusTherapeutics and our wholly-owned subsidiary in the United Kingdom, Agenus UK Limited, which increase was partially offset by a decrease in expensesdue to the closure of our facility in Basel, Switzerland in 2017. These increases were partially offset by a $1.6 million decrease in personnel related expenses,which consists of a $2.8 million decrease in share based compensation expense partially offset by a $1.2 million increase in other personnel related expenses,and a $0.3 million decrease in other R&D expenses.General and administrative expenseGeneral and administrative expense consists primarily of personnel costs, facility expenses, and professional fees. General and administrative expenseincreased 11% to $37.3 million for the year ended December 31, 2018 from $33.7 million for the year ended December 31, 2017. Increased general andadministrative expense in 2018 primarily relates to a $1.9 million increase in professional fees, a $1.0 million increase in other G&A expenses, and a $1.0million increase in expenses attributable to the activities of our subsidiaries, AgenTus Therapeutics and our wholly-owned subsidiary in the UnitedKingdom, Agenus UK Limited, which increase was partially offset by a decrease in expenses due to the closure of our facility in Basel, Switzerland in 2017.These increases were partially offset by a $0.3 million decrease in personnel related expenses, which consists of a $1.9 million decrease in share basedcompensation expense partially offset by a $1.7 million increase in other personnel related expenses.Contingent purchase price consideration fair value adjustmentContingent purchase price consideration fair value adjustment represents the change in the fair value of our contingent purchase price considerationduring the year ended December 31, 2018, which resulted from changes in our market capitalization and share price and changes in the credit spread since theprior year end. The fair value of our contingent purchase price consideration is based on estimates from a Monte Carlo simulation of our market capitalizationand share price.Loss on early extinguishment of debtLoss on early extinguishment of debt of $10.8 million for the year ended December 31, 2018 represents the payment of premiums and the write-off ofunamortized debt issuance costs and discounts incurred in connection with the full redemption and termination of Antigenics’ $115.0 million principalamount of notes issued pursuant to the Note Purchase Agreement dated September 4, 2015 with Oberland Capital SA Zermatt LLC and the purchasers namedtherein.46Source: AGENUS INC, 10-K, March 18, 2019Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results.Non-operating income (expense)Non-operating expense increased $4.2 million for the year ended December 31, 2018, from income of $2.0 million for the year ended December 31,2017, to expense of $2.2 million for the year ended December 31, 2018, primarily due to our increased foreign currency exchange losses in 2018 compared togains in 2017.Interest expense, netInterest expense, net increased to $25.3 million for the year ended December 31, 2018 from $18.9 million for the year ended December 31, 2017 dueto the January 2018 closing of the Royalty Purchase Agreement with HCR and the resulting increase in non-cash interest expense compared to the amountrecorded for our Note Purchase Agreement, which was outstanding in the year ended December 31, 2017, and fully redeemed and terminated simultaneouslywith the closing of the Royalty Purchase Agreement. Year Ended December 31, 2017 Compared to the Year Ended December 31, 2016Research and development revenueWe recognized research and development revenue of approximately $42.7 million and $22.4 million during the years ended December 31,2017 and 2016, respectively. R&D revenues primarily included fees earned under our license agreements, including approximately $14.6 million and$16.2 million for the years ended December 31, 2017, and 2016, respectively, related to reimbursement of development costs under our CollaborationAgreement with Incyte. The increase in total revenue for the year ended December 31, 2017 is primarily attributable to the $20.0 million in acceleratedmilestones, recognized as revenue during the twelve months ended December 31, 2017, related to the antibody candidates targeting GITR and OX40received in connection with the February 14, 2017 amendment to our License, Development and Commercialization Agreement with Incyte. During theyears ended December 31, 2017 and 2016, we recorded revenue of $3.1 million and $3.5 million, respectively, from the amortization of deferred revenue.Research and development expenseResearch and development expense increased 22% to $116.1 million for the year ended December 31, 2017 from $95.0 million for the year endedDecember 31, 2016. Increased expenses in 2017 primarily relate to a $17.6 million increase in third-party services and other expenses relating largely to theadvancement of our CPM antibody programs, a $3.3 million increase in payroll related costs primarily due to increased headcount, and a $0.6 millionincrease in depreciation expense, offset by a $0.4 million decrease in expense for our foreign subsidiaries due to the closure of our facility in Basel,Switzerland, which decrease was partially offset by increased expenses attributable to Agenus UK.General and administrative expenseGeneral and administrative expenses increased 2% to $33.7 million for the year ended December 31, 2017 from $33.1 million for the year endedDecember 31, 2016. Increased general and administrative expenses in 2017 primarily relate to a $1.8 million increase in payroll related costs primarily due toincreased headcount offset by a $0.6 million decrease in professional fees due to the reduced use of consultants and a $0.6 million decrease in expense for ourforeign subsidiaries due to the closure of our facility in Basel, Switzerland, which decrease was partially offset by increased expenses attributable to AgenusUK.Contingent purchase price consideration fair value adjustmentContingent purchase price consideration fair value adjustment represents the change in the fair value of our contingent purchase price considerationduring the year ended December 31, 2017, which resulted from changes in our market capitalization and share price and changes in the credit spread since theprior year end. The fair value of our contingent purchase price consideration is based on estimates from a Monte Carlo simulation of our market capitalizationand share price.Non-operating income (expense)Non-operating income increased by $4.2 million for the year ended December 31, 2017, from an expense of $2.2 million for the year ended December31, 2016, to income of $2.0 million for the year ended December 31, 2017, primarily due to our increased foreign currency exchange gains in 2017 comparedto losses in 2016.Interest expense, net47Source: AGENUS INC, 10-K, March 18, 2019Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results.Interest expense net increased to $18.9 million for the year ended December 31, 2017 from $17.3 million for the year ended December 31, 2016 due tothe compounding of interest on our debt under our Note Purchase Agreement and the issuance of additional notes under our NPA in November 2017.InflationWe believe that inflation has not had a material adverse effect on our business, results of operations, or financial condition to date.Research and Development Programs For the year ended December 31, 2018, our research and development programs consisted largely of our CPM antibody programs as indicated in thefollowing table (in thousands). For the Year Ended December 31, Research andDevelopment Program Product 2018 2017 2016 Prior to2016 Total Heat shock proteins for cancer Prophageand ASV $13,235 $12,499 $8,202 $315,189 $349,125 Antibody programs* Various 97,011 95,656 83,920 76,712 353,299 Vaccine adjuvant QS-21Stimulon 211 222 77 13,799 14,309 Other research and development programs 14,143 7,748 2,772 67,822 92,485 Total research and development expenses $124,600 $116,125 $94,971 $473,522 809,218 *Prior to 2014, costs were incurred by 4-AB, which we acquired in February 2014.Research and development program costs include compensation and other direct costs plus an allocation of indirect costs, based on certainassumptions and our review of the status of each program. Our product candidates are in various stages of development and significant additionalexpenditures will be required if we start new clinical trials, encounter delays in our programs, apply for regulatory approvals, continue development of ourtechnologies, expand our operations, and/or bring our product candidates to market. The total cost of any particular clinical trial is dependent on a number offactors such as trial design, length of the trial, number of clinical sites, number of patients, and trial sponsorship. The process of obtaining and maintainingregulatory approvals for new therapeutic products is lengthy, expensive, and uncertain. Because our CPM antibody programs are early stage, and becausefurther development of HSP-based vaccines is dependent on clinical trial results, among other factors, we are unable to reliably estimate the cost ofcompleting our research and development programs or the timing for bringing such programs to various markets or substantial partnering or out-licensingarrangements, and, therefore, when, if ever, material cash inflows are likely to commence. Active programs involving QS-21 Stimulon depend on our licenseesuccessfully completing clinical trials, successfully manufacturing QS-21 Stimulon to meet demand, obtaining regulatory approvals and successfullycommercializing product candidates containing QS-21 Stimulon. Product Development PortfolioAntibody Discovery Platforms and CPM ProgramsCheckpoint antibodies regulate immune response against pathogens that invade the body and are achieving positive outcomes in a number of cancersthat were untreatable only a few years ago. Two classes of checkpoint targets include:1.inhibitory checkpoints that help suppress an immune response in order to prevent excessive immune reaction resulting inundesired inflammation and/or auto-immunity, and2.stimulatory checkpoints that can enhance or amplify an antigen-specific immune response.We possess a suite of antibody discovery platforms that are designed to drive the discovery of future CPM antibody candidates. We are planning toemploy a variety of techniques to identify and optimize mono-specific and multi-specific antibody candidates, internally. We and our partners currently have more than a dozen antibody programs in pre-clinical or clinical development, including our anti-CTLA-4 and anti-PD-1 antibody programs (both partnered with Recepta for certain South America territories) and anti-GITR, anti-OX40, anti-LAG3 and anti-TIM3 antibodyprograms (all partnered with Incyte). For additional information regarding our48Source: AGENUS INC, 10-K, March 18, 2019Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results.antibody discovery platforms and checkpoint antibody program, please read Part I-Item 1. “Business” of this Annual Report on Form 10-K.Prophage Vaccine CandidatesOur early vaccine technology, Prophage (HSPPC-96), is an autologous cancer vaccine therapy derived from cancer tissues that are surgically removedfrom an individual patient designed to contain a broad sampling of potentially antigenic mutant proteins to educate the patient’s immune system to seek outand destroy cancer. To date, more than 1,000 patients have been treated with Prophage. Data reported at ASCO in 2015 demonstrated that patients withnewly diagnosed GBM (ndGBM) with lower immune suppression (measured by peripheral PD-L1 expression) had an improved response to vaccine. tofurther explore these findings, we announced a Phase 2 clinical trial collaboration with the National Cancer Institute (“NCI”) to evaluate Prophage incombination with pembrolizumab (Keytruda®). The trial is being conducted by the Brain Tumor Trials Collaborative (“BTTC”), led by by Dr. Mark Gilbert,Chief of the Neuro-Oncology Branch at the NCI Center for Cancer Research with product provided by Agenus and Merck. The trial is ongoing. For additionalinformation regarding regulatory risks and uncertainties, please read the risks identified under Part I-Item 1A. “Risk Factors” of this Annual Report on Form10-K.Neoantigen Vaccine PlatformsOur neoantigen vaccine platforms include: (i) individualized AutoSynVax™ (ASV™), which targets the unique antigens expressed by a patient’s owntumor, and (ii) off-the-shelf (or pre-manufactured) PhosphoSynVax™ (PSV™), which targets antigens expressed across patients and tumors, potentiallyenabling us to treat broader categories of patients.Mutation-based neo-epitopes, which will form the basis for the immunogens used in ASV, appear to be almost always particular to a given patient.Therefore, ASV is a largely individualized vaccine product candidate. With a small amount of a patient’s tumor as a sample, our ASV program is designed toutilize next generation sequencing technologies coupled with complex bioinformatics algorithms to identify mutations in a tumor’s DNA and RNA. Oncethese mutations have been identified, we plan to manufacture synthetic peptides encoding these neoepitopes, load these peptides on to our recombinantHSP70 and deliver a fully synthetic polyvalent vaccine to the patient. This program is based on the hypothesis that the HSP70 platform would shuttle themutated peptides to sites where they could be recognized by the immune system and elicit a cytotoxic and helper T cell response in patients with cancer.Biochemically based neoantigens, such as those arising from dysregulated phosphorylation of various proteins in malignant cells, can serve as a tumorfingerprint across a broad histology of tumors. Through our acquisition of PhosImmune, we have a portfolio of proprietary phosphorylated antigenic targetsthat can be used for therapeutic development. PSV is a vaccine candidate designed to induce immunity against this novel class of tumor specific neoepitopesknown as Phosphopeptides or PTTs. PSV is intended to induce cellular immunity to abnormal Phosphopeptide neoepitopes that are characteristic of thesevarious forms of cancer. We believe PTTs are among the most promising candidates for anti-cancer immunity, as patients with PTT immunity have beenshown to have better outcomes than those without PTT immunity. We have amassed a proprietary library of more than 2,000 PTTs. Many of these PTTs areshared among many cancer patients and across multiple tumor types. We are using these PTTs for developing multiple off-the-shelf vaccines. PSV is based onAgenus’ vaccine platform and includes our proprietary QS-21 Stimulon adjuvant and heat-shock protein backbone. Agenus is developing multipleindication-specific PSV offerings, with lead programs in acute myeloid leukemia (AML) and colorectal cancer (CRC). By leveraging our proprietary vaccineplatform which has already demonstrated clinical safety and immunogenicity, we intend to advance at least one PSV formulation into the clinic in 2019. Foradditional information regarding our Neoantigen Vaccine Platforms, please read Part I-Item 1. “Business” of this Annual Report on Form 10-K.QS-21 Stimulon AdjuvantQS-21 Stimulon is an adjuvant, which is a substance added to a vaccine or other immunotherapy that is intended to enhance an immune response tothe target antigens. QS-21 Stimulon is a natural product, a triterpene glycoside, or saponin, purified from the bark of the Chilean soapbark tree, Quillajasaponaria. QS-21 Stimulon has the ability to stimulate an antibody-mediated immune response and has also been shown to activate cellular immunity. It hasbecome a key component in the development of investigational preventive vaccine formulations across a wide variety of diseases. These studies have beencarried out by academic institutions and pharmaceutical companies in the United States and internationally. A number of these studies have shown QS-21Stimulon to be significantly more effective in stimulating immune responses than aluminum hydroxide or aluminum phosphate, the adjuvants mostcommonly used in approved vaccines in the United States today. In January 2019, we announced that the Bill & Melinda Gates Foundation awarded us agrant to develop an alternative, plant cell culture-based manufacturing process to ensure the continuous future supply of QS-21 Stimulon adjuvant, furthervalidating its importance to the global vaccines market. For additional information regarding QS-21 Stimulon, please read Part I-Item 1. “Business” of thisAnnual Report on Form 10-K.49Source: AGENUS INC, 10-K, March 18, 2019Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results.Liquidity and Capital ResourcesWe have incurred annual operating losses since inception, and we had an accumulated deficit of $1.18 billion as of December 31, 2018. We expect toincur significant losses over the next several years as we continue development of our technologies and product candidates, manage our regulatory processes,initiate and continue clinical trials, and prepare for potential commercialization of products. To date, we have financed our operations primarily through thesale of equity and debt securities, and interest income earned on cash, cash equivalents, and short-term investment balances. From our inception throughDecember 31, 2018, we have raised aggregate net proceeds of approximately $1.22 billion through the sale of common and preferred stock, the exercise ofstock options and warrants, proceeds from our Employee Stock Purchase Plan, royalty monetization transactions, and the issuance of convertible and othernotes.We maintain an effective registration statement (the “Registration Statement”), covering the offering of up to $250 million of common stock, preferredstock, warrants, debt securities and units. The Registration Statement includes prospectuses covering the offer, issuance and sale of up to 50 million shares ofour common stock from time to time in “at-the-market offerings” pursuant to an At Market Issuance Sales Agreement (the “Sales Agreement”) with B. RileyFBR, Inc. as our sales agent. We sold approximately 15.9 million shares of our common stock pursuant to the Sales Agreement during the year endedDecember 31, 2018 and received aggregate net proceeds totaling $36.4 million. As of December 31, 2018, approximately 34.1 million shares remainavailable for sale under the Sales Agreement.As of December 31, 2018, we had debt outstanding of $14.1 million in principal. In February 2015, we issued subordinated notes in the aggregateprincipal amount of $14.0 million with annual interest at 8% (the “2015 Subordinated Notes”). The 2015 Subordinated Notes are due in February 2020. Weand Antigenics entered into the Note Purchase Agreement with certain purchasers pursuant to which Antigenics issued, and we guaranteed, limited recoursenotes in the aggregate principal amount of $100.0 million, with an option to issue an additional $15.0 million principal amount of limited recourse notes,which we exercised in November 2017. In January 2018, we entered into a Royalty Purchase Agreement with HCR whereby we received proceeds of $190.0million. We used $161.9 million of these proceeds to redeem all of the notes issued pursuant to the NPA. Pursuant to our agreement with HCR, we are entitledto receive up to $40.35 million in milestone payments based on GSK’s sales of Shingrix as follows: (i) $15.1 million upon reaching $2.0 billion last-twelve-months net sales any time prior to 2024 and (ii) $25.25 million upon reaching $2.75 billion last-twelve-months net sales any time prior to 2026. We are alsoobligated to pay HCR approximately $25.9 million in 2021 if neither of the following Shingrix sales milestones are achieved: (i) 2019 sales exceed$1.0 billion or (ii) 2020 sales exceed $1.75 billion. In February 2019, GSK reported that Shingrix sales for 2018, its first full year on the market, were over$1.0 billion.Our cash, cash equivalents, and short-term investments at December 31, 2018 were $53.1 million, a decrease of $7.1 million from December 31, 2017,principally as a result cash used in operations. We believe that, based on our current plans and activities, including additional funding we received inconnection with our transactions with Gilead subsequent to December 31, 2018, our cash on-hand will be sufficient to satisfy our liquidity requirements formore than one year from when these financial statements were issued. We continue to monitor the likelihood of success of our key initiatives and are preparedto discontinue funding of such activities if they do not prove to be feasible, restrict capital expenditures and/or reduce the scale of our operations.Our future liquidity needs will be determined primarily by the success of our operations with respect to the progression of our product candidates andkey development and regulatory events in the future. Potential sources of additional funding include: (1) pursuing collaboration, out-licensing and/orpartnering opportunities for our portfolio programs and product candidates with one or more third parties, (2) renegotiating third party agreements, (3) sellingassets, (4) securing additional debt financing and/or (5) selling equity securities. Satisfying long-term liquidity needs may require the successfulcommercialization and/or substantial out-licensing or partnering arrangements for our antibody discovery platforms, CPM antibody programs, and HSP-based vaccines. Our long-term success will also be dependent on the successful identification, development and commercialization of potential other productcandidates, each of which will require additional capital with no certainty of timing or probability of success. If we incur operating losses for longer than weexpect, and/or we are unable to raise additional capital, we may become insolvent and be unable to continue our operations.Our future cash requirements include, but are not limited to, supporting clinical trial and regulatory efforts and continuing our other research anddevelopment programs. Since inception, we have entered into various agreements with contract manufacturers, institutions, and clinical researchorganizations (collectively "third party providers") to perform pre-clinical activities and to conduct and monitor our clinical studies. Under these agreements,subject to the enrollment of patients and performance by the applicable third-party provider, we have estimated our total payments to be $232.1 million overthe term of the related activities. Through December 31, 2018, we have expensed $171.7 million as research and development expenses and $173.8 millionhas been paid under these agreements. The timing of expense recognition and future payments related to these agreements is subject to the enrollment ofpatients and performance by the applicable third-party provider. We have also entered into sponsored research agreements related to our product candidatesthat required payments of $9.6 million, $8.6 million of which have been paid as of December 31, 2018. We50Source: AGENUS INC, 10-K, March 18, 2019Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results.plan to enter into additional agreements with third party providers as well as sponsored research agreements, and we anticipate significant additionalexpenditures will be required to initiate and advance our various programs.Part of our strategy is to develop and commercialize some of our product candidates by continuing our existing collaboration arrangements withacademic and collaboration partners and licensees and by entering into new collaborations. As a result of our collaboration agreements, we will notcompletely control the efforts to attempt to bring those product candidates to market. For example, our collaboration with Incyte for the development,manufacture and commercialization of CPM antibodies against certain targets is managed by a joint steering committee, which is controlled by Incyte. Net cash used in operating activities for the years ended December 31, 2018 and 2017 was $131.1 million and $94.2 million, respectively. Our futureability to generate cash from operations will depend on achieving regulatory approval and market acceptance of our product candidates, achievingbenchmarks as defined in existing collaboration agreements, and our ability to enter into new collaborations. Please see the “Note Regarding Forward-Looking Statements” of this Annual Report on Form 10-K and the risks highlighted under Part I-Item 1A. “Risk Factors” of this Annual Report on Form 10-K.The table below summarizes our contractual obligations as of December 31, 2018 (in thousands). Payments by Period Total Less than1 Year 1-3 Years 3-5 Years More than5 Years Long-term debt (1) $15,475 $1,322 $14,153 $— $— Operating leases (2) 10,951 2,499 4,152 3,372 927 Capital lease 540 374 166 — — Total $26,966 $4,195 $18,471 $3,372 $927 (1)Includes fixed interest payments.(2)The leases and subleases for our properties expire at various times between 2020 and 2025.Off-Balance Sheet ArrangementsAt December 31, 2018, we had no off-balance sheet arrangements.Critical Accounting Policies and EstimatesThe SEC defines “critical accounting policies” as those that require the application of management’s most difficult, subjective, or complex judgments,often as a result of the need to make estimates about the effect of matters that are inherently uncertain and may change in subsequent periods.The preparation of consolidated financial statements in conformity with U.S. generally accepted accounting principles requires us to make estimatesand assumptions that affect the reported amounts of assets and liabilities and disclosures of contingent assets and liabilities at the date of the financialstatements and the reported amounts of revenues and expenses during the reporting period. We base those estimates on historical experience and on variousassumptions that are believed to be reasonable under the circumstances. Actual results could differ from those estimates.The following listing is not intended to be a comprehensive list of all of our accounting policies. Our significant accounting policies are described inNote 2 of the notes to our consolidated financial statements contained elsewhere in this Annual Report on Form 10-K. In many cases, the accountingtreatment of a particular transaction is dictated by U.S. generally accepted accounting principles, with no need for our judgment in its application. There arealso areas in which our judgment in selecting an available alternative would not produce a materially different result. We have identified the following as ourcritical accounting policies.Share-Based CompensationWe recognize share-based compensation expense in accordance with the fair value recognition provisions of the Financial Accounting StandardsBoard (“FASB”) Accounting Standards Codification (“ASC”) 718, Compensation—Stock Compensation. Compensation expense is recognized on a straight-line basis over the requisite service period of the award. Forfeitures are recognized as they occur.51Source: AGENUS INC, 10-K, March 18, 2019Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results.Share-based awards granted to certain non-employees have been accounted for based on the fair value method of accounting in accordance with ASC505-50, Equity- Equity-Based Payments to Non-Employees. As a result, the non-cash charge to operations for non-employee awards with vesting or otherperformance criteria is affected each reporting period by changes in the fair value of our common stock.Determining the appropriate fair value model and calculating the fair value of share-based awards requires the use of highly subjective assumptions,including the expected life of the share-based awards and stock price volatility. The assumptions used in calculating the fair value of share-based awardsrepresent management’s best estimates, but these estimates involve inherent uncertainties and the application of management judgment. As a result, if factorschange and we use different assumptions, our share-based compensation expense could be materially different in the future. For performance conditionawards, we estimate the probability that the performance condition will be met. See Note 12 of the notes to our consolidated financial statements containedelsewhere in this Annual Report on Form 10-K for a further discussion on share-based compensation.Revenue RecognitionIn May 2014, the FASB issued Accounting Standards Update (“ASU”) No. 2014-09, Revenue from Contracts with Customers (Topic 606), whichsupersedes existing revenue recognition guidance. We adopted ASU 2014-09 and its related amendments (collectively known as “ASC 606”) on January 1,2018 using the modified retrospective method- i.e., by recognizing the cumulative effect of initially applying ASC 606 as an adjustment to the openingbalance of equity at January 1, 2018. The reported results for 2018 reflect the application of ASC 606 guidance while the reported results for 2017 wereprepared under the guidance of ASC 605, Revenue Recognition. The adoption of ASC 606 represents a change in accounting principle that will more closelyalign revenue recognition with the delivery of our goods and services and will provide financial statement readers with enhanced disclosures.In accordance with ASC 606, revenue is recognized when a customer obtains control of promised goods or services. The amount of revenuerecognized reflects the consideration to which we expect to be entitled to receive in exchange for these goods and services. Refer to Note 2 to ourconsolidated financial statements included within Item 8 of this Annual Report on Form 10-K for a more detailed description of our application of ASC 606.Non-cash Interest Expense on Liability Related to Sale of Future RoyaltiesIn January 2018 we entered into the HCR Royalty Purchase Agreement with HCR. Pursuant to the terms of the HCR Royalty Purchase Agreement, wesold to HCR 100% of our worldwide rights to receive royalties from GSK on sales of GSK’s vaccines containing our QS-21 Stimulon adjuvant. Although wesold all of our rights to receive royalties on sales of GSK’s vaccines containing QS-21, as a result of our obligation to HCR, we recorded the proceeds fromthis transaction as a liability on our consolidated balance sheet that will be amortized using the interest method over the estimated life of the HCR RoyaltyPurchase Agreement. As a result, we impute interest on the transaction and record non-cash interest expense at the estimated interest rate. Our estimate of theinterest rate under the agreement is based on the amount of royalty payments to be received by HCR over the life of the arrangement. We periodically assessthe expected royalty payments to HCR from GSK using a combination of historical results and forecasts from market data sources. To the extent suchpayments are greater or less than our initial estimates or the timing of such payments is materially different than our original estimates, we will prospectivelyadjust the amortization of the liability. There are a number of factors that could materially affect the amount and timing of royalty payments from GSK, all ofwhich are not within our control. Such factors include, but are not limited to, changing standards of care, the introduction of competing products,manufacturing or other delays, biosimilar competition, patent protection, adverse events that result in governmental health authority imposed restrictions onthe use of the drug products, significant changes in foreign exchange rates, and other events or circumstances that could result in reduced royalty paymentsfrom GSK, all of which would result in a reduction of non-cash royalty revenues and the non-cash interest expense over the life of the HCR Royalty PurchaseAgreement. Conversely, if sales of GSK’s vaccines containing QS-21 are more than expected, the non-cash royalty revenues and the non-cash interestexpense recorded by us would be greater over the life of the HCR Royalty Purchase Agreement.Fair Value MeasurementsIn accordance with ASC 820, Fair Value Measurements and Disclosures, we measure fair value based on a hierarchy for inputs used in measuring fairvalue that maximizes the use of observable inputs and minimizes the use of unobservable inputs by requiring that observable inputs be used when available.The fair value hierarchy is broken down into three levels based on the source of inputs.We measure our contingent purchase price considerations at fair value in accordance with ASC 825, Financial Instruments. The fair value contingentpurchase price considerations are based on significant inputs not observable in the market, which require them to be reported as a Level 3 liability within thefair value hierarchy. The fair values of our 4-AB and PhosImmune contingent purchase price considerations are based on estimates from a Monte Carlosimulation of our market capitalization and share price, respectively.52Source: AGENUS INC, 10-K, March 18, 2019Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results.Market capitalization and share price were evolved using a geometric brownian motion, calculated daily for the life of the contingent purchase priceconsideration. Acquired Intangible Assets, including IPR&DIPR&D acquired in a business combination represents the fair value assigned to research and development assets that have not reached technologicalfeasibility. The value assigned to acquired IPR&D is determined by estimating the costs to develop the acquired technology into commercially viableproducts, estimating the resulting revenue from the projects, and discounting the net cash flows to present value. The revenue and costs projections used tovalue acquired IPR&D are, as applicable, reduced based on the probability of success of developing a new drug. Additionally, the projections consider therelevant market sizes and growth factors, expected trends in technology, and the nature and expected timing of new product introductions by us and ourcompetitors. The rates utilized to discount the net cash flows to their present value are commensurate with the stage of development of the projects anduncertainties in the economic estimates used in the projections. Upon the acquisition of IPR&D, we complete an assessment of whether our acquisitionconstitutes the purchase of a single asset or a group of assets. We consider multiple factors in this assessment, including the nature of the technologyacquired, the presence or absence of separate cash flows, the development process and stage of completion, quantitative significance and our rationale forentering into the transaction.We review amounts capitalized as acquired IPR&D for impairment at least annually, as of October 31, and whenever events or changes incircumstances indicate that the carrying value of the assets might not be recoverable. When performing our impairment assessment, we have the option to firstassess qualitative factors to determine whether it is necessary to recalculate the fair value of our acquired IPR&D. If we elect this option and believe, as aresult of the qualitative assessment, that it is more-likely-than-not that the fair value of our acquired IPR&D is less than its carrying amount, we calculate thefair value using the same methodology as described above. If the carrying value of our acquired IPR&D exceeds its fair value, then the intangible asset iswritten-down to its fair value. Alternatively, we may elect to bypass the qualitative assessment and immediately recalculate the fair value of our acquiredIPR&D.Finite-lived intangible assets are amortized over their useful life. We review finite-lived intangible assets for impairment whenever events or changesin circumstances indicate that the carrying value of the assets might not be recoverable.GoodwillGoodwill is tested at least annually for impairment on a reporting unit basis. We have concluded that we consist of a single reportable segment andtwo reporting units. We assess goodwill for impairment by performing a quantitative analysis to determine whether the fair value of our reporting unitsexceed their carrying value. We perform our annual impairment test as of October 31 of each year and the first step of our impairment analysis compares thefair value of each reporting unit to its net book value to determine if there is an indicator of impairment.Recent Accounting PronouncementsRefer to Note 2 to our consolidated financial statements included within Item 8 of this Annual Report on Form 10-K for a description of recentaccounting pronouncements applicable to our business. 53Source: AGENUS INC, 10-K, March 18, 2019Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results.Item 7A.Quantitative and Qualitative Disclosures About Market RiskOur primary market risk exposure is foreign currency exchange rate risk. International revenues and expenses are generally transacted by our foreignsubsidiary and are denominated in local currency. Approximately 1% and 18% of our cash used in operations for the years ended December 31, 2018 and2017, respectively, was from a foreign subsidiary. Additionally, in the normal course of business, we are exposed to fluctuations in interest rates as we seekdebt financing and invest excess cash. We are also exposed to foreign currency exchange rate fluctuation risk related to our transactions denominated inforeign currencies. We do not currently employ specific strategies, such as the use of derivative instruments or hedging, to manage these exposures. Ourcurrency exposures vary, but are primarily concentrated in the Euro, pound sterling, and Swiss Franc, in large part due to our wholly-owned subsidiaries, 4-AB, a company with operations in Switzerland, and Agenus UK Limited, a company with operations in the United Kingdom as well as our subsidiaryAgenTus, a company with operations in the United Kingdom and Belgium. During the year ended December 31, 2018, there has been no material changewith respect to our approach toward those exposures.We had cash, cash equivalents and short-term investments at December 31, 2018 of $53.1 million, which are exposed to the impact of interest andforeign currency exchange rate changes, and our interest income fluctuates as interest rates change. Due to the short-term nature of our investments in moneymarket funds, our carrying value approximates the fair value of these investments at December 31, 2018, however, we are subject to investment risk.We invest our cash and cash equivalents in accordance with our investment policy. The primary objectives of our investment policy are to preserveprincipal, maintain proper liquidity to meet operating needs, and maximize yields. We review our investment policy annually and amend it as deemednecessary. Currently, the investment policy prohibits investing in any structured investment vehicles and asset-backed commercial paper. Although ourinvestments are subject to credit risk, our investment policy specifies credit quality standards for our investments and limits the amount of credit exposurefrom any single issue, issuer, or type of investment. We do not invest in derivative financial instruments. Accordingly, we do not believe that there iscurrently any material market risk exposure with respect to derivatives or other financial instruments that would require disclosure under this item. 54Source: AGENUS INC, 10-K, March 18, 2019Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results.Item 8.Financial Statements and Supplementary Data INDEX TO FINANCIAL STATEMENTS Report of Independent Registered Public Accounting Firm 56Consolidated Balance Sheets 57Consolidated Statements of Operations and Comprehensive Loss 58Consolidated Statements of Convertible Preferred Stock and Stockholders’ Deficit 59Consolidated Statements of Cash Flows 62Notes to Consolidated Financial Statements 64 55Source: AGENUS INC, 10-K, March 18, 2019Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results.Report of Independent Registered Public Accounting Firm To the Stockholders and Board of DirectorsAgenus Inc.:Opinion on the Consolidated Financial StatementsWe have audited the accompanying consolidated balance sheets of Agenus Inc. and subsidiaries (the Company) as of December 31, 2018 and 2017, therelated consolidated statements of operations and comprehensive loss, convertible preferred stock and stockholders’ deficit, and cash flows for each of theyears in the three-year period ended December 31, 2018, and the related notes (collectively, the consolidated financial statements). In our opinion, theconsolidated financial statements present fairly, in all material respects, the financial position of the Company as of December 31, 2018 and 2017, and theresults of its operations and its cash flows for each of the years in the three-year period ended December 31, 2018, in conformity with U.S. generally acceptedaccounting principles.We also have audited, in accordance with the standards of the Public Company Accounting Oversight Board (United States) (PCAOB), the Company’sinternal control over financial reporting as of December 31, 2018, based on criteria established in Internal Control – Integrated Framework (2013) issued bythe Committee of Sponsoring Organizations of the Treadway Commission, and our report dated March 18, 2019 expressed an unqualified opinion on theeffectiveness of the Company’s internal control over financial reporting.Change in Accounting PrincipleAs discussed in Notes 2(k) and 14 to the consolidated financial statements, the Company changed its method of accounting for revenue as of January 1, 2018due to the adoption of Accounting Standards Update No. 2014-09, Revenue from Contracts with Customers.Basis for OpinionThese consolidated financial statements are the responsibility of the Company’s management. Our responsibility is to express an opinion on theseconsolidated financial statements based on our audits. We are a public accounting firm registered with the PCAOB and are required to be independent withrespect to the Company in accordance with the U.S. federal securities laws and the applicable rules and regulations of the Securities and ExchangeCommission and the PCAOB.We conducted our audits in accordance with the standards of the PCAOB. Those standards require that we plan and perform the audit to obtain reasonableassurance about whether the consolidated financial statements are free of material misstatement, whether due to error or fraud. Our audits included performingprocedures to assess the risks of material misstatement of the consolidated financial statements, whether due to error or fraud, and performing procedures thatrespond to those risks. Such procedures included examining, on a test basis, evidence regarding the amounts and disclosures in the consolidated financialstatements. Our audits also included evaluating the accounting principles used and significant estimates made by management, as well as evaluating theoverall presentation of the consolidated financial statements. We believe that our audits provide a reasonable basis for our opinion./s/ KPMG LLPWe have served as the Company’s auditor since 1997.Boston, MassachusettsMarch 18, 2019 56Source: AGENUS INC, 10-K, March 18, 2019Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results.AGENUS INC. AND SUBSIDIARIESCONSOLIDATED BALANCE SHEETS December 31, 2018 December 31, 2017 ASSETS Cash and cash equivalents $53,053,531 $60,186,617 Inventories 55,491 79,491 Accounts Receivable 938,141 1,134,493 Prepaid expenses 19,264,798 11,070,960 Other current assets 1,495,719 1,081,993 Total current assets 74,807,680 73,553,554 Property, plant and equipment, net of accumulated amortization and depreciation of $38,068,114 and $34,029,085 at December 31, 2018 and 2017, respectively 25,115,578 26,178,622 Goodwill 22,924,870 23,048,804 Acquired intangible assets, net of accumulated amortization of $7,471,764 and $5,461,834 at December 31, 2018 and 2017, respectively 12,338,186 14,406,650 Other long-term assets 1,214,394 1,214,394 Total assets $136,400,708 $138,402,024 LIABILITIES, CONVERTIBLE PREFERRED STOCK AND STOCKHOLDERS’ DEFICIT Current portion, long-term debt $146,061 $20,639,735 Current portion, liability related to sale of future royalties and milestones 27,443,232 - Current portion, deferred revenue 1,814,146 4,484,882 Accounts payable 13,623,934 8,086,992 Accrued liabilities 24,551,286 21,569,449 Other current liabilities 483,557 1,657,063 Total current liabilities 68,062,216 56,438,121 Long-term debt 13,211,547 142,385,024 Liability related to sale of future royalties and milestones, net of current portion 182,817,015 - Deferred revenue, net of current portion 1,165,143 7,748,284 Contingent purchase price consideration 3,038,000 4,373,000 Other long-term liabilities 2,773,445 3,273,387 Commitments and contingencies (Notes 16 and 20) CONVERTIBLE PREFERRED STOCK Preferred stock, par value $0.01 per share; 5,000,000 shares authorized: Series C-1 convertible preferred stock; 18,459 shares and zero shares designated, issued, and outstanding at December 31, 2018 and 2017, respectively 39,879,089 - STOCKHOLDERS’ DEFICIT Series A-1 convertible preferred stock; 31,620 shares designated, issued, and outstanding at December 31, 2018 and 2017; liquidation value of $32,832,064, and $32,625,220 at December 31, 2018, and 2017, respectively 316 316 Common stock, par value $0.01 per share; 240,000,000 shares authorized; 119,996,331 shares and 101,706,117 shares issued at December 31, 2018 and 2017, respectively 1,199,964 1,017,061 Additional paid-in capital 1,005,183,033 951,811,958 Accumulated other comprehensive loss (1,539,367) (2,169,354)Accumulated deficit (1,177,311,393) (1,026,475,773)Total stockholders’ deficit attributable to Agenus Inc. (172,467,447) (75,815,792)Non-controlling interest (2,078,300) - Total stockholders’ deficit (174,545,747) (75,815,792)Total liabilities, convertible preferred stock and stockholders’ deficit $136,400,708 $138,402,024 See accompanying notes to consolidated financial statements. 57Source: AGENUS INC, 10-K, March 18, 2019Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results.AGENUS INC. AND SUBSIDIARIESCONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE LOSSFor the Years Ended December 31, 2018, 2017, and 2016 2018 2017 2016 Revenue: Research and development $19,474,672 $42,709,035 $22,393,443 Other revenues — 168,051 179,860 Non-cash royalty revenue related to the sale of future royalties 17,308,879 — — Total revenues 36,783,551 42,877,086 22,573,303 Operating expenses: Research and development (124,600,359) (116,125,299) (94,971,379)General and administrative (37,339,748) (33,741,183) (33,125,690)Contingent purchase price consideration fair value adjustment 1,335,000 3,188,000 (1,953,000)Operating loss (123,821,556) (103,801,396) (107,476,766)Other income (expense): Loss on early extinguishment of debt (10,766,625) — — Non-operating (expense) income (2,183,278) 1,977,398 (2,202,336)Interest expense, net (25,272,557) (18,868,494) (17,316,073)Net loss (162,044,016) (120,692,492) (126,995,175)Dividends on Series A-1 convertible preferred stock (206,844) (205,541) (204,246)Less: net loss attributable to non-controlling interest (2,351,900) — — Net loss attributable to Agenus Inc. common stockholders $(159,898,960) $(120,898,033) $(127,199,421)Per common share data: Basic and diluted net loss attributable to Agenus Inc. common stockholders $(1.44) $(1.23) $(1.46)Weighted average number of Agenus Inc. common shares outstanding: Basic and diluted 110,772,328 98,415,414 87,070,189 Other comprehensive income (loss): Foreign currency translation gain (loss) $629,987 $(615,213) $677,536 Pension liability — (24,582) (153,952)Other comprehensive income (loss) 629,987 (639,795) 523,584 Comprehensive loss $(159,268,973) $(121,537,828) $(126,675,837) See accompanying notes to consolidated financial statements. 58Source: AGENUS INC, 10-K, March 18, 2019Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results.AGENUS INC. AND SUBSIDIARIESCONSOLIDATED STATEMENTS OF CONVERTIBLE PREFERRED STOCK AND STOCKHOLDERS’ DEFICITFor the Years Ended December 31, 2018, 2017, and 2016 Series C-1 Series A-1 Convertible Convertible Preferred Stock Preferred Stock Common Stock Treasury Stock Number ofShares Amount Number ofShares ParValue Number ofShares ParValue AdditionalPaid-InCapital Numberof Shares Amount AccumulatedOtherComprehensiveIncome (Loss) Non-controllingInterest AccumulatedDeficit Total Balance at December31, 2015 - $— 31,620 $316 86,390,697 $863,907 $851,103,934 - $— $(2,053,143) $— $(779,187,464) $70,727,550 Net loss (126,995,175) (126,995,175)Other comprehensiveincome — — — — — — — — — 523,584 — — 523,584 Share-basedcompensation — — — — — — 13,323,616 — — — — — 13,323,616 Reclassification ofliability classified optiongrants — — — — — — (318,677) — — — — — (318,677)Vesting of nonvestedshares — — — — 570,037 5,701 (5,701) (185,117) (768,236) — — — (768,236)Shares sold at themarket — — — — 496,520 4,965 2,162,105 — — — — — 2,167,070 Issuance of directorshares forcompensation — — — — 23,110 231 161,332 — — — — — 161,563 Retirement of treasuryshares — — — — (188,184) (1,882) (1,632,554) 188,184 781,117 — — 853,319 - Issuance of shares formilestones — — — — 157,513 1,575 885,223 — — — — — 886,798 Exercise of stockoptions and employeeshare purchases — — — — 345,240 3,452 1,175,070 (3,067) (12,881) — — — 1,165,641 Balance at December31, 2016 — $— 31,620 $316 87,794,933 $877,949 $866,854,348 — $— $(1,529,559) $— $(905,329,320) $(39,126,266) See accompanying notes to consolidated financial statements.59Source: AGENUS INC, 10-K, March 18, 2019Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results.AGENUS INC. AND SUBSIDIARIESCONSOLIDATED STATEMENTS OF CONVERTIBLE PREFERRED STOCK AND STOCKHOLDERS’ DEFICIT(Continued)For the Years Ended December 31, 2018, 2017, and 2016 Series C-1 Series A-1 Convertible Convertible Preferred Stock Preferred Stock Common Stock Treasury Stock Number ofShares Amount Number ofShares ParValue Number ofShares ParValue AdditionalPaid-InCapital Numberof Shares Amount AccumulatedOtherComprehensiveIncome (Loss) Non-controllingInterest AccumulatedDeficit Total Net loss (120,692,492) (120,692,492)Othercomprehensiveloss — — — — — — — — — (639,795) — — (639,795)Impact ofaccountingchange — — — — — — 1,210,916 — — — — (1,292,230) (81,314)Shares soldunder StockPurchaseAgreement — — 10,000,000 100,000 59,900,000 — — — — — 60,000,000 Share-basedcompensation — — — — — — 10,924,122 — — — — — 10,924,122 Reclassificationof liability classifiedoption grants — — — — — — 2,015,974 — — — — — 2,015,974 Vesting ofnonvested shares — — — — 1,097,243 10,972 (10,972) (155,523) (527,223) — — — (527,223)Shares sold atthe market — — — — 1,315,288 13,153 5,546,553 — — — — — 5,559,706 Amendment to2013 warrants — — — — - - 731,498 — — — — — 731,498 Retirement oftreasury shares — — — — (155,523) (1,555) (1,363,937) 155,523 527,223 — — 838,269 — Issuance ofshares formilestones — — — — 373,351 3,734 1,482,203 — — — — — 1,485,937 Issuance of stockfor acquisition ofSECANT yeastdisplaytechnology — — — — 999,317 9,993 3,537,582 — — — — — 3,547,575 Exercise of stockoptions andemployee sharepurchases — — — — 281,508 2,815 983,671 — — — — — 986,486 Balance atDecember 31,2017 — $— 31,620 $316 101,706,117 $1,017,061 $951,811,958 — $— $(2,169,354) $— $(1,026,475,773) $(75,815,792) See accompanying notes to consolidated financial statements.60Source: AGENUS INC, 10-K, March 18, 2019Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results.AGENUS INC. AND SUBSIDIARIESCONSOLIDATED STATEMENTS OF CONVERTIBLE PREFERRED STOCK AND STOCKHOLDERS’ DEFICIT(Continued)For the Years Ended December 31, 2018, 2017, and 2016 Series C-1 Series A-1 Convertible Convertible Preferred Stock Preferred Stock Common Stock Treasury Stock Number ofShares Amount Number ofShares ParValue Number ofShares ParValue AdditionalPaid-InCapital NumberofShares Amount AccumulatedOtherComprehensiveIncome (Loss) Non-controllingInterest AccumulatedDeficit Total Net loss (2,351,900) (159,692,116) (162,044,016)Othercomprehensiveloss — — — — — — — — — 629,987 — 629,987 Adoption ofASC 606 — — — — — — — — — — — 8,856,496 8,856,496 AgenTus sharedistribution — — — — — — — — — — 273,600 — 273,600 Share-basedcompensation — — — — — — 7,351,528 — — — — — 7,351,528 Vesting ofnonvestedshares — — — — 53,050 531 (531) — — — — — — Shares sold atthe market — — — — 17,798,688 177,987 44,740,563 — — — — — 44,918,550 Issuance ofSeries C-1convertiblepreferredstock, net ofissuance costsof $122,000 18,459 39,879,089 — — — — — — — — — — — Payment ofconsultant inshares — — — — 25,670 257 49,743 — — — — — 50,000 Exercise ofstock optionsand employeesharepurchases — — — — 412,806 4,128 1,229,772 — — — — — 1,233,900 Balance atDecember 31,2018 18,459 $39,879,089 31,620 $316 119,996,331 $1,199,964 $1,005,183,033 — $— $(1,539,367) $(2,078,300) $(1,177,311,393) $(174,545,747) See accompanying notes to consolidated financial statements. 61Source: AGENUS INC, 10-K, March 18, 2019Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results.AGENUS INC. AND SUBSIDIARIESCONSOLIDATED STATEMENTS OF CASH FLOWSFor the Years Ended December 31, 2018, 2017, and 2016 2018 2017 2016 Cash flows from operating activities: Net loss $(162,044,016) $(120,692,492) $(126,995,175)Adjustments to reconcile net loss to net cash used in operating activities: Depreciation and amortization 6,288,001 6,006,299 4,947,787 Share-based compensation 7,625,128 12,428,655 13,188,364 Non-cash royalty revenue (17,308,879) — — Non-cash interest expense 24,598,564 18,242,299 16,530,437 Loss on disposal of assets 145,009 23,558 14,733 Change in fair value of contingent obligations (1,335,000) (3,188,000) 1,953,000 Gain on issuance of stock for settlement of milestone obligation — (566,488) — Loss on extinguishment of debt 10,766,625 — — Changes in operating assets and liabilities: Accounts receivable 196,352 10,217,529 (1,549,798)Inventories 24,000 8,709 - Prepaid expenses (8,209,703) (8,453,082) (650,824)Accounts payable 5,366,711 1,647,430 419,708 Deferred revenue (397,382) (2,722,020) (3,939,619)Accrued liabilities and other current liabilities 3,303,559 (4,848,372) 18,275,940 Other operating assets and liabilities (113,486) (2,329,168) (2,155,364)Net cash used in operating activities (131,094,517) (94,225,143) (79,960,811)Cash flows from investing activities: Proceeds from sale of plant and equipment 6,187 120,000 — Purchases of plant and equipment (3,597,107) (3,120,357) (12,519,738)Purchases of available-for-sale securities — (14,936,047) (54,884,101)Proceeds from sale of available-for-sale securities — 20,000,000 85,000,000 Net cash provided by (used in) investing activities (3,590,920) 2,063,596 17,596,161 Cash flows from financing activities: Net proceeds from sale of equity 44,918,550 65,559,706 2,167,070 Net proceeds from sale of C-1 Preferred Stock 39,879,089 — — Proceeds from employee stock purchases and option exercises 1,233,900 986,486 1,183,598 Purchase of treasury shares to satisfy tax withholdings — (527,223) (667,050)Proceeds from issuance of long-term debt — 15,000,000 — Debt issuance costs — (150,000) — Proceeds from sale of future royalties 204,878,400 — — Transaction costs from sale of future royalties and milestones (494,394) — — Repayments of debt (161,847,220) — — Payment under a purchase agreement for in-process research and development — — (5,000,000)Payment of capital lease obligation (283,408) (330,744) (144,658)Net cash provided by (used in) financing activities 128,284,917 80,538,225 (2,461,040)Effect of exchange rate changes on cash (732,566) 361,923 (429,167)Net decrease in cash and cash equivalents (7,133,086) (11,261,399) (65,254,857)Cash and cash equivalents, beginning of period 60,186,617 71,448,016 136,702,873 Cash and cash equivalents, end of period $53,053,531 $60,186,617 $71,448,016 Supplemental cash flow information: Cash paid for interest $1,171,085 $1,120,000 $1,120,000 Supplemental disclosures - non-cash activities: Purchases of plant and equipment in accounts payable and accrued liabilities $299,637 $968,400 $695,466 Issuance of common stock, $0.01 par value, issued in connection with the settlement ofmilestone obligation — 1,485,937 886,798 62Source: AGENUS INC, 10-K, March 18, 2019Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results.Issuance of common stock, $0.01 par value, issued to directors as compensation — — 161,332 Issuance of common stock, $0.01 par value, in connection with the acquisition of theSECANT yeast display technology — 3,547,575 —Issuance of common stock, $0.01 par value, in connection with payment to consultant 50,000 — —See accompanying notes to consolidated financial statements. 63Source: AGENUS INC, 10-K, March 18, 2019Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results.AGENUS INC. AND SUBSIDIARIESNOTES TO CONSOLIDATED FINANCIAL STATEMENTS (1) Description of BusinessAgenus Inc. (including its subsidiaries, collectively referred to as “Agenus,” the “Company,” “we,” “us,” and “our”) is a clinical-stage immuno-oncology (“I-O”) company with a pipeline of immune modulating antibodies, cancer vaccines, adjuvants and adoptive cell therapies dedicated to becominga leader in the discovery and development of innovative combination therapies and committed to bringing effective medicines to patients with cancer. Ourbusiness is designed to drive success in I-O through speed, innovation, and effective combination therapies. In addition to a diverse pipeline we haveassembled fully integrated capabilities including novel target discovery, antibody generation, cell line development, and good manufacturing practice(“GMP”) manufacturing We believe that these fully integrated capabilities enable us to produce novel candidates on timelines that are shorter than theindustry standard. Leveraging from our science and capabilities we have forged important partnerships to advance our innovation. We are developing a comprehensive I-O portfolio driven by the following platforms and programs, which we intend to utilize individually and incombination: •our antibody discovery platforms, including our Retrocyte Display™, SECANT® yeast display, and phage display technologies designed todrive the discovery of future CPM antibody candidates; •our antibody candidate programs, including our CPM programs; •our vaccine programs, including Prophage™, AutoSynVax™ and PhosphoSynVax ™; •our saponin-based vaccine adjuvants, principally our QS-21 Stimulon® adjuvant, or QS-21 Stimulon; and •our cell therapy subsidiary, AgenTus Therapeutics, which is designed to drive the discovery of future adoptive cell therapy, or “living drugs”(CAR-T and TCR) programs.Our business activities include product research and development, intellectual property prosecution, manufacturing, regulatory and clinical affairs,corporate finance and development activities, and support of our collaborations. Our product candidates require clinical trials and approvals from regulatoryagencies, as well as acceptance in the marketplace. Part of our strategy is to develop and commercialize some of our product candidates by continuing ourexisting arrangements with academic and corporate collaborators and licensees and by entering into new collaborations.Our cash, cash equivalents, and short-term investments at December 31, 2018 were $53.1 million, a decrease of $7.1 million from December 31, 2017. (Unaudited) Quarter Ended March 31,2018 June 30,2018 September 30,2018 December 31,2018 Cash and cash equivalents $52.3 $43.2 $46.2 $53.1 Increase (decrease) in cash and cash equivalents $(7.8) $(9.2) $3.0 $6.9 Cash used in operating activities $(40.2) $(30.5) $(24.6) $(35.8)Reported net loss $(54.3) $(25.2) $(33.7) $(48.8) We have incurred significant losses since our inception. As of December 31, 2018, we had an accumulated deficit of $1.18 billion. Since ourinception, we have successfully financed our operations through the sale of equity, notes, corporate partnerships, and interest income. We believe that, basedon our current plans and activities, including additional funding we received in connection with our transactions with Gilead subsequent to December 31,2018, our cash on-hand will be sufficient to satisfy our liquidity requirements for more than one year from when these financial statements were issued. Wecontinue to monitor the likelihood of success of our key initiatives and are prepared to discontinue funding of such activities if they do not prove to befeasible, restrict capital expenditures and/or reduce the scale of our operations. Our future liquidity needs will be determined primarily by the success of our operations with respect to the progression of our product candidates andkey development and regulatory events in the future. Potential sources of additional funding include: (1) pursuing collaboration, out-licensing and/orpartnering opportunities for our portfolio programs and product candidates with one or more third parties, (2) renegotiating third party agreements, (3) sellingassets, (4) securing additional debt financing and/or (5) selling equity securities. Our ability to address our future liquidity needs will largely be determinedby the success of our product candidates and key development and regulatory events and our decisions in the future.64Source: AGENUS INC, 10-K, March 18, 2019Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results.Research and development program costs include compensation and other direct costs plus an allocation of indirect costs, based on certainassumptions, and our review of the status of each program. Our product candidates are in various stages of development and significant additionalexpenditures will be required if we start new trials, encounter delays in our programs, apply for regulatory approvals, continue development of ourtechnologies, expand our operations, and/or bring our product candidates to market. The eventual total cost of each clinical trial is dependent on a number offactors such as trial design, length of the trial, number of clinical sites, and number of patients. The process of obtaining and maintaining regulatoryapprovals for new therapeutic products is lengthy, expensive, and uncertain. Because our antibody and neoantigen vaccine programs are early stage, andbecause any further development of HSP-based vaccines is dependent on clinical trial results, among other factors, we are unable to reliably estimate the costof completing our research and development programs or the timing for bringing such programs to various markets or substantial partnering or out-licensingarrangements, and, therefore, when, if ever, material cash inflows are likely to commence. We will continue to adjust our spending as needed in order topreserve liquidity. (2) Summary of Significant Accounting Policies(a) Basis of Presentation and Principles of ConsolidationThe consolidated financial statements have been prepared in accordance with U.S. generally accepted accounting principles and include the accountsof Agenus and our subsidiaries. All significant intercompany transactions and accounts have been eliminated in consolidation. Non-controlling interest inthe consolidated financial statements represents the portion of AgenTus Therapeutics not owned by Agenus.(b) Segment InformationWe are managed and currently operate as two segments. However, we have concluded that our two operating segments meet all three criteria requiredby Financial Accounting Standards Board (“FASB”) Accounting Standards Codification (“ASC”) 280, Segment Reporting to be aggregated into onereportable segment. The aggregation of our two operating segments into one reportable segment is consistent with the objectives and basic principles of ASC280. Our two operating segments have similar economic characteristics and are both similar with respect to the five qualitative characteristics specified inASC 280. Accordingly, we do not have separately reportable segments as defined by ASC 280.(c) Use of EstimatesThe preparation of consolidated financial statements in conformity with U.S. generally accepted accounting principles requires us to make estimatesand assumptions that affect the reported amounts of assets and liabilities and disclosures of contingent assets and liabilities at the date of the consolidatedfinancial statements and the reported amounts of revenues and expenses during the reporting period. We base those estimates on historical experience and onvarious assumptions that are believed to be reasonable under the circumstances. Actual results could differ from those estimates.(d) Cash and Cash EquivalentsWe consider all highly liquid investments purchased with maturities at acquisition of three months or less to be cash equivalents. Cash equivalentsconsist primarily of money market funds.(e) InvestmentsWe classify investments in marketable securities at the time of purchase. Gains and losses on the sale of marketable securities are recognized inoperations based on the specific identification method. At both December 31, 2018 and 2017 we had no holdings classified as investments.(f) Concentrations of Credit RiskFinancial instruments that potentially subject us to concentrations of credit risk are primarily cash equivalents, investments, and accounts receivable.We invest our cash, cash equivalents and short-term investments in accordance with our investment policy, which specifies high credit quality standards andlimits the amount of credit exposure from any single issue, issuer, or type of investment. We carry balances in excess of federally insured levels, however, wehave not experienced any losses to date from this practice.(g) InventoriesInventories are stated at the lower of cost or net realizable value. Cost has been determined using standard costs that approximate the first-in, first-outmethod. Inventory as of December 31, 2018 and 2017 consisted solely of finished goods.65Source: AGENUS INC, 10-K, March 18, 2019Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results.(h) Accounts ReceivableAccounts receivable are amounts due from our collaboration partner as a result of research and development services provided and reimbursementsunder co-funded research and development programs. We considered the need for an allowance for doubtful accounts and have concluded that no allowancewas needed as of December 31, 2018 and 2017, as the estimated risk of loss on our accounts receivable was determined to be minimal.(i) Property, Plant and EquipmentProperty, plant and equipment, including software developed for internal use, are carried at cost. Depreciation is computed using the straight-linemethod over the estimated useful lives of the assets. Amortization of leasehold improvements is computed over the shorter of the lease term or estimateduseful life of the asset. Additions and improvements are capitalized, while repairs and maintenance are charged to expense as incurred. Amortization anddepreciation of plant and equipment was $4.3 million, $3.8 million, and $2.7 million, for the years ended December 31, 2018, 2017, and 2016, respectively.(j) Fair Value of Financial InstrumentsThe estimated fair values of all our financial instruments, excluding our outstanding debt as of December 31, 2017, approximate their carryingamounts in the consolidated balance sheets. The fair value of our outstanding debt is based on a present value methodology. The outstanding principalamount of our debt, including the current portion, was $14.1 million and $129.1 million at December 31, 2018 and 2017, respectively.(k) Revenue RecognitionIn May 2014, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) No. 2014-09, Revenue fromContracts with Customers (Topic 606), which supersedes existing revenue recognition guidance. We adopted ASU 2014-09 and its related amendments(collectively known as “ASC 606”) on January 1, 2018 using the modified retrospective method- i.e., by recognizing the cumulative effect of initiallyapplying ASC 606 as an adjustment to the opening balance of equity at January 1, 2018. The reported results for 2018 reflect the application of ASC 606guidance while the reported results for 2017 were prepared under the guidance of ASC 605, Revenue Recognition (“ASC 605”). The adoption of ASC 606represents a change in accounting principle that will more closely align revenue recognition with the delivery of our goods and services and will providefinancial statement readers with enhanced disclosures. The details of the significant changes and quantitative impact of the changes are disclosed in Note 14.For the years ended December 31, 2018, 2017 and 2016, 43%, 87% and 87%, respectively, of our revenue was earned from one collaboration partner.In accordance with ASC 606, revenue is recognized when a customer obtains control of promised goods or services. The amount of revenuerecognized reflects the consideration to which we expect to be entitled to receive in exchange for these goods and services. To achieve this core principle, weapply the following five steps:1) Identify the contract with the customerA contract with a customer exists when (i) the Company enters into an enforceable contract with a customer that defines each party’s rights regardingthe goods or services to be transferred and identifies the related payment terms, (ii) the contract has commercial substance, and (iii) the Company determinesthat collection of substantially all consideration for goods and services that are transferred is probable based on the customer’s intent and ability to pay thepromised consideration. The Company applies judgment in determining the customer’s intent and ability to pay, which is based on a variety of factorsincluding the customer’s historical payment experience, or in the case of a new customer, published credit and financial information pertaining to thecustomer.2) Identify the performance obligations in the contractPerformance obligations promised in a contract are identified based on the goods and services that will be transferred to the customer that are bothcapable of being distinct, whereby the customer can benefit from the good or service either on its own or together with other available resources, and aredistinct in the context of the contract, whereby the transfer of the good or service is separately identifiable from other promises in the contract. To the extent acontract includes multiple promised goods and services, the Company must apply judgment to determine whether promised goods and services are capable ofbeing distinct and are distinct in the context of the contract. If these criteria are not met, the promised goods and services are accounted for as a combinedperformance obligation.66Source: AGENUS INC, 10-K, March 18, 2019Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results.3) Determine the transaction priceThe transaction price is determined based on the consideration to which the Company will be entitled in exchange for transferring goods and servicesto the customer. To the extent the transaction price includes variable consideration, the Company estimates the amount of variable consideration that shouldbe included in the transaction price utilizing either the expected value method or the most likely amount method depending on the nature of the variableconsideration. Variable consideration is included in the transaction price if, in the Company’s judgment, it is probable that a significant future reversal ofcumulative revenue under the contract will not occur. Any estimates, including the effect of the constraint on variable consideration, are evaluated at eachreporting period for any changes. Determining the transaction price requires significant judgment, which is discussed in further detail for each of theCompany’s contracts with customers in Note 14.4) Allocate the transaction price to performance obligations in the contractIf the contract contains a single performance obligation, the entire transaction price is allocated to the single performance obligation. Contracts thatcontain multiple performance obligations require an allocation of the transaction price to each performance obligation on a relative stand-alone selling pricebasis unless the transaction price is variable and meets the criteria to be allocated entirely to a performance obligation or to a distinct service that forms partof a single performance obligation. The consideration to be received is allocated among the separate performance obligations based on relative stand-aloneselling prices. Determining the amount of the transaction price to allocate to each separate performance obligation requires significant judgement, which isdiscussed in further detail for each of the Company’s contracts with customers in Note 14.5) Recognize revenue when or as the Company satisfies a performance obligationThe Company satisfies performance obligations either over time or at a point in time. Revenue is recognized over time if either 1) the customersimultaneously receives and consumes the benefits provided by the entity’s performance, 2) the entity’s performance creates or enhances an asset that thecustomer controls as the asset is created or enhanced, or 3) the entity’s performance does not create an asset with an alternative use to the entity and the entityhas an enforceable right to payment for performance completed to date. If the entity does not satisfy a performance obligation over time, the relatedperformance obligation is satisfied at a point in time by transferring the control of a promised good or service to a customer. Examples of control are using theasset to produce goods or services, enhance the value of other assets, settle liabilities, and holding or selling the asset. ASC 606 requires the Company toselect a single revenue recognition method for the performance obligation that faithfully depicts the Company’s performance in transferring control of thegoods and services. The guidance allows entities to choose between two methods to measure progress toward complete satisfaction of a performanceobligation: 1.Output methods - recognize revenue on the basis of direct measurements of the value to the customer of the goods or services transferred to daterelative to the remaining goods or services promised under the contract (e.g. surveys of performance completed to date, appraisals of resultsachieved, milestones reached, time elapsed, and units of produced or units delivered); and 2.Input methods - recognize revenue on the basis of the entity’s efforts or inputs to the satisfaction of a performance obligation (e.g., resourcesconsumed, labor hours expended, costs incurred, or time elapsed) relative to the total expected inputs to the satisfaction of that performanceobligation.Licenses of intellectual property: If the license to the Company’s intellectual property is determined to be distinct from the other performanceobligations identified in the arrangement, the Company recognizes revenue from non-refundable, up-front fees allocated to the license when the license istransferred to the customer and the customer is able to use and benefit from the license. For licenses that are bundled with other promises, the Companyutilizes judgment to assess the nature of the combined performance obligation to determine whether the combined performance obligation is satisfied overtime or at a point in time and, if over time, the appropriate method of measuring progress for purposes of recognizing revenue from non-refundable, up-frontfees. The Company evaluates the measure of progress each reporting period and, if necessary, adjusts the measure of performance and related revenuerecognition.Milestone payments: At the inception of each arrangement that includes development, regulatory or commercial milestone payments, the Companyevaluates whether the milestones are considered probable of being reached and estimates the amount to be included in the transaction price. ASC 606suggests two alternatives to use when estimating the amount of variable consideration: the expected value method and the most likely amount method.Under the expected value method, an entity considers the sum of probability-weighted amounts in a range of possible consideration amounts. Under the mostlikely amount method, an entity considers the single most likely amount in a range of possible consideration amounts. Whichever method is used, it shouldbe consistently applied throughout the life of the contract; however, it is not necessary for the Company to use the same approach for all contracts. TheCompany uses the most likely amount method for development and regulatory milestone payments. If it is probable that a significant revenue reversal wouldnot occur, the associated milestone value is included in the transaction price. The transaction price67Source: AGENUS INC, 10-K, March 18, 2019Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results.is then allocated to each performance obligation on a relative stand-alone selling price basis. The Company recognizes revenue as or when the performanceobligations under the contract are satisfied. At the end of each subsequent reporting period, the Company re-evaluates the probability or achievement of eachsuch milestone and any related constraint, and if necessary, adjusts its estimates of the overall transaction price. Any such adjustments are recorded on acumulative catch-up basis, which would affect revenues and earnings in the period of adjustment.Royalties: For arrangements that include sales-based royalties, including milestone payments based on the level of sales, and the license is deemed tobe the predominant item to which the royalties relate, the Company recognizes revenue at the later of (i) when the related sales occur, or (ii) when theperformance obligation to which some or all of the royalty has been allocated has been satisfied (or partially satisfied).Up-front Fees: Depending on the nature of the agreement, up-front payments and fees may be recorded as deferred revenue upon receipt or when dueand may require deferral of revenue recognition to a future period until the Company performs its obligations under these arrangements. Amounts payable tothe Company are recorded as accounts receivable when the Company’s right to consideration is unconditional. The Company does not assess whether acontract has a significant financing component if the expectation at contract inception is such that the period between payment by the customer and thetransfer of the promised goods or services to the customer will be one year or less.Impact of Adopting ASC 606 on the Consolidated Financial StatementsWe adopted ASC 606 using the modified retrospective method. The cumulative effect of applying the new guidance to all contracts with customersthat were not completed as of January 1, 2018 was recorded as an adjustment to accumulated deficit as of the adoption date. We elected to apply a practicalexpedient to reflect the aggregate effect of all modifications that occurred before January 1, 2018 when identifying the satisfied and unsatisfied performanceobligations, determining the transaction price, and allocating the transaction price to the satisfied and unsatisfied performance obligations. The estimatedeffect of applying this practical expedient results in a slower recognition of the transaction price, as more consideration is allocated to performanceobligations originally identified as a material right at contract inception. As a result of applying the modified retrospective method to adopt the new revenueguidance, the following adjustments were made to the consolidated balance sheet as of January 1, 2018 (in thousands): As ReportedDecember 31, 2017 ASC 606Adjustment Adjusted January 1,2018 Consolidated Balance Sheet Data: Current portion, deferred revenue $4,485 $(2,986) $1,499 Deferred revenue, net of current portion 7,748 (5,870) 1,878 Accumulated deficit $(1,026,476) $8,856 $(1,017,620) Impact of ASC 606 on the Consolidated Financial StatementsIn accordance with Topic 606, the disclosure of the impact of adoption to our consolidated statements of income and balance sheets was as follows (inthousands): Year ended December 31, 2018 As Reported UnderASC 606 Adjustments Notes Balances withoutAdoption of ASC 606 Consolidated Balance Sheet Data: Current portion, deferred revenue 1,814 1,001 (1) 2,815 Deferred revenue, net of current portion 1,165 4,695 (1) 5,860 Accumulated deficit (1,177,311) (5,696) (2) (1,183,007) Consolidated Statement of Operations Data: Research and development revenue $19,475 $3,160 (3) $22,635 (1)Adjustment to deferred revenue to reflect recognition of revenue under ASC 605 primarily attributable to the change in the timing of revenuerecognition for amounts received under the Incyte Collaboration Agreement, see Note 14. (2)Adjustment to accumulated deficit to reflect the reversal of the cumulative transition adjustment and the difference in revenue from ASC 606 toASC 605, see Note 14. (3)Adjustment to reflect the difference in revenue recognition from ASC 606 to ASC 605 primarily attributable to the change in recognition of anupfront fee related to the GSK License and Amended Supply Agreements, see Note 14.68Source: AGENUS INC, 10-K, March 18, 2019Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results.(l) Foreign Currency TransactionsGains and losses from our foreign currency based accounts and transactions, such as those resulting from the translation and settlement of receivablesand payables denominated in foreign currencies, are included in the consolidated statements of operations within other (expense) income. We do notcurrently use derivative financial instruments to manage the risks associated with foreign currency fluctuations. We recorded a foreign currency loss of $2.2million for the year ended December 31, 2018, a foreign currency gain of $1.9 million for the year ended December 31, 2017, and a foreign currency loss of$2.1 million for the year ended December 31, 2016.(m) Research and DevelopmentResearch and development expenses include the costs associated with our internal research and development activities, including salaries andbenefits, share-based compensation, occupancy costs, clinical manufacturing costs, related administrative costs, and research and development conducted forus by outside advisors, such as sponsored university-based research partners and clinical study partners. We account for our clinical study costs by estimatingthe total cost to treat a patient in each clinical trial and recognizing this cost based on estimates of when the patient receives treatment, beginning when thepatient enrolls in the trial. Research and development expenses also include the cost of clinical trial materials shipped to our research partners. Research anddevelopment costs are expensed as incurred.(n) Share-Based CompensationWe account for share-based compensation in accordance with the provisions of ASC 718, Compensation—Stock Compensation and ASC 505-50,Equity-Based Payments to Non-Employees. Share-based compensation expense is recognized based on the estimated grant date fair value. Compensation costis recognized on a straight-line basis over the requisite service period of the award. Forfeitures are recognized as they occur. The non-cash charge tooperations for non-employee awards with vesting or other performance criteria is affected each reporting period by changes in the fair value of our commonstock. See Note 12 for a further discussion on share-based compensation.(o) Income TaxesIncome taxes are accounted for under the asset and liability method with deferred tax assets and liabilities recognized for the future tax consequencesattributable to differences between the financial statement carrying amounts of existing assets and liabilities and their respective tax basis and net operatingloss and tax credit carryforwards. Deferred tax assets and liabilities are measured using enacted tax rates expected to apply to taxable income in the years inwhich such items are expected to be reversed or settled. The effect on deferred tax assets and liabilities of a change in tax rates is recognized in theconsolidated statement of operations in the period that includes the enactment date. Deferred tax assets are recognized when they are more likely than notexpected to be realized.The Tax Cuts and Jobs Act (“the Act”) was enacted on December 22, 2017. The Act reduces the US federal corporate tax rate from 34% to 21%,requires companies to pay a one-time transition tax on earnings of certain foreign subsidiaries that were previously tax deferred and creates new taxes oncertain foreign sourced earnings. On December 22, 2017, the Securities and Exchange Commission issued guidance under Staff Accounting Bulletin No.118, Income Tax Accounting Implications of the Tax Cuts and Jobs Act (“SAB 118”) directing taxpayers to consider the impact of the U.S. legislation as“provisional” when it does not have the necessary information available, prepared or analyzed (including computations) in reasonable detail to complete itsaccounting for the change in tax law.As of December 31, 2018, we have completed our accounting for the tax effects of enactment of the Act, including the impacts described below.The impacts of the Act relate to the reduction in the U.S. corporate income tax rate to 21 percent, which resulted in re-measuring our deferred tax assetsand liabilities using the new 21 percent federal tax rate. This did not result in any net tax expense or benefit as there were corresponding and offsettingimpacts to our deferred tax asset valuation allowance. For the years ended December 31, 2018 and 2017, we recognized no transition tax as a result of ouraccumulated losses since inception of our foreign subsidiaries, beginning in 2002. We have elected to account for global intangible low-taxed income(“GILTI”) as a period expense. During the year ended December 31, 2018 we recognized no changes to the 2017 enactment-date provisional amounts. 69Source: AGENUS INC, 10-K, March 18, 2019Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results.(p) Net Loss Per ShareBasic income and loss per common share is calculated by dividing the net loss attributable to common stockholders by the weighted average numberof common shares outstanding (including common shares issuable under our Directors’ Deferred Compensation Plan). Diluted income per common share iscalculated by dividing net income attributable to common stockholders by the weighted average number of common shares outstanding (including commonshares issuable under our Directors’ Deferred Compensation Plan) plus the dilutive effect of outstanding instruments such as warrants, stock options, non-vested shares, convertible preferred stock, and convertible notes. Because we reported a net loss attributable to common stockholders for all periodspresented, diluted loss per common share is the same as basic loss per common share, as the effect of utilizing the fully diluted share count would havereduced the net loss per common share. Therefore, the following potentially dilutive securities have been excluded from the computation of diluted weightedaverage shares outstanding as of December 31, 2018, 2017, and 2016, as they would be anti-dilutive: Year Ended 2018 2017 2016 Warrants 2,900,000 4,351,450 4,351,450 Stock options 18,613,822 14,366,787 11,693,400 Nonvested shares 2,213,967 1,313,550 1,942,476 Series A-1 convertible preferred stock 333,333 333,333 333,333 Series C-1 convertible preferred stock 18,459,000 - - (q) GoodwillGoodwill represents the excess of cost over the fair value of net assets of businesses acquired. Goodwill is not amortized, but instead tested forimpairment at least annually. Annually we assess whether there is an indication that goodwill is impaired, or more frequently if events and circumstancesindicate that the asset might be impaired during the year. We perform our annual impairment test as of October 31 of each year. The first step of ourimpairment analysis compares the fair value of our reporting units to their net book value to determine if there is an indicator of impairment. We operate astwo reporting units. ASC 350, Intangibles, Goodwill and Other states that if the carrying value of a reporting unit is negative, the second step of theimpairment test shall be performed to measure the amount of impairment loss, if any, if qualitative factors indicate that it is more likely than not that agoodwill impairment exists. No goodwill impairment has been recognized for the periods presented.(r) In-process Research and DevelopmentAcquired in-process research and development (“IPR&D”) represents the fair value assigned to research and development assets that have not reachedtechnological feasibility. The value assigned to acquired IPR&D is determined by estimating the costs to develop the acquired technology into commerciallyviable products, estimating the resulting revenue from the projects, and discounting the net cash flows to present value. The revenue and cost projectionsused to value acquired IPR&D are, as applicable, reduced based on the probability of success of developing a new drug. Additionally, the projectionsconsider the relevant market sizes and growth factors, expected trends in technology, and the nature and expected timing of new product introductions by usand our competitors. The rates utilized to discount the net cash flows to their present value are commensurate with the stage of development of the projectsand uncertainties in the economic estimates used in the projections. Upon the acquisition of IPR&D, we complete an assessment of whether our acquisitionconstitutes the purchase of a single asset or a group of assets. We consider multiple factors in this assessment, including the nature of the technologyacquired, the presence or absence of separate cash flows, the development process and stage of completion, quantitative significance and our rationale forentering into the transaction.If we acquire an asset or group of assets that do not meet the definition of a business under applicable accounting standards, then the acquired IPR&Dis expensed on its acquisition date. Future costs to develop these assets are recorded to research and development expense as they are incurred.We review amounts capitalized as acquired IPR&D for impairment at least annually, as of October 31, or whenever events or changes in circumstancesindicate that the carrying value of the assets might not be recoverable. When performing our impairment assessment, we have the option to first assessqualitative factors to determine whether it is necessary to estimate the fair value of our acquired IPR&D. If we elect this option and believe, as a result of thequalitative assessment, that it is more-likely-than-not that the fair value of our acquired IPR&D is less than its carrying amount, we estimate the fair valueusing the same methodology as described above. If the carrying value of our acquired IPR&D exceeds its fair value, then the intangible asset is written-downto its fair value. Alternatively, we may elect to not first assess qualitative factors and immediately estimate the fair value of our acquired IPR&D. No IPR&Dimpairments were recognized for the years presented.70Source: AGENUS INC, 10-K, March 18, 2019Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results.(s) Accounting for Asset Retirement ObligationsWe record the fair value of an asset retirement obligation as a liability in the period in which we incur a legal obligation associated with the retirementof tangible long-lived assets that result from the acquisition, construction, development, and/or normal use of the assets. A legal obligation is a liability that aparty is required to settle as a result of an existing or enacted law, statute, ordinance, or contract. We are also required to record a corresponding asset that isdepreciated over the life of the asset. Subsequent to the initial measurement of the asset retirement obligation, the obligation will be adjusted at the end ofeach period to reflect the passage of time (accretion) and changes in the estimated future cash flows underlying the obligation. Changes in the liability due toaccretion are charged to the consolidated statement of operations, whereas changes due to the timing or amount of cash flows are an adjustment to thecarrying amount of the related asset. Our asset retirement obligations primarily relate to the expiration of our facility lease and anticipated costs to beincurred based on our lease terms.(t) Long-lived AssetsIf required based on certain events and circumstances, recoverability of assets to be held and used, other than goodwill and intangible assets not beingamortized, is measured by a comparison of the carrying amount of an asset to the undiscounted future net cash flows expected to be generated by the asset orasset group. If the carrying amount of an asset exceeds its estimated future undiscounted cash flows, an impairment charge is recognized for the amount bywhich the carrying amount of the asset exceeds the fair value of the asset. Authoritative guidance requires companies to separately report discontinuedoperations and extends that reporting to a component of an entity that either has been disposed of (by sale, abandonment, or in a distribution to owners) or isclassified as held for sale. Assets to be disposed of are reported at the lower of the carrying amount or fair value less costs to sell.(u) Recent Accounting Pronouncements Recently Issued and AdoptedIn May 2014, the FASB issued Accounting Standards Update (“ASU”) No. 2014-09, Revenue from Contracts with Customers, (Topic 606) ("ASU2014-09"). ASU 2014-09 amends the guidance for the recognition of revenue from contracts with customers to transfer goods and services. The FASBsubsequently issued additional, clarifying standards to address issues arising from the implementation of the new revenue recognition standard. The newrevenue recognition standard and clarifying standards require an entity to recognize revenue when control of promised goods or services is transferred to thecustomer at an amount that reflects the consideration to which the entity expects to be entitled in exchange for those goods or services. We adopted this newstandard on January 1, 2018, by using the modified-retrospective method. See Note 2 (k) and Note 14. In January 2017, the FASB issued ASU No. 2017-01, Business Combinations (Topic 805): Clarifying the Definition of a Business (“ASU 2017-01”),which provides guidance regarding the definition of a business, with the objective of adding guidance to assist entities with evaluating whether transactionsshould be accounted for as acquisitions (or disposals) of assets or businesses. We adopted ASU 2017-01 on January 1, 2018 and will apply it prospectively.The impact on our consolidated financial statements in future periods will depend on the specific facts and circumstances of future transactions. In May 2017, the FASB issued ASU No. 2017-09, Compensation – Stock Compensation (Topic 718) Scope of Modification Accounting (“ASU 2017-09”). The amendments in ASU 2017-09 provide guidance about which changes to the terms or conditions of a share-based payment award require an entity toapply modification accounting in Topic 718. We adopted ASU 2017-09 on January 1, 2018. The guidance will be applied prospectively to awards modifiedon or after the adoption date. The adoption of ASU 2017-09 did not have any impact on our consolidated financial statements. Recently Issued, Not Yet AdoptedIn February 2016, the FASB issued ASU 2016-02, Leases (Topic 842) (“ASU 2016-02”) which supersedes Topic 840, Leases. ASU 2016-02 requireslessees to recognize a right-of-use asset and a lease liability on their balance sheets for all leases with terms greater than twelve months. Based on certaincriteria, leases will be classified as either financing or operating, with classification affecting the pattern of expense recognition in the income statement. Forleases with a term of 12 months or less, a lessee is permitted to make an accounting policy election by class of underlying asset not to recognize lease assetsand lease liabilities. If a lessee makes this election, it should recognize lease expense for such leases generally on a straight-line basis over the lease term.ASU 2016-02 is effective for us on January 1, 2019, and requires a modified retrospective transition approach. The modified retrospective approach includesa number of optional practical expedients primarily focused on leases that commenced before the effective date of Topic 842, including continuing toaccount for leases that commence before the effective date in accordance with previous guidance, unless the lease is modified. 71Source: AGENUS INC, 10-K, March 18, 2019Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results.In July 2018, the FASB issued ASU 2018-11, which provides companies an additional, optional, transition method. This optional method allowscompanies to initially apply the standard at the adoption date and recognize a cumulative-effect adjustment to the opening balance of retained earnings inthe period of adoption. We have elected this transition approach, using a cumulative-effect adjustment on the effective date of the standard, with comparativeperiods presented in accordance with the existing guidance in ASC 840. We adopted the standard on January 1, 2019 and have used the effective date as ourdate of initial application. We expect to take advantage of certain available expedients by electing the transition package of practical expedients permittedwithin ASU 2016-02, which allows us to not reassess previous accounting conclusions around whether arrangements are, or contain, leases, the classificationof leases, and the treatment of initial direct costs. We are still assessing the impact of adopting Topic 842, and currently expect to recognize additional lease liabilities and right-of-use assets as ofJanuary 1, 2019, related to our operating leases. Refer to Note 16 for details on our current lease arrangements. We further expect to provide enhanced newdisclosures about our leasing arrangements in our financial statements for future periods. We do not expect that the new standard will have a material impacton our consolidated statement of operations or cash flows. In January 2017, the FASB issued ASU 2017-04, Intangibles – Goodwill and Other (Topic 350) (“ASU 2017-04”) that will eliminate the requirementto calculate the implied fair value of goodwill to measure a goodwill impairment charge. Instead, an impairment charge will be based on the excess of areporting unit’s carrying amount over its fair value. The guidance is effective for the Company in the first quarter of fiscal 2020. Early adoption is permitted.We do not anticipate the adoption of this guidance to have a material impact on our consolidated financial statements, absent any goodwill impairment. In June 2018, the FASB issued ASU No. 2018-07, Compensation – Stock Compensation (Topic 718) Improvements to Nonemployee Share-BasedPayment Accounting (“ASU 2018-07”). The amendments in ASU 2018-07 simplify the accounting for share-based payments to nonemployees by aligning itwith the accounting for share-based payments to employees, with certain exceptions. The standard will be effective for fiscal years beginning after December15, 2018, and interim periods within those fiscal years. We are currently evaluating the impact of adoption of ASU 2018-07 on our consolidated financialstatements. In August 2018, the FASB issued ASU No. 2018-13, Fair Value Measurement (Topic 820): Disclosure Framework - Changes to the DisclosureRequirements for Fair Value Measurement ("ASU 2018-13"). The amendments in ASU 2018-13 modify the disclosure requirements of fair valuemeasurements. The standard will be effective for fiscal years beginning after December 15, 2019, and interim periods within those fiscal years, with earlyadoption permitted. Certain disclosures are required to be applied on a retrospective basis and others on a prospective basis. We are currently evaluating theimpact of adoption of ASU 2018-13 on our financial statement disclosures. In August 2018, the FASB issued ASU No. 2018-15, Intangibles - Goodwill and Other - Internal-Use Software (Subtopic 350-40): Customer'sAccounting for Implementation Costs Incurred in a Cloud Computing Arrangement that is a Service Contract ("ASU 2018-15"). The amendments in ASU2018-15 align the requirements for capitalizing implementation costs incurred in a hosting arrangement that is a service contract with the requirements forcapitalizing implementation costs incurred to develop or obtain internal-use software. The standard will be effective for fiscal years beginning after December15, 2019, and interim periods within those fiscal years, with early adoption permitted. ASU 2018-15 is required to be applied either retrospectively orprospectively to all implementation costs incurred after the date of adoption. We are currently evaluating the impact of adoption of ASU 2018-07 on ourconsolidated financial statements. In November 2018, the FASB issued ASU No. 2018-18, Collaborative Arrangements (Topic 808): Clarifying the Interaction between Topic 808 andTopic 606 (“ASU 2018-18”). ASU 2018-18 (1) clarifies that certain transactions between collaborative arrangement participants should be accounted forunder ASC 606, when the collaborative arrangement participant is a customer in the context of a unit of account, (2) adds unit-of-account guidance in ASC808 to align with ASC 606 when an entity is assessing whether the collaborative arrangement, or a part of the arrangement, is within the scope of ASC 606,(3) precludes presenting transactions together with revenue when those transactions involve collaborative arrangement participants that are not directlyrelated to third parties and are not customers. The standard will be effective for fiscal years beginning after December 15, 2019, and interim periods withinthose fiscal years, with early adoption permitted. We are currently evaluating the impact of adoption of ASU 2018-18 on our consolidated financialstatements.No other new accounting pronouncement issued or effective during the year ended December 31, 2018 had or is expected to have a material impact onour consolidated financial statements or disclosures. 72Source: AGENUS INC, 10-K, March 18, 2019Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results.(3) Business Acquisitions 4-AntibodyOn January 10, 2014, we entered into a Share Exchange Agreement (the “Share Exchange Agreement”) providing for our acquisition of all of theoutstanding capital stock of Agenus Switzerland Inc. (formerly known as 4-Antibody AG) (“4-AB”), from the shareholders of 4-AB (the “4-ABShareholders”). The transaction closed on February 12, 2014 (the “Closing Date”). In exchange for their shares, the 4-AB Shareholders received an aggregateof 3,334,079 shares of our common stock paid upon closing and valued at $10.1 million. Contingent milestone payments of up to $40.0 million (the“contingent purchase price consideration”), payable in cash or shares of our common stock at our option, are due to the 4-AB Shareholders as follows: (i)$20.0 million upon our market capitalization exceeding $300.0 million for 10 consecutive trading days prior to the earliest of (a) the fifth anniversary of theClosing Date (b) the sale of the 4-AB or (c) the sale of Agenus; (ii) $10.0 million upon our market capitalization exceeding $750.0 million for 30 consecutivetrading days prior to the earliest of (a) the tenth anniversary of the Closing Date (b) the sale of 4-AB, or (c) the sale of Agenus, and (iii) $10.0 million upon ourmarket capitalization exceeding $1.0 billion for 30 consecutive trading days prior to the earliest of (a) the tenth anniversary of the Closing Date, (b) the saleof 4-AB, or (c) the sale of Agenus. We assigned an acquisition date fair value of $9.7 million to the contingent purchase price consideration. During January2015, the first milestone noted above was achieved. This acquisition provided us with the Retrocyte Display technology platform for the rapid discovery andoptimization of fully-human and humanized monoclonal antibodies against a wide array of molecular targets and a portfolio of CPM antibodies. PhosImmune Inc. On December 23, 2015 (the “PhosImmune Closing Date”), we entered into a Purchase Agreement with PhosImmune Inc., a privately-held Virginiacorporation (“PhosImmune”), the securityholders of PhosImmune (the “PhosImmune Securityholders”) and Fanelli Haag PLLC, as representative of thePhosImmune Securityholders providing for the acquisition of all outstanding securities of PhosImmune. On the PhosImmune Closing Date, in exchange fortheir shares, the PhosImmune Securityholders received $2.5 million in cash and an aggregate of 1,631,521 of our common stock paid upon closing andvalued at $7.4 million. Contingent milestone payments up to $35.0 million payable in cash and/or stock at our option are due as follows: (i) $5.0 millionupon the closing trading price of our common stock equals or exceeds $8.00 for 60 consecutive trading days prior to the earlier of (a) the fifth anniversary ofthe PhosImmune Closing Date or (b) the sale of Agenus; (ii) $15.0 million if the closing trading price of our common stock equals or exceeds $13.00 for 60consecutive trading days prior to the earlier of (a) the tenth anniversary of the PhosImmune Closing Date or (b) the sale of Agenus; and (iii) $15.0 million ifthe closing trading price of our common stock equals or exceeds $19.00 for 60 consecutive trading days prior to the earlier of (a) the tenth anniversary of thePhosImmune Closing Date or (b) the sale of Agenus. We assigned an acquisition date fair value of $2.5 million to the contingent purchase priceconsideration. This acquisition expands our I-O pipeline and strengthens our neoantigen capabilities to enable the development of best-in-class cancervaccines and other novel therapies. (4) Asset Purchase Agreements Celexion, LLCOn April 7, 2015 (the “Celexion Closing Date”), we entered into an Asset Purchase Agreement (the “Celexion Purchase Agreement”) with Celexion,LLC (“Celexion”) and each of the members of Celexion, pursuant to which, we acquired Celexion’s SECANT yeast display antibody discovery platform, itsfull-length IgG antibody library, its technology for the discovery of molecules targeting cell membrane-associated antigens, and certain other relatedintellectual property assets (collectively, the “Purchased Assets”). As consideration for the Purchased Assets, on the Celexion Closing Date we paid Celexion$1.0 million in cash and issued Celexion 574,140 shares of our common stock valued at approximately $5.23 per share. As additional consideration for thePurchased Assets, we agreed under the Celexion Purchase Agreement to pay to Celexion (i) $1.0 million in cash payable on each of the 9-month and 18-month anniversaries of the Celexion Closing Date and (ii) $4.0 million on each of the 12-month and 24-month anniversaries of the Celexion Closing Datepayable at our discretion in cash, shares of our common stock, or any combination thereof. If we elect to pay any of the additional consideration in shares ofour common stock, such shares will be issued at a price per share equal to the simple average of the daily closing volume weighted average price over the 20trading days preceding the date of issuance. We agreed to file one or more registration statements under the Securities Act to cover the resale of all sharesissued as consideration under the Celexion Purchase Agreement. In May 2015, we filed a registration statement covering the resale of the 574,140 sharesissued to Celexion on the Celexion Closing Date, and the SEC declared the registration statement effective in June 2015. This transaction was accounted foras an asset acquisition in accordance with ASC 805 Business Combinations. In accordance with ASC 730 Research and Development, the purchase price ofapproximately $13.2 million was recorded as research and development expense in our consolidated statement of operations and comprehensive loss for theyear December 31, 2015 as the IPR&D was deemed to have no future alternative use.73Source: AGENUS INC, 10-K, March 18, 2019Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results.On November 9, 2017 we made the final payment under the Celexion Purchase Agreement. We issued to Celexion 999,317 shares of our commonstock based on the preceding 20 trading day average of approximately $4.10 per share. The closing price of our common stock on November 9, 2017 was$3.55 per share. As such, we recorded a gain of approximately $550,000 at issuance. Also on November 9, 2017, we filed a registration statement covering thesale of the 999,317 shares issued to Celexion. The SEC declared the registration statement effective in January 2018. (5) Goodwill and Acquired Intangible AssetsThe following table sets forth the changes in the carrying amount of goodwill for year ended December 31, 2018 (in thousands): Balance, December 31, 2017 $23,049 Effect of foreign currency (124)Balance, December 31, 2018 $22,925 Acquired intangible assets consisted of the following at December 31, 2018 and 2017 (in thousands): As of December 31, 2018 Amortizationperiod(years) Gross carryingamount Accumulatedamortization Net carryingamount Intellectual Property 7-15 years $16,509 $(6,147) $10,362 Trademarks 4.5 years 820 (820) - Other 2-6 years 569 (505) 64 In-process research and development Indefinite 1,912 — 1,912 Total $19,810 $(7,472) $12,338 As of December 31, 2017 Amortizationperiod(years) Gross carryingamount Accumulatedamortization Net carryingamount Intellectual Property 7-15 years $16,545 $(4,290) $12,255 Trademarks 4.5 years 826 (711) 115 Other 2-6 years 570 (461) 109 In-process research and development Indefinite 1,928 — 1,928 Total $19,869 $(5,462) $14,407The weighted average amortization period of our finite-lived intangible assets is approximately 9 years. Amortization expense for the years endedDecember 31, 2018, 2017, and 2015 was $2.0 million, $2.3 million and $2.2 million, respectively. Amortization expense related to acquired intangibles isestimated at $1.9 million for 2019, $1.9 million for each of 2020, 2021, and 2022 and $1.4 million for 2023.The acquired IPR&D asset relates to the six pre-clinical antibody programs acquired in the Agenus Switzerland transaction. IPR&D acquired in abusiness combination is capitalized at fair value until the underlying project is completed and is subject to impairment testing. Once the project iscompleted, the carrying value of IPR&D is amortized over the estimated useful life of the asset. Post-acquisition research and development expenses relatedto the acquired IPR&D are expensed as incurred. (6) InvestmentsCash Equivalents and Short-term InvestmentsCash equivalents and short-term investments consisted of the following as of December 31, 2018 and 2017 (in thousands): December 31, 2018 December 31, 2017 Cost EstimatedFair Value Cost EstimatedFair Value Institutional Money Market Funds $29,948 $29,948 $57,036 $57,036 As a result of the short-term nature of our investments, there were minimal unrealized holding gains or losses as of December 31, 2018, 2017 and 2016.74Source: AGENUS INC, 10-K, March 18, 2019Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results.All the investments listed above have been classified as cash equivalents on our consolidated balance sheet as of December 31, 2018 and 2017,respectively. (7) Property, Plant and EquipmentProperty, plant and equipment, net as of December 31, 2018 and 2017 consist of the following (in thousands): 2018 2017 EstimatedDepreciableLivesLand $2,230 $2,230 IndefiniteBuilding and building improvements 5,451 4,682 35 yearsFurniture, Fixtures, and other 3,984 5,409 3 to 10 yearsLaboratory and manufacturing equipment 18,993 17,438 4 to 10 yearsLeasehold improvements 24,525 23,415 2 to 12 yearsSoftware and computer equipment 8,001 7,034 3 years 63,184 60,208 Less accumulated depreciation and amortization (38,068) (34,029) Total $25,116 $26,179 (8) Income TaxesWe are subject to taxation in the U.S. and in various state, local, and foreign jurisdictions. We remain subject to examination by U.S. Federal, state,local, and foreign tax authorities for tax years 2015 through 2018. With a few exceptions, we are no longer subject to U.S. Federal, state, local, and foreignexaminations by tax authorities for the tax year 2014 and prior. However, net operating losses from the tax year 2014 and prior would be subject toexamination if and when used in a future tax return to offset taxable income. Our policy is to recognize income tax related penalties and interest, if any, in ourprovision for income taxes and, to the extent applicable, in the corresponding income tax assets and liabilities, including any amounts for uncertain taxpositions.As of December 31, 2018, we had available net operating loss carryforwards of $795.7 million and $300.4 million for Federal and state income taxpurposes, respectively, which are available to offset future Federal and state taxable income, if any, $85.3 million of these Federal net operating losscarryforwards do not expire, while the remaining net operating loss carryforwards expire between 2019 and 2038. Our ability to use these net operating lossesis limited by change of control provisions under Internal Revenue Code Section 382 and may expire unused. In addition, we have $8.9 million and $11.9million of Federal and state research and development credits, respectively, available to offset future taxable income. These Federal and state research anddevelopment credits expire between 2019 and 2038 and 2019 and 2029, respectively. Additionally, we have $0.2 million of state investment tax credits,available to offset future taxable income and expire between 2019 and 2021. We also have foreign income tax net operating loss carryforwards ofapproximately $1.8 million which are available to offset future foreign taxable income, if any, and expire between 2019 and 2024. The potential impacts ofsuch provisions are among the items considered and reflected in management’s assessment of our valuation allowance requirements.75Source: AGENUS INC, 10-K, March 18, 2019Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results.The tax effect of temporary differences and net operating loss and tax credit carryforwards that give rise to significant portions of the deferred taxassets and deferred tax liabilities as of December 31, 2018 and 2017 are presented below (in thousands). 2018 2017 Deferred tax assets: U.S. Federal and State net operating loss carryforwards $182,557 $185,535 Foreign net operating loss carryforwards 1,524 16,209 Research and development tax credits 18,507 19,597 Share-based compensation 4,824 8,249 Intangible Assets 36,217 — Interest expense carryforward 6,555 — Other 4,882 6,221 Total deferred tax assets 255,066 235,811 Less: valuation allowance (254,315) (232,443)Net deferred tax assets 751 3,368 Foreign intangible assets (1,063) (1,178)Other (406) (2,782)Deferred tax liabilities (1,469) (3,960)Net deferred tax liability $(718) $(592) In assessing the realizability of deferred tax assets, we consider whether it is more likely than not that some portion or all of the deferred tax assets willnot be realized. The ultimate realization of deferred tax assets is dependent upon the generation of future taxable income during the periods in which the netoperating loss and tax credit carryforwards can be utilized or the temporary differences become deductible. We consider projected future taxable income andtax planning strategies in making this assessment. In order to fully realize the deferred tax asset, we will need to generate future taxable income sufficient toutilize net operating losses prior to their expiration. Based upon our history of not generating taxable income due to our business activities focused onproduct development, we believe that it is more likely than not that deferred tax assets will not be realized through future earnings. Accordingly, a valuationallowance has been established for deferred tax assets which will not be offset by the reversal of deferred tax liabilities. The valuation allowance on thedeferred tax assets increased by $21.9 million during the year ended December 31, 2018, while the valuation allowance decreased by $63.1 during the yearended December 31, 2017, which was primarily related to the “Tax Cuts and Jobs Act”, which reduced the federal tax rate from 34% to 21%.Income tax benefit was nil for the years ended December 31, 2018, 2017 and 2016. Income taxes recorded differed from the amounts computed byapplying the U.S. Federal income tax rate of 21% in 2018 and 34% in 2017 and 2016 to loss before income taxes as a result of the following (in thousands). 2018 2017 2016 Computed “expected” Federal tax benefit $(34,029) $(41,035) $(42,781)(Increase) reduction in income taxes benefit resulting from: Change in valuation allowance 24,233 (63,868) 35,471 (Decrease) increase due to uncertain tax positions 7 — (203)Foreign income inclusion 11,089 — — State and local income benefit, net of Federal income tax benefit (11,708) (4,561) (3,452)Change in federal tax rate — 104,764 — Foreign rate differential 956 2,084 4,398 Other, net 9,452 2,616 6,567 Income tax benefit $— $— $— 76Source: AGENUS INC, 10-K, March 18, 2019Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results.A reconciliation of the beginning and ending amount of gross unrecognized tax benefits is as follows (in thousands): 2018 2017 2016 Balance, January 1 $4,349 $5,278 $5,481 Increase related to current year positions — — — Increase (decrease) related to previouslyrecognized positions 7 — (203)Decrease related to change in federal tax rate — (929) — Balance, December 31 $4,356 $4,349 $5,278 These unrecognized tax benefits would all impact the effective tax rate if recognized. There are no positions which we anticipate could change withinthe next twelve months. (9) Accrued and Other Current LiabilitiesAccrued liabilities consist of the following as of December 31, 2018 and 2017 (in thousands): December 31,2018 December 31,2017 Payroll $8,770 $7,790 Professional fees 3,528 2,021 Contract manufacturing costs 5,947 5,528 Research services 5,348 4,663 Other 958 1,567 Total $24,551 $21,569 (10) EquityEffective June 14, 2016, our certificate of incorporation was amended to increase the number of authorized shares of common stock from 140,000,000to 240,000,000.Under the terms and conditions of the Certificate of Designation creating the Series A-1 Preferred Stock, this stock is convertible by the holder at anytime into our common stock, is non-voting, has an initial conversion price of $94.86 per common share, subject to adjustment, and is redeemable by us at itsface amount ($31.6 million), plus any accrued and unpaid dividends. The Certificate of Designation does not contemplate a sinking fund. The Series A-1Preferred Stock ranks senior to both our Series C-1 Convertible Preferred Stock and our common stock. In a liquidation, dissolution, or winding up of theCompany, the Series A-1 Preferred Stock’s liquidation preference must be fully satisfied before any distribution could be made to the holders of the commonstock. Other than in such a liquidation, no terms of the Series A-1 Preferred Stock affect our ability to declare or pay dividends on our common stock as longas the Series A-1 Preferred Stock’s dividends are accruing. The liquidation value of this Series A-1 Preferred stock is equal to $1,000 per share outstandingplus any accrued unpaid dividends. Dividends in arrears with respect to the Series A-1 Preferred Stock were approximately $1.2 million or $38.33 per share,and $1.0 million, or $31.79 per share, at December 31, 2018 and 2017, respectively.In January 2008, we entered into a private placement agreement (the “January 2008 private placement”) pursuant to which we sold 1,451,450 shares ofcommon stock for $18.00 for each share sold. Investors also received (i) 10-year warrants to purchase, at an exercise price of $18.00 per share, up to 1,451,450shares of common stock and (ii) unit warrants to purchase, at an exercise price of $18.00 per unit, contingent upon a triggering event as defined in the January2008 private placement documents, (a) up to 1,451,450 shares of common stock and (b) additional 10-year warrants to purchase, at an exercise price of$18.00 per share, up to 1,451,450 additional shares of common stock. In accordance with the terms of the January 2008 private placement, the 10-yearwarrants became exercisable for a period of 9.5 years as of July 9, 2008. Our private placement in April 2008 qualified as a triggering event, and therefore theunit warrants became exercisable for a period of eighteen months as of July 9, 2008. The unit warrants expired unexercised in January 2010. In February2008, we filed, and the Securities and Exchange Commission (the “SEC”) declared effective, the required registration statement covering the resale of the1,451,450 shares of common stock issued and the 1,451,450 shares issuable upon the exercise of the 10-year warrants issued in the January 2008 privateplacement. In connection with the January 2008 private placement, of the 1,451,450 warrants issued, 284,785 of the warrants were issued to Garo Armen, ourCEO. These 10-year warrants expired unexercised in January 2018.77Source: AGENUS INC, 10-K, March 18, 2019Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results.During September 2013, we sold approximately 3,333,000 shares of our common stock and warrants to purchase 1,000,000 shares of our commonstock in a registered direct public offering raising net proceeds of approximately $9.5 million, after deducting offering expenses. The common stock andwarrants were sold in units, with each unit consisting of one share of common stock and a warrant to purchase 0.3 of a share of common stock. Subject tocertain ownership limitations, the warrants became exercisable beginning 6 months following issuance and will expire five years from the date they becomeexercisable, at an exercise price of $3.75 per share. The number of shares issuable upon exercise of the warrants and the exercise price of the warrants areadjustable in the event of stock splits, stock dividends, combinations of shares and similar recapitalization transactions. As of the year ended December 31,2018 all warrants remain unexercised.On January 9, 2015, in connection with the execution of the Collaboration Agreement, we also entered into the Stock Purchase Agreement (the “StockPurchase Agreement”) with Incyte Corporation, pursuant to which Incyte purchased approximately 7.76 million shares of our common stock (the “Shares”) inFebruary 2015 for an aggregate purchase price of $35.0 million, or approximately $4.51 per share. Under the Stock Purchase Agreement, we agreed to registerthe Shares for resale under the Securities Act of 1933, as amended (the "Securities Act"). Subsequently, we filed, and the SEC declared effective, a registrationstatement covering the resale of the 7,760,000 shares of our common stock issued. On February 14, 2017, we entered into an additional Stock PurchaseAgreement (the “Additional Stock Purchase Agreement”) with Incyte, pursuant to which Incyte purchased 10 million shares of our common stock (the“Additional Shares”) at a purchase price of $6.00 per share. Immediately following the transaction, Incyte owned approximately 18.1% of our outstandingshares. Under the Additional Stock Purchase Agreement, Incyte agreed not to dispose of any of the Additional Shares for a period of 12 months and to votethe Additional Shares in accordance with the recommendations of the Company’s board of directors in connection with certain equity incentive plan orcompensation matters for a period of 18 months, and we agreed to certain registration rights with respect to the Additional Shares. The parties also revised theexisting standstill provision to permit Incyte’s acquisition of the Additional Shares, but Incyte is precluded from acquiring any additional shares of ourvoting stock until December 31, 2019.In September 2016, in accordance with the terms of the Technology Transfer and License Agreement with Iontas Limited (“Iontas”), we issued157,513 shares of our common stock to Iontas valued at approximately $887,000. In March 2017, we issued an additional 373,351 shares of our commonstock, valued at approximately $1.5 million, to Iontas in accordance with the terms of the Technology Transfer and License Agreement. Subsequently, wefiled, and the SEC declared effective, a registration statement covering the resale of the 530,864 shares of our common stock issued.In October 2017, we filed, and the SEC declared effective, a Registration Statement on Form S-3 (the “2017 Registration Statement”), covering theoffering of up to $250 million of common stock, preferred stock, warrants, debt securities and units. The 2017 Registration Statement included a prospectuscovering the offering, issuance and sale of up to 15 million shares of our common stock from time to time in “at-the-market offerings” pursuant to aControlled Equity OfferingSM sales agreement (the “Sales Agreement”) entered into with Cantor Fitzgerald & Co. (the “Sales Agent”) on October 30, 2017.Pursuant to the Sales Agreement, sales will be made only upon instructions by us to the Sales Agent, and we cannot provide any assurances that it will issueany shares pursuant to the Sales Agreement. On October 18, 2017, we exercised our right under that certain At Market Issuance Sales Agreement by andbetween us and MLV & Co. LLC, dated as of October 10, 2014 (the “2014 ATM Program”) to terminate the 2014 ATM Program, which termination tookeffect upon the effectiveness of the 2017 Registration Statement. During the year ended December 31, 2018, we sold 1,920,368 shares of our common stockin at-the-market offerings under the Sales Agreement. We terminated the Sales Agreement with Cantor Fitzgerald & Co. in May 2018.In May 2018 we entered into an At Market Issuance Sales Agreement (the “Agreement”) with B. Riley FBR, Inc. (“BRFBR”) with respect to an at-the-market offering program under which we may offer and sell, from time to time at our sole discretion, up to 20 million shares of our common stock throughBRFBR as our sales agent. The issuance and sale of the shares under the Agreement are made pursuant to our 2017 Registration Statement. In December2018, we filed a prospectus supplement with the SEC in connection with the offer and sale of up to an additional 30 million shares from time to time pursuantto the Agreement. During the year ended December 31, 2018, we sold 15,878,320 shares of our common stock in at-the-market offerings under theAgreement. (11) Series C-1 Convertible Preferred StockIn October 2018, we entered into a Stock Purchase Agreement with certain institutional investors (the “Purchasers”), pursuant to which we issued andsold an aggregate of 18,459 shares of Series C-1 Convertible Preferred Stock (the “C-1 Preferred Shares”), at a purchase price of $2,167 per share. Each C-1Preferred Share is convertible into 1,000 shares of our common stock at an initial conversion price of $2.167 per share of common stock, which represents a10% premium over the prior day’s closing price on Nasdaq. The aggregate purchase price paid by the Purchasers C-1 Preferred Shares was approximately$40,000,000. We received net proceeds of $39.9 million after offering expenses.78Source: AGENUS INC, 10-K, March 18, 2019Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results.The Stock Purchase Agreement requires us to register the resale of the Common Stock underlying the C-1 Preferred Shares (the “Conversion Shares”),which occurred in the fourth quarter of 2018.The C-1 Preferred Shares have been classified as temporary or mezzanine equity on our Consolidated Balance Sheets in accordance with U.S. GAAP asthe C-1 Convertible Preferred Shares contain deemed liquidation rights that are a contingent redemption feature not solely in the Company’s control.ConversionThe C-1 Preferred Shares are convertible at the option of the stockholder into the number of shares of Common Stock determined by dividing thestated value of the C-1 Preferred Shares being converted by the conversion price of $2.167, subject to adjustment for stock splits, reverse stock splits andsimilar recapitalization events. We will not effect any conversion of the C-1 Preferred Shares, and a stockholder shall not have the right to convert anyportion of the C-1 Preferred Shares, to the extent that, after giving effect to the conversion such stockholder would beneficially own in excess of 9.99% of thenumber of shares of the Common Stock outstanding immediately after giving effect to the issuance of shares of Common Stock pursuant to a notice ofconversion (the “Beneficial Ownership Limitation”). By written notice to us, a Purchaser may from time to time increase or decrease the Beneficial OwnershipLimitation percentage not in excess of 19.99% of the number of shares of Common Stock outstanding immediately after giving effect to the issuance of theshares of Common Stock pursuant to a notice of conversion; provided that any such increase will not be effective until the sixty-first (61st) day after suchnotice is delivered to the us.VotingThe C-1 Preferred Shares do not have voting rights. However, as long as any Preferred Shares are outstanding, we may not, without the affirmative voteof the holders of a majority of the then-outstanding C-1 Preferred Shares, (i) alter or change adversely the powers, preferences or rights given to the C-1Preferred Shares or alter or amend the Certificate of Designation, amend or repeal any provision of, or add any provision to, our Certificate of Incorporation orbylaws, or file any articles of amendment, certificate of designations, preferences, limitations and relative rights of any series of preferred stock, if such actionwould adversely alter or change the preferences, rights, privileges or powers of, or restrictions provided for the benefit of the C-1 Preferred Shares, regardlessof whether any of the foregoing actions shall be by means of amendment to the Certificate of Incorporation or by merger, consolidation or otherwise, (ii) issuefurther C-1 Preferred Shares or increase or decrease (other than by conversion) the number of authorized C-1 Preferred Shares, or (iii) enter into any agreementwith respect to any of the foregoing.DividendsThe C-1 Preferred Shares are entitled to receive dividends equal (on an as-if-converted-to-Common-Stock-basis, without regard to the BeneficialOwnership Limitation) to and in the same form, and in the same manner, as dividends (other than dividends in the form of Common Stock) actually paid onshares of Common Stock when, and if paid.LiquidationIn any liquidation or dissolution of the Company, the C-1 Preferred Shares are entitled to participate in the distribution of assets, to the extent legallyavailable for distribution, on a pari passu basis with the Common Stock.RedemptionIf at any time while the C-1 Preferred Shares are outstanding, a) the Company effects any merger, consolidation, stock sale or other businesscombination (other than such a transaction in which the Company is the surviving or continuing entity and its common stock is not exchanged for orconverted into other securities, cash or property), b) the Company effects any sale of all or substantially all of its assets in one transaction or a series of relatedtransactions, c) any tender offer or exchange offer (whether by the Company or another person) is completed pursuant to which more than 50% of thecommon stock not held by the Company or is exchanged for or converted into other securities, cash or property, or d) the Company effects anyreclassification of the common stock or any compulsory share exchange pursuant (other than as a result of a dividend, subdivision or combination coveredabove) to which the common stock is effectively converted into or exchanged for other securities, cash or property, (in any such case, a “FundamentalTransaction”) then, upon any subsequent conversion of the C-1 Preferred Shares, the holder shall have the right to receive, in lieu of the right to receiveshares of common stock, for each share of common stock that would have been issued upon such conversion immediately prior to the occurrence of suchFundamental Transaction, the same kind and amount of securities, cash or property as it would have been entitled to receive upon the occurrence of suchFundamental Transaction if it had been, immediately prior to such Fundamental Transaction, the holder of the equivalent amount of common stock.Registration Payment ArrangementWe were required to file a registration statement covering the resale of the full number of shares no later than 30 days after the closing of the agreementand must use commercially reasonable efforts to cause the registration statement to be declared effective no later than 90 days after the closing date (noreview by the SEC) or in the event of a review by the SEC, 120 days after the closing date. We filed, and the SEC declared effective this registration statementduring 2018. If the registration statement is not maintained we79Source: AGENUS INC, 10-K, March 18, 2019Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results.must pay to each holder 1.0% of the holder’s ratable interest in the aggregate purchase price on the day of the filing/maintenance failure and on everythirtieth day thereafter until the filing/maintenance failure is cured, up to a maximum of 6% (six months). We currently deem the likelihood that we will everbe required to make payments under this arrangement to be remote, and as such no contingent liability has been recorded in our Consolidated BalanceSheets. (12) Share-based Compensation PlansOur 1999 Equity Incentive Plan, as amended (the “1999 EIP”) authorized awards of incentive stock options within the meaning of Section 422 of theInternal Revenue Code (the “Code”), non-qualified stock options, non-vested (restricted) stock, and unrestricted stock for up to 2.0 million shares of commonstock (subject to adjustment for stock splits and similar capital changes and exclusive of options exchanged at the consummation of mergers) to employeesand, in the case of non-qualified stock options, non-vested (restricted) stock, and unrestricted stock, to consultants and directors as defined in the 1999 EIP.The plan terminated on November 15, 2009. On March 12, 2009, our Board of Directors adopted, and on June 10, 2009, our stockholders approved, our 2009Equity Incentive Plan (the “2009 EIP”). The 2009 EIP provides for the grant of incentive stock options intended to qualify under Section 422 of the Code,nonstatutory stock options, restricted stock, unrestricted stock and other equity-based awards, such as stock appreciation rights, phantom stock awards, andrestricted stock units, which we refer to collectively as Awards, for up to 29.2 million shares of our common stock (subject to adjustment in the event of stocksplits and other similar events). The Board of Directors appointed the Compensation Committee to administer the 1999 EIP and the 2009 EIP. No awards willbe granted under the 2009 EIP after June 14, 2026.On March 12, 2009, our Board of Directors adopted, and on June 10, 2009, our stockholders approved, the 2009 Employee Stock Purchase Plan (the“2009 ESPP”) to provide eligible employees the opportunity to acquire our common stock in a program designed to comply with Section 423 of the Code.There are currently 166,666 shares of common stock reserved for issuance under the 2009 ESPP. Rights to purchase common stock under the 2009 ESPP aregranted at the discretion of the Compensation Committee, which determines the frequency and duration of individual offerings under the plan and the dateswhen stock may be purchased. Eligible employees participate voluntarily and may withdraw from any offering at any time before the stock is purchased.Participation terminates automatically upon termination of employment. The purchase price per share of common stock in an offering is 85% of the lesser ofits fair value at the beginning of the offering period or on the applicable exercise date and may be paid through payroll deductions, periodic lump sumpayments, the delivery of our common stock, or a combination thereof. Unless otherwise permitted by the Board of Directors, no participant may acquiremore than 3,333 shares of stock in any offering period. No participant is allowed to purchase shares under the 2009 ESPP if such employee would own orwould be deemed to own stock possessing 5% or more of the total combined voting power or value of the Company. No offerings will be made under the2009 ESPP after June 10, 2019, unless amended.Our Director’s Deferred Compensation Plan, as amended, permits each outside director to defer all, or a portion of, their cash compensation until theirservice as a director ends or until a specified date into a cash account or a stock account. There are 425,000 shares of our common stock reserved for issuanceunder this plan. As of December 31, 2018, 72,081 shares had been issued. Amounts deferred to a cash account will earn interest at the rate paid on one-yearTreasury bills with interest added to the account annually. Amounts deferred to a stock account will be converted on a quarterly basis into a number of unitsrepresenting shares of our common stock equal to the amount of compensation which the participant has elected to defer to the stock account divided by theapplicable price for our common stock. The applicable price for our common stock has been defined as the average of the closing price of our common stockfor all trading days during the calendar quarter preceding the conversion date as reported by The Nasdaq Capital Market. Pursuant to this plan, a total of349,442 units, each representing a share of our common stock at a weighted average common stock price of $4.79, had been credited to participants’ stockaccounts as of December 31, 2018. The compensation charges for this plan were immaterial for all periods presented.On November 4, 2015, our Board of Directors adopted and approved our 2015 Inducement Equity Plan (the “2015 IEP”) in compliance with and inreliance on NASDAQ Listing Rule 5635(c)(4), which exempts inducement grants from the general requirement of the NASDAQ Listing Rules that equity-based compensation plans and arrangements be approved by stockholders. There are 1,500,000 shares of our common stock reserved for issuance under the2015 IEP. We primarily use the Black-Scholes option pricing model to value options granted to employees and non-employees, as well as options granted tomembers of our Board of Directors. All stock option grants have 10-year terms and generally vest ratably over a 3 or 4-year period. The non-cash charge tooperations for the non-employee options with vesting or other performance criteria is affected each reporting period, until the non-employee options vest, bychanges in the fair value of our common stock.80Source: AGENUS INC, 10-K, March 18, 2019Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results.The fair value of each option granted during the periods was estimated on the date of grant using the following weighted average assumptions: 2018 2017 2016 Expected volatility 64% 65% 65%Expected term in years 6 4 4 Risk-free interest rate 2.8% 1.7% 1.0%Dividend yield 0% 0% 0% Expected volatility is based exclusively on historical volatility data of our common stock. The expected term of stock options granted is based onhistorical data and other factors and represents the period of time that stock options are expected to be outstanding prior to exercise. The risk-free interestrate is based on U.S. Treasury strips with maturities that match the expected term on the date of grant.A summary of option activity for 2018 is presented below: Options WeightedAverageExercisePrice WeightedAverageRemainingContractualTerm(in years) AggregateIntrinsicValue Outstanding at December 31, 2017 14,366,787 $4.22 Granted 6,195,082 4.06 Exercised (272,493) 3.41 Forfeited (912,514) 4.04 Expired (763,040) 5.26 Outstanding at December 31, 2018 18,613,822 $4.15 7.31 $1,320,643 Vested or expected to vest at December 31, 2018 18,613,822 $4.15 7.31 $1,320,643 Exercisable at December 31, 2018 10,083,270 $4.24 5.94 $2,577 The weighted average grant-date fair values of options granted during the years ended December 31, 2018, 2017, and 2016, was $1.23, $1.97, and$4.65, respectively.The aggregate intrinsic value in the table above represents the difference between our closing stock price on the last trading day of fiscal 2018 and theexercise price, multiplied by the number of in-the-money options that would have been received by the option holders had all option holders exercised theiroptions on December 31, 2018 (the intrinsic value is considered to be zero if the exercise price is greater than the closing stock price). This amount changesbased on the fair market value of our stock. The total intrinsic value of options exercised during the years ended December 31, 2018, 2017, and 2016,determined on the dates of exercise, was $399,000, $132,000, and $445,000, respectively. During 2018, 2017, and 2016, all options were granted with exercise prices equal to the market value of the underlying shares of common stock on thegrant date other than certain awards dated March 31, 2016, March 2, 2018 and August 6, 2018. In March 2016 and March 2018, our Board of Directorsapproved certain awards subject to forfeiture in the event shareholder approval was not obtained to increase the shares available under our 2009 EIP. Thisapproval was obtained in June 2016 and June 2018, respectively. Accordingly, these awards have a grant date of June 2016 and June 2018, respectively, withan exercise price as of the date the Board of Director's approved the awards in March 2016 and March 2018, respectively. In August 2018, our Board ofDirectors approved certain awards. However, the awards were not communicated until October 2018. Accordingly, these awards have a grant date of October2018 with an exercise price as of the date the Board of Director's approved the awards in August 2018.As of December 31, 2018, there was $9.4 million of unrecognized share-based compensation expense related to stock options granted to employeesand directors for which, if all milestones are achieved, will be recognized over a weighted average period of 2.4 years.As of December 31, 2018, unrecognized expense for options granted to outside advisors for which performance (vesting) has not yet been completedbut the exercise price of the option was known was approximately $1.0 million. Such amount is subject to change each reporting period based upon changesin the fair value of our common stock, expected volatility, and the risk-free interest rate, until the outside advisor completes his or her performance under theoption agreement.81Source: AGENUS INC, 10-K, March 18, 2019Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results.Certain employees and consultants have been granted non-vested stock. The fair value of non-vested market-based awards is calculated based on aMonte Carlo simulation as of the date of issuance. The fair value of other non-vested stock is calculated based on the closing sale price of our common stockon the date of issuance.A summary of non-vested stock activity for 2018 is presented below: NonvestedShares WeightedAverageGrant DateFair Value Outstanding at December 31, 2017 1,313,550 $2.91 Granted 1,043,432 3.70 Vested (53,050) 3.77 Forfeited (89,965) 4.21 Outstanding at December 31, 2018 2,213,967 $3.20 As of December 31, 2018, there was $3.2 million of unrecognized share-based compensation expense related to these non-vested shares for which, ifall milestones are achieved, will be recognized over a period of 2.4 years. The total intrinsic value of shares vested during the years ended December 31,2018, 2017, and 2016, was $242,000, $3.8 million, and $2.4 million, respectively.Cash received from option exercises and purchases under our 2009 ESPP for the years ended December 31, 2018, 2017, and 2016, was $1.2 million,$1.0 million, and $1.2 million, respectively. We issue new shares upon option exercises, purchases under our 2009 ESPP, vesting of non-vested stock, andunder the Director’s Deferred Compensation Plan. During the years ended December 31, 2018, 2017, and 2016, 140,313 shares, 121,183 shares, and 121,228shares, were issued under the 2009 ESPP, respectively. During the years ended December 31, 2018, 2017, and 2016, 53,050 shares, 1.1 million shares, and570,037 shares, respectively, were issued as a result of the vesting of non-vested stock.The impact on our results of operations from share-based compensation for the years ended December 31, 2018, 2017, and 2016, was as follows (inthousands). Year Ended 2018 2017 2016 Research and development $3,498 $6,159 $6,507 General and administrative 4,127 6,270 6,681 Total share-based compensation expense $7,625 $12,429 $13,188 (13) License, Research, and Other AgreementsIn May 2001, we entered into a license agreement with the University of Connecticut Health Center (“UConn”), which was amended in March 2003and June 2009. Through the license agreement, we obtained an exclusive license to patent rights resulting from inventions discovered under a researchagreement that was effective from February 1998 until December 2006. The term of the license agreement ends when the last of the licensed patents expires(2024) or becomes no longer valid. UConn may terminate the agreement: (1) if, after 30 days written notice for breach, we continue to fail to make anypayments due under the license agreement, or (2) we cease to carry on our business related to the patent rights or if we initiate or conduct actions in order todeclare bankruptcy. We may terminate the agreement upon 90 days written notice. We are still required to make royalty payments on any obligations createdprior to the effective date of termination of the license agreement. Upon expiration or termination of the license agreement due to breach, we have the right tocontinue to manufacture and sell products covered under the license agreement which are considered to be works in progress for a period of 6 months. Thelicense agreement contains aggregate milestone payments of $1.2 million for each product we develop covered by the licensed patent rights. These milestonepayments are contingent upon regulatory filings, regulatory approvals and commercial sales of products. We have also agreed to pay UConn a royalty on thenet sales of products covered by the license agreement as well as annual license maintenance fees beginning in May 2006. Royalties otherwise due on the netsales of products covered by the license agreement may be credited against the annual license maintenance fee obligations. As of December 31, 2018, we hadpaid approximately $1.0 million to UConn under the license agreement. The license agreement gives us complete discretion over the commercialization ofproducts covered by the licensed patent rights, but also requires us to use commercially reasonable diligent efforts to introduce commercial products withinand outside the United States. If we fail to meet these diligence requirements, UConn may be able to terminate the license agreement.In March 2003, we entered into an amendment agreement that amended certain provisions of the license agreement with UConn. The amendmentagreement granted us a license to additional patent rights. In consideration for execution of the amendment82Source: AGENUS INC, 10-K, March 18, 2019Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results.agreement, we agreed to pay UConn an upfront payment and to make future payments for licensed patents or patent applications. Through December 31,2018, we have paid approximately $100,000 to UConn under the license agreement, as amended.On December 5, 2014, Agenus Switzerland, entered into a license agreement with the Ludwig Institute for Cancer Research Ltd., or Ludwig, whichreplaced and superseded a prior agreement entered into between the parties in May 2011. Pursuant to the terms of the license agreement, Ludwig grantedAgenus Switzerland an exclusive, worldwide license under certain intellectual property rights of Ludwig and Memorial Sloan Kettering Cancer Centerarising from the prior agreement to further develop and commercialize GITR, OX40 and TIM-3 antibodies. On January 25, 2016, we and Agenus Switzerlandentered into a second license agreement with Ludwig, on substantially similar terms, to develop CTLA-4 and PD-1 antibodies. Pursuant to the December2014 license agreement, Agenus Switzerland made an upfront payment of $1.0 million to Ludwig. The December 2014 license agreement also obligatesAgenus Switzerland to make potential milestone payments of up to $20.0 million for events prior to regulatory approval of licensed GITR, OX40 and TIM-3products, and potential milestone payments in excess of $80.0 million if such licensed products are approved in multiple jurisdictions, in more than oneindication, and certain sales milestones are achieved. Under the January 2016 license agreement, we are obligated to make potential milestone payments ofup to $12.0 million for events prior to regulatory approval of CTLA-4 and PD-1 licensed products, and potential milestone payments of up to $32.0 million ifcertain sales milestones are achieved. Under each of these license agreements, we and/or Agenus Switzerland will also be obligated to pay low to mid-singledigit royalties on all net sales of licensed products during the royalty period, and to pay Ludwig a percentage of any sublicensing income, ranging from a lowto mid-double digit percentage depending on various factors. During the year ended December 31, 2017, we paid a percentage of sublicensing incometotaling $2.0 million to Ludwig under the license agreements. The license agreements may each be terminated as follows: (i) by either party if the other partycommits a material, uncured breach; (ii) by either party if the other party initiates bankruptcy, liquidation or similar proceedings; or (iii) by AgenusSwitzerland or us (as applicable) for convenience upon 90 days’ prior written notice. The license agreements also contain customary representations andwarranties, mutual indemnification, confidentiality and arbitration provisions.In connection with the December 2015 acquisition of PhosImmune, we obtained exclusive rights to a portfolio of patent applications and one issuedpatent relating to phosphopeptide tumor targets (PTTs) under a patent license agreement with the University of Virginia (“UVA”). The UVA license gives usexclusive rights to develop and commercialize the PTT technology and an exclusive option to license any further PTT technology arising from ongoingresearch at UVA until December 2018. Under the license agreement, we will pay low to mid-single digit running royalties on net sales of PTT products, and amodest flat percentage of sublicensing income. In addition, we may be obligated to make milestone payments of up to $2.7 million for each indication of alicensed PTT product to complete clinical trials and achieve certain sales thresholds. If we fail to meet certain diligence milestones, we may also be requiredto pay penalties in excess of $150,000. The term of the UVA license agreement ends when the last of the licensed patents expires or becomes no longer valid.The term of the UVA license agreement ends when the last of the licensed patents expires or becomes no longer valid. The UVA license agreement may beterminated as follows: (i) by UVA in connection with our bankruptcy or cessation of business relating to the licensed technology, (ii) by UVA if we commit amaterial, uncured breach or (iii) by us for our convenience on 180 days written notice.We have entered into various agreements with contract manufacturers, institutions, and clinical research organizations (collectively "third partyproviders") to perform pre-clinical activities and to conduct and monitor our clinical studies. Under these agreements, subject to the enrollment of patientsand performance by the applicable third-party provider, we have estimated our total payments to be $232.1 million over the term of the studies. For the yearsended December 31, 2018, 2017, and 2016, $41.5 million, $35.8 million, and $23.1 million, respectively, have been expensed in the accompanyingconsolidated statements of operations related to these third-party providers. Through December 31, 2018, we have expensed $171.7 million as research anddevelopment expenses and $173.8 million of this amount has been paid. The timing of expense recognition and future payments related to these agreementsis subject to the enrollment of patients and performance by the applicable third-party provider. (14) Revenue from Contracts with CustomersGSK License and Amended GSK Supply AgreementsIn July 2006, we entered into a license agreement and a supply agreement with GSK for the use of QS-21 Stimulon (the “GSK License Agreement” andthe “GSK Supply Agreement”, respectively). In January 2009, we entered into an Amended and Restated Manufacturing Technology Transfer and SupplyAgreement (the “Amended GSK Supply Agreement”) under which GSK has the right to manufacture all of its requirements of commercial grade QS-21Stimulon. GSK is obligated to supply us (or our affiliates, licensees, or customers) certain quantities of commercial grade QS-21 Stimulon for a stated periodof time. Under these agreements, GSK paid an upfront license fee of $3.0 million and agreed to pay aggregate milestones of $5.0 million. In July 2007, theAmended GSK Supply Agreement was further amended, and we were paid an additional fixed fee of $7.3 million. In March 2012 we entered into a First Rightto Negotiate and Amendment Agreement amending the GSK License Agreement and the Amended GSK Supply Agreement to clarify and include additionalrights for the use of our QS-21 Stimulon (the “GSK First Right to Negotiate Agreement”). In addition,83Source: AGENUS INC, 10-K, March 18, 2019Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results.we granted GSK the first right to negotiate for the purchase of the Company or certain of our assets, which such rights expired in March 2017. Asconsideration for entering into the GSK First Right to Negotiate Agreement, GSK paid us an upfront, non-refundable payment of $9.0 million, $2.5 million ofwhich is creditable toward future royalty payments. As of December 31, 2017, we had received all of the potential $24.3 million in upfront and milestonepayments related to the GSK Agreements. We were also generally entitled to receive 2% royalties on net sales of prophylactic vaccines for a period of 10years after the first commercial sale of a resulting GSK product, but we sold these royalty rights to HCR in January 2018 pursuant to the HCR RoyaltyPurchase Agreement (See Note 18). The GSK License and Amended GSK Supply Agreements may be terminated by either party upon a material breach if thebreach is not cured within the time specified in the respective agreement. The termination or expiration of the GSK License Agreement does not relieve eitherparty from any obligation which accrued prior to the termination or expiration. Among other provisions, the license rights granted to GSK survive expirationof the GSK License Agreement. The license rights and payment obligations of GSK under the Amended GSK Supply Agreement survive termination orexpiration, except that GSK's license rights and future royalty obligations do not survive if we terminate due to GSK's material breach unless we electotherwise.We assessed this arrangement in accordance with ASC 606 and concluded that the contract counterparty, GSK, is a customer. We identified thefollowing performance obligations under the contract: (1) an exclusive license to QS-21 in the specified field and related technology transfer; and (2) andexclusive license to QS-21 in an additional field. We determined that the fixed payments of $19.3 million constituted all of the consideration to be included in the transaction price and to be allocatedto the performance obligations based on their relative stand-alone selling prices. The fixed upfront consideration is recognized under ASC 606 based onwhen control of the combined performance obligation is transferred to the customer, which corresponds with the service period (through December 2014). Atcontract inception, the milestones of $5.0 million had been excluded from the transaction price, as we could not conclude that it was probable a significantreversal would not occur. Event driven milestones are a form of variable consideration as the payments are variable based on the occurrence of future events.As part of its estimation of the amount, we considered numerous factors, including that receipt of the milestones is outside of our control and contingent uponsuccess in future clinical trials and the licensee’s efforts. Recognition of event driven milestones should be recognized when the variable consideration isable to be estimated. As of December 31, 2017, all milestones had been received, and therefore recognized.Any consideration related to royalties will be recognized when the related sales occur as they were determined to relate predominantly to the licensegranted to GSK and therefore have also been excluded from the transaction price. We will re-evaluate the transaction price in each reporting period and asuncertain events are resolved or other changes in circumstances occur.For the year ended December 31, 2018, we recognized $17.3 million in non-cash royalty revenue from GSK. For the year ended December 31, 2017,we recognized $1.0 million in research and development revenue related to the achievement of a milestone and for the year ended December 31, 2016, we didnot recognize any revenue from GSK.The cumulative impact of changing the timing of revenue recognition for the GSK License and Amended GSK Supply Agreements as of January 1,2018 was a decrease to stockholders' deficit of approximately $2.5 million and a corresponding decrease in deferred revenue of $2.5 million for the portion ofthe upfront fee creditable toward future royalties, as described above. This amount was included in the transition adjustment, as under ASC 606 it would havebeen recognized as revenue in March 2012, at the time of the amendment.Merck Collaboration and License AgreementDuring the quarter ended June 30, 2014, we entered into a collaboration and license agreement with Merck to discover and optimize fully-humanantibodies against two undisclosed cancer targets using the Retrocyte Display®. Under this agreement, Merck is responsible for the clinical development andcommercialization of antibodies generated under the collaboration. There are no unsatisfied performance obligations relating to this contract. Pursuant to theXOMA Royalty Purchase Agreement (see Note 18), we sold to XOMA 33% of the future royalties and 10% of the future milestones that we are entitled toreceive from Merck, and we remain eligible to receive from Merck approximately $85.5 million in potential payments associated with the completion ofcertain clinical, regulatory and commercial milestones, as well as 67% of all future royalties on worldwide product sales.For each of the years ended December 31, 2018 and 2017, we recognized $4.0 million in research and development revenue related to theachievement of milestones. For the year ended December 31, 2016, we recognized $2.2 million in research and development revenue.The adoption of ASC 606 did not have an impact on the Merck collaboration and license agreement.Incyte Collaboration Agreement84Source: AGENUS INC, 10-K, March 18, 2019Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results.On January 9, 2015 and effective February 19, 2015, we entered into a global license, development and commercialization agreement (the“Collaboration Agreement”) with Incyte pursuant to which the parties plan to develop and commercialize novel immuno-therapeutics using our antibodydiscovery platforms. The Collaboration Agreement was initially focused on four checkpoint modulator programs directed at GITR, OX40, LAG-3 and TIM-3.In addition to the four identified antibody programs, the parties have an option to jointly nominate and pursue the development and commercialization ofantibodies against additional targets during a five-year discovery period which, upon mutual agreement of the parties for no additional consideration, can beextended for an additional three years. In November 2015, we and Incyte jointly nominated and agreed to pursue the development and commercialization ofthree additional CPM targets. In February 2017, we amended the Collaboration Agreement by entering into a First Amendment to License, Development andCommercialization Agreement (the “Amendment”). See “Amendment” section below.On January 9, 2015, we also entered into the Stock Purchase Agreement with Incyte Corporation whereby, for an aggregate purchase price of $35.0million, Incyte purchased approximately 7.76 million shares of our common stock.Agreement StructureUnder the terms of the Collaboration Agreement, we received non-creditable, nonrefundable upfront payments totaling $25.0 million. In addition,until the Amendment, the parties shared all costs and profits for the GITR, OX40 and two of the additional antibody programs on a 50:50 basis (profit-shareproducts), and we were eligible to receive up to $20.0 million in future contingent development milestones under these programs. Incyte is obligated toreimburse us for all development costs that we incur in connection with the TIM-3, LAG-3 and one of the additional antibody programs (royalty-bearingproducts) and we are eligible to receive (i) up to $155.0 million in future contingent development, regulatory, and commercialization milestone paymentsand (ii) tiered royalties on global net sales at rates generally ranging from 6% to 12%. For each royalty-bearing product, we will also have the right to elect toco-fund 30% of development costs incurred following initiation of pivotal clinical trials in return for an increase in royalty rates. Additionally, we had theoption to retain co-promotion participation rights in the United States on any profit-share product. Through the direction of a joint steering committee, untilthe Amendment, the parties anticipated that, for each program, we would serve as the lead for pre-clinical development activities through investigational newdrug (“IND”) application filing, and Incyte would serve as the lead for clinical development activities. The parties initiated the first clinical trials ofantibodies arising from these programs in 2016. For each additional program beyond GITR, OX40, TIM-3 and LAG-3 that the parties elect to bring into thecollaboration, we will have the option to designate it as a profit-share product or a royalty-bearing product.The Collaboration Agreement will continue as long as (i) any product is being developed or commercialized or (ii) the discovery period remains ineffect. Incyte may terminate the Collaboration Agreement or any individual program for convenience upon 12 months’ notice. The Collaboration Agreementmay also be terminated by either party upon the occurrence of an uncured material breach of the other party or by us if Incyte challenges patent rightscontrolled by us. In addition, either party may terminate the Collaboration Agreement as to any program if the other party is acquired and the acquiring partycontrols a competing program.AmendmentPursuant to the terms of the Amendment, the GITR and OX40 programs immediately converted from profit-share programs to royalty-bearing programsand we became eligible to receive a flat 15% royalty on global net sales should any candidates from either of these two programs be approved. Incyte is nowresponsible for global development and commercialization and all associated costs for these programs. In addition, the profit-share programs relating toTIGIT and one undisclosed target were removed from the collaboration, with the undisclosed target reverting to Incyte and TIGIT to Agenus. Should any ofthose programs be successfully developed by a party, the other party will be eligible to receive the same milestone payments as the royalty-bearing programsand royalties at a 15% rate on global net sales. The terms for the remaining three royalty-bearing programs targeting TIM-3, LAG-3 and one undisclosedtarget remain unchanged, with Incyte being responsible for global development and commercialization and all associated costs. The Amendment givesIncyte exclusive rights and all decision-making authority for manufacturing, development, and commercialization with respect to all royalty-bearingprograms.In connection with the Amendment, Incyte paid us $20.0 million in accelerated milestones related to the clinical development of the antibodycandidates targeting GITR and OX40.In February 2017, we also entered into a Stock Purchase Agreement with Incyte, pursuant to which Incyte purchased 10 million shares of our commonstock at a purchase price of $6.00 per share.Pursuant to the XOMA Royalty Purchase Agreement, we sold to XOMA 33% of the future royalties and 10% of the future milestones that we wereentitled to receive from Incyte, excluding the $5.0 million milestone that we recognized in the three months ended September 30, 2018. As of December 31,2018, we remain eligible to receive up to $450.0 million in future potential85Source: AGENUS INC, 10-K, March 18, 2019Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results.development, regulatory and commercial milestones across all programs in the collaboration, as well as 67% of all future royalties on worldwide productsales.Collaboration RevenueWe identified the following performance obligations under the Incyte Collaboration Agreement, as amended: (1) combined license and relatedresearch and development (“R&D”) services to a GITR antibody, (2) combined license and related R&D services to an OX40 antibody, (3) combined licenseand related R&D services to a TIM-3 antibody, (4) combined license and related R&D services to a LAG-3 antibody, (5) combined license and related R&Dservices to a TIGIT antibody, (6) combined license and related R&D services to a first undisclosed target, (7) combined license and related R&D services to asecond undisclosed target, and (8) the option to license certain other mutually agreed-upon antibodies combined with related R&D Services (“AssumedProject Options Development”). Each of these performance obligations consists of a license or option to a license and related R&D services through thefiling of an IND for each antibody candidate.We concluded that the licenses could be used with other readily available resources if the know-how was also transferred with the license; however,our knowledge and experience is necessary for further development of the licensed antibodies. Therefore, we determined that each of the licensed antibodiesand the related developmental R&D services should be treated as a combined performance obligation. We also evaluated whether the Assumed ProjectOptions Development was a material right. At contract inception Incyte paid us a nonrefundable access fee for the ability to exercise the option and bringadditional targets into the program. Both we and Incyte have the ability to explore targets and, if mutually agreed upon, convert those targets into assumedprojects for no additional license fee. We concluded that Assumed Project Options Development represents a material right and is therefore a performanceobligation.We determined that there were no significant financing components, noncash consideration, or amounts that may be refunded to the customer, and assuch the total upfront fixed consideration of the $10.0 million license fee and $15.0 million project access fee would be included in the total transactionprice of $25.0 million. This amount was then allocated to the performance obligations on a relative stand-alone selling price basis.The estimated variable consideration to be recognized for developmental R&D services and related reimbursable expenses (“Development Costs”) wasdetermined based on the forecasted amounts in the research plan that had been approved by the both parties via the joint steering committee (“JSC”). Underthe Agreement, Development Costs related to Profit-Sharing products are split equally between us and Incyte. Therefore, our expected revenue is 50% of thecosts of these programs. Based on review of the budgets presented at the JSC meetings, as well as costs of previous R&D projects, we expected the totaldevelopment costs over the term of the contract would be $43.4 million. This amount was allocated entirely to the distinct R&D services that forms part ofeach performance obligation.We determined that the transaction price of the Collaboration Agreement was $78.6 million as of December 31, 2018, an increase of $10.2 millionfrom the transaction price of $68.4 million as of December 31, 2017. In order to determine the transaction price, we evaluated all the payments to be receivedduring the duration of the contract. We determined that the fixed upfront license fee and project access fee of $10.0 million and $15.0 million, respectively,and the $53.6 million of actual and estimated variable consideration for development costs (including R&D services) and milestones constitutedconsideration to be included in the transaction price, which is allocated among the performance obligations.For payments made to Incyte related to their work performed on profit-sharing programs, we considered that we will receive a benefit through theperformance of a series of distinct R&D services by Incyte. Additionally, the R&D services are being provided by Incyte at fair value. Therefore, the amountpaid to Incyte represents the fair value of the services performed, and no excess will be allocated as a reduction of the transaction price. We will record theconsideration paid to Incyte in the same manner that we would purchases for other vendors, classified as R&D expense.In summary, each of the performance obligations includes a license or option to a license, and respective R&D services that will be performed overtime from program initiation through the filing of an IND with respect to each antibody candidate. We have determined that the combined performanceobligation is satisfied over time, and that the input method should be applied for all performance obligations that have consideration allocated to them. Thecost-cost measure will be applied based on the percentage of completion of R&D services provided during the period compared to the respective budget. Webelieve this is the best measure of progress because other measures do not reflect how we transfer our performance obligation to Incyte. We will recognize thefixed consideration allocated to each performance obligation over time as the related R&D services are being performed using the input of R&D costsincurred over total R&D costs expected to be incurred through IND filing, beginning on the date a license is granted. A cost-based input method of revenuerecognition requires management to make estimates of costs to complete our performance obligations. In making such estimates, significant judgment isrequired to evaluate assumptions related to cost estimates. The cumulative effect of revisions to estimated costs to complete our performance obligations willbe recorded in the period in which86Source: AGENUS INC, 10-K, March 18, 2019Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results.changes are identified and amounts can be reasonably estimated. A significant change in these assumptions and estimates could have a material impact onthe timing and amount of revenue recognized in future periods.We considered the nature of the arrangement between Incyte and us in evaluating the classification of the payments to be received under the cost-sharing arrangement. We do not currently have any commercial products available for sale. Our primary operations to date have included research anddevelopment activities, licensing intellectual property and performing R&D services for external parties. Accordingly, arrangements such as thisCollaboration Agreement represent our ongoing business operations. Therefore, we have concluded that payments received from Incyte under the cost-sharing arrangement represent payments made to us as part of our on-going operations and should be classified as revenue as such amounts are earned.For the year ended December 31, 2018, we recognized approximately $15.5 million of license and collaboration revenue. This amount included $1.3million of the transaction price for the Collaboration Agreement recognized based on proportional performance, $10.0 million for the achievement ofmilestones and $4.2 million for research and development services. For years ended December 31, 2017 and 2016, we recognized approximately $37.3million and $19.7 million, respectively, of research and development revenue.We expect to recognize deferred research and development revenue of $0.9 million and $1.2 million for 2019 and 2020, respectively, related toperformance obligations that are unsatisfied or partially unsatisfied as of December 31, 2018. These amounts exclude amounts (milestones, R&D services androyalties) where we have a right to invoice the customer in the amount that corresponds directly with the value of the performance completed to date.The cumulative impact of the adoption of ASC 606 for the Incyte Collaboration Agreement as of January 1, 2018 was a decrease to stockholders'deficit of approximately $6.4 million and a corresponding decrease in deferred revenue of $6.4 million.Disaggregation of RevenueThe following table presents revenue (in thousands) for years ended December 31, 2018, 2017 and 2016, disaggregated by geographic region andrevenue type. Revenue by geographic region is allocated based on the domicile of our respective business operations. Year ended December 31, 2018 United States Europe Total Revenue Type Research and development services $4,150 $— $4,150 License and collaboration milestones 10,000 4,000 14,000 Recognition of deferred revenue 1,325 — 1,325 Non-cash royalty revenue 17,309 — 17,309 $32,784 $4,000 $36,784 Year ended December 31, 2017 Revenue Type Research and development services $14,615 $— $14,615 License and collaboration milestones 21,000 3,994 24,994 Recognition of deferred revenue 3,100 — 3,100 Grant revenue 168 — 168 $38,883 $3,994 $42,877 Year ended December 31, 2016 Revenue Type Research and development services $16,631 $234 $16,865 License and collaboration milestones — 2,000 2,000 Recognition of deferred revenue 3,522 — 3,522 Grant revenue 32 7 39 Service Revenue 147 — 147 $20,332 $2,241 $22,573Contract Balances87Source: AGENUS INC, 10-K, March 18, 2019Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results.Contract assets primarily relate to our rights to consideration for work completed in relation to our R&D services performed but not billed at thereporting date. The contract assets are transferred to the receivables when the rights become unconditional. Currently, we do not have any contract assetswhich have not transferred to a receivable. We had no asset impairment charges related to contract assets in the period. The contract liabilities primarily relateto contracts where we received payments but have not yet satisfied the related performance obligations. The advance consideration received from customersfor R&D services or licenses bundled with other promises is a contract liability until the underlying performance obligations are transferred to the customer.The following table provides information about contract assets and contract liabilities from contracts with customers (in thousands):Year ended December 31, 2018 Balance atbeginning ofperiod Additions Deductions Balance at endof period Contract assets: Unbilled receivables from collaborationpartners $- $- $- $- Contract liabilities: Deferred revenue $3,377 $- $(1,325) $2,052The change in contract liabilities is primarily related to the recognition of $1.3 million of revenue in the year ended December 31, 2018. Deferredrevenue related to our Collaboration Agreement with Incyte of $2.0 million as of December 31, 2018, which was comprised of the $25.0 million upfrontpayment, less $23.0 million of license and collaboration revenue recognized from the effective date of the contract, will be recognized as the combinedperformance obligation is satisfied.We also recorded a $0.9 million receivable as of December 31, 2018 for R&D services provided.In the year ended December 31, 2018, we did not recognize any revenue from amounts included in the contract asset or the contract liability balancesfrom performance obligations satisfied in previous periods. None of the costs to obtain or fulfill a contract were capitalized. (15) Related Party TransactionsOur Audit and Finance Committee approved a charitable contribution to the Children of Armenia Fund (“COAF”) totaling $125,000 for 2018.Dr. Garo H. Armen, our CEO, is the founder and chairman of COAF. The 2018 charitable contribution was comprised of a cash component and a non-cashcomponent. The cash component was $75,000, which we paid in quarterly installments. The non-cash component was $50,000, which was the estimatedvalue of a portion of office space made available to COAF employees.We also consider our transactions with Incyte, as disclosed in Note 14, to be related party transactions. (16) LeasesWe lease manufacturing, research and development, and office facilities under various lease arrangements. Rent expense (before sublease income) was$2.4 million, $2.6 million, and $3.3 million, for the years ended December 31, 2018, 2017, and 2016, respectively.We lease a facility in Lexington, Massachusetts for our manufacturing, research and development, and corporate offices, approximately 5,600 squarefeet of office space in New York, New York for use as corporate offices, a facility in Berkeley, California, for manufacturing and corporate offices andfacilities in Charlottesville, Virginia and Cambridge, United Kingdom for research and development and corporate offices.We previously leased facilities in Basel, Switzerland for manufacturing, research and development and corporate offices. During the year endedDecember 31, 2017 we terminated the lease for these facilities.88Source: AGENUS INC, 10-K, March 18, 2019Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results.The future minimum rental payments under our facility lease agreements, which expire at various times between 2020 and 2025, are as follows (inthousands): Year ending December 31, 2019 $2,499 2020 2,279 2021 1,874 2022 1,915 2023 1,457 Thereafter 928 Total $10,952 In connection with the Lexington facility, we maintain a fully collateralized letter of credit of $1.0 million. No amounts had been drawn on the letterof credit as of December 31, 2018. In addition, for our properties, we are required to have an aggregate deposit of approximately $200,000 with the landlordsas interest-bearing security deposits pursuant to our obligation under the leases.We sublet a portion of our facilities and received rental payments of $541,000, $562,000, and $733,000 for the years ended December 31, 2018, 2017,and 2016, respectively. We are contractually entitled to receive rental payments of $561,000 and 578,000 in 2019 and 2020, respectively. During 2016 and 2018, we entered into agreements which are classified as capital leases for a pieces of laboratory equipment. Both are included in ourproperty and equipment as follows (in thousands): 2018 2017 EstimatedDepreciableLivesLaboratory and manufacturing equipment $1,180 $1,021 4 yearsLess accumulated depreciation and amortization (266) (153) Total $914 $868 Under the terms of the capital lease agreements, we will remit payments to the lessors of $374,000 and $166,000 for the years ending December 31,2019 and 2020, respectively. (17) DebtDebt obligations consisted of the following as of December 31, 2018 and 2017 (in thousands): Debt instrument Principal atDecember 31,2018 Non-cashInterest UnamortizedDebt IssuanceCosts UnamortizedDebt Discount Balance atDecember 31,2018 Current Portion: Debentures $146 $— $— $— $146 Long-term Portion: 2015 Subordinated Notes 14,000 — — (788) 13,212 Total $14,146 $— $— $(788) $13,358 Debt instrument Principal atDecember 31,2017 Non-cashInterest UnamortizedDebt IssuanceCosts UnamortizedDebt Discount Balance atDecember 31,2017 Current Portion: Debentures $146 $— $— $— $146 Note Purchase Agreement 15,000 5,494 20,494 Total current 15,146 5,494 — - 20,640 Long-term Portion: 2015 Subordinated Notes 14,000 — — (1,375) 12,625 Note Purchase Agreement 100,000 31,323 (1,362) (201) 129,760 Total long-term 114,000 31,323 (1,362) (1,576) 142,385 Total $129,146 $36,816 $(1,362) $(1,576) $163,025 89Source: AGENUS INC, 10-K, March 18, 2019Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results.Subordinated NotesOn February 20, 2015, we, certain existing investors and certain additional investors entered into an Amended and Restated Note Purchase Agreement,pursuant to which we (i) canceled our senior subordinated promissory notes issued in April 2013 (the “2013 Notes”) in exchange for new senior subordinatedpromissory notes (the “2015 Subordinated Notes”) in the aggregate principal amount of $5.0 million, (ii) issued additional 2015 Subordinated Notes in theaggregate principal amount of $9.0 million and (iii) issued five year warrants (the “2013 Warrants”) to purchase 1,400,000 shares of our common stock at anexercise price of $5.10 per share.The 2015 Subordinated Notes bear interest at a rate of 8% per annum, payable in cash on the first day of each month in arrears. Among other defaultand acceleration terms customary for indebtedness of this type, the 2015 Subordinated Notes include default provisions which allow for the noteholders toaccelerate the principal payment of the 2015 Subordinated Notes in the event we become involved in certain bankruptcy proceedings, become insolvent, failto make a payment of principal or (after a grace period) interest on the 2015 Subordinated Notes, default on other indebtedness with an aggregate principalbalance of $13.5 million or more if such default has the effect of accelerating the maturity of such indebtedness, or become subject to a legal judgment orsimilar order for the payment of money in an amount greater than $13.5 million if such amount will not be covered by third-party insurance. The 2015Subordinated Notes are not convertible into shares of our common stock and will mature on February 20, 2020, at which point we must repay the outstandingbalance in cash. The Company may prepay the 2015 Subordinated Notes at any time, in part or in full, without premium or penalty.The exchange of the 2013 Notes for the 2015 Subordinated Notes was accounted for as a debt extinguishment under the guidance of ASC 470 Debt.For the year ended December 31, 2015, we recorded a loss on debt extinguishment of approximately $154,000 in non-operating (expense) income in ourconsolidated statements of operations and comprehensive loss. The debt discount of approximately $3.0 million, which relates to the warrants issued inconnection with the 2015 Subordinated Notes, is being amortized using the effective interest method over three years, the expected life of the 2015Subordinated Notes.The warrants to purchase 500,000 shares of the Company’s common stock issued in connection with the 2013 Notes (the “2013 Warrants”) have anexercise price of $4.41 per share; and are scheduled to expire on April 15, 2019.In March 2017, we and the holders of the 2015 Subordinated Notes entered into an Amendment to Notes and Warrants, pursuant to which we (i)extended the term of the 2013 Warrants by two years from April 15, 2017 to April 15, 2019 and (ii) extended the maturity date of the 2015 Notes by two yearsfrom February 20, 2018 to February 20, 2020. This resulted in an additional debt discount of $0.7 million, which will be amortized using the effectiveinterest method over three years, the expected life of the 2015 Subordinated Notes. The 2013 Warrants and 2015 Notes are otherwise unchanged. TheAmendment to Notes and Warrants was accounted for as a debt modification.Note Purchase Agreement Related to Future RoyaltiesOn September 4, 2015, we and our wholly-owned subsidiaries, Antigenics and Aronex Pharmaceuticals, Inc. (“Aronex”), entered into a NPA withOberland Capital SA Zermatt LLC, as collateral agent (“Oberland”), an affiliate of Oberland as the lead purchaser and other purchasers. Pursuant to the termsof the NPA, on September 8, 2015 (the “Closing Date”), Antigenics issued $100.0 million aggregate principal amount of limited recourse notes (the “Notes”)to the purchasers. On November 2, 2017, following the October 20, 2017 approval of GSK’s shingles vaccine by the FDA, we exercised our option to issue anadditional $15.0 million aggregate principal amount of Notes to the purchasers. On December 31, 2017 the outstanding aggregate principal amount of theNotes was $115.0 million.In January 2018, we through our wholly-owned subsidiary, Antigenics, entered into a Royalty Purchase Agreement (the “HCR Royalty PurchaseAgreement”) with Healthcare Royalty Partners III, L.P., and certain of its affiliates (collectively “HCR”), and we used $161.9 million of the upfront proceedsfrom HCR to redeem all of the notes issued pursuant to the NPA, accordingly, the NPA and the Notes issued thereunder were redeemed in full and terminated.In connection with this redemption, we recorded a $10.8 million loss on early extinguishment of debt which primarily reflects the payment of premiums tofully redeem the notes and the write-off of unamortized debt issuance costs and discounts. See Note 18 for additional information on the Royalty PurchaseAgreement.The Notes accrued interest at a rate of 13.5% per annum, compounded quarterly, from and after the Closing Date computed on the basis of a 360-dayyear and the actual number of days elapsed. The Notes had limited recourse and were secured solely by a first priority security interest in the royalties andaccounts and payment intangibles relating thereto plus various rights of Antigenics related to the royalties under its contracts with GSK.90Source: AGENUS INC, 10-K, March 18, 2019Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results.The redemption price was equal to the outstanding principal amount of the Notes, plus all accrued and unpaid interest thereon, plus a premiumpayment that would yield an aggregate internal rate of return (“IRR”) for the purchasers of 17.5% in accordance with the terms of the NPA.In accordance with the guidance of ASC 470 Debt, we determined the NPA represents a debt transaction and does not purport to be a sale.We recorded $849,000, $17.4 million, and $15.1 million in non-cash interest expense related to the Notes for the years ended December 31, 2018,2017 and 2016, respectively, within our consolidated statement of operations and comprehensive loss.In connection with the execution of the NPA, we reimbursed the purchasers for legal fees of $250,000 and incurred debt issuance costs ofapproximately $1.5 million. Under the relevant accounting guidance, legal fees and debt issuance costs have been recorded as a reduction to the grossproceeds. These amounts were being amortized over 12 years, the expected term of the Notes, using the effective interest rate method. In connection with theissuance of the Additional Notes, we incurred debt issuance cost of approximately $150,000. As with the costs incurred in connection with the execution ofthe NPA, these additional debt issuance costs have been recorded as a reduction to the gross proceeds and were being amortized over the remaining expectedterm of the Notes using the effective interest rate method.OtherWe have capital lease agreements that expire in June 2020 for equipment with a carrying value of approximately $0.9 million, which is included inproperty, plant and equipment, net on our consolidated balance sheets as of December 31, 2018. As of December 31, 2018, our remaining obligations underthe capital lease agreement are approximately $468,000, of which $364,000 and $104,000 are classified as other current and other long-term liabilities,respectively, on our consolidated balance sheets.At December 31, 2018, approximately $146,000 of debentures we assumed in our merger with Aquila Biopharmaceuticals are outstanding. Thesedebentures carry interest at 7% and are callable by the holders. Accordingly, they are classified as short-term debt. (18) Liability Related to the Sale of Future Royalties and Milestones The following table shows the activity within the liability account in the year ended December 31, 2018 (in thousands): Year endedDecember 31, 2018 Liability related to sale of future royalties and milestones - beginningbalance $— Proceeds from sale of future royalties and milestones 205,000 Non-cash royalty revenue (17,309)Non-cash interest expense recognized 23,104 Liability related to sale of future royalties and milestones - endingbalance 210,795 Less: unamortized transaction costs (535)Liability related to sale of future royalties and milestones, net $210,260 Healthcare Royalty PartnersOn January 6, 2018, we, through Antigenics, entered into the HCR Royalty Purchase Agreement with HCR, which closed on January 19, 2018.Pursuant to the terms of the HCR Royalty Purchase Agreement, we sold to HCR 100% of Antigenics’ worldwide rights to receive royalties GSK on sales ofGSK’s vaccines containing our QS-21 Stimulon adjuvant. At closing, we received gross proceeds of $190.0 million from HCR. As part of the transaction, wereimbursed HCR for transaction costs of $100,000 and incurred approximately $500,000 in transaction costs of our own, which are presented net of theliability in the consolidated balance sheet and will be amortized to interest expense over the estimated life of the HCR Royalty Purchase Agreement.Although we sold all of our rights to receive royalties on sales of GSK’s vaccines containing QS-21, as a result of our obligation to HCR, we are required toaccount for these royalties as revenue when earned, and we recorded the $190.0 million in proceeds from this transaction as a liability on our consolidatedbalance sheet that will be amortized using the interest method over the estimated life of the HCR Royalty Purchase Agreement. The liability is classifiedbetween the current and non-current portion of liability related to sale of future royalties and milestones in the consolidated balance sheets based on theestimated recognition of the royalty payments to be received by HCR in the next 12 months from the financial statement reporting date.91Source: AGENUS INC, 10-K, March 18, 2019Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results.In the year ended December 31, 2018, we recognized $17.3 million of non-cash royalty revenue, and we recorded $23.1 million of related non-cashinterest expense related to the HCR Royalty Purchase Agreement.As royalties are remitted to HCR from GSK, the balance of the recorded liability will be effectively repaid over the life of the HCR Royalty PurchaseAgreement. To determine the amortization of the recorded liability, we are required to estimate the total amount of future royalty payments to be received byHCR. The sum of these amounts less the $190.0 million proceeds we received will be recorded as interest expense over the life of the HCR Royalty PurchaseAgreement. Periodically, we assess the estimated royalty payments to be paid to HCR from GSK, and to the extent the amount or timing of the payments ismaterially different from our original estimates, we will prospectively adjust the amortization of the liability. Since the inception of the HCR RoyaltyPurchase Agreement our estimate of the effective annual interest rate over the life of the agreement increased to 16.9%, which results in a prospective interestrate of 16.0%.There are a number of factors that could materially affect the amount and timing of royalty payments from GSK, all of which are not within our control.Such factors include, but are not limited to, changing standards of care, the introduction of competing products, manufacturing or other delays, biosimilarcompetition, patent protection, adverse events that result in governmental health authority imposed restrictions on the use of the drug products, significantchanges in foreign exchange rates, and other events or circumstances that could result in reduced royalty payments from GSK, all of which would result in areduction of non-cash royalty revenues and the non-cash interest expense over the life of the HCR Royalty Purchase Agreement. Conversely, if sales of GSK’svaccines containing QS-21 are more than expected, the non-cash royalty revenues and the non-cash interest expense recorded by us would be greater over thelife of the HCR Royalty Purchase Agreement.Pursuant to the HCR Royalty Purchase Agreement, we will also be entitled to receive up to $40.4 million in milestone payments from HCR based onsales of GSK’s vaccines as follows: (i) $15.1 million upon reaching $2.0 billion last-twelve-months net sales any time prior to 2024 and (ii) $25.3 millionupon reaching $2.75 billion last-twelve-months net sales any time prior to 2026.Additionally, pursuant to the HCR Royalty Purchase Agreement, we would owe approximately $25.9 million to HCR in 2021 (the “Rebate Payment”)if neither of the following sales milestones are achieved: (i) 2019 sales exceed $1.0 billion or (ii) 2020 sales exceed $1.75 billion. As part of the transaction,we provided a guaranty for the potential Rebate Payment and secured the obligation with substantially all of our assets pursuant to a security agreement,subject to certain customary exceptions and excluding all assets necessary for AgenTus Therapeutics.XOMAOn September 20, 2018, we, through our wholly-owned subsidiary, Agenus Royalty Fund, LLC, entered into a Royalty Purchase Agreement (the“XOMA Royalty Purchase Agreement”) with XOMA (US) LLC (“XOMA”). Pursuant to the terms of the XOMA Royalty Purchase Agreement, XOMA paid us$15.0 million at closing in exchange for the right to receive 33% of the future royalties and 10% of the future milestones that we are entitled to receive fromIncyte Corporation (“Incyte”) and Merck Sharpe & Dohme (“Merck”) under our agreements with each party (see Note 14), net of certain of our obligations toa third party and excluding the $5.0 million milestone from Incyte that we recognized in the quarter ended September 30, 2018. We retained 90% of thefuture milestones and 67% of the future royalties under our agreements with Incyte and Merck. Although we sold our rights to receive 33% of future royaltiesand 10% of future milestones, as a result of our significant continued involvement in the generation of the potential royalties and milestones, we are requiredto account for the full amount of these royalties and milestones as revenue when earned, and we recorded the $15.0 million in proceeds from this transactionas a liability on our consolidated balance sheet. Under the terms of the XOMA Royalty Purchase Agreement, should the percentage of milestones androyalties ultimately received by XOMA fail to repay the amount received by us at closing we would have no further obligation to XOMA. 92Source: AGENUS INC, 10-K, March 18, 2019Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results.(19) Fair Value MeasurementsWe measure our contingent purchase price consideration at fair value. The fair values of our Agenus Switzerland and PhosImmune contingentpurchase price consideration, $2.1 million and $0.9 million, respectively, are based on significant inputs not observable in the market, which require them tobe reported as Level 3 liabilities within the fair value hierarchy. The valuation of the liabilities uses assumptions we believe would be made by a marketparticipant. The fair value of our Agenus Switzerland and PhosImmune contingent purchase price consideration is based on estimates from a Monte Carlosimulation of our market capitalization and share price, respectively, and other factors impacting the probability of triggering the milestone payments.Market capitalization and share price were evolved using a geometric brownian motion, calculated daily for the life of the contingent purchase priceconsideration.Assets and liabilities measured at fair value are summarized below (in thousands): Description December 31,2018 Quoted Prices inActiveMarkets forIdentical Assets(Level 1) SignificantOtherObservableInputs(Level 2) SignificantUnobservableInputs(Level 3) Liabilities: Contingent purchase price consideration 3,038 — — 3,038 Total $3,038 $— $— $3,038 Description December 31,2017 Quoted Prices inActiveMarkets forIdentical Assets(Level 1) SignificantOtherObservableInputs(Level 2) SignificantUnobservableInputs(Level 3) Liabilities: Contingent purchase price consideration 4,373 — — 4,373 Total $4,373 $— $— $4,373 The following table presents our liabilities measured at fair value using significant unobservable inputs (Level 3), as of December 31, 2018 (amountsin thousands): Balance, December 31, 2017 $4,373 Change in fair value of contingent purchase price consideration during the period (1,335)Balance, December 31, 2018 $3,038 There were no changes in the valuation techniques during the period and there were no transfers into or out of Levels 1 and 2.The fair value of our outstanding debt balance at December 31, 2018 and 2017 was $14.2 million and $205.9 million, respectively, based on the Level2 valuation hierarchy of the fair value measurements standard using a present value methodology which was derived by evaluating the nature and terms ofeach note and considering the prevailing economic and market conditions at the balance sheet date. The principal amount of our outstanding debt balance atDecember 31, 2018 and 2017 was $14.1 million and $129.1, respectively. (20) ContingenciesWe may currently be, or may become, a party to legal proceedings. While we currently believe that the ultimate outcome of any of these proceedingswill not have a material adverse effect on our financial position, results of operations, or liquidity, litigation is subject to inherent uncertainty. Furthermore,litigation consumes both cash and management attention. (21) Benefit PlansWe sponsor a defined contribution 401(k) Savings Plan in the US and a defined contribution Group Personal Pension Plan in the UK (the “Plans”) forall eligible employees, as defined in the Plans. Participants may contribute a portion of their compensation, subject to a maximum annual amount, asestablished by the applicable taxing authority. Each participant is fully vested in his or her93Source: AGENUS INC, 10-K, March 18, 2019Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results.contributions and related earnings and losses. During the years ended December 31, 2018, 2017, and 2016 we made discretionary contributions to the Plansof $617,000, $487,000, and $334,000, respectively. For the years ended December 31, 2018, 2017, and 2016, we expensed $617,000, $487,000, and$334,000, respectively, related to the discretionary contribution to the Plans.We also participated in a multiple employer benefit plan that covers certain international employees. During the year ended December 31, 2017, inconnection with the closure of our facility in Basel, Switzerland, we ended our participation in the plan. When an employee terminates employment prior toretirement, the amounts invested in the plan are withdrawn and invested in the plan of the employee’s new employer.The annual measurement date for our multiple employer benefit plan was December 31. Benefits were based upon years of service and compensation.We were required to recognize the funded status (the difference between the fair value of plan assets and the projected benefit obligations) of our multipleemployer plan in our consolidated balance sheets which, for the years ended December 31, 2018, and 2017 amounted to an adjustment to accumulated othercomprehensive loss of nil and $25,000, respectively. During the year ended December 31, 2018, we made no contributions to the plan. During the year endedDecember 31, 2017, we contributed approximately $127,000 to our multiple employer benefit plan. In connection with the termination of our multipleemployer benefit plan we recognized a settlement gain of approximately $1.5 million within operating expense for the year ended December 31, 2017. As ourparticipation in the multiple employer benefit plan has ended, no future contributions are expected, and no future benefits are expected to be paid. (22) Geographic InformationThe following is geographical information regarding our revenues for the years ended December 31, 2018, 2017 and 2016 and our long-lived assets asof December 31, 2018 and 2017 (in thousands): 2018 2017 2016 Revenue: United States $32,784 $38,883 $20,332 Europe 4,000 3,994 2,241 $36,784 $42,877 $22,573 Revenue by geographic region is allocated based on the domicile of our respective business operations. 2018 2017 Long-lived Assets: United States $22,681 $22,993 Europe 3,649 4,400 Total $26,330 $27,393 Long-lived assets include “Property, plant and equipment, net” and “Other long-term assets” from the consolidated balance sheets, by the geographiclocation where the asset resides. 94Source: AGENUS INC, 10-K, March 18, 2019Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results.(23) Quarterly Financial Data (Unaudited) Quarter Ended March 31, June 30, September 30, December 31, 2018 Revenue $1,636 $15,895 $12,802 $6,451 Net loss (54,261) (25,204) (33,731) (48,848)Net loss attributable to Agenus Inc. common shareholders (54,192) (24,723) (33,177) (47,807)Per common share, basic and diluted: Basic and diluted net loss attributable to Agenus Inc. common stockholders (0.53) (0.24) (0.37) (0.40)2017 Revenue $26,956 $4,208 $3,359 $8,354 Net loss (17,103) (31,713) (36,842) (35,035)Net loss attributable to Agenus Inc. common shareholders (17,154) (31,764) (36,893) (35,087)Per common share, basic and diluted: Basic and diluted net loss attributable to Agenus Inc. common stockholders (0.18) (0.32) (0.37) (0.35) Net loss attributable to common stockholders per share is calculated independently for each of the quarters presented. Therefore, the sum of thequarterly net loss per share amounts will not necessarily equal the total for the full fiscal year. (24) Subsequent Events Gilead TransactionOn December 20, 2018, we and Gilead Sciences, Inc. (“Gilead”) entered into a series of agreements, which became effective on January 23, 2019, tocollaborate on the development and commercialization of up to five novel immuno-oncology therapies. Pursuant to the terms of the Transaction Agreements(as defined below), we received an upfront cash payment from Gilead of $120.0 million and Gilead made a $30.0 million equity investment in Agenus. Wewill also be eligible to receive up to $1.7 billion in aggregate potential milestones.License AgreementPursuant to the terms of a license agreement between the parties (the “License Agreement”), we granted Gilead an exclusive, worldwide license undercertain of our intellectual property rights to develop, manufacture and commercialize our preclinical bispecific antibody, AGEN1423, in all fields of use.Pursuant to the terms of the License Agreement, Gilead will be responsible for all of the development, manufacture and commercialization costs for anyproducts that Gilead may develop under the License Agreement. In addition, Gilead will also receive the right of first negotiation for two of our undisclosed,preclinical antibody programs. The License Agreement will continue until all of Gilead’s applicable payment obligations under the License Agreement havebeen performed or have expired, or the agreement is earlier terminated. Under the terms of the License Agreement, we and Gilead each have the right toterminate the agreement for material breach by, or insolvency of, the other party. Gilead may also terminate the License Agreement in its entirety, or ona product-by-product or country-by-country basis, for convenience upon ninety (90) days’ notice. Pursuant to the terms of the License Agreement, we areeligible to receive potential development and commercial milestones of up to $552.5 million in the aggregate, as well as tiered royalty payments onaggregate net sales ranging from the high single digit to mid-teen percent, subject to certain reductions under certain circumstances as described in theLicense Agreement.Option and License AgreementsPursuant to the terms of two separate option and license agreements between the parties (each, an “Option and License Agreement” and together, the“Option and License Agreements”), we granted Gilead exclusive options to license exclusively (“License Option”) our preclinical bispecific antibody,AGEN1223, and our preclinical monospecific antibody, AGEN2373 (together, the “Option Programs”), during the respective Option Periods (defined below).Pursuant to the terms of the Option and License Agreements, we have agreed to grant Gilead an exclusive, worldwide license under certain of our intellectualproperty rights to develop, manufacture and commercialize AGEN1223 or AGEN2373, as applicable, in all fields of use upon Gilead’s exercise of theapplicable License Option. Gilead is entitled to exercise its License Option for either or both Option Programs at any time up until ninety (90) days followingGilead’s receipt of a data package with respect to the first complete Phase 1b clinical trial for each Option Program (the “Option Period”). During the OptionPeriod, we will be responsible for its costs and expenses related to the development95Source: AGENUS INC, 10-K, March 18, 2019Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results.of the Option Programs. After Gilead’s exercise of a License Option, if at all, Gilead would be responsible for all development, manufacture andcommercialization activities relating to the relevant Option Program at Gilead’s cost and expense.During the Option Period, we are eligible to receive milestones of up to $30.0 million in the aggregate. If Gilead exercises a License Option, it wouldbe required to pay an upfront license exercise fee of $50.0 million for each License Option that is exercised. Following any exercise of a License Option, wewould be eligible to receive additional development and commercial milestones of up to $520.0 million in the aggregate for each such Option Program, aswell as tiered royalty payments on aggregate net sales ranging from the high single digit to mid-teen percent, subject to certain reductions under certaincircumstances as described in each License and Option Agreement. For either, but not both, of the Option Programs, we will have the right to opt-in to shareGilead’s development and commercialization costs in the United State for such Option Program in exchange for a profit (loss) share on a 50:50 basis andrevised milestone payments. If we opt-in under one Option and License Agreement, our right to opt-in under the other Option and License Agreementautomatically terminates.Unless earlier terminated, each Option and License Agreement will continue until the earlier of (i) the expiration of the Option Period, withoutGilead’s exercise of the License Option; and (ii) the date all of Gilead’s applicable payment obligations under the Option and License Agreement have beenperformed or have expired. Under the terms of each Option and License Agreement, we and Gilead each have the right to terminate the agreement for materialbreach by, or insolvency of, the other party. Gilead may also terminate an Option License Agreement in its entirety, or on a product-by-product or country-by-country basis for convenience upon ninety (90) days’ notice.Stock Purchase AgreementPursuant to the terms of a stock purchase agreement between the parties (the “Stock Purchase Agreement”), Gilead purchased 11,111,111 shares ofAgenus common stock (the “Shares”) for an aggregate purchase price of $30.0 million, or $2.70 per share. Gilead owned approximately 8.5% of theoutstanding shares of Agenus common stock after such purchase. Under the Stock Purchase Agreement, Gilead has agreed (i) not to dispose of any of theShares for a period of 12 months, (ii) to certain standstill provisions that generally preclude it from acquiring more than 15% of Agenus’ outstanding votingstock after taking into account the purchase of the Shares and (iii) to vote the Shares in accordance with the recommendations of our board of directors inconnection with certain equity incentive plan or compensation matters for a period of 12 months. We have agreed to register the Shares for resale under theSecurities Act of 1933. Conversion of a portion of the C-1 preferred sharesIn February 2019, holders of shares of Series C-1 Convertible Preferred Stock converted a portion of such shares into 3,000,000 shares of our commonstock. As of March 15, 2019, 15,459 shares of Series C-1 Convertible Preferred Stock remained outstanding. 96Source: AGENUS INC, 10-K, March 18, 2019Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results.Item 9.Changes in and Disagreements With Accountants on Accounting and Financial DisclosureNot applicable. Item 9A.Controls and ProceduresConclusion Regarding the Effectiveness of Disclosure Controls and ProceduresUnder the supervision and with the participation of our management, including our Chief Executive Officer and Principal Financial Officer, weconducted an evaluation of the effectiveness of our disclosure controls and procedures, as such term is defined under Rule 13a-15(e) promulgated under theExchange Act. Based on this evaluation, our Chief Executive Officer and our Principal Financial Officer concluded that our disclosure controls andprocedures were functioning effectively as of the end of the period covered by this Annual Report on Form 10-K to provide reasonable assurance that theCompany can meet its disclosure obligations.Management’s Annual Report on Internal Control Over Financial ReportingOur management is responsible for establishing and maintaining adequate internal control over financial reporting, as such term is defined inExchange Act Rule 13a-15(f). Under the supervision and with the participation of our management, including our Chief Executive Officer and PrincipalFinancial Officer, we conducted an evaluation of the effectiveness of our internal control over financial reporting based on the framework in Internal Control—Integrated Framework (2013) issued by the Committee of Sponsoring Organizations of the Treadway Commission. Based on our evaluation under theframework, our management concluded that our internal control over financial reporting was effective as of December 31, 2018.KPMG LLP, our independent registered public accounting firm, has issued their report, included herein, on the effectiveness of our internal controlover financial reporting.Changes in Internal Control Over Financial ReportingThere was no change in our internal control over financial reporting (as defined in Rules 13a-15(f) and 15d-15(f) under the Exchange Act) thatoccurred during the fourth quarter 2018 that have materially affected, or are reasonably likely to materially affect, our internal control over financialreporting. 97Source: AGENUS INC, 10-K, March 18, 2019Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results.Report of Independent Registered Public Accounting Firm To the Stockholders and Board of DirectorsAgenus Inc.:Opinion on Internal Control Over Financial ReportingWe have audited Agenus, Inc. and subsidiaries’ (the Company) internal control over financial reporting as of December 31, 2018, based on criteriaestablished in Internal Control – Integrated Framework (2013) issued by the Committee of Sponsoring Organizations of the Treadway Commission. In ouropinion, the Company maintained, in all material respects, effective internal control over financial reporting as of December 31, 2018, based on criteriaestablished in Internal Control – Integrated Framework (2013) issued by the Committee of Sponsoring Organizations of the Treadway Commission.We also have audited, in accordance with the standards of the Public Company Accounting Oversight Board (United States) (PCAOB), the consolidatedbalance sheets of the Company as of December 31, 2018 and 2017, the related consolidated statements of operations and comprehensive loss, convertiblepreferred stock and stockholders’ deficit, and cash flows for each of the years in the three-year period ended December 31, 2018, and the related notes(collectively, the consolidated financial statements), and our report dated March 18, 2019 expressed an unqualified opinion on those consolidated financialstatements.Basis for OpinionThe Company’s management is responsible for maintaining effective internal control over financial reporting and for its assessment of the effectiveness ofinternal control over financial reporting, included in the accompanying Management’s Annual Report on Internal Control Over Financial Reporting. Ourresponsibility is to express an opinion on the Company’s internal control over financial reporting based on our audit. We are a public accounting firmregistered with the PCAOB and are required to be independent with respect to the Company in accordance with the U.S. federal securities laws and theapplicable rules and regulations of the Securities and Exchange Commission and the PCAOB.We conducted our audit in accordance with the standards of the PCAOB. Those standards require that we plan and perform the audit to obtain reasonableassurance about whether effective internal control over financial reporting was maintained in all material respects. Our audit of internal control over financialreporting included obtaining an understanding of internal control over financial reporting, assessing the risk that a material weakness exists, and testing andevaluating the design and operating effectiveness of internal control based on the assessed risk. Our audit also included performing such other procedures aswe considered necessary in the circumstances. We believe that our audit provides a reasonable basis for our opinion.Definition and Limitations of Internal Control Over Financial ReportingA company’s internal control over financial reporting is a process designed to provide reasonable assurance regarding the reliability of financial reportingand the preparation of financial statements for external purposes in accordance with generally accepted accounting principles. A company’s internal controlover financial reporting includes those policies and procedures that (1) pertain to the maintenance of records that, in reasonable detail, accurately and fairlyreflect the transactions and dispositions of the assets of the company; (2) provide reasonable assurance that transactions are recorded as necessary to permitpreparation of financial statements in accordance with generally accepted accounting principles, and that receipts and expenditures of the company are beingmade only in accordance with authorizations of management and directors of the company; and (3) provide reasonable assurance regarding prevention ortimely detection of unauthorized acquisition, use, or disposition of the company’s assets that could have a material effect on the financial statements.Because of its inherent limitations, internal control over financial reporting may not prevent or detect misstatements. Also, projections of any evaluation ofeffectiveness to future periods are subject to the risk that controls may become inadequate because of changes in conditions, or that the degree of compliancewith the policies or procedures may deteriorate./s/ KPMG LLPBoston, MassachusettsMarch 18, 2019 98Source: AGENUS INC, 10-K, March 18, 2019Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results.Item 9B.Other InformationNone. 99Source: AGENUS INC, 10-K, March 18, 2019Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results.PART III Item 10.Directors, Executive Officers and Corporate GovernanceInformation regarding our executive officers is incorporated herein by reference to the information contained in Part I of this Annual Report on Form10-K under the heading “Executive Officers of the Registrant.” The balance of the information required by this Item is incorporated herein by reference to theinformation that will be contained in our proxy statement related to the 2019 Annual Meeting of Stockholders, which we intend to file with the Securitiesand Exchange Commission within 120 days of the end of our fiscal year pursuant to General Instruction G(3) of Form 10-K.Item 11.Executive CompensationThe information required by this Item is incorporated herein by reference to the information that will be contained in our proxy statement related tothe 2019 Annual Meeting of Stockholders, which we intend to file with the Securities and Exchange Commission within 120 days of the end of our fiscalyear pursuant to General Instruction G(3) of Form 10-K.Item 12.Security Ownership of Certain Beneficial Owners and Management and Related Stockholder MattersThe information required by this Item is incorporated herein by reference to the information that will be contained in our proxy statement related tothe 2019 Annual Meeting of Stockholders, which we intend to file with the Securities and Exchange Commission within 120 days of the end of our fiscalyear pursuant to General Instruction G(3) of Form 10-K.Item 13.Certain Relationships and Related Transactions, and Director IndependenceThe information required by this Item is incorporated herein by reference to the information that will be contained in our proxy statement related tothe 2019 Annual Meeting of Stockholders, which we intend to file with the Securities and Exchange Commission within 120 days of the end of our fiscalyear pursuant to General Instruction G(3) of Form 10-K.Item 14.Principal Accounting Fees and ServicesThe information required by this Item is incorporated herein by reference to the information that will be contained in our proxy statement related tothe 2019 Annual Meeting of Stockholders, which we intend to file with the Securities and Exchange Commission within 120 days of the end of our fiscalyear pursuant to General Instruction G(3) of Form 10-K. 100Source: AGENUS INC, 10-K, March 18, 2019Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results.PART IV Item 15.Exhibits and Financial Statement Schedules(a) 1. Consolidated Financial StatementsThe consolidated financial statements are listed under Item 8 of this Annual Report on Form 10-K.2. Financial Statement SchedulesThe financial statement schedules required under this Item and Item 8 are omitted because they are not applicable, or the required information isshown in the consolidated financial statements or the footnotes thereto.3. ExhibitsThe exhibits are listed below under Part IV Item 15(b).(b) Exhibits Exhibit No. Description 3.1 Amended and Restated Certificate of Incorporation of Antigenics Inc. Filed as Exhibit 3.1 to our Current Report on Form 8-K (File No. 0-29089) filed on June 10, 2002 and incorporated herein by reference. 3.1.1 Certificate of Amendment to the Amended and Restated Certificate of Incorporation of Antigenics Inc. Filed as Exhibit 3.1 to our CurrentReport on Form 8-K (File No. 0-29089) filed on June 11, 2007 and incorporated herein by reference. 3.1.2 Certificate of Ownership and Merger changing the name of the corporation to Agenus Inc. Filed as Exhibit 3.1 to our Current Report onForm 8-K (File No. 0-29089) filed on January 6, 2011 and incorporated herein by reference. 3.1.3 Certificate of Second Amendment to the Amended and Restated Certificate of Incorporation of Agenus Inc. Filed as Exhibit 3.1 to ourCurrent Report on Form 8-K (File No. 0-29089) filed on September 30, 2011 and incorporated herein by reference. 3.1.4 Certificate of Third Amendment to the Amended and Restated Certificate of Incorporation of Agenus Inc. Filed as Exhibit 3.1.4 to ourQuarterly Report on Form 10-Q (File No. 0-29089) for the quarter ended June 30, 2012 and incorporated herein by reference. 3.1.5 Certificate of Fourth Amendment to the Amended and Restated Certificate of Incorporation of Agenus Inc. Filed as Exhibit 3.1 to ourCurrent Report on Form 8-K (File No. 0-29089) filed on April 25, 2014 and incorporated herein by reference. 3.1.6 Certificate of Fifth Amendment to the Amended and Restated Certificate of Incorporation of Agenus Inc. Filed as Exhibit 3.1 to ourCurrent Report on Form 8-K (File No. 0-29089) filed on June 16, 2016 and incorporated herein by reference. 3.3 Certificate of Designation, Preferences and Rights of the Series A Convertible Preferred Stock of Agenus Inc. filed with the Secretary ofState of the State of Delaware on September 24, 2003. Filed as Exhibit 3.1 to our Current Report on Form 8-K (File No. 0-29089) filed onSeptember 25, 2003 and incorporated herein by reference. 3.4 Certificate of Designations, Preferences and Rights of the Class B Convertible Preferred Stock of Agenus Inc. Filed as Exhibit 3.1 to ourCurrent Report on Form 8-K (File No. 0-29089) filed on September 5, 2007 and incorporated herein by reference. 3.5 Certificate of Designations, Preferences and Rights of the Series A-1 Convertible Preferred Stock of Agenus Inc. Filed as Exhibit 3.1 to ourCurrent Report on Form 8-K (File No. 0-29089) filed on February 5. 2013 and incorporated herein by reference. 3.6 Form of Certificate of Designation of Preferences, Rights and Limitations of Series C-1 Convertible Preferred Stock. Filed as Exhibit 3.1 toour Current Report on Form 8-K (File No. 0-29089) filed on October 11, 2018 and incorporated herein by reference. 4.1 Form of Common Stock Certificate. Filed as Exhibit 4.1 to our Current Report on Form 8-K (File No. 0-29089) filed on January 6, 2011and incorporated herein by reference. 101Source: AGENUS INC, 10-K, March 18, 2019Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results.Exhibit No. Description 4.2 Form of Amended and Restated Note under the Securities Purchase Agreement dated as of October 30, 2006 (as amended), by and amongAgenus Inc., a Delaware corporation and the investors listed on the Schedule of Buyers thereto. Filed as Exhibit 4.4 to our Annual Reporton Form 10-K (File No. 0-29089) for the year ended December 31, 2010 and incorporated herein by reference. 4.3 Form of Warrant under the Securities Purchase Agreement dated January 9, 2008. Filed as Exhibit 4.1 to our Current Report on Form 8-K(File No. 0-29089) filed on January 11, 2008 and incorporated herein by reference. 4.4 Purchase Agreement dated August 31, 2007 by and between Agenus Inc. and Fletcher International. Filed as Exhibit 99.1 to our CurrentReport on Form 8-K (File No. 0-29089) filed on September 5, 2007 and incorporated herein by reference. 4.5 Securities Purchase Agreement dated April 8, 2008. Filed as Exhibit 10.1 to our Current Report on Form 8-K (File No. 0-29089) filed onApril 10, 2008 and incorporated herein by reference. 4.6 Form of Warrant to purchase common stock dated April 9, 2008. Filed as Exhibit 4.1 to our Current Report on Form 8-K (File No. 0-29089)filed on April 10, 2008 and incorporated herein by reference. 4.7 Securities Purchase Agreement by and between Agenus Inc. and the investors identified on Schedule I attached to the agreement, datedJanuary 9, 2008. Filed as Exhibit 10.1 to our Current Report on Form 8-K (File No. 0-29089) filed on January 11, 2008 and incorporatedherein by reference. 4.8 Form of 4 Year Warrant under the Securities Purchase Agreement dated July 30, 2009. Filed as Exhibit 4.2 to our Current Report on Form8-K (File No. 0-29089) filed on August 3, 2009 and incorporated herein by reference. 4.9 Form of 4 Year Warrant under the Securities Purchase Agreement dated August 3, 2009. Filed as Exhibit 4.2 to our Current Report on Form8-K (File No. 0-29089) filed on August 5, 2009 and incorporated herein by reference. 4.10 Securities Purchase Agreement dated as of July 30, 2009 by and among Agenus Inc. and the investors listed on the Schedule of Buyersthereto. Filed as Exhibit 10.1 to our Current Report on Form 8-K (File No. 0-29089) filed on August 3, 2009 and incorporated herein byreference. 4.11 Securities Exchange Agreement dated as of February 4, 2013 by and between Agenus Inc., and Mr. Brad Kelley. Filed as Exhibit 10.1 toour Current Report on Form 8-K (File No. 0-29089) filed on February 5, 2013 and incorporated herein by reference. 4.12 Note Purchase Agreement dated as of April 15, 2013 by and between Agenus Inc., and the Purchasers listed on Schedule 1.1 thereto. Filedas Exhibit 4.1 to our Quarterly Report on Form 10-Q (File No. 0-29089) for the quarter ended March 31, 2013 and incorporated herein byreference. 4.13 Form of Senior Subordinated Note under the Note Purchase Agreement dated as of April 15, 2013 by and between Agenus Inc., and thePurchasers listed on Schedule 1.1 thereto. Filed as Exhibit 4.2 to our Quarterly Report on Form 10-Q (File No. 0-29089) for the quarterended March 31, 2013 and incorporated herein by reference. 4.14 Form of Warrant under the Note Purchase Agreement dated as of April 15, 2013 by and between Agenus Inc., and the Purchasers listed onSchedule 1.1 thereto. Filed as Exhibit 4.3 to our Quarterly Report on Form 10-Q (File No. 0-29089) for the quarter ended March 31, 2013and incorporated herein by reference. 4.15 Securities Purchase Agreement, dated September 18, 2013, as amended, by and between Agenus Inc. and the investors party thereto. Filedas Exhibit 10.1 to our Current Report on Form 8-K (File No. 0-29089) filed on September 19, 2013 and incorporated herein by reference. 4.16 Form of Warrant under the Securities Purchase Agreement, dated September 18, 2013, as amended, by and between Agenus Inc. and theinvestors party thereto. Filed as Exhibit 4.1 to our Current Report on Form 8-K (File No. 0-29089) filed on September 19, 2013 andincorporated herein by reference. 4.17 Share Exchange Agreement, dated January 10, 2014, by and among Agenus Inc., 4-Antibody AG, certain shareholders of 4-Antibody AGand Vischer AG. Filed as Exhibit 2.1 to our Current Report on Form 8-K (File No. 0-29089) filed on January 13, 2014 and incorporatedherein by reference. 4.18 Securities Purchase Agreement dated as of August 3, 2009 by and among Agenus Inc. and the investors listed on the Schedule of Buyersthereto. Filed as Exhibit 10.1 to our Current Report on Form 8-K (File No. 0-29089) filed on August 5, 2009 and incorporated herein byreference. 102Source: AGENUS INC, 10-K, March 18, 2019Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results.Exhibit No. Description 4.19 Stock Purchase Agreement dated as of January 9, 2015, by and between Agenus Inc. and Incyte Corporation. Filed as Exhibit 4.21 to ourAnnual Report on Form 10-K (File No. 0-29089) for the year ended December 31, 2014 and incorporated herein by reference. 4.20(1) Amended and Restated Note Purchase Agreement dated as of February 20, 2015, as amended, by and between Agenus Inc. andthe Purchasers listed on Schedule 1.1 thereto. Filed as Exhibit 4.2 to our Quarterly Report on Form 10-Q (File No. 0-29089) for thequarter ended March 31, 2015 and incorporated herein by reference. 4.21 Form of Senior Subordinated Note under the Amended and Restated Note Purchase Agreement dated as of February 20, 2015,as amended, by and between Agenus Inc. and the Purchasers listed on Schedule 1.1 thereto. Filed as Exhibit 4.3 to our QuarterlyReport on Form 10-Q (File No. 0-29089) for the quarter ended March 31, 2015 and incorporated herein by reference. 4.22 Form of Warrant under the Amended and Restated Note Purchase Agreement dated as of February 20, 2015, as amended, byand between Agenus Inc. and the Purchasers listed on Schedule 1.1 thereto. Filed as Exhibit 4.4 to our Quarterly Report on Form10-Q (File No. 0-29089) for the quarter ended March 31, 2015 and incorporated herein by reference. 4.23 Amendment to Notes and Warrants dated as of March 15, 2017 by and among Agenus Inc. and the Investors listed therein. Filed asExhibit 4.27 to our Annual Report on Form 10-K (File No. 0-29089) for the year ended December 31, 2016 and incorporated herein byreference. 4.24(1) Note Purchase Agreement, by and among Antigenics LLC, the guarantors named therein, Oberland Capital SA Zermatt LLC, as collateralagent (“Oberland”), an affiliate of Oberland as the lead purchaser and the other purchasers, dated September 4, 2015. Filed as Exhibit 4.1to our Current Report on Form 8-K/A (File No. 0-29089) filed on September 11, 2015 and incorporated herein by reference. 4.25 Form of Limited Recourse Note under the Note Purchase Agreement, by and among Antigenics LLC, the guarantors named therein,Oberland Capital SA Zermatt LLC, as collateral agent (“Oberland”), an affiliate of Oberland as the lead purchaser and the other purchasers,dated September 4, 2015. Filed as Exhibit 4.2 to our Current Report on Form 8-K/A (File No. 0-29089) filed on September 11, 2015 andincorporated herein by reference. 4.26 Revenue Interest Assignment and Termination Agreement, by and among Agenus Inc., Antigenics LLC, Ingalls & Snyder Value Partners,L.P. and Arthur Koenig, dated September 4, 2015. Filed as Exhibit 4.3 to our Current Report on Form 8-K/A (File No. 0-29089) filed onSeptember 11, 2015 and incorporated herein by reference. 4.27 Stock Purchase Agreement dated as of February 14, 2017, by and between Agenus Inc. and Incyte Corporation. Filed as Exhibit 4.1 to ourQuarterly Report on Form 10-Q (File No. 0-29089) for the quarter ended March 31, 2017 and incorporated herein by reference. 4.28 Form of Indenture. Filed as Exhibit 4.1 to our Registration Statement on Form S-3 (File No. 333-221008) and incorporated herein byreference. 4.29 Royalty Purchase Agreement dated January 6, 2018, by and among Antigenics LLC, Healthcare Royalty Partners III, L.P. and certain of itsaffiliates. Filed as Exhibit 4.1 to our Quarterly Report on Form 10-Q (File No. 0-29089) for the quarter ended March 31, 2018 andincorporated herein by reference. 4.30 Royalty Purchase Agreement dated September 20, 2018, by and among Agenus Inc., Agenus Royalty Fund, LLC and XOMA (US) LLC.Filed as Exhibit 4.1 to our Quarterly Report on Form 10-Q (File No. 0-29089) for the quarter ended September 30, 2018 and incorporatedherein by reference. 4.31 Stock Purchase Agreement dated October 10, 2018, between the Company and the purchasers listed on Exhibit A thereto. Filed as Exhibit10.1 to the Current Report on Form 8-K (File No. 0-29089) filed on October 11, 2018 and incorporated herein by reference. 4.32(1) Stock Purchase Agreement dated December 20, 2018, by and between Agenus Inc. and Gilead Sciences, Inc. Filed herewith. Employment Agreements and Compensation Plans 10.1* 1999 Equity Incentive Plan, as amended. Filed as Exhibit 10.1 to our Annual Report on Form10-K (File No. 0-29089) for the year ended December 31, 2008 and incorporated herein by reference. 103Source: AGENUS INC, 10-K, March 18, 2019Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results.Exhibit No. Description 10.1.1* Form of Non-Statutory Stock Option. Filed as Exhibit 10.1 to our Current Report on Form 8-K (File No. 0-29089) filed on December 15,2004 and incorporated herein by reference. 10.1.2* Form of 2007 Restricted Stock Award Agreement. Filed as Exhibit 10.1.5 to our Annual Report on Form 10-K (File No. 0-29089) for theyear ended December 31, 2007 and incorporated herein by reference. 10.1.3* Form of 2008 Restricted Stock Award Agreement. Filed as Exhibit 10.1 to our Current Report on Form 8-K (File No. 0-29089) filed onMarch 11, 2008 and incorporated herein by reference. 10.1.4* Sixth Amendment to the Agenus Inc. 1999 Equity Incentive Plan. Filed as Appendix D to our Definitive Proxy Statement on Schedule 14Afiled on April 27, 2009 and incorporated herein by reference. 10.2* Agenus Inc. Amended and Restated 2009 Equity Incentive Plan. Filed as Exhibit 10.1 to our Current Report on Form 8-K (File No. 0-29089) filed on June 16, 2016 and incorporated herein by reference. 10.2.1* Form of Restricted Stock Award Agreement for the Agenus Inc. Amended and Restated 2009 Equity Incentive Plan. Filed as Exhibit 10.2to our Current Report on Form 8-K (File No. 0-29089) filed on June 15, 2009 and incorporated herein by reference. 10.2.2* Form of Stock Option Agreement for the Agenus Inc. Amended and Restated 2009 Equity Incentive Plan. Filed asExhibit 10.3 to our Current Report on Form 8-K (File No. 0-29089) filed on June 15, 2009 and incorporated herein by reference. 10.3* Agenus Inc. 2009 Employee Stock Purchase Plan. Filed as Appendix B to our Definitive Proxy Statement on Schedule 14A filed on April27, 2009 and incorporated herein by reference. 10.4 Agenus Inc. Directors' Deferred Compensation Plan, as amended to date. Filed as Exhibit 10.4 to our Annual Report on Form 10-K (FileNo. 0-29089) for the year ended December 31, 2012 and incorporated herein by reference. 10.4.1 Seventh Amendment to Agenus Directors' Deferred Compensation Plan. Filed as Appendix C to our Definitive Proxy Statementon Schedule 14A filed on April 30, 2015 and incorporated herein by reference. 10.5* Amended and Restated Executive Change-in-Control Plan applicable to Christine M. Klaskin. Filed as Exhibit 10.1 to our Current Reporton Form 8-K (File No. 0-29089) filed on November 3, 2010 and incorporated herein by reference. 10.5.1* Modification of Rights in the Event of a Change of Control, dated as of June 14, 2012, by and between Agenus Inc. and ChristineKlaskin. Filed as Exhibit 10.1 to our Quarterly Report on Form 10-Q (File No. 0-29089) for the quarter ended June 30, 2012 andincorporated herein by reference. 10.6* 2004 Executive Incentive Plan, as amended. Filed as Exhibit 10.1 to our Current Report on Form 8-K (File No. 0-29089) filed on January27, 2011 and incorporated herein by reference. 10.6.1 Agenus Inc. 2016 Executive Incentive Plan. Filed as Exhibit 10.2 to our Current Report on Form 8-K (File No. 0-29089) filed on June 16,2016 and incorporated herein by reference. 10.7* Employment Agreement dated December 1, 2005 between Agenus Inc. and Garo Armen. Filed as Exhibit 10.1 to our Current Report onForm 8-K (File No. 0-29089) filed on December 7, 2005 and incorporated herein by reference. 10.7.1* First Amendment to Employment Agreement dated July 2, 2009 between Agenus Inc. and Garo Armen. Filed as Exhibit 10.1 to ourQuarterly Report on Form 10-Q (File No. 0-29089) for the quarter ended September 30, 2009 and incorporated herein by reference. 10.7.2* Second Amendment to Employment Agreement dated December 15, 2010 between Agenus Inc. and Garo Armen. Filed as Exhibit 10.12.2to our Annual Report on Form 10-K (File No. 0-29089) for the year ended December 31, 2010 and incorporated herein by reference. 10.8* Agenus Inc. 2015 Inducement Equity Plan. Filed as Exhibit 4.14 to our Registration Statement on Form S-8 (File No. 333-209074) filed onJanuary 21, 2016 and incorporated herein by reference. 10.9.1* Form of Stock Option Agreement for the Agenus Inc. 2015 Inducement Equity Plan. Filed as Exhibit 4.15 to our Registration Statement onForm S-8 (File No. 333-209074) filed on January 21, 2016 and incorporated herein by reference. 10.9.2* Form of Restricted Stock Award Agreement for the Agenus Inc. 2015 Inducement Equity Plan. Filed as Exhibit 4.16 to our RegistrationStatement on Form S-8 (File No. 333-209074) filed on January 21, 2016 and incorporated herein by reference. 104Source: AGENUS INC, 10-K, March 18, 2019Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results.Exhibit No. Description 10.9.3* Form of Restricted Stock Unit Agreement for the Agenus Inc. 2015 Inducement Equity Plan. Filed as Exhibit 4.17 to our RegistrationStatement on Form S-8 (File No. 333-209074) filed on January 21, 2016 and incorporated herein by reference. 10.10* Form of Restricted Stock Unit Agreement for the Agenus Inc. Amended and Restated 2009 Equity Incentive Plan. Filed asExhibit 10.2 to our Current Report on Form 8-K (File No. 0-29089) filed on June 30, 2015 and incorporated herein by reference. 10.11* Contract of Employment dated February 1, 2016, by and between Agenus UK Limited and Alex Duncan. Filed as Exhibit 10.1 to ourCurrent Report on Form 10-Q (File No. 0-29089) for the quarter ended March 31, 2018 and incorporated herein by reference. 10.12* Change of Control Agreement dated February 1, 2016, by and between Agenus Inc. and Alex Duncan. Filed as Exhibit 10.2 to our CurrentReport on Form 10-Q (File No. 0-29089) for the quarter ended March 31, 2018 and incorporated herein by reference. License and Collaboration Agreements 10.13(1) Patent License Agreement between Agenus Inc. and Mount Sinai School of Medicine dated November 1, 1994, as amended on June 5,1995. Filed as Exhibit 10.8 to our registration statement on Form S-1 (File No. 333-91747) and incorporated herein by reference. 10.14(1) License Agreement between the University of Connecticut Health Center and Agenus Inc. dated May 25, 2001, as amended on March 18,2003. Filed as Exhibit 10.2 to the Amendment No. 1 to our Quarterly Report on Form 10-Q (File No. 0-29089) for the quarter ended March31, 2003 and incorporated herein by reference. 10.15.1(1) Letter Agreement by and between Agenus Inc. and The University of Connecticut Health Center dated May 11, 2009. Filed as Exhibit 10.5to our Quarterly Report on Form 10-Q (File No. 0-29089) for the quarter ended June 30, 2009 and incorporated herein by reference. 10.15.2(1) Amendment Number Two to License Agreement by and between Agenus Inc. and The University of Connecticut Health Center dated June5, 2009. Filed as Exhibit 10.6 to our Quarterly Report on Form 10-Q (File No. 0-29089) for the quarter ended June 30, 2009 andincorporated herein by reference. 10.16(1) License Agreement by and between Agenus Inc. and GlaxoSmithKline Biologicals SA dated July 6, 2006. Filed as Exhibit 10.1 to ourQuarterly Report on Form 10-Q (File No. 0-29089) for the quarter ended June 30, 2006 and incorporated herein by reference. 10.17(1) Amended and Restated Manufacturing Technology Transfer and Supply Agreement by and between Agenus Inc. and GlaxoSmithKlineBiologicals SA dated January 19, 2009. Filed as Exhibit 10.1 to our Quarterly Report on Form 10-Q (File No. 0-29089) for the quarterended March 31, 2009 and incorporated herein by reference. 10.18(1) First Right to Negotiate and Amendment Agreement between Agenus Inc., Antigenics LLC and GlaxoSmithKline Biologicals SA, datedMarch 2, 2012. Filed as Exhibit 10.1 to our Quarterly Report on Form 10-Q (File No. 0-29089) for the quarter ended March 31, 2012 andincorporated herein by reference. 10.19(1) Revenue Interests Assignment Agreement dated as of April 15, 2013 by and among Agenus Inc., Ingalls & Snyder Value Partners L.P.,Arthur Koenig and Antigenics LLC. Filed as Exhibit 10.1 to our Quarterly Report on Form 10-Q (File No. 0-029089) for the quarter endedMarch 31, 2013 and incorporated herein by reference. 10.20(1) License Agreement dated as of December 5, 2014 by and between 4-Antibody AG, a limited liability company organized under the laws ofSwitzerland (and wholly-owned subsidiary of Agenus Inc.) and Ludwig Institute for Cancer Research Ltd. Filed as Exhibit 10.21 to ourAnnual Report on Form 10-K (File No. 0-29089) for the year ended December 31, 2014 and incorporated herein by reference. 10.21.1(1) License, Development and Commercialization Agreement dated as of January 9, 2015 by and among Agenus Inc., 4-Antibody AG, alimited liability company organized under the laws of Switzerland (and wholly-owned subsidiary of Agenus Inc.), Incyte Corporation andIncyte Europe Sarl, a Swiss limited liability company (and wholly-owned subsidiary of Incyte Corporation). Filed as Exhibit 10.22 to ourAnnual Report on Form 10-K (File No. 0-29089) for the year ended December 31, 2014 and incorporated herein by reference. 105Source: AGENUS INC, 10-K, March 18, 2019Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results.Exhibit No. Description 10.21.2(1) First Amendment to License, Development and Commercialization Agreement dated as of February 14, 2017 by and among Agenus Inc.,Agenus Switzerland Inc. (f/k/a 4-Antibody AG) and Incyte Europe Sarl. Filed as Exhibit 10.1 to our Quarterly Report on Form 10-Q (FileNo. 0-29089) for the quarter ended March 31, 2017 and incorporated herein by reference. 10.22(1) License Agreement dated March 19, 2013, as amended, by and between the University of Virginia Patent Foundation d/b/a University ofVirginia Licensing and Ventures Group and Agenus Inc. (as successor by merger to PhosImmune Inc.). Filed as Exhibit 10.24 to our AnnualReport on Form 10-K (File No. 0-29089) for the year ended December 31, 2015 and incorporated herein by reference. 10.23(1) License Agreement dated as of January 25, 2016 by and among Agenus Inc., 4-Antibody AG, a limited liability company organized underthe laws of Switzerland (and wholly-owned subsidiary of Agenus Inc.), and Ludwig Institute for Cancer Research Ltd. Filed as Exhibit10.25 to our Annual Report on Form 10-K (File No. 0-29089) for the year ended December 31, 2015 and incorporated herein by reference. 10.24(1) Development and Manufacturing Services Agreement dated April 14, 2017 by and between Agenus Inc. and CMC ICOS Biologics, Inc.Filed as Exhibit 10.1 to our Quarterly Report on Form 10-Q (File No. 0-29089) for the quarter ended June 30, 2017 and incorporated hereinby reference. 10.25(1) License Agreement dated December 20, 2018, by and between Agenus Inc. and Gilead Sciences, Inc. Filed herewith. 10.26(1) Option and License Agreement (AGEN1223) dated December 20, 2018, by and between Agenus Inc. and Gilead Sciences, Inc. Filedherewith. 10.27(1) Option and License Agreement (AGEN2373) dated December 20, 2018, by and between Agenus Inc. and Gilead Sciences, Inc. Filedherewith. Real Estate Leases 10.28 Lease of Premises at 3 Forbes Road, Lexington, Massachusetts dated as of December 6, 2002 from BHX, LLC, as Trustee of 3 Forbes RealtyTrust, to Agenus Inc. Filed as Exhibit 10.1 to our Current Report on Form 8-K (File No. 0-29089) filed on January 8, 2003 and incorporatedherein by reference. 10.28.1 First Amendment of Lease dated as of August 15, 2003 from BHX, LLC, as trustee of 3 Forbes Road Realty, to Agenus Inc. Filed as Exhibit10.1 to our Quarterly Report on Form 10-Q (File No. 0-29089) for the quarter ended March 31, 2004 and incorporated herein by reference. 10.28.2 Second Amendment of Lease dated as of March 7, 2007 from BHX, LLC as trustee of 3 Forbes Road Realty, to Agenus Inc. Filed as Exhibit10.1 to our Quarterly Report on Form 10-Q (File No. 0-29089) for the quarter ended March 31, 2007 and incorporated herein by reference. 10.28.3 Third Amendment to Lease dated April 23, 2008 between TBCI, LLC, as successor to BHX, LLC, as Trustee of 3 Forbes Road Realty Trust,and Agenus Inc. Filed as Exhibit 10.2 to our Quarterly Report on Form 10-Q (File No. 0-29089) for the quarter ended June 30, 2008 andincorporated herein by reference. 10.28.4 Fourth Amendment to Lease dated September 30, 2008 between TBCI, LLC, as successor to BHX, LLC, as Trustee of 3 Forbes Road RealtyTrust, and Agenus Inc. Filed as Exhibit 10.2 to our Quarterly Report on Form 10-Q (File No. 0-29089) for the quarter ended September 30,2008 and incorporated herein by reference. 10.28.5 Fifth Amendment to Lease dated April 11, 2011 between TBCI, LLC, as successor to BHX, LLC, as Trustee of 3 Forbes Road Realty Trust,and Agenus Inc. Filed as Exhibit 10.3 to our Quarterly Report on Form 10-Q (File No. 0-29089) for the quarter ended March 31, 2011 andincorporated herein by reference. 10.29 Standard Form of Office Lease dated December 13, 2012 between 149 Fifth Ave. Corp. and Agenus Inc. Filed as Exhibit 10.22 to ourAnnual Report on Form 10-K (File No. 0-29089) for the year ended December 31, 2012 and incorporated herein by reference. Sales Agreement 10.30 Sales Agreement dated May 11, 2018 by and between Agenus Inc. and B. Riley FBR, Inc. Filed as Exhibit 1.1 to the Current Report onForm 8-K filed by the Company on May 11, 2018 and incorporated by reference. 21.1 Subsidiaries of Agenus Inc. Filed herewith. 23.1 Consent of KPMG LLP, independent registered public accounting firm. Filed herewith. 106Source: AGENUS INC, 10-K, March 18, 2019Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results.Exhibit No. Description 31.1 Certification of Chief Executive Officer pursuant to Rules 13a-14(a) and 15d-14(a) under the Securities Exchange Act of 1934, asamended. Filed herewith. 31.2 Certification of Principal Financial Officer pursuant to Rules 13a-14(a) and 15d-14(a) under the Securities Exchange Act of 1934, asamended. Filed herewith. 32.1 Certification of Chief Executive Officer and Principal Financial Officer pursuant to 18 U.S.C. Section 1350 as adopted pursuant to Section906 of the Sarbanes-Oxley Act of 2002. Submitted herewith. 101.INS XBRL Instance Document 101.SCH XBRL Taxonomy Extension Schema Document 101.CAL XBRL Calculation Linkbase Document 101.DEF XBRL Taxonomy Extension Definition Linkbase Document 101.LAB XBRL Label Linkbase Document 101.PRE XBRL Taxonomy Presentation Linkbase Document *Indicates a management contract or compensatory plan.(1)Certain confidential material contained in the document has been omitted and filed separately with the Securities and Exchange Commission pursuantto Rule 406 of the Securities Act or Rule 24b-2 of the Securities Exchange Act. Item 16.Form 10-K Summary None. 107Source: AGENUS INC, 10-K, March 18, 2019Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results.SIGNATURESPursuant to the requirements of Section 13 or 15(d) of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed onits behalf by the undersigned, thereunto duly authorized. AGENUS INC. By: /s/ GARO H. ARMEN, PH.D. Garo H. Armen, Ph.D. Chief Executive Officer and Chairman of the Board Dated: March 18, 2019Pursuant to the requirements of the Securities Exchange Act of 1934, this report has been signed below by the following persons on behalf of theregistrant and in the capacities and on the dates indicated. Signature Title Date /S/ GARO H. ARMEN, PH.D. Chief Executive Officer and Chairman of the March 18, 2019Garo H. Armen, Ph.D. Board of Directors (Principal Executive Officer) /s/ CHRISTIAN CORTIS, PH.D. Chief Strategy Officer and Head of Finance March 18, 2019Christian Cortis, Ph.D. (Principal Financial Officer) /S/ CHRISTINE M. KLASKIN Vice President Finance March 18, 2019Christine M. Klaskin (Principal Accounting Officer) /S/ ULF WIINBERG Director March 18, 2019Ulf Wiinberg /S/ BRIAN CORVESE Director March 18, 2019Brian Corvese /S/ WADIH JORDAN Director March 18, 2019Wadih Jordan /S/ ALLISON JEYNES-ELLIS Director March 18, 2019Allison Jeynes-Ellis /S/ TIMOTHY R. WRIGHT Director March 18, 2019Timothy R. Wright 108Source: AGENUS INC, 10-K, March 18, 2019Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results.[******] - Certain confidential information contained in this document, marked by brackets, is filed with the Securities and Exchange Commission pursuantto Rule 24b-2 of the Securities Exchange Act of 1934, as amended.[******] - Certain confidential information contained in this document, marked by brackets, is filed with the Securities and Exchange Commissionpursuant to Rule 24b-2 of the Securities Exchange Act of 1934, as amended.Exhibit 4.32AGENUS INC.COMMON STOCK PURCHASE AGREEMENTTHIS COMMON STOCK PURCHASE AGREEMENT (this “Agreement”) is made as of December 20, 2018 (the “ExecutionDate”) by and between Agenus Inc., a Delaware corporation (“Agenus”), and Gilead Sciences, Inc., a Delaware corporation(“Purchaser”). Agenus and Purchaser are each referred to herein by name or as a “Party” or, collectively, as the “Parties”.RECITALSWHEREAS, simultaneously with entering into this Agreement, the Parties are entering into a license agreement (the “LicenseAgreement”) pursuant to which Agenus will license certain Agenus Intellectual Property with respect to the program known asAGEN1423 [******] to Purchaser, and will grant rights of first negotiation with respect to the programs known as [******] and[******] to Purchaser;WHEREAS, simultaneously with entering into this Agreement, the Parties are entering into the Option and LicenseAgreement with respect to the program known as AGEN1223 [******] and the Option and License Agreement with respect to theprogram known as AGEN2373 [******], pursuant to which Agenus will grant options to license certain Agenus Intellectual Propertywith respect to such programs to Purchaser (collectively with the License Agreement, the “Licenses”); andWHEREAS, in connection with the Licenses and pursuant to terms set forth in this Agreement, Agenus desires to sell toPurchaser, and Purchaser desires to purchase from Agenus, shares of Common Stock in reliance upon the exemption from securitiesregistration afforded by Section 4(a)(2) of the Securities Act of 1933, as amended (the “Securities Act”), and Rule 506 of Regulation Das promulgated by the Commission under the Securities Act (“Regulation D”).NOW, THEREFORE, in consideration of the foregoing and the mutual agreements set forth below, and for other good andvaluable consideration, the receipt and sufficiency of which are hereby acknowledged, the Parties hereby agree as follows:SECTION 1Purchase and Sale of Shares1.1Sale of Shares. Subject to the terms and conditions hereof, Agenus will issue and sell to Purchaser, andPurchaser will purchase from Agenus, at the Closing (as defined below), 11,111,111 shares of Common Stock (the “Shares”) for a totalpurchase price of $30,000,000 (which the Parties agree represents a price per share equal to the daily volume-weighted average pershare intraday price of the Common Stock on Nasdaq over the 30 trading day period ending on and including December 6, 2018 plus35%) (the “Aggregate Purchase Price”).1.2Closing. The purchase and sale of the Shares shall take place at a closing (the “Closing”) to be held atthe offices of Hogan Lovells US LLP, 875 Third Avenue, New York, NY 10022 on the Closing Date (as defined in the LicenseAgreement), or such other time as agreed by both Parties (the “Investment Closing Date”). At the Closing, Agenus will deliver orcause to be delivered to Purchaser the Shares Source: AGENUS INC, 10-K, March 18, 2019Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results.[******] - Certain confidential information contained in this document, marked by brackets, is filed with the Securities and Exchange Commission pursuantto Rule 24b-2 of the Securities Exchange Act of 1934, as amended. represented by book-entry credits as instructed in writing by Purchaser and, concurrently, Purchaser shall pay the Aggregate PurchasePrice by wire transfer in accordance with Agenus’s instructions.SECTION 2Representations and Warranties of AgenusExcept as set forth in Agenus’s disclosure letter (the “Disclosure Letter”), Agenus hereby represents and warrants thefollowing as of the Execution Date and the Investment Closing Date:2.1Organization and Good Standing and Qualifications. Agenus is a corporation duly organized, validlyexisting and in good standing under the laws of the State of Delaware and has all requisite power and authority to own, lease, operateand occupy its properties and to carry on its business as now being conducted. Except for the subsidiaries set forth on Exhibit 21.1 toAgenus’s Form 10-K for the year ended December 31, 2017 or as set forth on Section 2.1 of the Disclosure Letter, all of whichsubsidiaries are wholly owned by Agenus, Agenus does not have any equity interest in, or control, any other business entity. Agenus isduly qualified as a foreign corporation to do business and is in good standing in every jurisdiction in which the nature of the businessconducted or property owned or leased by it makes such qualification necessary, other than those in which the failure so to qualify orbe in good standing would not have a Material Adverse Effect.2.2Authorization. (a) Agenus has the requisite corporate power and authority to enter into and perform itsobligations under this Agreement; (b) the execution and delivery of this Agreement by Agenus, the consummation by Agenus of thetransactions contemplated hereby and thereby and the issuance, sale and delivery of the Shares have been duly authorized by allnecessary corporate action and no further consent or authorization of Agenus or its Board of Directors or stockholders is required; and(c) this Agreement has been duly executed and delivered and constitutes a valid and binding obligation of Agenus enforceable againstAgenus in accordance with its terms, except as such enforceability may be limited by applicable bankruptcy, securities, insolvency, orsimilar laws relating to, or affecting generally the enforcement of, creditors’ rights and remedies, or indemnification or by otherequitable principles of general application.2.3Valid Issuance of Shares. The issuance of the Shares has been duly authorized by all requisitecorporate action. When the Shares are issued, sold and delivered in accordance with the terms of this Agreement for the considerationexpressed herein, the Shares will be duly and validly issued and outstanding, fully paid, and nonassessable, and will be free of all liensand restrictions on transfer other than restrictions on transfer under this Agreement and under applicable state and federal securitieslaws.2.4No Conflict. The execution, delivery and performance of this Agreement, and any other document orinstrument contemplated hereby, by Agenus and the consummation by Agenus of the transactions contemplated hereby, do not:(a) violate any provision of Agenus’s Amended and Restated Certificate of Incorporation (the “Certificate”), as amended, or Agenus’sBy-laws (the “Bylaws”), (b) conflict with, or constitute a material default (or an event that with notice or lapse of time or both wouldbecome a default) under, or give to others any material rights of termination, amendment, acceleration or cancellation of, or require anyconsent of any third party that has not been obtained pursuant to, any material agreement, mortgage, deed of trust, indenture, note,bond, license, lease agreement, instrument, obligation or any other agreement or document filed, or required to be filed, pursuant toItem 601(b) of Regulation S-K promulgated under the Securities Act to which Agenus is a party, (c) create or impose a lien, charge or2 Source: AGENUS INC, 10-K, March 18, 2019Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results.[******] - Certain confidential information contained in this document, marked by brackets, is filed with the Securities and Exchange Commission pursuantto Rule 24b-2 of the Securities Exchange Act of 1934, as amended. encumbrance on any material property of Agenus under any agreement or any commitment to which Agenus is a party or by whichAgenus is bound, or (d) result in a material violation of any federal, state, local or foreign statute, rule, regulation, order, writ, judgmentor decree (including federal and state securities laws and regulations) applicable to Agenus or any of its subsidiaries or by which anyproperty or asset of Agenus are bound or affected. Agenus is not required under federal, state or local law, rule or regulation to obtainany consent, authorization or order of, or make any filing or registration with, any Governmental Authority in order for it to execute,deliver or perform any of its obligations under this Agreement or issue and sell the Shares in accordance with the terms hereof (otherthan any filings that may be required to be made by Agenus with the Commission, the Financial Industry Regulatory Authority, Nasdaqor state securities commissions subsequent to the Closing); provided that, for purposes of the representation made in this sentence,Agenus is assuming and relying upon the accuracy of the relevant representations and agreements of Purchaser herein.2.5Capitalization. As of November 30, 2018 (the “Reference Date”), a total of 31,620 shares of Series A-1 Convertible Preferred Stock of Agenus, 18,459 shares of Series C-1 Convertible Preferred Stock, and 119,995,686 shares of CommonStock were issued and outstanding. Agenus has not issued any capital stock since the Reference Date other than pursuant to (a) theexercise of stock options under Agenus’s stock option plans, (b) the issuance of shares of Common Stock to employees pursuant toAgenus’s employee stock purchase plans, (c) the issuance of shares of Common Stock pursuant to Agenus’s at-the-market salesagreement and pursuant to the conversion and/or exercise of warrants outstanding as of the date of and disclosed in the most recentCommission Document. No Person has any right of first refusal, preemptive right, right of participation, or any similar right toparticipate in the transactions contemplated by this Agreement. Except as disclosed on Section 2.5 of the Disclosure Letter, there are nooutstanding options, warrants, scrip rights to subscribe to, calls or commitments of any character whatsoever relating to, or securities,rights or obligations convertible into or exercisable or exchangeable for, or giving any Person any right to subscribe for or acquire, anyshares of Common Stock, or contracts, commitments, understandings or arrangements by which Agenus is or may become bound toissue additional shares of Common Stock. Neither the issuance nor sale of the Shares will obligate Agenus to issue shares of CommonStock or other securities to any Person and will not result in a right of any holder of Agenus securities to adjust the exercise, conversion,exchange or reset price under any of such securities. All of the outstanding shares of capital stock of Agenus are duly authorized,validly issued, fully paid and nonassessable, have been issued in compliance with all federal and state securities laws, and none of suchoutstanding shares was issued in violation of any preemptive rights or similar rights to subscribe for or purchase securities. There are nostockholders agreements, voting agreements or other similar agreements with respect to Agenus’s capital stock to which Agenus is aparty or, to the knowledge of Agenus, between or among any of Agenus’s stockholders.2.6Commission Documents, Financial Statements.(a)The Common Stock is registered pursuant to Section 12(b) or 12(g) of the SecuritiesExchange Act of 1934, as amended (the “Exchange Act”). Since January 1, 2017, Agenus has timely filed all reports, schedules,forms, statements and other documents required to be filed by it with the Commission pursuant to the reporting requirements of theExchange Act, including material filed pursuant to Section 13(a) or 15(d) of the Exchange Act (all of the foregoing, including filingsincorporated by reference therein and, for the avoidance of doubt, all reports, schedules, forms, statements and other documentsrequired to be filed following the date hereof, being referred to herein as the “Commission Documents”). The Common Stock iscurrently listed on Nasdaq. Agenus is not in violation of the listing requirements of Nasdaq and has no knowledge of any facts thatwould reasonably lead to delisting or suspension of the Common Stock from Nasdaq in the foreseeable future. As of its date, eachCommission Document filed since January 1,3 Source: AGENUS INC, 10-K, March 18, 2019Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results.[******] - Certain confidential information contained in this document, marked by brackets, is filed with the Securities and Exchange Commission pursuantto Rule 24b-2 of the Securities Exchange Act of 1934, as amended. 2017 complied in all material respects with the requirements of the Exchange Act and the rules and regulations of the Commissionpromulgated thereunder applicable to such document, and, as of its date, after giving effect to the information disclosed andincorporated by reference therein, no such Commission Document contained any untrue statement of a material fact or omit to state amaterial fact required to be stated therein or necessary in order to make the statements therein, in light of the circumstances under whichthey were made, not misleading. The Commission has not issued any stop order or other order suspending the effectiveness of anyregistration statement filed by Agenus under the Exchange Act or the Securities Act.(b)As of their respective dates, the financial statements of Agenus included in theCommission Documents filed with the Commission since January 1, 2017 complied as to form and substance in all material respectswith applicable accounting requirements and the published rules and regulations of the Commission or other applicable rules andregulations with respect thereto. Such financial statements have been prepared in accordance with GAAP applied on a consistent basisduring the periods involved (except (i) as may be otherwise indicated in such financial statements or the notes thereto or (ii) in the caseof unaudited interim statements, to the extent they may not include footnotes or may be condensed or summary statements), and fairlypresent in all material respects the financial position of Agenus as of the dates thereof and the results of operations and cash flows forthe periods then ended (subject, in the case of unaudited statements, to normal year-end audit adjustments).2.7Internal Controls and Procedures. Agenus maintains disclosure controls and procedures as such termsare defined in, and required by, Rule 13a-15 and Rule 15d-15 under the Exchange Act. Such disclosure controls and procedures areeffective as of the latest date of management’s evaluation of such disclosure controls and procedures as set forth in the CommissionDocuments to ensure that all material information required to be disclosed by Agenus in the reports that it files or furnishes under theExchange Act is recorded, processed, summarized and reported within the time periods specified in the rules and forms of theCommission. Agenus maintains a system of internal controls over financial reporting sufficient to provide reasonable assurance that (a)transactions are executed in accordance with management’s general or specific authorizations; and (b) transactions are recorded asnecessary to permit preparation of financial statements in conformity with GAAP. Agenus has disclosed, based on its most recentevaluation prior to the date hereof, to Agenus’s auditors and the audit committee of Agenus’s Board of Directors (y) any materialweaknesses in its internal control over financial reporting and (z) any allegation of fraud that involves management of Agenus or anyother employees of Agenus who have a significant role in Agenus’s internal control over financial reporting or disclosure controls andprocedures.2.8Sarbanes-Oxley. Since January 1, 2017, Agenus has been in material compliance with all applicableprovisions of the Sarbanes-Oxley Act of 2002, as amended.2.9Material Adverse Change. Since September 30, 2018, no event or series of events has or have occurredthat would, individually or in the aggregate, have a Material Adverse Effect on Agenus.2.10No Undisclosed Liabilities. Neither Agenus nor any of its subsidiaries has any liabilities, obligations,claims or losses (whether liquidated or unliquidated, secured or unsecured, absolute, accrued, contingent or otherwise) that would berequired to be disclosed on a balance sheet of Agenus or any of its subsidiaries (including the notes thereto) in conformity with GAAPand are not disclosed in the Commission Documents, other than those incurred in the ordinary course of Agenus’s or its subsidiaries’respective businesses since September 30, 2018.4 Source: AGENUS INC, 10-K, March 18, 2019Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results.[******] - Certain confidential information contained in this document, marked by brackets, is filed with the Securities and Exchange Commission pursuantto Rule 24b-2 of the Securities Exchange Act of 1934, as amended. 2.11No Undisclosed Events or Circumstances. Except for the transactions contemplated by thisAgreement and the Licenses, no event or circumstance has occurred or exists with respect to Agenus, its subsidiaries, or their respectivebusinesses, properties, operations or financial condition that, under applicable law, rule or regulation, requires a filing with theCommission on Form 8-K (or would be required to be included in a registration statement filed under the Securities Act were such aregistration statement filed on the date hereof) or public disclosure or announcement by Agenus but that has not been so filed orpublicly announced or disclosed.2.12Actions Pending. There is no Action pending or, to the knowledge of Agenus, threatened againstAgenus or any subsidiary that questions the validity of this Agreement or the transactions contemplated hereby or any action taken or tobe taken pursuant hereto. There is no Action pending or, to the knowledge of Agenus, threatened, against or involving Agenus, anysubsidiary, or any of their respective properties or assets that could be reasonably expected to have a Material Adverse Effect onAgenus. No judgment, order, writ, injunction, decree or award has been issued by or, to the knowledge of Agenus, requested of anyGovernmental Authority that could be reasonably expected to result in a Material Adverse Effect.2.13Compliance with Law. Agenus has all material permits, licenses, franchises, authorizations, orders andapprovals of (collectively, “Permits”), and has made all filings, applications and registrations with, Governmental Authorities that arerequired in order to permit Agenus to own or lease its properties and assets and to carry on its business as presently conducted. Neitherthe issuance or sale of the Shares hereunder nor the performance of Agenus’s other obligations under this Agreement, will result in thesuspension, revocation, impairment, forfeiture or nonrenewal of any Permit applicable to Agenus, its businesses or operations or any ofits assets or properties. Agenus and its subsidiaries have complied and are in compliance in all material respects with all Permits,statutes, laws, regulations, rules, judgments, orders and decrees of all Governmental Authorities applicable to it. Agenus has notreceived any notice alleging noncompliance, and, to the knowledge of Agenus, Agenus is not under investigation with respect to, orthreatened to be charged with, any material violation of any applicable statutes, laws, regulations, rules, judgments, orders or decrees ofany Governmental Authorities. Agenus has not received any notice of proceedings relating to the suspension, revocation, impairment,forfeiture or nonrenewal of any Permit. Except as disclosed in the Commission Documents, since January 1, 2014, Agenus has notentered into or been subject to any judgment, consent decree, compliance order or administrative order with respect to any aspect of thebusiness, affairs, properties or assets of Agenus or received any formal or informal complaint or claim from any GovernmentalAuthority with respect to any aspect of the business, affairs, properties or assets of Agenus.2.14Patents and Trademarks. Except as otherwise disclosed on Section 2.14 of the Disclosure Letter,Agenus owns, or has the right pursuant to a valid, written license agreement to use and exploit, all Intellectual Property used in ornecessary for the conduct of the business of Agenus and that is material to the business of Agenus as currently conducted (collectively,the “Agenus Intellectual Property”). Since January 1, 2014, no claims have been asserted by a third party in writing (including anyGovernmental Authority) (a) alleging that the conduct of the business of Agenus has infringed or misappropriated any IntellectualProperty of any third party, or (b) challenging or questioning the patentability (except in the case of proceedings relating to theprosecution and maintenance of the Agenus Intellectual Property in the ordinary course of business), validity, enforceability, oreffectiveness of any Agenus Intellectual Property. To Agenus’s knowledge, there is no valid basis for any claim by a third party(including any Governmental Authority) (x) alleging that the conduct of the business of Agenus has infringed or misappropriated any5 Source: AGENUS INC, 10-K, March 18, 2019Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results.[******] - Certain confidential information contained in this document, marked by brackets, is filed with the Securities and Exchange Commission pursuantto Rule 24b-2 of the Securities Exchange Act of 1934, as amended. Intellectual Property of any third party, or (y) challenging or questioning the validity, enforceability, or effectiveness of any AgenusIntellectual Property. To the knowledge of Agenus, all issued patents and registered trademarks that are Agenus Intellectual Property arevalid and enforceable and there is no existing infringement by another Person of any of the Agenus Intellectual Property. To theknowledge of Agenus, there are no actual or threatened disputes concerning any of the Agenus Intellectual Property. Neither Agenusnor any of its subsidiaries has received a notice (written or otherwise) that any material Agenus Intellectual Property has expired,terminated or been abandoned, or is expected to expire or terminate or be abandoned, within three years from the date of thisAgreement.2.15Taxes. (a) Agenus and its subsidiaries have filed all tax returns that are required to have been filed byeach of them or has requested extensions of the filing date thereof and (b) Agenus and its subsidiaries have paid all taxes required to bepaid by any of them and any other assessment, fine or penalty levied against any of them, to the extent that any of the foregoing is dueand payable, except in the case of clauses (a) and (b), for any such assessment, fine or penalty that is currently being contested in goodfaith or as would not have a Material Adverse Effect, whether or not arising from transactions in the ordinary course of business and(c) there are no tax audits ongoing of which Agenus has received written notice.2.16Exemption from Registration, Valid Issuance. Subject to, and in reliance on, the representations,warranties and covenants made herein by Purchaser, the issuance and sale of the Shares in accordance with the terms and on the basesof the representations and warranties set forth in this Agreement may and shall be properly issued pursuant to Section 4(a)(2) of theSecurities Act, Regulation D and any other applicable federal and state securities laws. The sale and issuance of the Shares pursuant to,and Agenus’s performance of its obligations under, this Agreement will not (i) result in the creation or imposition of any liens, charges,claims or other encumbrances upon the Shares or any of the assets of Agenus, or (ii) entitle the holders of any outstanding shares ofcapital stock of Agenus to preemptive or other rights to subscribe to or acquire the Shares or other securities of Agenus.2.17No Bad Actors. None of Agenus, any of its predecessors, any affiliated issuer, any director, executiveofficer, other officer of Agenus any beneficial owner of twenty percent (20%) or more of Agenus’s outstanding voting equity securities,calculated on the basis of voting power, nor any promoter (as that term is defined in Rule 405 under the Securities Act) connected withAgenus in any capacity at the time of sale (each, an “Issuer Covered Person”) is subject to any of the “Bad Actor” disqualificationsdescribed in Rule 506(d)(1)(i) to (viii) under the Securities Act (a “Disqualification Event”), except for a Disqualification Eventcovered by Rule 506(d)(2) or (d)(3). Agenus has exercised reasonable care to determine whether any Issuer Covered Person is subjectto a Disqualification Event.2.18No Integrated Offering. Neither Agenus, nor any of its Affiliates, nor any Person acting on its or theirbehalf has, directly or indirectly, made any offers or sales of any security or solicited any offers to buy any security, undercircumstances that would cause this offering of the Shares to be integrated with prior offerings by Agenus for purposes of the SecuritiesAct or any applicable stockholder approval provisions, including, without limitation, under the rules and regulations of any exchange orautomated quotation system on which any of the securities of Agenus are listed or designated.2.19Health Laws and FDA Compliance. (a) Each of Agenus and each of its subsidiaries is and has been incompliance in all material respects with statutes, laws, ordinances, rules and regulations applicable to Agenus or its subsidiaries for theownership, testing, development, manufacture, packaging, processing, use, labeling, storage, or disposal of any product manufacturedby or on behalf of Agenus and its subsidiaries or out-licensed by Agenus and its subsidiaries (each an “Agenus Product”), includingwithout6 Source: AGENUS INC, 10-K, March 18, 2019Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results.[******] - Certain confidential information contained in this document, marked by brackets, is filed with the Securities and Exchange Commission pursuantto Rule 24b-2 of the Securities Exchange Act of 1934, as amended. limitation, the Federal Food, Drug, and Cosmetic Act, 21 U.S.C. § 301, et seq., the Public Health Service Act, 42 U.S.C. § 262, similar(collectively, “Applicable Health Laws”); (b) Agenus and its subsidiaries possess all material licenses, certificates, approvals,authorizations, permits and supplements or amendments thereto required by any such Applicable Health Laws and/or for the ownershipof their properties or the conduct of their business as it relates to an Agenus Product and as described in Commission Documents(collectively, “Authorizations”) and such Authorizations are valid and in full force and effect and neither Agenus nor any of itssubsidiaries is in violation of any term of any such Authorizations; (c) neither Agenus nor any of its subsidiaries has received anywritten notice of adverse finding, warning letter or other written correspondence or notice from the U.S. Food and Drug Administration(the “FDA”) or any other Governmental Authority alleging or asserting noncompliance with any Applicable Health Laws orAuthorizations relating to an Agenus Product; (d) neither Agenus nor any of its subsidiaries has received written notice of any ongoingclaim, action, suit, proceeding, hearing, enforcement, investigation, arbitration or other action from any Governmental Authority orthird party alleging that any Agenus Product, operation or activity related to an Agenus Product is in violation of any Applicable HealthLaws or Authorizations; and (e) neither Agenus nor any of its subsidiaries has received written notice that any Governmental Authorityhas taken, is taking or intends to take action to limit, suspend, modify or revoke any Authorizations.2.20Tests and Preclinical and Clinical Trials. The studies, tests and preclinical and clinical trialsconducted by or, to Agenus’s knowledge, on behalf of Agenus that are described in the Commission Documents were and, if stillpending, are being, conducted in all material respects in accordance with any applicable protocols submitted to the FDA or anyGovernmental Authority exercising comparable authority, procedures and controls pursuant to, where applicable, accepted professionaland scientific standards, and all applicable laws, rules and regulations; the descriptions of the studies, tests and preclinical and clinicaltrials conducted by or, to Agenus’s knowledge, on behalf of Agenus, and the results thereof, contained in the Commission Documentsare accurate and complete in all material respects; to Agenus’s knowledge, there are no subsequent studies, tests or preclinical andclinical trials, the results of which call into question the results described in the Commission Documents; and Agenus has not receivedany notices or correspondence from the FDA, any Governmental Authority exercising comparable authority or any Institutional ReviewBoard requiring the termination, suspension, material modification or clinical hold of any studies, tests or preclinical or clinical trialsconducted by or on behalf of Agenus.2.21Solvency. Agenus has not: (a) made a general assignment for the benefit of creditors; (b) filed anyvoluntary petition in bankruptcy or suffered the filing of any involuntary petition by its creditors; (c) suffered the appointment of areceiver to take possession of all, or substantially all, of its assets; (d) suffered the attachment or other judicial seizure of all, orsubstantially all, of its assets; (e) admitted in writing its inability to pay its debts as they come due; or (f) made an offer of settlement,extension or composition to its creditors generally.2.22Investment Company. Agenus is not and, immediately after giving effect to the offering and sale ofthe Shares, will not be an “investment company” as defined in the Investment Company Act of 1940, as amended.2.23Regulation M Compliance. Agenus has not, and to its knowledge no one acting on its behalf has, (a)taken, directly or indirectly, any action designed to cause or to result in the stabilization or manipulation of the price of any security ofAgenus to facilitate the sale or resale of any of the Shares, (b) sold, bid for, purchased, or paid any compensation for solicitingpurchases of, any of the Shares, or (c) paid or agreed to pay to any Person any compensation for soliciting another to purchase anyother securities of Agenus.7 Source: AGENUS INC, 10-K, March 18, 2019Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results.[******] - Certain confidential information contained in this document, marked by brackets, is filed with the Securities and Exchange Commission pursuantto Rule 24b-2 of the Securities Exchange Act of 1934, as amended. 2.24Whistleblowers. To the knowledge of Agenus, as of the date hereof, no employee of Agenus or any ofits subsidiaries has provided since January 1, 2014 or is providing information to any law enforcement agency regarding the violationof any applicable law of the type described in Section 806 of the Sarbanes-Oxley Act by Agenus or its subsidiaries. Neither Agenus norits subsidiaries have discharged, demoted or suspended an employee of Agenus or its subsidiaries in the terms and conditions ofemployment because of any lawful act of such employee described in Section 806 of the Sarbanes-Oxley Act.2.25Brokers. Except as set forth on Section 2.23 of the Disclosure Letter, there are no brokers, finders orfinancial advisory fees or commissions that will be payable by Agenus or any of its subsidiaries in respect of the transactionscontemplated by this Agreement or the Licenses.2.26Money Laundering. The operations of Agenus are and have been conducted at all times incompliance with applicable financial record-keeping and reporting requirements of the Currency and Foreign Transactions ReportingAct of 1970, as amended, applicable money laundering statutes and applicable rules and regulations thereunder (collectively, the“Money Laundering Laws”), and no action, suit or proceeding by or before any court or governmental agency, authority or body orany arbitrator involving Agenus with respect to the Money Laundering Laws is pending or, to the knowledge of Agenus, threatened.2.27Foreign Corrupt Practices. Neither Agenus, nor to the knowledge of Agenus, any agent or otherPerson acting on behalf of Agenus, has (a) directly or indirectly, used any funds for unlawful contributions, gifts, entertainment or otherunlawful expenses related to foreign or domestic political activity, (b) made any unlawful payment to foreign or domestic governmentofficials or employees or to any foreign or domestic political parties or campaigns from corporate funds, (c) failed to disclose fully anycontribution made by Agenus (or made by any Person acting on its behalf of which Agenus is aware) which is in violation of the law,or (d) violated in any material respect any provision of the Foreign Corrupt Practices Act of 1977, as amended.2.28Acknowledgment. Agenus acknowledges and agrees that Purchaser will rely upon the truth andaccuracy of, and Agenus’s compliance with, the representations, warranties, agreements, acknowledgements and understandings ofAgenus set forth herein, the Licenses or any other document or instrument executed and/or delivered in connection with this Agreementor the consummation of the transactions contemplated hereby. Agenus acknowledges and agrees that the representations contained inSECTION 3 shall not modify, amend or affect Purchaser’s right to rely on Agenus’s representations, warranties, agreements,acknowledgements and understandings contained in this Agreement, the Licenses or any other document or instrument executed and/ordelivered in connection with this Agreement or the consummation of the transactions contemplated hereby.SECTION 3Representations and Warranties of PurchaserPurchaser hereby represents and warrants the following as of the Execution Date and as of the Investment Closing Date:3.1Experience. Purchaser is experienced in evaluating companies such as Agenus, has such knowledgeand experience in financial and business matters that Purchaser is capable of evaluating the merits8 Source: AGENUS INC, 10-K, March 18, 2019Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results.[******] - Certain confidential information contained in this document, marked by brackets, is filed with the Securities and Exchange Commission pursuantto Rule 24b-2 of the Securities Exchange Act of 1934, as amended. and risks of Purchaser’s prospective investment in Agenus, and has the ability to bear the economic risks of the investment.3.2Investment. Purchaser is acquiring the Shares for investment for Purchaser’s own account and not withthe view to, or for resale in connection with, any distribution thereof. Purchaser understands that the Shares have not been registeredunder the Securities Act by reason of a specific exemption from the registration provisions of the Securities Act that depends upon,among other things, the bona fide nature of the investment intent as expressed herein. Purchaser further represents that it does not haveany contract, undertaking, agreement or arrangement with any Person to sell, transfer or grant participation to any third person withrespect to any of the Shares.3.3Rule 144. Purchaser acknowledges that the Shares must be held indefinitely unless subsequentlyregistered under the Securities Act or an exemption from such registration is available. Purchaser is aware of the provisions of Rule 144that permit limited resale of shares purchased in a private placement subject to the satisfaction of certain conditions. In connectiontherewith, Purchaser acknowledges that Agenus will make a notation on its stock books regarding the restrictions on transfers set forthin this SECTION 3, subject to Section 7.4, and will transfer the Shares on the books of Agenus only to the extent not inconsistentherewith and therewith.3.4Access to Information. Purchaser has received and reviewed information about Agenus and has had anopportunity to discuss Agenus’s business, management and financial affairs with its management and to review Agenus’s facilities.Purchaser has had a full opportunity to ask questions of and receive answers from Agenus, or any Person or Persons acting on behalf ofAgenus, concerning the terms and conditions of an investment in the Shares.3.5Authorization. This Agreement has been duly executed and delivered and constitutes a valid andbinding obligation of Purchaser enforceable against Purchaser in accordance with its terms, except as such enforceability may belimited by applicable bankruptcy, securities, insolvency, or similar laws relating to, or affecting generally the enforcement of, creditors’rights and remedies, or indemnification or by other equitable principles of general application.3.6Investor Status. Purchaser acknowledges that it is an institutional “accredited investor” as defined inRule 501(a) of Regulation D of the Securities Act, and Purchaser shall submit to Agenus such further assurances of such status as maybe reasonably requested by Agenus.3.7No Inducement. Purchaser was not induced to participate in the offer and sale of the Shares by thefiling of any registration statement in connection with any public offering of Agenus’s securities, and Purchaser’s decision to purchasethe Shares hereunder was not influenced by the information contained in any such registration statement.3.8Purpose and Effect. Purchaser is not acquiring the Shares for the purpose of or, to the knowledge ofPurchaser, with the effect of, changing or influencing the control of Agenus, or in connection with or as a participant in any transactionthat to the knowledge of Purchaser has that purpose or effect.3.9Brokers. There are no brokers, finders or financial advisory fees or commissions that will be payableby Purchaser or any of its subsidiaries in respect of the transactions contemplated by this Agreement or the Licenses.9 Source: AGENUS INC, 10-K, March 18, 2019Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results.[******] - Certain confidential information contained in this document, marked by brackets, is filed with the Securities and Exchange Commission pursuantto Rule 24b-2 of the Securities Exchange Act of 1934, as amended. SECTION 4Conditions to Purchaser’s Obligations at ClosingThe obligations of Purchaser under this Agreement are subject to the fulfillment on or before the Closing of each of thefollowing conditions, any of which may be waived in writing by Purchaser (except to the extent not permitted by law):4.1No Injunction, etc. No preliminary or permanent injunction or other binding order, decree or rulingissued by a Governmental Authority shall be in effect that shall have the effect of preventing the consummation of the transactionscontemplated by this Agreement. No action or claim shall be pending before any Governmental Authority or before any arbitratorwherein an unfavorable injunction, judgment, order, decree, ruling or charge would be reasonably likely to (a) prevent consummationof any of the transactions contemplated by this Agreement, (b) cause any of the transactions contemplated by this Agreement to berescinded following consummation, or (c) have the effect of making illegal the purchase of, or payment for, any of the Shares byPurchaser.4.2Representations and Warranties. The representations and warranties of Agenus contained in SECTION2 shall be true and correct in all material respects on and as of the Closing, except to the extent such representations and warranties aremade as of another date, in which case such representations and warranties shall be true and correct as of such other date.4.3Performance. Agenus shall have performed and complied with all covenants, agreements, obligationsand conditions contained in this Agreement that are required to be performed or complied with by it on or before the Closing.4.4Securities Laws. The offer and sale of the Shares to Purchaser pursuant to this Agreement shall beexempt from the registration requirements of the Securities Act and the registration and/or qualification requirements of all applicablestate securities laws.4.5Trading. From the date hereof to the Investment Closing Date, trading in the Common Stock shall nothave been suspended by the Commission or Nasdaq, nor shall a banking moratorium have been declared either by the United States orNew York State authorities, nor shall there have occurred any material outbreak or escalation of hostilities or other national orinternational calamity of such magnitude in its effect on any financial market which, in each case, remains in effect as of the InvestmentClosing Date and would prevent the Purchaser from purchasing the Shares at the Closing.4.6Transfer Agent Instructions. Agenus shall deliver to its Transfer Agent irrevocable written instructionsto issue the Shares to Purchaser in a form and substance acceptable to the Transfer Agent.4.7Authorizations. All authorizations, approvals or permits, if any, of any Governmental Authority that arerequired in connection with the lawful issuance and sale of the Shares pursuant to this Agreement shall have been duly obtained andshall be effective on and as of the Closing.4.8Nasdaq Qualification. The Shares will be duly authorized for listing by Nasdaq, subject to officialnotice of issuance.10 Source: AGENUS INC, 10-K, March 18, 2019Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results.[******] - Certain confidential information contained in this document, marked by brackets, is filed with the Securities and Exchange Commission pursuantto Rule 24b-2 of the Securities Exchange Act of 1934, as amended. 4.9Licenses. The Licenses shall be in effect. Any applicable waiting periods under the Hart-Scott-RodinoAntitrust Improvements Act of 1976 (15 U.S.C. § 18a) related to the transactions contemplated under the License Agreement shall haveexpired or terminated.4.10Registration Rights Agreement. Purchaser shall have received an executed counterpart to theRegistration Rights Agreement.4.11Legal Opinion. Purchaser shall have received a legal opinion from Ropes & Gray LLP in form andsubstance reasonably acceptable to Purchaser.4.12No Material Adverse Effect. No Material Adverse Effect with respect to Agenus shall have occurredor be existing as of the Closing.4.13Compliance Certificate. A duly authorized officer of Agenus shall deliver to Purchaser at the Closinga certificate stating that the conditions specified in Sections 4.2, 4.3 and 4.12 have been fulfilled and certifying and attaching theCertificate, the Bylaws and authorizing Board of Directors resolutions with respect to this Agreement, the Licenses and the transactionscontemplated hereby and thereby.SECTION 5Conditions to Agenus’s Obligations at ClosingThe obligations of Agenus to Purchaser under this Agreement are subject to the fulfillment on or before the Closing of each ofthe following conditions by Purchaser:5.1Representations and Warranties. The representations and warranties of Purchaser contained inSECTION 3 shall be true and correct in all material respects on and as of the Closing, except to the extent such representations andwarranties are made as of another date, in which case such representations and warranties will be true and correct as of such other date.5.2Securities Law. The offer and sale of the Shares to Purchaser pursuant to this Agreement shall beexempt from the registration requirements of the Securities Act and the registration and/or qualification requirements of all applicablestate securities laws.5.3Authorization. All authorizations, approvals or permits, if any, of any Governmental Authority that arerequired in connection with the lawful issuance and sale of the Shares pursuant to this Agreement shall have been duly obtained andshall be effective on and as of the Closing.5.4Registration Rights Agreement. Agenus shall have received an executed counterpart to the RegistrationRights Agreement.5.5Licenses. The Licenses shall be in effect.11 Source: AGENUS INC, 10-K, March 18, 2019Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results.[******] - Certain confidential information contained in this document, marked by brackets, is filed with the Securities and Exchange Commission pursuantto Rule 24b-2 of the Securities Exchange Act of 1934, as amended. SECTION 6Agenus Covenants6.1Conduct of Business Prior to the Closing. From the date hereof until the Closing, except as otherwiseprovided in this Agreement or consented to in writing by Purchaser (which consent shall not be unreasonably withheld or delayed),Agenus shall use its reasonable best efforts to (x) conduct Agenus’s business in the ordinary course of business consistent with pastpractice; and (y) maintain and preserve intact the current organization and business of Agenus and to preserve the rights, franchises,goodwill and relationships of its employees, collaborators, regulators and others having business relationships with Agenus. Withoutlimiting the foregoing, from the date hereof until the Investment Closing Date, Agenus shall not:(a)authorize or effect any amendment or change to the Certificate or the Bylaws,including any amendment to the Certificate that has the effect of splitting, combining, reclassifying, recapitalizing, or modifying theterms of any equity interests of Agenus;(b)declare, set aside or pay any cash dividend on, or make any other cash distribution inrespect of outstanding equity securities of Agenus or any of its subsidiaries, except for cash dividends by a wholly owned subsidiary ofAgenus to Agenus or another wholly owned subsidiary of Agenus;(c)sell, transfer, abandon, allow to lapse, license or otherwise encumber any AgenusIntellectual Property, except in the ordinary course of business consistent with past practice or that would not reasonably be expected tohave an adverse effect on the transactions contemplated in the Licenses;(d)except as set forth on Section 6.1(d) of the Disclosure Letter, adopt a plan of completeor partial liquidation, dissolution, merger, consolidation, restructuring, recapitalization or other reorganization of Agenus or any of itssubsidiaries; or(e)authorize, or commit or agree to take, any of the foregoing actions.6.2Commission Filings. Agenus will timely make all filings with the Commission that are required byAgenus in connection with its entrance into this Agreement and the offer and sale of the Shares.6.3Listing of Common Stock, No Integrated Offerings. Agenus shall take no action designed to, or whichto the knowledge of Agenus is likely to have the effect of, terminating the registration of the Common Stock under the Exchange Act.Agenus agrees to use reasonable best efforts to file with the Commission in a timely manner all reports and other filings required ofAgenus under the Securities Act and the Exchange Act. Agenus further agrees, if Agenus applies to have the Common Stock traded onany other trading market, it will include in such application all of the Shares, and will take such other action as is necessary to cause allof the Shares to be listed on such other trading market as promptly as possible. Agenus shall take all action reasonably necessary tocontinue the listing and trading of its Common Stock, including the Shares, on Nasdaq and will comply in all material respects withAgenus’s reporting, filing and other obligations under the bylaws or rules of Nasdaq. Agenus currently meets the continuing eligibilityrequirements for listing on Nasdaq and has not received in the past twelve (12) months any notification of non-compliance ofapplicable Nasdaq listing standards. Agenus shall not sell, offer for sale or solicit offers to buy or otherwise negotiate in respect of anysecurity (as defined in Section 2 of the Securities Act) that would be integrated with the offer or sale of the Shares in a manner thatwould require the registration under the12 Source: AGENUS INC, 10-K, March 18, 2019Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results.[******] - Certain confidential information contained in this document, marked by brackets, is filed with the Securities and Exchange Commission pursuantto Rule 24b-2 of the Securities Exchange Act of 1934, as amended. Securities Act of the sale to Purchaser of the Shares, or that would be integrated with the offer or sale of the Shares for purposes of therules and regulations of Nasdaq.6.4Use of Proceeds. Agenus shall use the net proceeds from the sale of the Shares hereunder for workingcapital purposes and shall not use such proceeds: (a) for the redemption of any Common Stock, outstanding preferred stock, options orwarrants or any other securities convertible thereto or exercisable or exchangeable therefor, (b) for the settlement of any outstandinglitigation or (c) in violation of FCPA or regulations of the Office of Foreign Assets Control of the U.S. Treasury Department. For theavoidance of doubt, a payment described in clause (a) – (b) shall not be deemed to use the net proceeds from the sale of the Shares, solong as immediately prior to such payment Agenus has cash on hand or the right to receive third-party proceeds sufficient to make suchpayment without taking into account the proceeds from such sale.6.5Notices of Certain Events. Agenus shall as promptly as reasonably practicable notify Purchaser of: (i)any notice or other communication of which Agenus has knowledge from any Person alleging that the consent of such Person (oranother Person) is or may be required in connection with the transactions contemplated by this Agreement; (ii) any notice or othercommunication of which Agenus has knowledge from any Governmental Authority in connection with the transactions contemplatedby this Agreement; (iii) any Actions commenced or, to the knowledge of Agenus, threatened against, relating to or involving orotherwise affecting Agenus or any of its subsidiaries that, if pending on the date of this Agreement, would have been required to havebeen disclosed pursuant to Section 2.10 or which relate to the consummation of the transactions contemplated by this Agreement; and(iv) any fact or occurrence between the date of this Agreement and the Execution Date of which it has knowledge that makes any of itsrepresentations contained in this Agreement untrue in any material respect or causes any material breach of its obligations under thisAgreement.SECTION 7Purchaser Covenants; Resales; Registration Rights, Legends7.1Stock Ownership Guidance.(a)Lock-Up Period. Excluding any transfers of Shares between Purchaser and any of itsAffiliates, during the twelve (12) month period beginning on the Investment Closing Date and ending on the first anniversary thereof(the “Lock-Up Period”), Purchaser shall not, and shall not cause any other holder of the Shares to, without the prior written consent ofAgenus, sell, contract to sell, pledge or otherwise dispose of, directly or indirectly, any Shares or enter into a transaction which wouldhave the same effect. Notwithstanding any other provision of this Section 7.1(a), this Section 7.1(a) shall not prohibit or restrict anydisposition of Shares into (i) a tender offer or a merger or binding share exchange effected by a third party that if completed inaccordance with its terms would result in a change of control or (ii) an issuer tender offer. All restrictions pursuant to this Section 7.1(a)shall terminate upon (x) a change of control of Agenus and (y) a liquidation or dissolution of Agenus.(b)Market Stand-Off Agreement. During the Lock-Up Period, Purchaser agrees that inconnection with any registration of Agenus’s securities that, upon the request of Agenus or the underwriters managing any underwrittenoffering of Agenus’s securities, Purchaser will deliver its written agreement not to sell, make any short sale of, loan, grant any optionfor the purchase of, or otherwise dispose of any Shares without the prior written consent of Agenus or such underwriters, as the casemay be, for such period of time within the Lock-Up Period as Agenus or the underwriters may specify.13 Source: AGENUS INC, 10-K, March 18, 2019Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results.[******] - Certain confidential information contained in this document, marked by brackets, is filed with the Securities and Exchange Commission pursuantto Rule 24b-2 of the Securities Exchange Act of 1934, as amended. (c)Standstill. Notwithstanding anything in this Section 7.1 to the contrary, from the datehereof until the expiration of the Lock-Up Period, Purchaser and its Affiliates may not acquire an aggregate number of Voting Securitiesthat, together with the Shares and any other Voting Securities beneficially owned by Purchaser on the date hereof would represent 15%or more of the voting power represented by Agenus’ Voting Securities. Nothing in this Section 7.1 shall restrict (i) passive investmentsby any employee benefit plan of Purchaser or its Affiliates or (ii) any acquisition of Voting Securities by virtue of a transaction with anystockholder of Agenus the primary purpose of which is not to elude this Section 7.1(c). Notwithstanding the foregoing, the provisionsof this Section 7.1(c) shall be deemed to have terminated, and the restrictions in Section 7.1(c) shall terminate, upon the occurrence ofthe following: (x) Agenus publicly announces the execution of a definitive agreement contemplating a transaction pursuant to whichAgenus’s stockholders immediately prior to the transaction will own less than 50% of the voting securities of the surviving parent entityimmediately following the transaction, (y) the commencement by any third party of a tender offer seeking to acquire beneficialownership of more than 50% of Agenus’s outstanding voting securities; or (z) Agenus publicly announces the commencement of aprocess to solicit proposals for a potential business combination transaction.(d)Remedies. Without prejudice to the rights and remedies otherwise available to theparties, Agenus shall be entitled to seek equitable relief by way of injunction if Purchaser or any other holder of the Shares breaches orthreatens to breach any of the provisions of this Section 7.1.(e)Voting. During the Lock-Up Period, Purchaser shall vote, or cause to be voted, allshares of Common Stock then beneficially owned by Purchaser, in accordance with the recommendation of the Board of Directors onany matters presented to Agenus’s stockholders with respect to any of Agenus’s equity incentive plans or compensation matters that, ineach case, apply to employees of Agenus generally.7.2Rule 144 Reporting. With a view to making available to Purchaser the benefits of certain rules andregulations of the Commission that may permit the sale of the Shares to the public without registration, Agenus agrees to usecommercially reasonable efforts to:(a)make and keep current public information available, as those terms are understoodand defined in Rule 144;(b)file with the Commission in a timely manner all reports and other documents requiredof Agenus under the Exchange Act; and(c)furnish Purchaser forthwith upon request (i) a written statement by Agenus as to itscompliance with the current public information requirements of Rule 144, (ii) a copy of the most recent annual or quarterly report ofAgenus, and (iii) such other reports and documents as may be reasonably requested in availing Purchaser of any rule or regulation ofthe Commission permitting the sale of any such securities without registration.7.3Registration. Agenus shall provide Purchaser with the registration rights set forth in the RegistrationRights Agreement.7.4Restrictive Legend. The book-entry credits representing the Shares, when issued, will bear a restrictivelegend in substantially the following form:14 Source: AGENUS INC, 10-K, March 18, 2019Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results.[******] - Certain confidential information contained in this document, marked by brackets, is filed with the Securities and Exchange Commission pursuantto Rule 24b-2 of the Securities Exchange Act of 1934, as amended. “THE SECURITIES REPRESENTED HEREBY HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933,AS AMENDED (THE “ACT”), OR UNDER THE SECURITIES LAWS OF CERTAIN STATES. THESE SECURITIES ARE SUBJECTTO RESTRICTIONS ON TRANSFERABILITY AND RESALE AND MAY NOT BE TRANSFERRED OR RESOLD EXCEPT ASPERMITTED UNDER THE ACT AND ANY APPLICABLE STATE SECURITIES LAWS, PURSUANT TO REGISTRATION OREXEMPTION THEREFROM OR UNLESS THE COMPANY HAS RECEIVED AN OPINION OF COUNSEL SATISFACTORY TO THECOMPANY AND ITS COUNSEL THAT SUCH REGISTRATION IS NOT REQUIRED.”The legend set forth in this Section 7.4 and the related notation in Agenus’s stock books shall be removed and Agenus shallcause such legend to be removed from the book-entry credits representing the Shares within two Business Days of receipt of a requestpursuant to Section 9.6 by Purchaser if (i) the Shares are registered for resale under the Securities Act, (ii) the Shares are sold ortransferred in compliance with Rule 144, or (iii) the Shares are eligible for sale under Rule 144 without the requirement for Agenus tobe in compliance with the current public information required under Rule 144. Following Rule 144 becoming available for the resale ofShares, without the requirement for Agenus to be in compliance with the current public information required under Rule 144, Agenusshall (at Agenus’s expense), upon the written request of Purchaser, and within two Business Days of receipt of such request pursuant toSection 9.6, cause its counsel to issue to the Transfer Agent a legal opinion authorizing the removal of the legend from the book-entrycredits representing the Shares, if requested by the Transfer Agent.SECTION 8IndemnificationEach Party (an “Indemnifying Party”) hereby indemnifies and holds harmless the other Party, such other Party’s respectiveofficers, directors, employees, consultants, representatives and advisers, and any and all Affiliates of the foregoing (each of theforegoing, an “Indemnified Party”) from and against all losses, liabilities, costs, damages and expense (including reasonable legal feesand expenses) suffered or incurred by any such Indemnified Party to the extent arising from, connected with or related to (i) breach ofany representation or warranty of such Indemnifying Party in this Agreement; and (ii) breach of any covenant or undertaking of anyIndemnifying Party in this Agreement. If an event or omission (including, without limitation, any claim asserted or action or proceedingcommenced by a third party) occurs that an Indemnified Party asserts to be an indemnifiable event pursuant to this Section 8, theIndemnified Party will provide written notice to the Indemnifying Party, setting forth the nature of the claim and the basis forindemnification under this Agreement. The Indemnified Party will give such written notice to the Indemnifying Party immediately afterit becomes aware of the existence of any such event or occurrence. Such notice will be a condition precedent to any obligation of theIndemnifying Party to act under this Agreement but will not relieve it of its obligations under the indemnity except to the extent that thefailure to provide prompt notice as provided in this Agreement prejudices the Indemnifying Party with respect to the transactionscontemplated by this Agreement and to the defense of the liability. In case any such action is brought by a third party against anyIndemnified Party and it notifies the Indemnifying Party of the commencement thereof, the Indemnifying Party will be entitled toparticipate therein and, to the extent that it wishes, to assume the defense and settlement thereof with counsel reasonably selected by itand, after notice from the Indemnifying Party to the Indemnified Party of such election so to assume the defense and settlement thereof,the Indemnifying Party will not be liable to the Indemnified Party for any legal expenses of other counsel or any other expensessubsequently incurred by such Indemnified Party in connection with the defense thereof,15 Source: AGENUS INC, 10-K, March 18, 2019Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results.[******] - Certain confidential information contained in this document, marked by brackets, is filed with the Securities and Exchange Commission pursuantto Rule 24b-2 of the Securities Exchange Act of 1934, as amended. provided, however, that an Indemnified Party shall have the right to employ separate counsel at the expense of the Indemnifying Partyif (i) the employment thereof has been specifically authorized in writing by the Indemnifying Party or (ii) representation of both partiesby the same counsel would be inappropriate due to actual or potential conflicts of interests between such parties (which such judgmentshall be made in good faith after consultation with counsel). The Indemnified Party agrees to cooperate fully with (and to provide allrelevant documents and records and make all relevant personnel available to) the Indemnifying Party and its counsel, as reasonablyrequested, in the defense of any such asserted claim at no additional cost to the Indemnifying Party. No Indemnifying Party will consentto the entry of any judgment or enter into any settlement with respect to any such asserted claim without the prior written consent of theIndemnified Party, not to be unreasonably withheld or delayed, (a) if such judgment or settlement does not include as an unconditionalterm thereof the giving by each claimant or plaintiff to each Indemnified Party of a release from all liability in respect to such claim or(b) if, as a result of such consent or settlement, injunctive or other equitable relief would be imposed against the Indemnified Party orsuch judgment or settlement could materially and adversely affect the business, operations or assets of the Indemnified Party. NoIndemnified Party will consent to the entry of any judgment or enter into any settlement with respect to any such asserted claim withoutthe prior written consent of the Indemnifying Party, not to be unreasonably withheld or delayed. If an Indemnifying Party makes apayment with respect to any claim under the representations or warranties set forth herein and the Indemnified Party subsequentlyreceives from a third party or under the terms of any insurance policy a sum in respect of the same claim, the receiving party will repayto the other party such amount that is equal to the sum subsequently received.SECTION 9Miscellaneous9.1Termination. This Agreement may be terminated at any time prior to Closing:(a)by mutual written consent of Purchaser and Agenus;(b)by Purchaser or Agenus:(i)if there shall be any statute, law, regulation or rule thatmakes consummating the transactions contemplated hereby illegal or if any Governmental Authority shall have issued a judgment,order, decree or ruling, or shall have taken such other action restraining, enjoining or otherwise prohibiting the issuance of the Sharescontemplated hereby and such judgment, order, decree or ruling shall have become final and non-appealable; or(ii)if any of the Licenses shall have terminated;(c)by Purchaser:(i)if Agenus shall have (A) failed to perform any of itsmaterial obligations contained herein, or (B) breached any of its material representations or warranties contained herein, provided thatPurchaser gives Agenus written notice of such failure to perform or breach and Agenus does not cure such failure to perform or breachwithin 30 days after its receipt of such written notice, and provided, further, that the right to terminate this Agreement under this Section9.1(c)(i) shall not be available to Purchaser if Purchaser is then in breach of this Agreement;16 Source: AGENUS INC, 10-K, March 18, 2019Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results.[******] - Certain confidential information contained in this document, marked by brackets, is filed with the Securities and Exchange Commission pursuantto Rule 24b-2 of the Securities Exchange Act of 1934, as amended. (ii)if any of the conditions set forth in SECTION 4 shallbecome impossible to fulfill (other than as a result of any breach by Purchaser of the terms of this Agreement) and shall not have beenwaived in accordance with the terms of this Agreement; or(iii)if the Common Stock shall no longer be listed for tradingon Nasdaq or another national securities exchange or automated quotation system;(d)by Agenus:(i)if Purchaser shall have (A) failed to perform any of itsmaterial obligations contained herein, or (B) breached any of its material representations or warranties contained herein, provided thatAgenus gives Purchaser written notice of such failure to perform or breach and Purchaser does not cure such failure to perform orbreach within 30 days after its receipt of such written notice, and provided, further, that the right to terminate this Agreement under thisSection 9.1(d)(i) shall not be available to Agenus if Agenus is then in breach of this Agreement; or(ii)if any of the conditions set forth in SECTION 5 shallbecome impossible to fulfill (other than as a result of any breach by Agenus of the terms of this Agreement) and shall not have beenwaived in accordance with the terms of this Agreement.(e)If this Agreement is terminated and the transactions contemplated hereby are notconsummated as described above, this Agreement shall become void and of no further force and effect, provided, however, that (i)none of the Parties shall have any liability in respect of a termination of this Agreement pursuant to Sections 9.1(a) or 9.1(b)(i), and (ii)nothing shall relieve any of the Parties from liability for actual damages resulting from a termination of this Agreement pursuant toSections 9.1(c) or 9.1(d); and provided, further, except in the case of fraud or willful misconduct, that none of the Parties shall have anyliability for speculative, indirect, unforeseeable or consequential damages or lost profits resulting from any legal action relating to anytermination of this Agreement.9.2Governing Law. This Agreement and any dispute arising from the performance or breach hereof shallbe governed by and interpreted in accordance with the laws of the State of New York, without giving effect to any choice of law rules.The provisions of the United Nations Convention on Contracts for the International Sale of Goods shall not apply to this Agreement orany subject matter hereof.9.3Jurisdiction. Each Party irrevocably submits to the exclusive jurisdiction of the United States DistrictCourt for the Southern District of New York for the purposes of any suit, action or other proceeding arising out of this Agreement. EachParty agrees to commence any such action, suit or proceeding in the United States District Court for the Southern District of New Yorkor if such suit, action or other proceeding may not be brought in such court for jurisdictional reasons, in the Supreme Court of the Stateof New York, New York County. Each Party irrevocably and unconditionally waives any objection to the laying of venue of any suchaction, suit or proceeding arising out of this Agreement in the United States District Court for the Southern District of New York, andhereby and thereby further irrevocably and unconditionally waives and agrees not to plead or claim in any such court that any suchaction, suit or proceeding brought in any such court has been brought in an inconvenient forum. 9.4Investigation. The representations, warranties, covenants and agreements made herein shall survive anyinvestigation made by Purchaser and the Closing. The representations, warranties, covenants and agreements of Agenus shall not beaffected or deemed waived by reason of any investigation made by or17 Source: AGENUS INC, 10-K, March 18, 2019Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results.[******] - Certain confidential information contained in this document, marked by brackets, is filed with the Securities and Exchange Commission pursuantto Rule 24b-2 of the Securities Exchange Act of 1934, as amended. on behalf of Purchaser (including by any of its Representatives) or by reason of the fact that Purchaser or any of its Representativesknew or should have known that any such representation or warranty is, was or might be inaccurate or by reason of Purchaser’s waiverof any condition set forth in SECTION 4.9.5Successors, Assigns. Except as otherwise provided herein, the provisions hereof shall inure to thebenefit of, and be binding upon, the successors, assigns, heirs, executors and administrators of the Parties. This Agreement may not beassigned by either Party without the prior written consent of the other; except that Purchaser may assign this Agreement to an Affiliateand either Party may assign this Agreement to any third party that acquires all or substantially all of such Party’s business, whether bymerger, sale of assets or otherwise.9.6Notices. Any notice required or permitted to be given by this Agreement shall be in writing and inEnglish and shall be: (a) delivered by hand or by overnight courier with tracking capabilities; (b) mailed postage prepaid by first class,registered, or certified mail; (c) delivered by facsimile; or (d) soley for the purposes of requests pursuant to Section 7.4, delivered byemail to Agenus, in each case, addressed as set forth below unless changed by notice so given: If to Purchaser: Gilead Sciences, Inc. 333 Lakeside Drive Foster City, CA 94404 Attention: Facsimile: With copies to: Gilead Sciences, Inc. 333 Lakeside Drive Foster City, CA 94404 Attention: Facsimile: If to Agenus: Agenus Inc. 3 Forbes Road Lexington, MA 02421-7305 Attention:General CounselFacsimile:Email: With copies to: 18 Source: AGENUS INC, 10-K, March 18, 2019Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results.[******] - Certain confidential information contained in this document, marked by brackets, is filed with the Securities and Exchange Commission pursuantto Rule 24b-2 of the Securities Exchange Act of 1934, as amended. Ropes & Gray LLP Prudential Tower 800 Boylston Street Boston, MA 02199 Attention:Zachary R. BlumeFacsimile:Email: Any such notice shall be deemed given on the date received, except any notice received after 5:30 p.m. (in the time zone of thereceiving Party) on a Business Day or received on a non-Business Day shall be deemed to have been received on the next BusinessDay. Any notice pursuant to subsections (c) and (d) above, shall be deemed received on the Business Day that such notices are sent,except any notice received after 5:30 p.m. (in the time zone of the receiving Party) on a Business Day or received on a non-BusinessDay shall be deemed to have been received on the next Business Day. A Party may add, delete, or change the person or address towhich notices should be sent at any time upon written notice delivered to the other Parties in accordance with this Section 9.6.9.7Expenses. Each Party shall bear its own costs and expenses (including investment banking and legalfees and expenses) incurred in connection with this Agreement and the transactions contemplated hereby.9.8Finder’s Fees. Each of Agenus and Purchaser shall indemnify and hold the other harmless from anyliability for any commission or compensation in the nature of a finder’s fee, placement fee or underwriter’s discount (including thecosts, expenses and legal fees of defending against such liability) for which Agenus or Purchaser, or any of its respective partners,employees, or representatives, as the case may be, is responsible.9.9Counterparts. This Agreement may be executed in counterparts with the same effect as if both Partieshad signed the same document. All such counterparts shall be deemed an original, shall be construed together, and shall constitute oneand the same instrument. Any such counterpart, to the extent delivered by means of facsimile by .pdf, .tif, .gif, .jpeg, or similarattachment to electronic mail (any such delivery, an “Electronic Delivery”) shall be treated in all manner and respects as an originalexecuted counterpart and shall be considered to have the same binding legal effect as if it were the original signed version thereofdelivered in person. No Party shall raise the use of Electronic Delivery to deliver a signature or the fact that any signature or agreementor instrument was transmitted or communicated through the use of Electronic Delivery as a defense to the formation of a contract, andeach Party forever waives any such defense, except to the extent that such defense relates to lack of authenticity.9.10Further Assurances. In the event that at any time after the Investment Closing Date any further actionis reasonably necessary to carry out the purposes of this Agreement, each of the Parties will take such further action (including theexecution and delivery of such further instruments and documents) as the other Party reasonably may request, at the sole cost andexpense of the requesting Party.9.11Severability. If one or more of the terms or provisions of this Agreement is held by a court ofcompetent jurisdiction to be void, invalid, or unenforceable in any situation in any jurisdiction, such holding shall not affect the validityor enforceability of the remaining terms and provisions hereof or the validity or enforceability of the void, invalid, or unenforceableterm or provision in any other situation or in19 Source: AGENUS INC, 10-K, March 18, 2019Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results.[******] - Certain confidential information contained in this document, marked by brackets, is filed with the Securities and Exchange Commission pursuantto Rule 24b-2 of the Securities Exchange Act of 1934, as amended. any other jurisdiction, and the term or provision shall be considered severed from this Agreement solely for such situation and solely insuch jurisdiction, unless the void, invalid, or unenforceable term or provision is of such essential importance to this Agreement that it isto be reasonably assumed that the Parties would not have entered into this Agreement without the void, invalid, or unenforceable termor provision. If the final judgment of such court declares that any term or provision hereof is void, invalid, or unenforceable, the Partiesagree to: (a) reduce the scope, duration, area, or applicability of the term or provision or to delete specific words or phrases to theminimum extent necessary to cause such term or provision as so reduced or amended to be enforceable; and (b) make a good-faitheffort to replace any void, invalid, or unenforceable term or provision with a valid and enforceable term or provision such that theobjectives contemplated by the Parties when entering this Agreement may be realized.9.12Entire Agreement. This Agreement and the Licenses, including the exhibits and schedules attachedhereto and thereto, constitute the full and entire understanding and agreement among the Parties with regard to the subjects hereof andthereof. No Party shall be liable or bound to any other Party in any manner with regard to the subjects hereof or thereof by anywarranties, representations or covenants except as specifically set forth herein or therein.9.13Mutual Drafting. This Agreement has been diligently reviewed by and negotiated by and between theParties, and in such negotiations each of the Parties has been represented by competent (in-house or external) counsel, and the finalagreement contained herein, including the language whereby it has been expressed, represents the joint efforts of the Parties and theircounsel. Accordingly, in interpreting this Agreement or any provision hereof, no presumption shall apply against any Party as beingresponsible for the wording or drafting of this Agreement or any such provision, and ambiguities, if any, in this Agreement shall not beconstrued against any Party, irrespective of which Party may be deemed to have authored the ambiguous provision.9.14Waivers and Modifications. The failure of any Party to insist on the performance of any obligationhereunder shall not be deemed to be a waiver of such obligation. Waiver of any breach of any provision hereof shall not be deemed tobe a waiver of any other breach of such provision or any other provision on such occasion or any succeeding occasion. No waiver,modification, release, or amendment of any obligation under or provision of this Agreement shall be valid or effective unless in writingand signed by the Parties.9.15Waiver of Jury Trial. THE PARTIES HEREBY WAIVE, AND COVENANT THAT THEY SHALLNOT ASSERT (WHETHER AS PLAINTIFF, DEFENDANT, OR OTHERWISE), ANY RIGHT TO TRIAL BY JURY IN ANY ACTIONARISING IN WHOLE OR IN PART UNDER OR IN CONNECTION WITH THIS AGREEMENT, WHETHER NOW EXISTING ORHEREAFTER ARISING, AND WHETHER SOUNDING IN CONTRACT, TORT, OR OTHERWISE. THE PARTIES AGREE THATANY OF THEM MAY FILE A COPY OF THIS PARAGRAPH WITH ANY COURT AS WRITTEN EVIDENCE OF THE KNOWING,VOLUNTARY, AND BARGAINED-FOR AGREEMENT AMONG THE PARTIES IRREVOCABLY TO WAIVE ITS RIGHT TOTRIAL BY JURY IN ANY PROCEEDING WHATSOEVER BETWEEN THEM RELATING TO THIS AGREEMENT SHALLINSTEAD BE TRIED IN A COURT OF COMPETENT JURISDICTION BY A JUDGE SITTING WITHOUT A JURY. 20 Source: AGENUS INC, 10-K, March 18, 2019Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results.[******] - Certain confidential information contained in this document, marked by brackets, is filed with the Securities and Exchange Commission pursuantto Rule 24b-2 of the Securities Exchange Act of 1934, as amended. SECTION 10Certain Defined TermsAs used in this Agreement, the following terms shall have the following meanings:10.1“Action” means any notice of noncompliance or violation, or any claim, demand, charge, action, suit,litigation, audit, settlement, complaint, stipulation, assessment or arbitration, or any request (including any request for information),review, inquiry, hearing, proceeding or investigation, an opposition, revocation, reexamination, interference or similar proceeding byany Person or by or before any Governmental Authority.10.2“Affiliate” means any Person which, directly or indirectly through one or more intermediaries,controls, is controlled by, or is under common control with a Party. The term “control” (including the terms “controlled by” and“under common control with”), with respect to the relationship between or among two or more Persons, means the possession, directlyor indirectly, of the power to direct or cause the direction of the affairs or management of a Person, whether through the ownership ofvoting securities, as trustee or executor, by contract or otherwise.10.3“Business Day” means a day on which banking institutions in Boston, Massachusetts, and SanFrancisco, California, are open for business, excluding any Saturday or Sunday and December 26 through December 31.10.4“Commission” means the United States Securities and Exchange Commission.10.5“Common Stock” means Agenus’s common stock, par value $0.01 per share.10.6“GAAP” means generally accepted accounting principles as practiced in the United States, asconsistently applied.10.7“Governmental Authority” means any: (a) federal, state, local, municipal, foreign, or othergovernment; (b) governmental or quasi-governmental authority of any nature (including any agency, board, body, branch, bureau,commission, council, department, entity, governmental division, instrumentality, office, officer, official, organization, representative,subdivision, unit, and any court or other tribunal); (c) multinational governmental organization or body; or (d) entity or bodyexercising, or entitled to exercise, any executive, legislative, judicial, administrative, regulatory, police, military, or taxing authority orpower of any nature.10.8“Intellectual Property” means all patents, patent applications, trademarks, trademark applications,service marks, trade names, trade dress, trade secrets, inventions and discoveries and invention disclosures whether or not patented,copyrights in both published and unpublished works, including without limitation all compilations, data bases and computer programs,materials and other documentation, licenses, internet domain names and other intellectual property rights and similar rights.10.9“Material Adverse Effect” means any event or condition that has had or could reasonably be likelyto have a material adverse effect on the business, operations, properties or financial condition of Agenus and its consolidatedsubsidiaries, taken as a whole, or adversely affect in any material respect the ability of Agenus to perform its obligations, or Purchaser’srights, under the Licenses; provided,21 Source: AGENUS INC, 10-K, March 18, 2019Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results.[******] - Certain confidential information contained in this document, marked by brackets, is filed with the Securities and Exchange Commission pursuantto Rule 24b-2 of the Securities Exchange Act of 1934, as amended. that the following shall not, standing alone, constitute a “Material Adverse Effect,” solely to the extent, that such change does not havea material and disproportionate adverse impact on Agenus, taken as a whole, as compared to other industry participants: the effects ofconditions or events that are generally applicable to the capital, financial, banking or currency markets and the biotechnology industry.10.10“Nasdaq” means the Nasdaq Capital Market (or any successor thereto).10.11“Person” means any individual, partnership, joint venture, limited liability company, corporation,firm, trust, association, unincorporated organization, governmental authority or agency, or any other entity not specifically listed herein.10.12“Registration Rights Agreement” means the registration rights agreement to be entered intobetween Agenus and Purchaser on the Investment Closing Date, in the form attached hereto as Exhibit A10.13“Representatives” means directors, officers, employees, consultants, financial advisors, counsel,accountants or other agents of a Person.10.14“Rule 144” means Rule 144 promulgated by the Commission pursuant to the Securities Act, as suchRule may be amended or interpreted from time to time, or any similar rule or regulation hereafter adopted by the Commission havingsubstantially the same purpose and effect as such Rule.10.15“Transfer Agent” means American Stock Transfer & Trust Company, LLC, the current transferagent of Agenus, with a mailing address of 6201 15th Avenue, Brooklyn, NY 11219 and a facsimile number of (718) 236-4588, andany successor transfer agent of Agenus.10.16“Voting Securities” means any Voting Stock of Agenus or any securities that at such time areconvertible or exchangeable into or exercisable for any Voting Stock of Agenus.10.17“Voting Stock” means securities of any class or series of a corporation, limited liability company,association or other entity, the holders of which are ordinarily, in the absence of contingencies, entitled to vote generally in matters putbefore the shareholders or members of such corporation, limited liability company, association or other entity, including the right tovote for the election of directors or members of an equivalent governing body.[SIGNATURE PAGES FOLLOW] 22 Source: AGENUS INC, 10-K, March 18, 2019Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results.[******] - Certain confidential information contained in this document, marked by brackets, is filed with the Securities and Exchange Commission pursuantto Rule 24b-2 of the Securities Exchange Act of 1934, as amended. IN WITNESS WHEREOF, the Parties have executed this Agreement as of the date first set forth above. AGENUS INC. By:/s/ Garo Armen Name: Garo Armen, Ph.D. Title: Chairman and CEO GILEAD SCIENCES, INC. By:/s/ John McHutchison Name: John McHutchison, MD Title: Chief Scientific Officer, Head of R&D Source: AGENUS INC, 10-K, March 18, 2019Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results.[******] - Certain confidential information contained in this document, marked by brackets, is filed with the Securities and Exchange Commission pursuantto Rule 24b-2 of the Securities Exchange Act of 1934, as amended.Exhibit 10.25 LICENSE AGREEMENTby and betweenAGENUS INC.andGILEAD SCIENCES, INC.dated as of December 20, 2018 Source: AGENUS INC, 10-K, March 18, 2019Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results.[******] - Certain confidential information contained in this document, marked by brackets, is filed with the Securities and Exchange Commission pursuantto Rule 24b-2 of the Securities Exchange Act of 1934, as amended. TABLE OF CONTENTSPage ARTICLE 1 DEFINITIONS1 ARTICLE 2 DEVELOPMENT17 2.1Responsibility17 2.2Development Diligence17 2.3Development Updates17 ARTICLE 3 REGULATORY18 3.1Regulatory Matters18 3.2Regulatory Materials18 3.3Right of Reference; Access to Data19 ARTICLE 4 COMMERCIALIZATION19 4.1General19 ARTICLE 5 MANUFACTURING19 5.1General19 5.2Supply Agreement19 ARTICLE 6 ASSISTANCE; TRANSITION; UPSTREAM LICENSE AGREEMENTS20 6.1Assistance20 6.2Know-How Transfer20 6.3Licensed Products Inventory Transfer20 6.4Manufacturing Technology Transfer20 6.5Assignment of Agreements21 6.6Upstream License Agreements21 ARTICLE 7 FINANCIAL TERMS22 7.1Upfront Payment22 7.2Milestones22 7.3Sales Milestones23 7.4Royalties24 7.5Invoice and Payment of Royalty Payments27 7.6Additional Payment Terms27 7.7Records; Audit Rights28 7.8Upstream License Agreements and Development and Manufacturing Agreements29 7.9Non-Refundable and Non-Creditable Payments29 ARTICLE 8 LICENSES; EXCLUSIVITY29 8.1Licenses to Gilead; Upstream License Agreements29 8.2Subcontracting; Sublicenses30 8.3Rights Retained by the Parties30 8.4No Implied Licenses30 i Source: AGENUS INC, 10-K, March 18, 2019Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results.[******] - Certain confidential information contained in this document, marked by brackets, is filed with the Securities and Exchange Commission pursuantto Rule 24b-2 of the Securities Exchange Act of 1934, as amended.TABLE OF CONTENTS(continued)Page 8.5Exclusivity30 8.6Right of First Negotiation30 ARTICLE 9 INTELLECTUAL PROPERTY31 9.1Inventorship and Ownership31 9.2Prosecution and Maintenance32 9.3Enforcement32 9.4Defense33 9.5Recovery33 9.6Trademarks33 9.7Patent Extensions33 ARTICLE 10 ANTITRUST LAW COMPLIANCE; EFFECTIVENESS33 10.1Filings33 10.2Closing.34 ARTICLE 11 CONFIDENTIALITY34 11.1Nondisclosure34 11.2Exceptions35 11.3Authorized Disclosure35 11.4Terms of this Agreement36 11.5Securities Filings; Disclosure under Applicable Law36 11.6Publicity37 11.7Use of Names37 11.8Clinical Trials Registry38 ARTICLE 12 REPRESENTATIONS AND WARRANTIES; COVENANTS38 12.1Representations and Warranties of Each Party38 12.2Representations and Warranties of Agenus38 12.3Representation and Warranty of Gilead41 12.4Covenants41 12.5Disclaimer43 ARTICLE 13 INDEMNIFICATION; INSURANCE43 13.1Indemnification by Gilead43 13.2Indemnification by Agenus43 13.3Procedure44 13.4Insurance45 13.5LIMITATION OF LIABILITY45 ARTICLE 14 TERM AND TERMINATION46 14.1Term; Expiration46 14.2Termination for Material Breach46 ii Source: AGENUS INC, 10-K, March 18, 2019Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results.[******] - Certain confidential information contained in this document, marked by brackets, is filed with the Securities and Exchange Commission pursuantto Rule 24b-2 of the Securities Exchange Act of 1934, as amended.TABLE OF CONTENTS(continued)Page 14.3Termination at Will47 14.4Termination for Bankruptcy47 14.5Effects of Termination48 14.6[******]50 14.7Surviving Provisions51 ARTICLE 15 MISCELLANEOUS51 15.1Severability51 15.2Notices51 15.3Force Majeure52 15.4Assignment52 15.5Waivers and Modifications53 15.6Choice of Law; Waiver of Jury Trial; Dispute Resolution; Jurisdiction53 15.7Relationship of the Parties54 15.8Fees and Expenses54 15.9Third Party Beneficiaries54 15.10Entire Agreement54 15.11Counterparts54 15.12Equitable Relief; Cumulative Remedies55 15.13Interpretation55 15.14Further Assurances56 15.15Extension to Affiliates56 SCHEDULES Schedule 1.11:[******]Schedule 1.85:[******]Schedule 1.86:[******]Schedule 1.126:[******]Schedule 6.2:[******]Schedule 6.3:[******]Schedule 7.1:[******]Schedule 8.1.2:[******]Schedule 12.2:[******]Schedule 12.2.15:[******] EXHIBITS Exhibit A:[******] iii Source: AGENUS INC, 10-K, March 18, 2019Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results.[******] - Certain confidential information contained in this document, marked by brackets, is filed with the Securities and Exchange Commission pursuantto Rule 24b-2 of the Securities Exchange Act of 1934, as amended. LICENSE AGREEMENTThis LICENSE AGREEMENT (this “Agreement”) is entered into as of December 20, 2018 (the “Execution Date”) byand between Agenus Inc., a Delaware corporation (“Agenus”) and Gilead Sciences, Inc., a Delaware corporation (“Gilead”). Agenusand Gilead are each referred to herein by name or as a “Party” or, collectively, as the “Parties.”RECITALSWHEREAS, Agenus Controls the Agenus IP (each, as defined below);WHEREAS, Gilead wishes to obtain, and Agenus wishes to grant, a license under the Agenus IP with respect to LicensedProducts in the Field in the Territory (each, as defined below) on the terms and conditions set forth in this Agreement;WHEREAS, simultaneously with entering into this Agreement, the Parties are entering into the Option and LicenseAgreements (as defined below); andWHEREAS, simultaneously with entering into this Agreement, the Parties are entering into a stock purchase agreement andcertain related agreements, pursuant to which Agenus will issue and Gilead will purchase shares of capital stock of Agenus on theterms and conditions set forth therein (the “Stock Purchase Agreement”).NOW, THEREFORE, in consideration of the foregoing and the mutual agreements set forth below, and for other good andvaluable consideration, the receipt and sufficiency of which are hereby acknowledged, the Parties hereby agree as follows:ARTICLE 1DEFINITIONSUnless specifically set forth to the contrary herein, the following terms shall have the respective meanings set forth below.1.1“Accounting Standards” means U.S. generally accepted accounting principles in effect at the relevant time,consistently applied.1.2“Acquired Person” has the meaning set forth in Section 1.24.1.3[******]1.4“Additional Active” has the meaning set forth in Section 1.28.1.5“Affiliate” means any Person which, directly or indirectly through one (1) or more intermediaries, controls, iscontrolled by, or is under common control with a Party. For purposes of this Section 1.5 only, the term “control” (including, withcorrelative meanings, the terms “controlled by” and “under common control with”) as used with respect to a Person means: (a) director indirect ownership of fifty percent (50%) or more of the voting securities or other voting interest of any Person (including attributionfrom related parties); or (b) the1 Source: AGENUS INC, 10-K, March 18, 2019Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results.[******] - Certain confidential information contained in this document, marked by brackets, is filed with the Securities and Exchange Commission pursuantto Rule 24b-2 of the Securities Exchange Act of 1934, as amended. possession, directly or indirectly, of the power to direct, or cause the direction of, the management and policies of such Person, whetherthrough ownership of voting securities, by contract, as a general partner, as a manager, or otherwise.1.6“Agenus” has the meaning set forth in the Preamble.1.7[******]1.8“Agenus Indemnitees” has the meaning set forth in Section 13.1.1.9“Agenus IP” means the Agenus Patents and the Agenus Know-How. [******]1.10“Agenus Know-How” means any Know-How Controlled by Agenus or any of its Affiliates as of the ExecutionDate or thereafter during the Term which is [******] for the Development, Manufacture, or Commercialization of the LicensedProducts in the Field in the Territory.1.11“Agenus Patents” means any and all Patents Controlled by Agenus or its Affiliates as of the Execution Date orat any time during the Term, including Agenus’s interest in any and all Joint Patents, which are [******] for the Development,Manufacture, or Commercialization of any Licensed Product in the Field in the Territory. Without limiting the foregoing, Schedule1.11 sets forth a complete and accurate list of all Agenus Patents as of the Execution Date. Agenus shall update Schedule 1.11 asnecessary from time to time to reflect the then-current Agenus Patents.1.12“Agreement” has the meaning set forth in the Preamble.1.13“Agreement Payments” has the meaning set forth in Section 7.6.2(a).1.14“ANDA” means an abbreviated new drug application filed pursuant to the requirements of the FDA pursuant to21 C.F.R. Part 314 to obtain regulatory approval for a product in the United States, or the equivalent application or filing in anothercountry (as applicable).1.15“Annual Net Sales” means, on a Licensed Product-by-Licensed Product basis, total Net Sales by Gilead, itsAffiliates, and its Sublicensees in the Territory of such Licensed Product in a particular Calendar Year, calculated in accordance withAccounting Standards.1.16“Applicable Law” means all applicable laws, statutes, rules, regulations, treaties (including tax treaties), orders,judgments or ordinances having the effect of law of any national, multinational, federal, state, provincial, county, city, or other politicalsubdivision, including, to the extent applicable, GCP, GLP, and GMP, as well as all applicable data protection and privacy laws, rules,and regulations, including, to the extent applicable, the United States Department of Health and Human Services privacy rules underthe Health Insurance Portability and Accountability Act and the Health Information Technology for Economic and Clinical Health Actand the EU Data Protection Directive (Council Directive 95/46/EC) and applicable laws implementing the EU Data ProtectionDirective and the General Data Protection Regulation2 Source: AGENUS INC, 10-K, March 18, 2019Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results.[******] - Certain confidential information contained in this document, marked by brackets, is filed with the Securities and Exchange Commission pursuantto Rule 24b-2 of the Securities Exchange Act of 1934, as amended. (2016/679), the Foreign Corrupt Practices Act of 1977, or any comparable laws in any country, and all export control laws.1.17“Auditor” has the meaning set forth in Section 7.7.2.1.18“Biosimilar Product” means, [******].1.19“BLA” means a Biologics License Application filed with the FDA in the United States with respect to aLicensed Product, as defined in Title 21 of the U.S. Code of Federal Regulations, Section 601.2 et seq., or any non-U.S. counterpart ofthe foregoing.1.20“Business Day” means any day other than: (a) a Saturday or Sunday or any day on which commercial banks inBoston, Massachusetts, and San Francisco, California, are authorized or required by Applicable Law to remain closed; or (b)December 26 through December 31.1.21“Calendar Quarter” means each of the three (3) month periods ending March 31, June 30, September 30, andDecember 31; provided, that: (a) the first Calendar Quarter of the Term shall extend from the Effective Date to the end of the firstcomplete such three (3)-month period thereafter; and (b) the final Calendar Quarter of the Term shall end on the last day of the Term.1.22“Calendar Year” means the period beginning on the Effective Date and ending on December 31 of thecalendar year in which the Effective Date falls, and thereafter each successive period of twelve (12) consecutive calendar monthsbeginning on January 1 and ending on December 31; provided, that the final Calendar Year of the Term shall end on the last day of theTerm.1.23[******]1.24[******]1.25“Clinical Trial” means any human clinical trial of a pharmaceutical or biological product.1.26“Closing Date” has the meaning set forth in Section 10.2.1.1.27“Code” has the meaning set forth in Section 14.4.2.1.28“Combination Product” means: (a) a product that contains a Licensed Product and one (1) or more [******](each, an “Additional Active”); or (b) a Licensed Product that is co-packaged or combined with one (1) or more Additional Actives,and such Licensed Product and Additional Actives are sold for a single price. 1.29“Commercialization” means any and all activities directed to the commercialization of a product, includingmarketing, detailing, promotion, market research, distributing, order processing, handling returns and recalls, booking sales, customerservice, administering, and commercially selling such product, importing, exporting, and transporting3 Source: AGENUS INC, 10-K, March 18, 2019Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results.[******] - Certain confidential information contained in this document, marked by brackets, is filed with the Securities and Exchange Commission pursuantto Rule 24b-2 of the Securities Exchange Act of 1934, as amended. such product for commercial sale, and seeking Pricing Approval of a product (if applicable), whether before or after RegulatoryApproval has been obtained, as well all regulatory compliance with respect to the foregoing. For clarity, “Commercialization” doesnot include: (a) Manufacturing; or (b) any Clinical Trials and other trials commenced after Regulatory Approval. When used as averb, “Commercialize” means to engage in Commercialization. 1.30“Commercially Reasonable Efforts” means, with respect to [******].1.31“Competing Product” means any product, [******].1.32“Compulsory License” means, with respect to a Licensed Product in a country or territory, a license, or rightsgranted to a Third Party by a governmental agency within such country or territory to sell or offer for sale such Licensed Product insuch country or territory under any Patents or Know-How owned or controlled by either Party or its Affiliates, without direct orindirect authorization from such Party or its Affiliates.1.33“Compulsory Licensee” means a Third Party granted a Compulsory License.1.34“Confidential Information” means, with respect to a Party, all confidential and proprietary information,including chemical or biological materials, chemical structures, sequence information, commercialization plans, correspondence,customer lists, data, development plans, formulae, improvements, Inventions, Know-How, processes, regulatory filings, reports,strategies, techniques, or other information, in each case, that are disclosed by or on behalf of such Party to the other Party pursuant tothis Agreement, regardless of whether any of the foregoing are marked “confidential” or “proprietary” or communicated to the otherParty by or on behalf of the disclosing Party in oral, written, visual, graphic, or electronic form.1.35“Control,” “Controls,” or “Controlled” means with respect to any Patent, Know-How, other intellectualproperty right, or Confidential Information, the ability of a Party or its Affiliates, as applicable (whether through ownership or license(other than a license granted in this Agreement)) to grant to the other Party the licenses or sublicenses as provided herein, or tootherwise disclose such intellectual property right or Confidential Information to the other Party, without violating the terms of anythen-existing agreement with any Third Party at the time such Party or its Affiliates, as applicable, would be required hereunder togrant the other Party such license or sublicenses as provided herein or to otherwise disclose such intellectual property right orConfidential Information to the other Party. Notwithstanding the foregoing, a Party will be deemed not to Control any Patent, Know-How, other intellectual property right, Confidential Information, compound, or molecule (including any antibody) that is [******]except: [******].1.36“Cover” means, with reference to [******], that the making, using, offering to sell, selling, importing, orexporting of such product would [******].1.37[******]1.38“Cure Period” has the meaning set forth in Section 14.2.1.4 Source: AGENUS INC, 10-K, March 18, 2019Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results.[******] - Certain confidential information contained in this document, marked by brackets, is filed with the Securities and Exchange Commission pursuantto Rule 24b-2 of the Securities Exchange Act of 1934, as amended. 1.39“Damages” means all losses, costs, claims, damages, judgments, liabilities, and expenses (including reasonableattorneys’ fees and other reasonable out-of-pocket costs in connection therewith).1.40“Data Package” means:1.40.1[******]1.40.2[******]1.41“Default” means: (a) any material breach, violation, or default; (b) the existence of circumstances or theoccurrence of an event that with the passage of time or the giving of notice or both would constitute a material breach, violation, ordefault; or (c) the existence of circumstances or the occurrence of an event that, with or without the passage of time or the giving ofnotice or both, would give rise to a right of termination, renegotiation, acceleration, or material change of terms.1.42“Development” means: (a) research activities (including drug discovery, identification, or synthesis) withrespect to a product; or (b) preclinical and clinical drug development activities and other development activities with respect to aproduct, including test method development and stability testing, toxicology, formulation, process development, qualification andvalidation, quality assurance, quality control, Clinical Trials (including Clinical Trials and other trials commenced after RegulatoryApproval), statistical analysis and report writing, the preparation and submission of INDs and MAAs, regulatory affairs with respect tothe foregoing, and all other activities necessary or useful or otherwise requested or required by a Regulatory Authority or as a conditionor in support of obtaining or maintaining a Regulatory Approval. For clarity, “Development” does not include Manufacturing. Whenused as a verb, “Develop” means to engage in Development.1.43“Development and Manufacturing Agreement” means any contract or agreement, other than any UpstreamLicense Agreement, between Agenus (or any of its Affiliates, as applicable) and any Third Party which is related to the Developmentor Manufacture of any Licensed Antibody or Licensed Product.1.44“Disclosing Party” has the meaning set forth in Section 11.1.1.45“Dispute” has the meaning set forth in Section 15.6.3(a).1.46“Dollars” or “$” means the legal tender of the United States.1.47“Effective Date” has the meaning set forth in Section 14.1.1.1.48“Electronic Delivery” has the meaning set forth in Section 15.11.1.49“EMA” has the meaning set forth in Section 1.122.1.50“EU” means all countries that are officially recognized as member states of the European Union at any particulartime.5 Source: AGENUS INC, 10-K, March 18, 2019Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results.[******] - Certain confidential information contained in this document, marked by brackets, is filed with the Securities and Exchange Commission pursuantto Rule 24b-2 of the Securities Exchange Act of 1934, as amended. 1.51“EU Regulatory Approval” means Regulatory Approval [******] of a Licensed Product by EMA or therelevant Regulatory Authority in [******] of the Major European Markets.1.52“Execution Date” has the meaning set forth in the Preamble.1.53“Executive Officers” means: (a) with respect to Agenus, [******] or his/her designee or successor withequivalent responsibilities; and (b) with respect to Gilead, [******] or his/her designee or successor with equivalent responsibilities.1.54“Existing Development and Manufacturing Agreement” means any Development and ManufacturingAgreement in effect as of the Execution Date.1.55“Existing Regulatory Materials” has the meaning set forth in Section 3.2.1.1.56“Existing Upstream License Agreements” has the meaning set forth in Section 1.157.1.57“FDA” has the meaning set forth in Section 1.122.1.58“Field” means any and all uses or purposes, including the treatment, prophylaxis, palliation, diagnosis, orprevention of any human or animal disease, disorder, or condition.1.59“First Commercial Sale” means, on a Licensed Product-by-Licensed Product and country-by-country basis, thefirst sale of such Licensed Product in such country for use or consumption by the general public (following receipt of all RegulatoryApprovals that are required in order to sell such Licensed Product in such country) and for which any of Gilead or its Affiliates orSublicensees has invoiced sales of Licensed Products in the Territory; provided, however, that the following shall not constitute a FirstCommercial Sale: [******].1.60“GCP” means the applicable then-current ethical and scientific quality standards for designing, conducting,recording, and reporting Clinical Trials as are required by applicable Regulatory Authorities or Applicable Law in the relevantjurisdiction, including, in the United States, Good Clinical Practices established through FDA guidances, and, outside the UnitedStates, Guidelines for Good Clinical Practice – ICH Harmonized Tripartite Guideline (ICH E6).1.61“Gilead” has the meaning set forth in the Preamble.1.62“Gilead Indemnitees” has the meaning set forth in Section 13.2.1.63“GLP” means the applicable then-current good laboratory practice standards as are required by applicableRegulatory Authorities or Applicable Law in the relevant jurisdiction, including, in the United States, those promulgated or endorsedby the FDA in U.S. 21 C.F.R. Part 58, or the equivalent thereof as promulgated or endorsed by the applicable Regulatory Authoritiesoutside of the United States.1.64“GMP” means all applicable then-current good manufacturing practice standards relating for fine chemicals,intermediates, bulk products, or finished pharmaceutical or biological6 Source: AGENUS INC, 10-K, March 18, 2019Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results.[******] - Certain confidential information contained in this document, marked by brackets, is filed with the Securities and Exchange Commission pursuantto Rule 24b-2 of the Securities Exchange Act of 1934, as amended. products, as are required by applicable Regulatory Authorities or Applicable Law in the relevant jurisdiction, including, as applicable:(a) all applicable requirements detailed in the FDA’s current Good Manufacturing Practices regulations, U.S. 21 C.F.R. Parts 210 and211; (b) all applicable requirements detailed in the EMA’s “The Rules Governing Medicinal Products in the European Community,Volume IV, Good Manufacturing Practice for Medicinal Products;” and (c) all Applicable Law promulgated by any GovernmentalAuthority having jurisdiction over the manufacture of the applicable compound or pharmaceutical or biological product, as applicable.1.65“Governmental Authority” means any: (a) federal, state, local, municipal, foreign, or other government; (b)governmental or quasi-governmental authority of any nature (including any agency, board, body, branch, bureau, commission, council,department, entity, governmental division, instrumentality, office, officer, official, organization, representative, subdivision, unit, andany court or other tribunal); (c) multinational governmental organization or body; or (d) entity or body exercising, or entitled toexercise, any executive, legislative, judicial, administrative, regulatory, police, military, or taxing authority or power of any nature.1.66[******]1.67“HSR Act” means the Hart-Scott-Rodino Antitrust Improvements Act of 1976 (15 U.S.C. § 18a).1.68“ICC Rules” has the meaning set forth in Section 15.6.3(b).1.69“IND” means an investigational new drug application (including any amendment or supplement thereto)submitted to the FDA pursuant to U.S. 21 C.F.R. Part 312, including any amendments thereto. References herein to IND shallinclude, to the extent applicable, any comparable filing(s) outside the U.S. for the investigation of any product in any other country orgroup of countries (such as a Clinical Trial Application in the EU).1.70“IND Acceptance” means, with respect to an IND, the earlier of: (a) receipt by a Party, its Affiliate or aSublicensee of written confirmation from a Regulatory Authority or other applicable Person that Clinical Trials may proceed undersuch IND; or (b) expiration of the applicable waiting period after which Clinical Trials may proceed under such IND.1.71“Indemnification Claim Notice” has the meaning set forth in Section 13.3.1.1.72“Indemnitee” has the meaning set forth in Section 13.3.1.1.73“Indemnitor” has the meaning set forth in Section 13.3.1.1.74“Indication” means an [******].1.75“Information Request Notice” has the meaning set forth in Section 8.6.1.76“Infringement” has the meaning set forth in Section 9.3.11.77“Initial Licensed Antibody” has the meaning set forth in Section 1.86(i)7 Source: AGENUS INC, 10-K, March 18, 2019Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results.[******] - Certain confidential information contained in this document, marked by brackets, is filed with the Securities and Exchange Commission pursuantto Rule 24b-2 of the Securities Exchange Act of 1934, as amended. 1.78“Initial Licensed Product” means the Licensed Product that constitutes, incorporates, comprises, or containsthe Initial Licensed Antibody [*****].1.79“Initial Outside Date” has the meaning set forth in Section 14.1.1.1.80[******]1.81“Invention” means any process, method, composition of matter, article of manufacture, discovery, or findingthat is conceived or reduced to practice.1.82“Joint IP” has the meaning set forth in Section 9.1.1.83“Joint Patents” has the meaning set forth in Section 9.1.1.84“Know-How” means algorithms, data, information, Inventions, knowledge, methods (including methods of useor administration or dosing), practices, results, software, techniques, technology, and trade secrets, including analytical and qualitycontrol data, analytical methods (including applicable reference standards), assays, batch records, chemical structures and formulations,compositions of matter, formulae, materials, manufacturing data, pharmacological, toxicological and clinical test data and results,processes, reports, research data, research tools, sequences, standard operating procedures, and techniques, in each case, whetherpatentable or not, and, in each case, tangible manifestations thereof.1.85“Knowledge” means, with respect to Agenus, [******].1.86“Licensed Antibody” means (i) the antibody known as AGEN1423 [******], as described in more detail onSchedule 1.86 (the “Initial Licensed Antibody”) and (ii) [******].1.87“Licensed Product” means [******] product that [******] a Licensed Antibody, [******]. 1.88“Licensed Product Marks” has the meaning set forth in Section 9.6.1.89“MAA” means a Marketing Authorization Application, BLA, or similar application, as applicable, and allamendments and supplements thereto, submitted to the FDA, EMA, or any equivalent filing in a country or regulatory jurisdictionother than the U.S. or EU with the applicable Regulatory Authority, to obtain marketing approval for a pharmaceutical or biologicalproduct, in a country or in a group of countries.1.90“Major European Markets” means [******].1.91“Manufacture” means all activities related to the manufacturing of a product or any component or ingredientthereof, including the production, manufacture, processing, filling, finishing, packaging, labeling, shipping, and holding of product orany intermediate thereof, including process development, process qualification and validation, scale-up, commercial manufacture andanalytic development, product characterization, stability testing, quality assurance, and quality control.8 Source: AGENUS INC, 10-K, March 18, 2019Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results.[******] - Certain confidential information contained in this document, marked by brackets, is filed with the Securities and Exchange Commission pursuantto Rule 24b-2 of the Securities Exchange Act of 1934, as amended. 1.92“Manufacturing CMO” means a Third Party designee of Gilead which performs, or will perform,Manufacturing services with respect to any Licensed Product.1.93“Material Breach” means a breach of this Agreement which [******].1.94“Milestone Event” has the meaning set forth in Section 7.2.1.1.95“Milestone Payment” has the meaning set forth in Section 7.2.1.1.96[******]1.97“Net Sales” means [******]:1.97.1[******]1.97.2[******]1.97.3[******]1.97.4[******]1.97.5[******]1.97.6[******]1.97.7[******]1.98[******]1.99“Option and License Agreements” means (i) the Option and License Agreement, dated the date hereof, by andbetween the Parties, with respect to the antibody known as AGEN1223 and (ii) the Option and License Agreement, dated the datehereof, by and between the Parties, with respect to the antibody known as AGEN2373.1.100“Ordinary Course Agreement” means [******].1.101[******]1.102[******]1.103“Party” has the meaning set forth in the Preamble.1.104“Patent Extensions” has the meaning set forth in Section 9.7.1.105“Patents” means: (a) U.S. patents and patent applications in any country or supranational jurisdictionworldwide; (b) any substitutions, divisionals, continuations, continuations‑in‑part, reissues, renewals, registrations, confirmations, andthe like of any such patents or patent applications; (c) foreign counterparts of any of the foregoing; and (d) any and all extensions orrestorations by existing or future extension or restoration mechanisms,9 Source: AGENUS INC, 10-K, March 18, 2019Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results.[******] - Certain confidential information contained in this document, marked by brackets, is filed with the Securities and Exchange Commission pursuantto Rule 24b-2 of the Securities Exchange Act of 1934, as amended. including revalidations, reissues, re-examinations and extensions, including any supplementary protection certificates of any of theforegoing.1.106“Payee” means a Party receiving a payment under this Agreement.1.107“Payor” means a Party owing or making a payment under this Agreement.1.108“Person” means any individual, partnership, joint venture, limited liability company, corporation, firm, trust,association, unincorporated organization, governmental authority or agency, or any other entity not specifically listed herein.1.109“Phase 1 Clinical Trial” means [******].1.110“Phase 1b Clinical Trial” means [******].1.111“Phase 2 Clinical Trial” means [******].1.112[******]1.113[******]1.114[******]1.115[******]1.116[******]1.117“Pricing Approval” means any approval, agreement, determination, or decision establishing prices that can becharged to consumers for a pharmaceutical or biological product or that will be reimbursed by Governmental Authorities for apharmaceutical or biological product, in each case, in a country where Governmental Authorities approve or determine pricing forpharmaceutical or biological products for reimbursement or otherwise.1.118“Prior CDA” means that certain mutual confidentiality agreement, by and between Agenus Inc. and Gileaddated [******], as amended by (i) that certain letter agreement dated [******] between Agenus Inc. and Gilead, [******] and (ii) thatcertain letter agreement between Agenus Inc. and Gilead dated [******].1.119“Prosecution and Maintenance” or “Prosecute and Maintain” means, with regard to a Patent, thepreparation, filing, prosecution, and maintenance of such Patent, as well as re-examinations, reissues, appeals, and requests for patentterm adjustments with respect to such Patent, together with the initiation or defense of interferences, oppositions, inter partes review,derivations, re-examinations, post-grant proceedings, and other similar proceedings [******] with respect to the particular Patent, andany appeals therefrom. For clarification, “Prosecution and Maintenance” or “Prosecute and Maintain” shall not include any otherenforcement actions taken with respect to a Patent.1.120“Receiving Party” shall have the meaning set forth in Section 11.1.10 Source: AGENUS INC, 10-K, March 18, 2019Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results.[******] - Certain confidential information contained in this document, marked by brackets, is filed with the Securities and Exchange Commission pursuantto Rule 24b-2 of the Securities Exchange Act of 1934, as amended. 1.121“Regulatory Approval” means, all approvals, licenses, and authorizations of the applicable RegulatoryAuthority necessary for the marketing and sale of a pharmaceutical or biological product for a particular Indication in a country orregion (including separate Pricing Approvals, as necessary), and including the approvals by the applicable Regulatory Authority of anyexpansion or modification of the label for such Indication.1.122“Regulatory Authority” means any national or supranational Governmental Authority, including the U.S.Food and Drug Administration (and any successor entity thereto) (the “FDA”) in the U.S., the European Medicines Agency (and anysuccessor entity thereto) (the “EMA”) in the EU, or any health regulatory authority in any country or region that is a counterpart to theforegoing agencies, in each case, that holds responsibility for development and commercialization of, and the granting of RegulatoryApproval for, a pharmaceutical or biological product in such country or region.1.123[******]1.124“Regulatory Materials” means the regulatory registrations, applications, authorizations, and approvals(including approvals of MAAs, INDs, supplements and amendments, pre- and post-approvals, Pricing Approvals, and labelingapprovals), Regulatory Approvals, and other submissions made to or with any Regulatory Authority, including drug master files, forresearch, development (including the conduct of Clinical Trials), manufacture, or commercialization of a pharmaceutical or biologicalproduct in a regulatory jurisdiction, together with all related correspondence to or from any Regulatory Authority and all documentsreferenced in the complete regulatory chronology for each MAA, IND, and foreign equivalents of any of the foregoing.1.125“Rejection Event” has the meaning set forth in Section 14.4.1.1.126“ROFN Antibodies” means [******].1.127“ROFN Notice” has the meaning set forth in Section 8.6.1.128“ROFN Product(s)” means, with respect to a ROFN Antibody, [******] product that [******] such ROFNAntibody, [******].1.129“ROFN Product License” has the meaning set forth in Section 8.6.1.130“Royalty Floor” means [******].1.131“Royalty Term” means, on a Licensed Product-by-Licensed Product and country-by-country basis, the periodof time commencing on the First Commercial Sale of any Licensed Product in such country and expiring upon the latest of: [******].1.132“Sales Milestone Event” has the meaning set forth in Section 7.3.1.1.133“Sales Milestone Payment” has the meaning set forth in Section 7.3.1.1.134“Securities Regulators” has the meaning set forth in Section 11.3.1(a).11 Source: AGENUS INC, 10-K, March 18, 2019Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results.[******] - Certain confidential information contained in this document, marked by brackets, is filed with the Securities and Exchange Commission pursuantto Rule 24b-2 of the Securities Exchange Act of 1934, as amended. 1.135[******]1.136[******]1.137[******]1.138[******]1.139“Settlement Sublicensee” means a Third Party that is granted a license or sublicense under a settlementagreement between such Third Party and a Party, any of its Affiliates, or any of its or their respective licensees or sublicensees, whichagreement was entered into in connection with an ANDA settlement or similar agreement.1.140“Stock Purchase Agreement” has the meaning set forth in the Recitals.1.141“Sublicensee” means, with respect to Gilead, a Third Party to whom Gilead has granted a sublicense orlicense, either directly or indirectly, under the Agenus IP licensed to Gilead by Agenus pursuant to this Agreement, to Develop,Manufacture, or Commercialize the Licensed Products in the Field in the Territory, but excluding: (a) any Third Party acting solely as adistributor; and (b) Agenus and any of its Affiliates.1.142“Supply Agreement” has the meaning set forth in Section 5.2.1.143“Taxes” has the meaning set forth in Section 7.6.2.1.144“Term” has the meaning set forth in Section 14.1.1.1.145“Terminated Licensed Product” means: (a) in the case of the termination of this Agreement with respect to aLicensed Product pursuant to Section 14.2 or Section 14.3, the Licensed Product subject to such termination; (b) in the case of thetermination of this Agreement with respect to a country pursuant to Section 14.2 or Section 14.3, all Licensed Products in the countrysubject to such termination; and (c) in the case of termination of this Agreement in its entirety, all Licensed Products in all countries inthe Territory.1.146“Territory” means worldwide.1.147[******]1.148[******]1.149“Third Party” means any Person other than Agenus or Gilead that is not an Affiliate of Agenus or of Gilead.1.150“Third Party Claim” means any and all suits, claims, actions, proceedings, or demands brought by a ThirdParty.1.151“Third Party Infringement Claim” has the meaning set forth in Section 9.4.1.152[******]12 Source: AGENUS INC, 10-K, March 18, 2019Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results.[******] - Certain confidential information contained in this document, marked by brackets, is filed with the Securities and Exchange Commission pursuantto Rule 24b-2 of the Securities Exchange Act of 1934, as amended. 1.153“Transfer Taxes” has the meaning set forth in Section 7.6.2(a).1.154“Transferred Inventory” has the meaning set forth in Section 6.3.1.155“Transition Period” has the meaning set forth in Section 6.1.1.156“United States” or “U.S.” means the United States of America and all of its territories and possessions.1.157“Upstream License Agreement” means any contract or agreement with a Third Party pursuant to whichAgenus in-licenses or otherwise maintains Control of Patents, Know-How, or other intellectual property rights that constitute AgenusIP for purposes of this Agreement, including such Upstream License Agreements set forth on Schedule 12.2.15 (“Existing UpstreamLicense Agreements”) and any Upstream License Agreements which become such pursuant to Section 6.6.1.158“Valid Claim” means, (a) with respect to a pending application, [******]; and (b) with respect to an issuedPatent, a claim of such patent that has not expired, lapsed, been cancelled, or abandoned, or been dedicated to the public, disclaimed,or held unenforceable, invalid, revoked, or cancelled by a court or administrative agency of competent jurisdiction in an order ordecision from which no appeal has been or can be taken, including through opposition, reexamination, reissue, disclaimer, inter partesreview, post grant procedures, or similar proceedings.ARTICLE 2DEVELOPMENT2.1Responsibility.2.1.1Subject to the terms and conditions of this Agreement, including Section 2.1.2, Gilead shall have thesole right (and shall solely control, at its discretion), itself or with or through its Affiliates, Sublicensees, or other Third Parties, toDevelop the Licensed Products in the Field in the Territory. All such Development shall be at [******].2.1.2Subject to the terms and conditions of this Agreement, the Parties acknowledge that, during theperiod in between the Execution Date and the Effective Date, Agenus will continue to advance the Initial Licensed Antibody for theinitiation of its Phase 1 Clinical Trial, which may include engaging Third Party vendors for the purposes of such Phase 1 Clinical Trial.If Gilead nominates a Third Party for consideration as a vendor for such Phase 1 Clinical Trial, Agenus will consider in good faithwhether to select such Third Party as a vendor; provided, that Agenus will not be obligated to select such Third Party.2.1.3[******]2.2Development Diligence. Subject to the terms and conditions of this Agreement, Gilead, itself or with or through its Affiliates or Sublicensees or other ThirdParties, shall [******].13 Source: AGENUS INC, 10-K, March 18, 2019Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results.[******] - Certain confidential information contained in this document, marked by brackets, is filed with the Securities and Exchange Commission pursuantto Rule 24b-2 of the Securities Exchange Act of 1934, as amended. 2.3Development Updates. Until the date on which Gilead has submitted an MAA to the applicable Regulatory Authority for [******], Gilead shall submit toAgenus, [******], a written report with respect to the Licensed Products summarizing: [******].ARTICLE 3REGULATORY3.1Regulatory Matters.3.1.1Responsibility. Subject to the terms and conditions of this Agreement, including Section 3.2.1(b),Gilead shall have the sole right (and shall solely control, at its discretion), itself or with or through its Affiliates, Sublicensees, or otherThird Parties, to: (i) prepare, and submit to applicable Regulatory Authorities, all Regulatory Materials for Licensed Products; and (ii)obtain and maintain all Regulatory Approvals for Licensed Products.3.1.2Communications with Regulatory Authorities. For clarity and without limiting Section 3.1.1, Gileadshall have the exclusive right to correspond or communicate with Regulatory Authorities regarding the Licensed Products. Unlessrequired by Applicable Law, Agenus, its Affiliates, and its permitted subcontractors shall not correspond or communicate withRegulatory Authorities regarding any Licensed Product without first obtaining Gilead’s prior written consent. If Agenus, its Affiliates,or its permitted subcontractors receive any correspondence or other communication from a Regulatory Authority regarding a LicensedProduct, Agenus shall provide Gilead with access to or copies of all such material written or electronic correspondence promptly afterits receipt.3.1.3Agenus Support. Agenus shall [******] to support Gilead as may be reasonably requested byGilead from time to time in connection with Gilead’s preparation, submission to Regulatory Authorities and maintenance of RegulatoryMaterials for Licensed Products, including, upon Gilead’s reasonable request, attending meetings with Regulatory Authoritiesregarding any Licensed Product.3.2Regulatory Materials.3.2.1Existing Regulatory Materials. (a)Except to the extent notified otherwise in writing by Gilead, Agenus shall assign and transfer (andhereby does assign and transfer), or cause to be assigned and transferred to the extent not owned by Agenus, to Gilead (or itsdesignee), no later than [******] after the Effective Date any and all Regulatory Materials for the Licensed Products held by or onbehalf of Agenus, its Affiliates or contractors as of or prior to the Effective Date (the “Existing Regulatory Materials”), includingproviding true, accurate, and complete hard or electronic copies thereof to Gilead. From and after such assignment and transfer, Gilead(or its designee) shall have the sole right, in its sole discretion, to file, maintain, and hold title to all Existing Regulatory Materials.(b)[******]. Agenus shall assign and transfer to Gilead (or its designee), no later than [******] after thelater of the Effective Date or the date of IND Acceptance, the IND and related Regulatory Materials. From and after such assignmentand transfer, Gilead (or its14 Source: AGENUS INC, 10-K, March 18, 2019Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results.[******] - Certain confidential information contained in this document, marked by brackets, is filed with the Securities and Exchange Commission pursuantto Rule 24b-2 of the Securities Exchange Act of 1934, as amended. designee) shall have the sole right, in its sole discretion, to file, maintain, and hold title to such IND and related Regulatory Materials.3.2.2New Regulatory Materials. All Regulatory Materials generated or arising from or in connection withactivities under this Agreement with respect to Licensed Products shall be owned by and held in the name of Gilead or its designee,and, except for Existing Regulatory Materials (which are addressed in Section 3.2.1), and any such Regulatory Materials issued in thename of Agenus, its Affiliates or contractors shall promptly be assigned by Agenus to Gilead or its designee to the extent permitted byApplicable Law or, in the event assignment is not permitted under Applicable Law, held in trust for, or for the sole benefit of, Gileador its designee.3.3Right of Reference; Access to Data.3.3.1Prior to the time at which Regulatory Materials are transferred and assigned to Gilead or its designee,or in the event of failure to transfer and assign any Regulatory Materials to Gilead or its designee, as required by Section 3.2.1 orSection 3.2.2, Gilead and its designees shall have, and Agenus (on behalf of itself and its Affiliates) hereby grants to Gilead and itsdesignees, access and a right of reference (without any further action required on the part of Agenus, its Affiliates or contractors,whose authorization to file this consent with any Regulatory Authority is hereby granted) to all such Regulatory Materials and all datacontained or referenced therein for Gilead and its designees to exercise its rights and perform its obligations under this Agreement withrespect to Licensed Products. In all cases, Gilead and its designees shall have access to all data contained or referenced in all suchRegulatory Materials, and Agenus shall ensure that Gilead and its designees are afforded such access.3.3.2Upon transfer and assignment of the Existing Regulatory Materials and the data contained orreferenced therein to Gilead or its designee in accordance with Section 3.2.1, Gilead shall grant and hereby grants to Agenus and itsdesignees a right of reference (without any further action required on the part of Gilead, its Affiliates or contractors, whoseauthorization to file this right of reference with any Regulatory Authority is hereby granted) to any INDs transferred and assigned toGilead as an Existing Regulatory Material and all data contained or referenced therein, solely for Agenus and its designees to Developand seek and maintain Regulatory Approvals of [******].ARTICLE 4COMMERCIALIZATION4.1General. Subject to the terms and conditions of this Agreement, Gilead shall have the sole right (and shall solely control, at its discretion), itselfor with or through its Affiliates, Sublicensees, or other Third Parties, to Commercialize the Licensed Products in the Field in theTerritory. All such Commercialization shall be at [******].ARTICLE 5MANUFACTURING5.1General. Subject to the terms and conditions of this Agreement, Gilead shall have the sole right (and shall solely control, at its discretion), itselfor with or through its Affiliates,15 Source: AGENUS INC, 10-K, March 18, 2019Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results.[******] - Certain confidential information contained in this document, marked by brackets, is filed with the Securities and Exchange Commission pursuantto Rule 24b-2 of the Securities Exchange Act of 1934, as amended. Sublicensees, or other Third Parties, to Manufacture the Licensed Products in the Field in the Territory. All such Manufacturing shallbe at [******].5.2Supply Agreement. At the election of Gilead exercisable by written notice to Agenus within [******] of the Effective Date, and subject to anymanufacturing capacity constraints that Agenus may have at the time of such request, the Parties shall conduct good-faith discussionsregarding the terms of a supply agreement (and a corresponding quality agreement with customary terms and conditions) pursuant towhich Agenus would supply the Licensed Products to Gilead for its Clinical Trials (the “Supply Agreement”). [******]. In addition,the Supply Agreement shall otherwise include mutually agreed terms as are customary for agreements of such type.ARTICLE 6ASSISTANCE; TRANSITION; UPSTREAM LICENSE AGREEMENTS6.1Assistance. Agenus shall, and shall cause its Affiliates to, cooperate with Gilead and its designees and provide reasonable assistance to Gileadand its designees to transition Development and Manufacturing activities with respect to Initial Licensed Products to Gilead and itsdesignees to the extent reasonably requested by Gilead, including by: (a) providing Gilead and its designees reasonable assistance withrespect to Development, regulatory, and Manufacturing transition matters related to the Initial Licensed Products; and (b) providingGilead and its designees with reasonable access by teleconference or in‑person (as requested by Gilead) to Agenus personnel (andpersonnel of its Affiliates and Third Party contractors) involved in Development, regulatory, or Manufacturing matters related to theInitial Licensed Products to assist with the transition and answer questions related to the Initial Licensed Products. Agenus shallprovide the assistance described in this Article 6, with qualified personnel and at Gilead’s reasonable request, until [******] (the“Transition Period”); provided, that Agenus shall, and shall cause its Affiliates to, complete the activities assigned to, or otherwisecontemplated to be completed by, Agenus under the Tech Transfer Plan which have not been completed as of the expiration of theTransition Period, and shall cooperate in good faith with Gilead and its designees and provide reasonable assistance to Gilead and itsdesignees after expiration of the Transition Period to address any issues arising out of or not addressed by the transition activitiescontemplated by this Section 6.1, which issues are materially and adversely impacting Gilead’s ability to assume responsibility for theDevelopment and Manufacture of the Initial Licensed Products in accordance with this Agreement.6.2Know-How Transfer. The Parties have agreed to the tech transfer plan attached hereto as Schedule 6.2 (the “Tech Transfer Plan”), pursuant to whichAgenus shall disclose to Gilead and its designees in English, including by providing hard or electronic copies thereof, [******].6.3Licensed Products Inventory Transfer. Without limiting the provisions of Section 6.1, upon Gilead’s written request and at no additional cost to Gilead, Agenus shallpromptly assign and transfer to Gilead or its designee and deliver to Gilead or its designee, at a location to be specified by Gilead, theinventory of the Licensed Products set forth in Schedule 6.3 (the “Transferred Inventory”), along with all applicable manufacturing,GMP and shelf-life information in accordance with the Tech Transfer Plan.16 Source: AGENUS INC, 10-K, March 18, 2019Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results.[******] - Certain confidential information contained in this document, marked by brackets, is filed with the Securities and Exchange Commission pursuantto Rule 24b-2 of the Securities Exchange Act of 1934, as amended. 6.4Manufacturing Technology Transfer. Without limiting the other provisions of Article 6, as soon as reasonably practicable following the Effective Date (but in no eventlater than as required under the Tech Transfer Plan), Agenus shall transfer, and thereafter continue, during the Transition Period as maybe reasonably requested by Gilead from time to time, the transfer (from Agenus, its Affiliates, or its Third Party contract manufacturers)to Gilead and its designees copies in English (in writing or in an electronic format) of [******] as of the Effective Date that is[******] to the Manufacture of the Licensed Products, in order to enable Gilead and its designees to Manufacture the LicensedProducts, including, if desired by Gilead, to replicate the process employed by or on behalf of Agenus prior to the Effective Date toManufacture the Licensed Products. Such transfers shall be in accordance with the Tech Transfer Plan in which the Parties haveidentified [******] required for Manufacture, or [******] for the Development and Manufacture of the Licensed Products; provided,that, if Gilead reasonably believes that any materials which are not identified in the Tech Transfer Plan are [******] for theManufacture, or are [******] for the Development or Manufacture of the Licensed Products (but excluding [******]), then Agenusshall cooperate in good faith with Gilead to provide such materials to Gilead. In addition, at the reasonable request of Gilead from timeto time, Agenus shall make its employees and consultants (including personnel of its Affiliates and Third Party contract manufacturers)available to Gilead and its designees to provide reasonable consultation and technical assistance in order to ensure an orderly transitionof the Manufacturing technology and operations to Gilead and its designees and to assist Gilead and its designees in the Manufactureof the Licensed Products. [******].6.5Assignment of Agreements. Agenus shall, or shall cause its Affiliates to, as applicable, to the extent legally permissible (provided, that, to the extent consent isrequired from the relevant counterparty, Agenus shall, or shall cause its Affiliates to, as applicable, [******]): (a) assign to Gilead orits designee any or all (as designated by Gilead) Development and Manufacturing Agreements; or (b) assist Gilead or its Affiliate inentering into new agreements directly with the counterparties to any or all Development and Manufacturing Agreements to cover thesubject matter of such Development and Manufacturing Agreements, as applicable, in each case ((a) and (b)), to the extent requestedby Gilead in writing. If any Development and Manufacturing Agreement is assigned to Gilead, Agenus shall be solely responsible for,and shall indemnify and hold harmless Gilead and all other Gilead Indemnitees from and against any costs and other Damages arisingfrom, or relating to, any such Development and Manufacturing Agreement as a result of, or in connection with, events or occurrencesprior to the date of such assignment (including any payments that accrued prior to the date of such assignment but which do notbecome payable until after the date of such assignment).6.6Upstream License Agreements. In the event that after the Effective Date Agenus enters into a contract or agreement with a Third Party pursuant to which Agenus in-licenses or otherwise acquires Control of any Patents, Know-How, or other intellectual property rights that would constitute Agenus IPfor purposes of this Agreement, then Agenus shall promptly provide Gilead with notice and a copy of the applicable license or othercontract or agreement with the Third Party. Within [******] following receipt of such notice, Gilead shall decide, in its solediscretion, whether or not to accept such Patents, Know-How, or other intellectual property as Agenus IP licensed under thisAgreement and provide Agenus written notice of such decision. In the event of acceptance, such Patents, Know-How, or otherintellectual property shall constitute Agenus IP licensed to Gilead under this Agreement, such agreement shall thereafter be17 Source: AGENUS INC, 10-K, March 18, 2019Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results.[******] - Certain confidential information contained in this document, marked by brackets, is filed with the Securities and Exchange Commission pursuantto Rule 24b-2 of the Securities Exchange Act of 1934, as amended. included within the definition of Upstream License Agreements, and [******] shall be responsible for any payments arising thereunder[******] (provided, that, [******]). In the event that Gilead does not accept such Third Party agreement as an Upstream LicenseAgreement (including by failing to respond within such [******] period), Gilead and its Affiliates shall have no obligations withrespect to such Third Party agreement and such Patents, Know-How or other intellectual property shall not constitute Agenus IPlicensed to Gilead hereunder.ARTICLE 7FINANCIAL TERMS7.1Upfront Payment. No later than [******] after the Effective Date, Gilead shall pay to Agenus a one (1)-time, non-refundable, and non-creditablepayment of [******] in immediately available funds by wire transfer, in accordance with wire instructions to be provided in writing byAgenus to Gilead on or before the Effective Date. The foregoing upfront payment shall be deemed to be allocated [******] in themanner set forth on Schedule 7.1 attached hereto.7.2Milestones.7.2.1Milestones. Subject to the terms of this Section 7.2.1 and Section 7.7.1, Gilead shall notify Agenuswithin [******] following the achievement by Gilead, its Affiliates, or its Sublicensees under this Agreement of each milestone eventdescribed in the table below in this Section 7.2.1 (each, a “Milestone Event”) with respect to the first (and only the first) LicensedProduct to achieve such Milestone Event under this Agreement, and Gilead shall thereafter pay the applicable amount set forth belowassociated with the applicable Milestone Event in accordance with Section 7.2.2 (each, a “Milestone Payment”):Development Milestone EventDevelopment MilestonePayment(a)[******][******](b)[******][******](c)[******][******](d)[******][******](e)[******][******]Regulatory Milestone EventRegulatory MilestonePayment(f)[******][******](g)[******][******](h)[******][******]Each Milestone Payment shall be non-refundable, non-creditable, and payable a maximum of one (1) time as set forth in thetable above, regardless of the number of Licensed18 Source: AGENUS INC, 10-K, March 18, 2019Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results.[******] - Certain confidential information contained in this document, marked by brackets, is filed with the Securities and Exchange Commission pursuantto Rule 24b-2 of the Securities Exchange Act of 1934, as amended. Products which achieve the applicable Milestone Event (i.e., a maximum of [******] Milestone Payments may be made pursuant tothis Section 7.2.1), and no Milestone Payment shall be due hereunder for subsequent or repeated achievement of any such MilestoneEvent.Upon the achievement of any Milestone Event listed in Section [******] above, any of the Milestone Event(s) listed in suchSections: (i) which are listed earlier in the table above than the achieved Milestone Event; and (ii) for which the applicable MilestonePayment(s) has not been previously paid, shall become due and payable together with the Milestone Payment due in connection withsuch achieved Milestone Event; provided, that if the achieved Milestone Event is the Milestone Event listed in Section [******] above,the Milestone Payment due in connection with the achievement of the Milestone Event listed in Section [******] shall not become dueand payable together with the Milestone Payment due in connection with such achieved Milestone Event. If the Milestone Event listedin Section [******] above is achieved prior to the achievement of the Milestone Event listed in Section [******] above, then theMilestone Payment corresponding to the Milestone Event listed in Section [******] above shall become due and payable together withthe Milestone Payment due in connection with the achievement of the Milestone Event listed in Section [******] above.Further, if a [******] for a [******] does not constitute a [******] at the time of its [******], then subject to the otherterms of this Section 7.2.1, such [******] shall be deemed a [******] and the Milestone Event listed in Section [******] or Section[******], as applicable, for such [******] shall be deemed achieved (to the extent not previously achieved) at the [******].For the avoidance of doubt, the maximum amount payable by Gilead pursuant to this Section 7.2.1 is [******], assumingthat each Milestone Event in this Section 7.2.1 were achieved.7.2.2Invoice and Payment of Milestone Payments. Following Agenus’s receipt of notice from Gilead thatGilead has achieved a Milestone Event, Agenus shall invoice Gilead for the applicable Milestone Payment, and Gilead shall pay suchMilestone Payment within [******] after receipt of such invoice.7.3Sales Milestones.7.3.1Sales Milestones. Subject to the terms of this Section 7.3.1 and Section 7.7, Gilead shall notifyAgenus within [******] after the end of the [******] during which a given milestone event described below in this Section 7.3.1(each, a “Sales Milestone Event”) was first achieved by Gilead under this Agreement, and Gilead shall thereafter pay the applicableamounts set forth below associated with the applicable Sales Milestone Event in accordance with Section 7.3.2 (each, a “SalesMilestone Payment”):Sales Milestone EventSales Milestone Payment(a)[******][******](b)[******][******]19 Source: AGENUS INC, 10-K, March 18, 2019Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results.[******] - Certain confidential information contained in this document, marked by brackets, is filed with the Securities and Exchange Commission pursuantto Rule 24b-2 of the Securities Exchange Act of 1934, as amended. Sales Milestone EventSales Milestone Payment(c)[******][******](d)[******][******]Each Sales Milestone Payment shall be non-refundable, non-creditable, and payable a maximum of one (1) time as set forthin the table above, regardless of the number of times the applicable Sales Milestone Event was achieved (i.e., a maximum of [******]Sales Milestone Payments may be made pursuant to this Section 7.3.1), and no Sales Milestone Payment shall be due hereunder forsubsequent or repeated achievement of any such Sales Milestone Event. Upon achievement of any Sales Milestone Event listed in[******] above, any previously listed Sales Milestone Event for which the applicable Milestone Payment has not been paid shall bedue together with the Milestone Payment due in connection with such achieved Sales Milestone Event. For the avoidance of doubt,the maximum amount payable by Gilead pursuant to this Section 7.3.1 is [******], assuming that each Sales Milestone Event in thisSection 7.3.1 were achieved. [******].7.3.2Invoice and Payment of Sales Milestone Payments. Following Agenus’s receipt of notice fromGilead that Gilead has achieved a Sales Milestone Event, Agenus shall invoice Gilead for the applicable Sales Milestone Payment, andGilead shall pay such Sales Milestone Payment within [******] after receipt of the invoice therefor.7.4Royalties.7.4.1Royalty Rates. Subject to the terms of this Section 7.4.1 and Section 7.7, Gilead shall pay Agenusroyalties on Annual Net Sales, on a Licensed Product-by-Licensed Product basis, during the applicable Royalty Term, equal to thefollowing portions of Annual Net Sales of the applicable Licensed Product multiplied by the applicable royalty rate set forth below forsuch portion of Annual Net Sales during the applicable Royalty Term for each such Licensed Product. For clarity, the royalties (androyalty tiers) shall be calculated separately on a Licensed Product-by-Licensed Product basis.Portion of Annual Net Sales in the Territory for a given Licensed Product in agiven Calendar YearRoyalty Ratei.[******][******]ii.[******][******]iii.[******][******]iv.[******][******]The applicable royalty rate set forth in the table above shall apply only to that portion of the Annual Net Sales of a givenLicensed Product during a given Calendar Year that falls within the indicated range. [******].7.4.2Royalty Term. Gilead’s royalty obligations to Agenus under Section 7.4.1 shall apply, on a LicensedProduct-by-Licensed Product and country-by-country basis, only20 Source: AGENUS INC, 10-K, March 18, 2019Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results.[******] - Certain confidential information contained in this document, marked by brackets, is filed with the Securities and Exchange Commission pursuantto Rule 24b-2 of the Securities Exchange Act of 1934, as amended. during the applicable Royalty Term for such Licensed Product in such country. Following the expiration of the applicable RoyaltyTerm for a given Licensed Product in a given country: (a) no further royalties shall be payable with respect to sales of such LicensedProduct in such country; and (b) the license granted to Gilead under this Agreement with respect to such Licensed Product in suchcountry shall become fully paid-up, perpetual, irrevocable, and royalty-free in accordance with Section 14.1.2(a).7.4.3Royalty Reductions.(a)[******](b)[******]7.4.4Offset for Third Party Payments.(a)[******](b)[******]7.4.5Royalty Floor.(a)[******](b)[******](c)[******](d)[******]Invoice and Payment of Royalty Payments. Starting on the date of First Commercial Sale of a Licensed Product in the Territory, Gilead shall furnish to Agenus a [******]written report for each subsequent [******] showing the Net Sales of all Licensed Products and the royalty payments due to Agenuson such sales. Each such royalty report shall be due within [******] after the end of the relevant [******]. Each royalty report shalldescribe [******]. Within [******] following the delivery of the applicable [******], Agenus shall invoice Gilead for the royaltiesdue to Agenus with respect to Net Sales for such [******] as set forth in such royalty report and Gilead shall pay such amounts toAgenus within [******] following Gilead’s receipt of such invoice.Additional Payment Terms.7.6.1Currency. All payments hereunder shall be made in Dollars by wire transfer to a bank designated inwriting by the Payee no later than [******] prior to the date by which the applicable payment must be made. Conversion of salesrecorded in local currencies to Dollars shall be performed in compliance with Accounting Standards and the Payor’s normal practicesused to prepare its audited financial statements.21 Source: AGENUS INC, 10-K, March 18, 2019Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results.[******] - Certain confidential information contained in this document, marked by brackets, is filed with the Securities and Exchange Commission pursuantto Rule 24b-2 of the Securities Exchange Act of 1934, as amended. 7.6.2Taxes; Withholding.(a)Generally. Except as set forth in this Section 7.6.2, the Payee shall be liable for all income and othertaxes (including interest) (“Taxes”) imposed upon any payments made by the Payor to Payee under this Agreement (“AgreementPayments”). The amounts set forth herein are exclusive of all applicable sales or use, goods and services, value added, consumptionor other similar fees or taxes (“Transfer Taxes”) arising on the Agreement Payments, and the Payor shall be responsible for and payany such Transfer Taxes imposed on it with respect to the Agreement Payments due to the Payee hereunder.(b)Tax Withholding. If Applicable Law requires the withholding of Taxes, the Payor shall subtract theamount thereof from the Agreement Payments and remit such withheld amount to the relevant Governmental Authority in a timelymanner; provided, however, that before making such withholding, the Payor shall use reasonable efforts to give the Payee notice of theintention to make such withholding. For the avoidance of doubt, Payor’s remittance of such withheld Taxes, together with payment tothe Payee of the remaining Agreement Payments, shall constitute Payor’s full satisfaction of Agreement Payments under thisAgreement. The Payor shall promptly (as available) submit to the Payee appropriate proof of payment of the withheld Taxes as well asthe official receipts within a reasonable period of time. The Payor shall provide the Payee reasonable assistance in establishingentitlement to a reduction to, or elimination of, such withholding of Taxes under Applicable Law, including under the benefit of anypresent or future treaty against double taxation, and the Payor shall provide the Payee with reasonable assistance in seeking refund ofsuch withheld Taxes. Notwithstanding the foregoing, if, as a result of Payor (i) assigning this Agreement, (ii) extending its rights orobligations pursuant to Section 15.15 or (iii) changing its domicile, additional Taxes become due that would not have otherwise beendue hereunder with respect to Agreement Payments, Payor shall be responsible for all such additional withholding Taxes and shall payPayee such amounts as are necessary to ensure that Payee receives the same amount as it would have received had no such assignmentor change in domicile been made. [******].(c)Tax Cooperation. The Parties shall cooperate with respect to all documentation required by any taxingauthority or reasonably requested by either Party to secure a reduction in the rate of applicable withholding taxes.Records; Audit Rights.7.7.1Records. Each Party shall keep complete, true, and accurate books and records in accordance with itsAccounting Standards in relation to this Agreement, including with respect to Gilead, its Affiliates, and cause its Sublicensees, inrelation to Net Sales, royalties, Milestone Payments, and Sales Milestone Payments. Each Party shall keep such books and records forat least [******] following the Calendar Year to which they pertain or for such longer period of time as required under any ApplicableLaw.7.7.2Audit Rights. Subject to the other terms of this Section 7.7.2, during the Term, at the request ofAgenus, which shall not be made more frequently than [******] per [******], upon at least [******] prior written notice fromAgenus, and at the expense of Agenus, Gilead shall permit an independent, nationally-recognized certified public accountant22 Source: AGENUS INC, 10-K, March 18, 2019Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results.[******] - Certain confidential information contained in this document, marked by brackets, is filed with the Securities and Exchange Commission pursuantto Rule 24b-2 of the Securities Exchange Act of 1934, as amended. selected by Agenus and reasonably acceptable to Gilead (the “Auditor”) to inspect, during regular business hours, the relevant recordsrequired to be maintained by Gilead under Section 7.7.1 or otherwise reasonably necessary to verify the accuracy of royalty reports forsuch Calendar Year; provided, that such audit right shall not apply to records beyond [******] from the end of the Calendar Year towhich they pertain [******]. Prior to its inspection, the Auditor shall enter into a confidentiality agreement with both Parties havingobligations of confidentiality and non-use no less restrictive than those set forth in Article 11 and limiting the disclosure and use of suchinformation by such accountant to authorized representatives of the Parties and the purposes germane to Section 7.7.1. The Auditorshall report to Agenus only whether the particular amounts being audited were accurate and, if not, the amount of any discrepancy, andthe Auditor shall not report any other information to Agenus. Agenus shall treat the results of any the Auditor’s review of Gilead’srecords as Confidential Information of Gilead subject to the terms of Article 11. In the event such audit leads to the discovery of adiscrepancy to Agenus’s detriment, Gilead shall, within [******] days after receipt of such report from the Auditor, pay anyundisputed amount of the discrepancy. Agenus shall pay the Auditor’s full cost of the audit unless the underpayment of amounts dueAgenus is more than [******], in which case Gilead shall pay the reasonable cost charged by the Auditor for such review. Anyundisputed overpayments by Gilead revealed by an examination shall be paid by Agenus within [******] of Agenus’s receipt of theapplicable report. [******].7.7.3[******]Upstream License Agreements and Development and Manufacturing Agreements. Notwithstanding anything to the contrary under this Agreement, but subject to Section 6.6 and Section 6.5, Agenus shall be solelyresponsible for all costs and payments of any kind (including all upfront fees, annual payments, milestone payments, and royaltypayments) arising under any agreements between Agenus (or any of its Affiliates) and any Third Party, including under: (a) anyExisting Upstream License Agreements and any other Upstream License Agreements, unless and until (in the case of such otherUpstream License Agreements) such agreements have been accepted by Gilead pursuant to Section 6.6, and (b) any Development andManufacturing Agreements, unless and until such agreements have been assigned to Gilead pursuant to Section 6.5, as applicable.7.9[******] ARTICLE 8LICENSES; EXCLUSIVITYLicenses to Gilead; Upstream License Agreements.Licenses to Gilead.(a)Licensed Products. As of the Effective Date and subject to the terms and conditions of this Agreement,Agenus hereby grants to Gilead a royalty-bearing, exclusive, transferrable (solely pursuant to Section 15.4), and sublicenseable(through multiple tiers)23 Source: AGENUS INC, 10-K, March 18, 2019Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results.[******] - Certain confidential information contained in this document, marked by brackets, is filed with the Securities and Exchange Commission pursuantto Rule 24b-2 of the Securities Exchange Act of 1934, as amended. license, under the Agenus IP, to Develop, Manufacture, and Commercialize the Licensed Products in the Field in the Territory.(b)[******](c)[******](d)Exclusion. For the avoidance of doubt, Agenus does notgrant to Gilead pursuant to this Agreement any license under or rights to any intellectual property rightsControlled by Agenus or its Affiliates to Develop, Manufacture or Commercialize any product that[******].Upstream License Agreements. To the extent that the licenses granted by Agenus to Gilead under the Agenus IP pursuant to Section 8.1 constitute (a) the grant of a sublicense to Gilead of certain Agenus IP that is not owned by Agenus or any of its Affiliates, but that is in-licensed by Agenus or any such Affiliate from a Third Party licensor pursuant to an Upstream License Agreement or (b) the license ofcertain Agenus IP that is otherwise encumbered by obligations that would be binding on Gilead by their terms, then Gilead shallcomply, and shall cause its Affiliates and Sublicensees to comply, with the specific obligations applicable to sublicensees under suchUpstream License Agreement(s) [******].Subcontracting; Sublicenses.Subcontracting. Gilead may subcontract to Affiliates or Third Parties the performance of tasks and obligations related to Gilead’s Development,Manufacture, and Commercialization of the Licensed Products under this Agreement as Gilead deems appropriate, which subcontractmay include a sublicense of Agenus IP rights necessary for the performance of the subcontract as reasonably required.Sublicenses. Gilead shall provide Agenus with [******] of each agreement with a Third Party Sublicensee (other than any agreement with aThird Party subcontractor entered into in the ordinary course of business) within [******] after the execution thereof; provided, thatGilead may [******]. Each sublicense shall require the applicable Sublicensee to comply with applicable terms and conditions of thisAgreement. Gilead shall remain liable for any action or failure to act by any Sublicensee or Affiliate if such action or failure to actwould have constituted a breach of this Agreement if committed by Gilead. Rights Retained by the Parties. Each Party retains all rights under Patents, Know-How, or other intellectual property rights Controlled by such Party which are notexpressly granted to the other Party pursuant to this Agreement. Notwithstanding the foregoing, [******].No Implied Licenses. Except as otherwise expressly provided in this Agreement, under no circumstances shall a Party or any of its Affiliates, as a result ofthis Agreement, obtain any ownership interest, license, or other right in or to any Patents, Know-How, or other intellectual propertyrights of the other Party, including tangible or intangible items owned, controlled, or developed by the other Party, or provided by theother Party to the receiving Party at any time, in each case, pursuant to this Agreement.24 Source: AGENUS INC, 10-K, March 18, 2019Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results.[******] - Certain confidential information contained in this document, marked by brackets, is filed with the Securities and Exchange Commission pursuantto Rule 24b-2 of the Securities Exchange Act of 1934, as amended. Exclusivity.8.5.1General. Subject to Section 8.5.2, [******], Agenus shall not, and shall cause its Affiliates not to,[******].8.5.2[******]Right of First Negotiation. In the event that (a) Gilead is interested in obtaining a right or license to Develop or Commercialize a ROFN Product (a “ROFNProduct License”), (b) [******] or (c) [******], then Gilead will provide notice thereof to Agenus or Agenus will provide noticethereof to Gilead (which notice by Agenus to Gilead will include the applicable Data Package), as applicable (a “ROFN Notice”). IfGilead provides a ROFN Notice, Agenus shall [******] provide a Data Package to Gilead with respect to the applicable ROFNProduct. Gilead shall have [******] from receipt of a ROFN Notice from Agenus or, if Gilead provides a ROFN Notice to Agenus,receipt of the applicable Data Package from Agenus, to elect to seek a ROFN Product License with respect to the applicable ROFNProduct, in which case it will provide notice of such election to Agenus (a “ROFN Negotiation Notice”). If Gilead provides a ROFNNegotiation Notice, the Parties shall negotiate [******] (the “ROFN Negotiation Period”), to reach agreement on the terms andconditions of such ROFN Product License for such ROFN Product. If Gilead fails to provide Agenus with a ROFN NegotiationNotice within such [******] period, Gilead shall have no further rights with respect to a ROFN Product License for such ROFNProduct. If Gilead provides a ROFN Negotiation Notice within such [******] period, but Gilead and Agenus fail to reach agreementwithin the ROFN Negotiation Period on the terms of a ROFN Product License for the applicable ROFN Product, then [******]. From time to time during the ROFN Negotiation Period, Gilead may provide Agenus with written notice requesting additionalinformation relevant to the ROFN Product that then exists and is within Agenus’s control with respect to the applicable ROFNProduct, or a discussion with Agenus representative(s) who have the relevant knowledge and information regarding the applicableROFN Product (an “Information Request Notice”). Agenus shall use all reasonable efforts to provide such information or hold suchdiscussion as promptly as practicable but in any event within [******] after receipt of such Information Request Notice. If theInformation Request Notice is provided during [******], to the extent that Agenus has not provided such information in any materialrespect or has failed to hold such discussion, Gilead shall notify Agenus thereof and the ROFN Negotiation Period shall be extendedby [******].ARTICLE 9INTELLECTUAL PROPERTY9.1Inventorship and Ownership. The determination of inventorship under this Agreement shall be made in accordance with U.S. patent laws. As betweenthe Parties, all Inventions made or created solely by a Party’s or any of its Affiliates’ employees, independent contractors, orconsultants, in the course of conducting activities under this Agreement, together with all intellectual property rights therein, shall beowned by such Party. All Inventions made or created jointly by each Party’s (or any of its Affiliates’) employees, independentcontractors, or consultants, in the course of conducting activities under this Agreement, together with all Patents therein (“JointPatents”), shall be jointly owned by the Parties (“Joint IP”). Joint IP shall be owned jointly by Gilead and Agenus on the basis of anequal, undivided interest25 Source: AGENUS INC, 10-K, March 18, 2019Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results.[******] - Certain confidential information contained in this document, marked by brackets, is filed with the Securities and Exchange Commission pursuantto Rule 24b-2 of the Securities Exchange Act of 1934, as amended. [******] and shall be deemed to be Controlled by each Party, subject to the licenses granted under this Agreement. [******].9.2Prosecution and Maintenance.9.2.1[******] shall be responsible for the Prosecution and Maintenance of the Agenus Patents [******]. [******] shall [******] the Agenus Patents and, [******]. [******] shall [******], and [******].9.2.2[******] shall [******], or [******]. [******] shall [******], in connection with such[******]. In such event, [******] shall [******], to [******] or [******] of such [******].9.2.3Each Party hereby agrees to reasonably cooperate with one another with respect to the Prosecutionand Maintenance of the Agenus Patents for which such Party is responsible pursuant to this Agreement, including by: (a) making itsemployees, and using reasonable efforts to make its licensees, sublicensees, independent contractors, agents and consultants,reasonably available to the other Party (or to the other Party’s authorized attorneys, agents or representatives), to the extent reasonablynecessary to enable such Party to undertake Prosecution and Maintenance of Patents as contemplated by this Agreement; and (b)endeavoring in good faith to coordinate its efforts with the other Party [******].9.3Enforcement.9.3.1Each Party shall promptly notify the other Party of any infringement by a Third Party of any AgenusPatent in the Territory of which it becomes aware, including any declaratory judgment, opposition, or similar action alleging theinvalidity, unenforceability, or non-infringement with respect to such Agenus Patent (“Infringement”). Without limiting theforegoing, Gilead shall deliver to Agenus any certification that Gilead receives pursuant to 42 U.S.C. § 262(l) or such similar laws asmay exist in jurisdictions other than the United States with respect to a Licensed Product within [******] after receipt thereof.9.3.2[******] shall have [******], but not [******], to [******] in connection with [******]. At the[******], [******] shall provide [******] in connection with [******] in connection [******], including by [******]. [******] may [******] if [******]. [******] agrees to [******]. Additionally, [******] shall have the right to [******] at [******] and[******].9.4Defense.9.4.1Each Party shall promptly notify the other Party of any claim alleging that the Development,Manufacture, or Commercialization of the Licensed Products in the Territory infringes, misappropriates, or otherwise violates anyPatents, Know-How, or other intellectual property rights of any Third Party (“Third Party Infringement Claim”). In any suchinstance, the Parties shall as soon as practicable thereafter discuss in good faith the best response to such notice of such Third PartyInfringement Claim.9.4.2[******] shall [******]; provided, [******].26 Source: AGENUS INC, 10-K, March 18, 2019Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results.[******] - Certain confidential information contained in this document, marked by brackets, is filed with the Securities and Exchange Commission pursuantto Rule 24b-2 of the Securities Exchange Act of 1934, as amended. 9.5Recovery. Any recovery received as a result of any action under Section 9.3 or Section 9.4, as applicable, shall be allocated in thefollowing order: [******].9.6Trademarks. [******] shall have the right, but not the obligation, to brand the Licensed Products using trademarks and trade names[******] for the Licensed Products, which may vary within the Territory (the “Licensed Product Marks”). [******].9.7Patent Extensions. [******], [******] shall: (a) with respect to requests [******]; and (b) with respect to all other requests, [******], ineach case, patent term restoration (including under the Drug Price Competition and Patent Term Restoration Act), supplementalprotection certificates or their equivalents, and patent term extensions (collectively, “Patent Extensions”) with respect to the AgenusPatents, where applicable, [******]. If requested by [******] or in the event that [******], [******] shall [******] to [******] forsuch Patent Extensions [******], [******], and [******] shall [******].ARTICLE 10ANTITRUST LAW COMPLIANCE; EFFECTIVENESS10.1Filings. Each Party agrees to make any appropriate filings, if necessary or advisable, pursuant to the HSR Act as promptly as practicable butin any event no later than [******] after the Execution Date, with the Federal Trade Commission and the U.S. Department ofJustice. The Parties shall cooperate with one another in the preparation and execution of all documents that are necessary to be filedpursuant to the HSR Act and shall specifically request early termination of the initial HSR Act waiting period. The related filing feesassociated with the submission under the HSR Act [******].10.2Closing.10.2.1Closing. The closing of the transactions contemplated by this Agreement shall take place remotelyvia the electronic exchange of documents and signatures as soon as practical, but no later than on the [******] following the date onwhich all of the conditions precedent set forth in Section 10.2.2 have been satisfied or waived by the applicable Party (other thanSection 10.2.2(c), which can only be satisfied or waived at the closing), or at such other time and place as Agenus and Gilead mayagree upon in writing (the “Closing Date”).10.2.2Conditions to Effectiveness. The obligation of the Parties to consummate the transactionscontemplated by this Agreement is subject to the satisfaction by each Party of the following conditions, any or all of which may bewaived in whole or in part by the other Party in its sole discretion, subject to Applicable Law:(a)the expiration or termination of all applicable waiting period(s) and any other required clearances underthe HSR Act;(b)the representations and warranties made by such Party in Sections 12.1 and 12.2 of this Agreement,Sections 13.1 and 13.2 of the Option and License Agreement (AGEN1223), and Sections 13.1 and 13.2 of the Option and LicenseAgreement (AGEN2373) (each, with respect to Agenus) and Sections 12.1 and 12.3, Sections 13.1 and 13.3 of the Option andLicense Agreement (AGEN1223), and Sections 13.1 and 13.3 of the Option and License27 Source: AGENUS INC, 10-K, March 18, 2019Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results.[******] - Certain confidential information contained in this document, marked by brackets, is filed with the Securities and Exchange Commission pursuantto Rule 24b-2 of the Securities Exchange Act of 1934, as amended. Agreement (AGEN2373) (each, with respect to Gilead) shall be true and correct in all material respects as of the Effective Date, and,with respect to Agenus as such Party, Agenus shall have performed and complied in all material respects with the covenants set forth inSection 2.1.3 and Section 12.4.2 of this Agreement, Section 13.4.2 of the Option and License Agreement (AGEN1223), and Section13.4.2 of the Option and License Agreement (AGEN2373); and(c)the provision by each Party to the other Party of an officer’s certificate certifying the satisfaction of thecondition in Section 10.2.2(b) with respect to such Party.ARTICLE 11CONFIDENTIALITY11.1Nondisclosure. Each Party agrees that a Party (the “Receiving Party”) which receives the Confidential Information of the other Party (the“Disclosing Party”) pursuant to this Agreement shall: (a) maintain in confidence such Confidential Information using not less than theefforts that such Receiving Party uses to maintain in confidence its own proprietary information of similar kind and value, but in noevent less than a reasonable degree of efforts; (b) not disclose such Confidential Information to any Third Party without first obtainingthe prior written consent of the Disclosing Party, except for disclosures expressly permitted pursuant to this Article 11; and (c) not usesuch Confidential Information for any purpose except those permitted under this Agreement, including, in the case of Gilead, theexercise of the rights and licenses granted to Gilead hereunder. The obligations of confidentiality, non-disclosure, and non-use underthis Section 11.1 shall be in full force and effect from the Execution Date until [******] following the expiration of the Term. TheReceiving Party shall return all copies of or destroy the Confidential Information of the Disclosing Party disclosed or transferred to itby the Disclosing Party pursuant to this Agreement, within [******] after the expiration or termination of this Agreement; provided,however, that a Party may retain: (i) Confidential Information of the Disclosing Party to exercise rights and licenses which expresslysurvive such termination or expiration pursuant to this Agreement; and (ii) one (1) copy of all other Confidential Information inarchives solely for the purpose of establishing the contents thereof. In addition, [******] shall keep confidential, and shall cause itsAffiliates and its and their employees, consultants, licensees, sublicensees, professional advisors, and Affiliates to keep confidential,[******] to the extent [******] on confidentiality terms at least as protective as the confidentiality provisions of this Agreement[******].11.2Exceptions.11.2.1General. Section 11.1 shall not apply with respect to any portion of the Confidential Information ofthe Disclosing Party to the extent that such Confidential Information:(a)was known to the Receiving Party or any of its Affiliates, as evidenced by written records, without anyobligation to keep it confidential or any restriction on its use, prior to disclosure by the Disclosing Party;28 Source: AGENUS INC, 10-K, March 18, 2019Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results.[******] - Certain confidential information contained in this document, marked by brackets, is filed with the Securities and Exchange Commission pursuantto Rule 24b-2 of the Securities Exchange Act of 1934, as amended. (b)is subsequently disclosed to the Receiving Party or any of its Affiliates by a Third Party lawfully inpossession thereof and without any obligation to keep it confidential or any restriction on its use;(c)is published by a Third Party or otherwise becomes publicly available or enters the public domain,either before or after it is disclosed to the Receiving Party, without any breach by the Receiving Party of its obligations hereunder; or(d)is independently developed by or for the Receiving Party or any of its Affiliates, as evidenced bywritten records, without reference to or reliance upon the Disclosing Party’s Confidential Information.Any combination of features or disclosures shall not be deemed to fall within the foregoing exclusions merely because individualfeatures are published or available to the general public or in the rightful possession of the Receiving Party unless the combination itselfand principle of operation are published or available to the general public or in the rightful possession of the Receiving Party.11.3Authorized Disclosure.11.3.1Disclosure. Notwithstanding Section 11.1, the Receiving Party may disclose ConfidentialInformation belonging to the Disclosing Party in the following instances:(a)subject to Section 11.5, to comply with Applicable Law (including the rules and regulations of the U.S.Securities and Exchange Commission or any national securities exchange in any jurisdiction in the Territory) (collectively, the“Securities Regulators”) or with judicial process (including prosecution or defense of litigation) if, in the reasonable opinion of theReceiving Party’s counsel, such disclosure is necessary for such compliance or for such judicial process (including prosecution ordefense of litigation);(b)disclosure to governmental or other regulatory agencies in order to obtain Patents, to obtain or maintainapproval to conduct Clinical Trials, or to market the Licensed Products under this Agreement, in each case, in accordance with thisAgreement; provided, that reasonable steps are taken to ensure confidential treatment of such Confidential Information to the extentavailable;(c)disclosure to any of its officers, employees, consultants, agents, or Affiliates, and: (i) in the case of[******], any [******], (ii) in the case of [******], [******], any [******], and (iii) in the case of either Party, to such Party’s actualor potential acquirers, investors, or lenders as part of their due diligence investigations; provided, that, prior to any such disclosure,each such disclosee is bound by written obligations of confidentiality, non-disclosure, and non-use no less restrictive than theobligations set forth in this Article 11 to maintain the confidentiality thereof and not to use such Confidential Information except asexpressly permitted by this Agreement; provided, however, that, in each of the above situations in this Section 11.3.1(c), the ReceivingParty shall remain responsible for any failure by any Person who receives Confidential Information from such Receiving Partypursuant to this Section 11.3.1(c) to treat such Confidential Information as required under this Article 11; and29 Source: AGENUS INC, 10-K, March 18, 2019Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results.[******] - Certain confidential information contained in this document, marked by brackets, is filed with the Securities and Exchange Commission pursuantto Rule 24b-2 of the Securities Exchange Act of 1934, as amended. (d)disclosure to its advisors (including attorneys and accountants) in connection with activities under thisAgreement; provided, that, prior to any such disclosure, each such disclosee is bound by written obligations of confidentiality, non-disclosure, and non-use no less restrictive than the obligations set forth in this Article 11 (provided, however, that in the case of legaladvisors, no written agreement shall be required), to maintain the confidentiality thereof and not to use such Confidential Informationexcept as expressly permitted by this Agreement; provided, however, that, in each of the above situations in this Section 11.3.1(d), theReceiving Party shall remain responsible for any failure by any Person who receives Confidential Information from such ReceivingParty pursuant to this Section 11.3.1(d) to treat such Confidential Information as required under this Article 11.11.3.2Terms of Disclosure. If and whenever any Confidential Information is disclosed in accordance withthis Section 11.3, such disclosure shall not cause any such information to cease to be Confidential Information, except to the extent thatsuch disclosure results in a public disclosure of such information other than by breach of this Agreement.11.4Terms of this Agreement. The Parties agree that this Agreement and the terms hereof shall be deemed to be Confidential Information of both Agenus andGilead, and each Party agrees not to disclose this Agreement or any terms hereof without obtaining the prior written consent of theother Party; provided, that each Party may disclose this Agreement or any terms hereof in accordance with the provisions of Section11.3 or Section 11.5, as applicable.11.5Securities Filings; Disclosure under Applicable Law. Each Party acknowledges and agrees that the other Party may submit this Agreement to, or file this Agreement with, the SecuritiesRegulators or to other Persons as may be required by Applicable Law, and if a Party submits this Agreement to, or files this Agreementwith, any Securities Regulator or other Person as may be required by Applicable Law, such Party agrees to consult with the other Partywith respect to the preparation and submission of a confidential treatment request for this Agreement. Notwithstanding the foregoing,if a Party is required by any Securities Regulator or other Person as may be required by Applicable Law to make a disclosure of theterms of this Agreement in a filing or other submission as required by such Securities Regulator or such other Person, and such Partyhas: (a) provided copies of the disclosure to the other Party reasonably in advance under the circumstances of such filing or otherdisclosure; (b) promptly notified the other Party in writing of such requirement and any respective timing constraints; and (c) given theother Party reasonable time under the circumstances from the date of provision of copies of such disclosure to comment upon andrequest confidential treatment for such disclosure, then such Party shall have the right to make such disclosure at the time and in themanner reasonably determined by its counsel to be required by the Securities Regulator or the other Person. Notwithstanding theforegoing, if a Party seeks to make a disclosure as required by a Securities Regulator or other Person as may be required by ApplicableLaw as set forth in this Section 11.5 and the other Party provides comments in accordance with this Section 11.5, the Party seeking tomake such disclosure or its counsel, as the case may be, shall use good-faith efforts to incorporate such comments.30 Source: AGENUS INC, 10-K, March 18, 2019Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results.[******] - Certain confidential information contained in this document, marked by brackets, is filed with the Securities and Exchange Commission pursuantto Rule 24b-2 of the Securities Exchange Act of 1934, as amended. Publicity.11.6.1Subject to Section 11.3, Section 11.5, and this Section 11.6.1, [******]; provided, that[******]. The contents of any press release, publication, or other public statement that has been reviewed and approved by [******]may be re-released by [******] without first obtaining [******] prior written consent in accordance with this Section 11.6.1.11.6.2[******]; provided, that, subject to Sections 11.3 and 11.5, any such [******]. [******], [******]shall use [******]. [******] shall first [******], subject to and in accordance with Section 11.3 and Section 11.5, as applicable.11.6.3Notwithstanding the foregoing Sections 11.6.1 and 11.6.2, the Parties shall mutually agree to a pressrelease or public announcement regarding this Agreement and the terms hereof, such press release or public announcement to be issuedpromptly (but in no event later than [******]) after the Execution Date, or as otherwise agreed by the Parties. Either Party shall beauthorized to use the information disclosed in any mutually approved press release or public announcement without the need to seekfurther consent or approval thereof from the other Party.11.7Use of Names. Except as otherwise expressly set forth herein, neither Party (or any of its respective Affiliates) shall use thename, trademark, trade name, or logo of the other Party or any of its Affiliates, or its or their respective employees, in any publicity,promotion, news release, or other public disclosure relating to this Agreement or its subject matter, without first obtaining the priorwritten consent of the other Party; provided, that such consent shall not be required to the extent use thereof may be required byApplicable Law, including the rules of any securities exchange or market on which a Party’s or its Affiliate’s securities are listed ortraded. Each Party shall be authorized to use the name, trademark, trade name, or logo of the other Party in the manner that such otherParty has previously approved, without the need to seek further consent or approval thereof from the other Party.11.8Clinical Trials Registry. For clarity, Gilead, its Affiliates, and its designees shall [******]. The Parties shall [******].ARTICLE 12REPRESENTATIONS AND WARRANTIES; COVENANTS12.1Representations and Warranties of Each Party. Each Party hereby represents and warrants to the other Party, as of the Execution Date and the Effective Date, that:12.1.1such Party is duly organized, validly existing, and in good standing under the Applicable Law of thejurisdiction of its formation and has full corporate power and authority to enter into this Agreement and to carry out the provisionshereof;12.1.2such Party has taken all necessary corporate action on its part to authorize the execution and deliveryof this Agreement and the performance of its obligations hereunder;12.1.3this Agreement has been duly executed and delivered on behalf of such Party and constitutes a legal,valid, and binding obligation, enforceable against it in accordance31 Source: AGENUS INC, 10-K, March 18, 2019Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results.[******] - Certain confidential information contained in this document, marked by brackets, is filed with the Securities and Exchange Commission pursuantto Rule 24b-2 of the Securities Exchange Act of 1934, as amended. with its terms, except to the extent that enforcement of the rights and remedies created hereby is subject to: (i) bankruptcy, insolvency,reorganization, moratorium, and other similar laws of general application affecting the rights and remedies of creditors; or (ii) lawsgoverning specific performance, injunctive relief, and other equitable remedies;12.1.4the execution, delivery, and performance of this Agreement by such Party does not breach orconflict with any agreement or any provision thereof, or any instrument or understanding, oral or written, to which such Party (or anyof its Affiliates) is a party or by which such Party (or any of its Affiliates) is bound, nor violate any Applicable Law of anyGovernmental Authority having jurisdiction over such Party (or any of its Affiliates);12.1.5no government authorization, consent, approval, license, exemption of or filing or registration withany court or governmental department, commission, board, bureau, agency, or instrumentality, domestic or foreign, under anyApplicable Law currently in effect, is or shall be necessary for, or in connection with, the transactions contemplated by this Agreement,or for the performance by it of its obligations under this Agreement, except: (i) as may be required to conduct Clinical Trials or to seekor obtain Regulatory Approvals or applicable Regulatory Materials; or (ii) as set forth in Article 10; and12.1.6it has obtained all necessary authorizations, consents, and approvals of any Third Party that isrequired to be obtained by it for, or in connection with, the transactions contemplated by this Agreement, or for the performance by itof its obligations under this Agreement, except: (i) as may be required to conduct Clinical Trials or to seek or obtain RegulatoryApprovals or applicable Regulatory Materials; or (ii) as set forth in Article 10.12.2Representations and Warranties of Agenus. Except as set forth on Schedule 12.2, Agenus hereby represents and warrants to Gilead, as of the Execution Date and the EffectiveDate, that:12.2.1(i) Schedule 1.11 sets forth a complete and accurate list of all Agenus Patents; and [******];12.2.2[******]12.2.3Agenus has the full right and authority to grant all of the rights and licenses granted to Gilead (orpurported to be granted to Gilead) hereunder, [******] have [******] to any [******] relating to [******] that would [******];12.2.4[******]12.2.5[******]12.2.6[******]12.2.7all of Agenus’s and its Affiliates’ officers, employees, and consultants: (i) have executedagreements or have existing obligations under Applicable Law requiring assignment to Agenus or its Affiliates of all inventions madeduring the course of and as the result of their association with Agenus or its Affiliates, as applicable, and obligating the32 Source: AGENUS INC, 10-K, March 18, 2019Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results.[******] - Certain confidential information contained in this document, marked by brackets, is filed with the Securities and Exchange Commission pursuantto Rule 24b-2 of the Securities Exchange Act of 1934, as amended. individual to assign to Agenus or its Affiliate, as applicable, all Inventions made during the course of performance under thisAgreement; [******] and [******] have executed agreements or have existing obligations under Applicable Law obligating theindividual to maintain as confidential Agenus’s Confidential Information as well as confidential information of other parties (includingof Gilead and its Affiliates) that such individual may receive in its performance under this Agreement, to the extent required to supportAgenus’s obligations under this Agreement;12.2.8neither Agenus nor its Affiliates have [******] would be [******] by the [******];12.2.9[******]12.2.10[******]12.2.11there are no [******] proceedings ([******]), or governmental investigations pending or, to theKnowledge of Agenus, threatened against Agenus or its Affiliates which could reasonably be expected to adversely affect or restrictthe ability of Agenus to consummate or perform the transactions contemplated under this Agreement, [******]; 12.2.12[******]12.2.13[******]12.2.14neither Agenus nor its Affiliates have entered into any agreement under which Agenus or itsAffiliates: (i) has obtained a license or sublicense of rights from a Third Party to any Agenus IP; or (ii) has granted a license,sublicense, option, or right to a Third Party that remains in effect to Develop, Manufacture, or Commercialize any Licensed Product, ineach case (i) and (ii), with the exception of the Existing Upstream License Agreements, the Existing Development and ManufacturingAgreements, and Ordinary Course Agreements;12.2.15Schedule 12.2.15 sets forth a complete and accurate list of the Existing Upstream LicenseAgreements, other than Ordinary Course Agreements, in effect as of the Execution Date. Agenus has provided Gilead or its counsel true, correct, and complete copies of each such Existing Upstream License Agreement, subject to redaction of certain terms notnecessary to determining Gilead’s rights or obligations as a sublicensee of Agenus. Each such Existing Upstream License Agreementis in full force and effect, and there has been no Default of or under any such Existing Upstream License Agreement as a result of anyaction or omission of Agenus or its Affiliates or, to the Knowledge of Agenus, the actions or omissions of any Third Party. Agenushas not waived any of its rights under any such Existing Upstream License Agreement to which it is party. The entry into thisAgreement and the contemplated activities of the Parties hereunder will not adversely affect Agenus’s rights under any ExistingUpstream License Agreement;12.2.16other than the Existing Upstream License Agreements and the Existing Development andManufacturing Agreements, Agenus (or its Affiliates, as applicable) has not entered into any material agreement relating to (i) theDevelopment, Manufacture, or Commercialization of any Licensed Product [******];33 Source: AGENUS INC, 10-K, March 18, 2019Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results.[******] - Certain confidential information contained in this document, marked by brackets, is filed with the Securities and Exchange Commission pursuantto Rule 24b-2 of the Securities Exchange Act of 1934, as amended. 12.2.17Agenus has disclosed to Gilead all material information and data, and all material correspondencessent to or received from any Regulatory Authority in the possession or control of Agenus or its Affiliates, in each case, related to anyLicensed Product to the extent permitted under the Prior CDA;12.2.18Subject to Section 3.2.1(b), Agenus has not obtained, or filed, any INDs, MAAs, or RegulatoryApprovals or any other form of regulatory application for the conduct of Clinical Trials, marketing, or other purpose, for any LicensedProduct, and no other Person has obtained, or filed for, any such INDs, MAAs, or Regulatory Approvals for such Licensed Products;and12.2.19 [******]12.3Representation and Warranty of Gilead. Gilead hereby represents and warrants to Agenus, as of the Execution Date and the Effective Date, that there areno claims, judgments, settlements, litigations, suits, actions, disputes, arbitration, judicial, or legal, administrative, or other proceedingsor governmental investigations pending or, to the knowledge of Gilead, threatened against Gilead which would reasonably be expectedto adversely affect or restrict the ability of Gilead to consummate or perform the transactions contemplated under this Agreement.12.4Covenants.12.4.1Mutual Covenants. (a)Each Party hereby covenants to the other Party that such Party and its Affiliates shall perform itsactivities pursuant to this Agreement in compliance (and shall ensure compliance by any of its Sublicensees and subcontractors) withall Applicable Law, including, to the extent applicable, GCP, GLP, and GMP.(b)Each Party shall immediately notify the other Party in writing if any debarment under Section 335a ofTitle 21 of United States Code comes to its attention with respect to any person employed or otherwise used in any capacity forperforming any activities under this Agreement, and shall promptly remove such person or entity from performing any activities relatedto or in connection with this Agreement.12.4.2Additional Agenus Covenants. Agenus hereby covenants to Gilead that:(a)Neither Agenus nor any of its Affiliates shall grant any right or license to any Third Party relating to: (i)one (1) or more of the intellectual property rights within the Agenus IP; or (ii) any other right with respect to any Licensed Product, ineither case (i) or (ii), which would conflict with, [******], any of the rights or licenses granted to Gilead hereunder;(b)[******](c)[******](d)Agenus shall: (i) without limiting Agenus’s other obligations under this Agreement, maintain Controlof all Agenus IP licensed or sublicensed to Gilead under each34 Source: AGENUS INC, 10-K, March 18, 2019Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results.[******] - Certain confidential information contained in this document, marked by brackets, is filed with the Securities and Exchange Commission pursuantto Rule 24b-2 of the Securities Exchange Act of 1934, as amended. Existing Upstream License Agreement to the extent of Agenus’s Control of such Agenus IP as of the Execution Date; and (ii) notterminate, breach, or otherwise Default under, or amend or modify any Existing Upstream License Agreement in a manner that wouldpermit the counterparty thereto to terminate such Existing Upstream License Agreement or otherwise diminish the scope or exclusivityof the rights or licenses granted to Gilead with respect to any Agenus IP [******];(e)[******](f)[******]12.5Disclaimer. EXCEPT AS OTHERWISE EXPRESSLY PROVIDED IN THIS AGREEMENT, NEITHER PARTY MAKES ANYREPRESENTATIONS OR EXTENDS ANY WARRANTY OF ANY KIND, EITHER EXPRESS OR IMPLIED (AND EACHPARTY HEREBY EXPRESSLY DISCLAIMS ANY AND ALL REPRESENTATIONS AND WARRANTIES NOTEXPRESSLY PROVIDED IN THIS AGREEMENT), INCLUDING WITH RESPECT TO ANY PATENTS OR KNOW-HOW,INCLUDING WARRANTIES OF VALIDITY OR ENFORCEABILITY, MERCHANTABILITY, FITNESS FOR APARTICULAR USE OR PURPOSE, PERFORMANCE, AND NON-INFRINGEMENT OF ANY THIRD PARTY PATENTOR OTHER INTELLECTUAL PROPERTY RIGHT. WITHOUT LIMITING THE FOREGOING, THE PARTIES AGREETHAT THE MILESTONE EVENTS, SALES MILESTONE EVENTS, AND NET SALES LEVELS SET FORTH IN THISAGREEMENT OR THAT HAVE OTHERWISE BEEN DISCUSSED BY THE PARTIES ARE MERELY INTENDED TODEFINE THE MILESTONE PAYMENTS, SALES MILESTONE PAYMENTS, AND ROYALTY OBLIGATIONS IF SUCHMILESTONE EVENTS, SALES MILESTONE EVENTS, OR NET SALES LEVELS ARE ACHIEVED. NEITHER PARTYMAKES ANY REPRESENTATION OR WARRANTY, EITHER EXPRESS OR IMPLIED, THAT IT WILL BE ABLE TOSUCCESSFULLY DEVELOP, MANUFACTURE, OR COMMERCIALIZE ANY LICENSED PRODUCT OR, IFCOMMERCIALIZED, THAT ANY PARTICULAR SALES LEVEL OF SUCH LICENSED PRODUCT WILL BEACHIEVED.ARTICLE 13INDEMNIFICATION; INSURANCE13.1Indemnification by Gilead. Gilead shall indemnify, defend, and hold harmless Agenus, its Affiliates, and its and their respective directors, officers, employees,agents, successors, and assigns (collectively, the “Agenus Indemnitees”) from and against any and all Damages to the extent arisingout of or relating to, directly or indirectly, any Third Party Claim based upon:13.1.1[******]13.1.2[******]13.1.3[******]35 Source: AGENUS INC, 10-K, March 18, 2019Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results.[******] - Certain confidential information contained in this document, marked by brackets, is filed with the Securities and Exchange Commission pursuantto Rule 24b-2 of the Securities Exchange Act of 1934, as amended. provided, however, that, in each case of [******], such indemnity shall not apply to the extent Agenus has an indemnificationobligation pursuant to [******] for such Damages.13.2Indemnification by Agenus. Agenus shall indemnify and hold harmless Gilead, its Affiliates, and its and their respective directors, officers, employees, agents,successors, and assigns (collectively, the “Gilead Indemnitees”), from and against any and all Damages to the extent arising out of orrelating to, directly or indirectly, any Third Party Claim based upon:13.2.1[******]13.2.2[******]13.2.3[******]provided, however, that, in each case of [******], such indemnity shall not apply to the extent Gilead has an indemnificationobligation pursuant to [******] for such Damages.13.3Procedure.13.3.1If a Party is seeking indemnification under Section 13.1 or Section 13.2, as applicable (the“Indemnitee”), it shall inform the other Party (the “Indemnitor”) of the claim giving rise to the obligation to indemnify pursuant toSection 13.1 or Section 13.2, as applicable, as soon as reasonably practicable after receiving notice of the claim (an “IndemnificationClaim Notice”); provided, that any delay or failure to provide such notice shall not constitute a waiver or release of, or otherwise limit,the Indemnitee’s rights to indemnification under Section 13.1 or Section 13.2, as applicable, except to the extent that such delay orfailure materially prejudices the Indemnitor’s ability to defend against the relevant claims.13.3.2The Indemnitor shall have the right, upon written notice given to the Indemnitee within [******]after receipt of the Indemnification Claim Notice (and, where the Indemnitor is Agenus, subject to receipt of Gilead’s prior writtenconsent), to assume the defense of any such claim for which the Indemnitee is seeking indemnification pursuant to Section 13.1 orSection 13.2, as applicable. The Indemnitee shall cooperate with the Indemnitor and the Indemnitor’s insurer as the Indemnitor mayreasonably request, and at the Indemnitor’s cost and expense. The Indemnitee shall have the right to participate, at its own expenseand with counsel of its choice, in the defense of any claim or suit that has been assumed by the Indemnitor.13.3.3The Indemnitor shall not settle any claim without first obtaining the prior written consent of theIndemnitee, not to be unreasonably withheld, conditioned, or delayed; provided, however, that the Indemnitor shall not be required toobtain such consent if the settlement: (a) involves only the payment of money and shall not result in the Indemnitee (or other AgenusIndemnitees or Gilead Indemnitees, as applicable) becoming subject to injunctive or other similar type of relief; (b) does not require anadmission by the Indemnitee (or other Agenus Indemnitees or Gilead Indemnitees, as applicable); and (c) does not adversely affect theintellectual property Controlled by, or the rights or licenses granted to the Indemnitee (or its Affiliate) under this Agreement. TheIndemnitee shall not settle or compromise any such claim without first obtaining the prior written consent of the Indemnitor.36 Source: AGENUS INC, 10-K, March 18, 2019Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results.[******] - Certain confidential information contained in this document, marked by brackets, is filed with the Securities and Exchange Commission pursuantto Rule 24b-2 of the Securities Exchange Act of 1934, as amended. 13.3.4If the Parties cannot agree as to the application of Section 13.1 or Section 13.2, as applicable, to anyclaim, pending the resolution of the dispute pursuant to Section 15.6, the Parties may conduct separate defenses of such claims, witheach Party retaining the right to claim indemnification from the other Party in accordance with Section 13.1 or Section 13.2, asapplicable, upon resolution of the underlying claim. In each case, the Indemnitee shall reasonably cooperate with the Indemnitor andshall make available to the Indemnitor all pertinent information under the control of the Indemnitee, which information shall be subjectto Article 11.13.4Insurance.13.4.1Insurance Maintained by each Party. During the Term, each Party shall have and maintain in fullforce and effect, at its own expense, insurance coverage to include:(a)Commercial general liability insurance, including personal and advertising injury, with limits of liabilitynot less than [******]. General liability limit requirements may be satisfied by a combination of primary and umbrella or excessliability insurance coverage; and(b)Workers’ compensation insurance in compliance with Applicable Law (including the local lawrequirements of the state or jurisdiction in which the work is to be performed). Employer’s liability insurance in amounts not less than[******]. Where permitted by Applicable Law, such policies shall contain a waiver of the insurer’s subrogation rights against the non-insured Party.13.4.2Additional Requirements.(a)Additional Insured. Each Party shall name the other Party as an additional insured on the insurancepolicies maintained pursuant to Section 13.4.1(a) either by endorsement or blanket additional insured endorsement.(b)Evidence of Insurance. Each Party will provide evidence of insurance maintained pursuant to thisSection 13.4 on request of the other Party.(c)Notice of Cancellation. Each Party will provide the other Party a notice of insurance policy cancellationin accordance with the provisions of the applicable insurance policy maintained pursuant to this Section 13.4.(d)Policy Type. Insurance policies maintained pursuant to this Section 13.4 should be occurrence type. Ifpolicies maintained pursuant to this Section 13.4 are claims made, then insurance shall be maintained for at least [******] followingexpiration or termination of this Agreement.(e)Insurance Carrier Rating. All insurance maintained pursuant to this Section 13.4 will be underwritten bycompanies with an AM best rating of at least [******].[******]13.5[******]37 Source: AGENUS INC, 10-K, March 18, 2019Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results.[******] - Certain confidential information contained in this document, marked by brackets, is filed with the Securities and Exchange Commission pursuantto Rule 24b-2 of the Securities Exchange Act of 1934, as amended. .ARTICLE 14TERM AND TERMINATION14.1Term; Expiration.14.1.1Term. Except for the terms and conditions of Article 1 (to the extent the definitions are used in thefollowing provisions), Article 10, Article 11, Article 12, Article 15, this Section 14.1.1, and Section 14.7.1 (all of which shall becomeeffective on the Execution Date), this Agreement shall become effective on the Closing Date (the “Effective Date”); provided, that thisAgreement shall terminate immediately, upon written notice by a Party to the other Party, in the event that the Effective Date has notoccurred on or prior to [******] after the Execution Date (“Initial Outside Date”), provided, Gilead may, in its sole discretion,provide written notice to Agenus on or prior to such Initial Outside Date to extend such Initial Outside Date by an additional [******]. Unless earlier terminated in accordance with this Article 14, this Agreement shall remain in effect until it expires as follows (the“Term”):(a)on a Licensed Product-by-Licensed Product and country-by-country basis, this Agreement shall expireon the date of the expiration of the Royalty Term with respect to such Licensed Product in such country; and(b)this Agreement shall expire in its entirety upon the expiration of all applicable Royalty Terms under thisAgreement with respect to the Licensed Products in all countries in the Territory.14.1.2Effect of Expiration. Upon the expiration of the Term pursuant to Section 14.1.1, the followingterms shall apply:(a)Licenses after Licensed Product Expiration. Upon the expiration of the Term with respect to a givenLicensed Product in a given country pursuant to Section 14.1.1(a), the license set forth in Section 8.1.1 with respect to the LicensedProduct in such country shall become fully paid-up, perpetual, irrevocable, and royalty-free.(b)Licenses after Expiration of Agreement. Upon the expiration of the Term with respect to thisAgreement in its entirety pursuant to Section 14.1.1(b), the license set forth in Section 8.1.1 with respect to all Licensed Products in allcountries in the Territory shall become fully paid-up, perpetual, irrevocable, and royalty-free.14.2Termination for Material Breach.14.2.1Material Breach. This Agreement may be terminated in its entirety or on a Licensed Product-by-Licensed Product or country-by-country basis by a Party for a Material Breach by the other Party; provided, that the breaching Partyhas not cured such breach within [******] after the date of written notice to the breaching Party of such breach (the “Cure Period”),which notice shall describe such breach in reasonable detail and shall state the non-breaching Party’s intention to terminate thisAgreement (in its entirety or on a Licensed Product-by-Licensed Product or country-by-country basis). Notwithstanding the foregoing,for any38 Source: AGENUS INC, 10-K, March 18, 2019Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results.[******] - Certain confidential information contained in this document, marked by brackets, is filed with the Securities and Exchange Commission pursuantto Rule 24b-2 of the Securities Exchange Act of 1934, as amended. breach of this Agreement with respect to any undisputed payment obligation, the Cure Period shall be [******]. Any termination ofthis Agreement (in its entirety or on a Licensed Product-by-Licensed Product or country-by-country basis) under this Section 14.2.1shall become effective [******], unless the breaching Party has cured such breach prior to the expiration of such Cure Period, or, ifsuch breach is not susceptible to cure within the Cure Period, then, except with respect to any breach of any undisputed paymentobligation, such Cure Period shall be extended for [******].14.2.2Disagreement as to Material Breach. Notwithstanding Section 14.2.1, if the Parties in good faithdisagree as to whether there has been a Material Breach of this Agreement, then: (a) the Party that disputes whether there has been aMaterial Breach may contest the allegation by referring such matter, within [******] following its receipt of notice of alleged MaterialBreach, for resolution in accordance with Section 15.6.3(a); (b) the relevant Cure Period with respect to such alleged Material Breachshall be [******].14.3Termination at Will. Gilead may terminate this Agreement at will, in its sole discretion, in its entirety or on a Licensed Product-by-Licensed Product orcountry-by-country basis at any time upon [******] prior written notice to Agenus.Termination for Bankruptcy.14.4.1If either Party makes a general assignment for the benefit of, or an arrangement or compositiongenerally with, its creditors, appoints or suffers appointment of an examiner or of a receiver or trustee over all or substantially all of itsproperty, passes a resolution for its winding up, or files a petition under any bankruptcy or insolvency act or law or has any suchpetition filed against it which is not dismissed, discharged, bonded, or stayed within [******] after the filing thereof and seeks to rejectthis Agreement, (a “Rejection Event”), the other Party may treat this Agreement as terminated by such rejection, effective immediatelyupon written notice to such Party.14.4.2For purposes of Section 365(n) of the U.S. Bankruptcy Code (the “Code”) and any similar laws inany other country, all rights and licenses granted under or pursuant to any Section of this Agreement are rights to “intellectualproperty” (as defined in Section 101(35A) of the Code). The Parties agree that the licensee of such rights under this Agreement willretain and may fully exercise all of its protections, rights and elections under the Code and any similar laws in any other country. EachParty hereby acknowledges that (a) copies of research data, (b) laboratory samples, (c) product samples, (d) formulas, (e) laboratorynotes and notebooks, (f) data and results related to clinical trials, (g) regulatory filings and approvals, (h) rights of reference in respectof regulatory filings and approvals, (i) pre-clinical research data and results, and (j) marketing, advertising and promotional materials, ineach case, that relate to such intellectual property, constitute “embodiments” of such intellectual property pursuant to Section 365(n) ofthe Code, and that the licensee will be entitled to a complete duplicate of (or complete access to, as appropriate) any such intellectualproperty and all embodiments of such intellectual property, and the same, if not already in its possession, will be promptly delivered toit upon its written request therefor and election under Bankruptcy Code Section 365(n)(1)(B) to retain the licenses granted by Agenusto Gilead hereunder in the event of Agenus’s rejection of this Agreement, unless the licensor elects to continue to perform all of itsobligations under this39 Source: AGENUS INC, 10-K, March 18, 2019Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results.[******] - Certain confidential information contained in this document, marked by brackets, is filed with the Securities and Exchange Commission pursuantto Rule 24b-2 of the Securities Exchange Act of 1934, as amended. Agreement. The provisions of this Section 14.4.2 are without prejudice to any rights the non-subject Party may have arising under theCode, laws of other jurisdictions governing insolvency and bankruptcy, or other Applicable Law. The Parties agree that they intendthe following rights to extend to the maximum extent permitted by law, including for purposes of the Code and any similar laws in anyother country: (x) the right of access to any intellectual property (including all embodiments thereof) of the licensor, or any Third Partywith whom the licensor contracts to perform an obligation of such licensor under this Agreement which is necessary for theDevelopment or Commercialization of a Licensed Product; (y) the right to contract directly with any Third Party described in (x) tocomplete the contracted work, and (z) the right to cure any breach of or default under any such agreement with a Third Party and setoff the costs thereof against amounts payable to such licensor under this Agreement.Effects of Termination.14.5.1Termination by Gilead at Will or by Agenus for Material Breach or Bankruptcy. Upon terminationof this Agreement with respect to a Terminated Licensed Product: (a) by Gilead, in accordance with Section 14.3; or (b) by Agenus, inaccordance with Section 14.2 or Section 14.4.(a)the licenses granted by Agenus to Gilead pursuant to Section 8.1 with respect to the TerminatedLicensed Product shall terminate and Gilead shall not have any rights to use or exercise any rights under the Agenus IP with respect tosuch Terminated Licensed Product;(b)Gilead shall be released from its Development, Manufacturing, and Commercialization obligationsunder this Agreement with respect to the Terminated Licensed Product, including with respect to Section 2.2 and Section 2.3;(c)Gilead shall as soon as reasonably practicable transfer and assign (to the extent permitted) to Agenus allRegulatory Materials owned and controlled by Gilead or its Affiliates, in each case, at Agenus’s cost, to the extent solely related to theTerminated Licensed Product and necessary for Developing, Manufacturing, or Commercializing such Terminated Licensed Productin the Field in the Territory; provided, that Gilead may retain a copy of such items for its records;(d)[******](e)upon receipt by Gilead from Agenus of written notice no later than [******], the Parties [******];(f)in the event that Gilead does not receive written notice from Agenus within [******] pursuant toSection 14.5.1(e), then [******];(g)in the case of termination of this Agreement in its entirety, any and all sublicense agreements enteredinto by Gilead or any of its Affiliates with a Sublicensee pursuant to this Agreement shall survive such termination of this Agreement,except to the extent that: (i) any such Sublicensee is in material breach of this Agreement or such sublicense; or (ii) Agenus elects togrant such Sublicensee a direct license of the sublicensed rights on the same terms40 Source: AGENUS INC, 10-K, March 18, 2019Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results.[******] - Certain confidential information contained in this document, marked by brackets, is filed with the Securities and Exchange Commission pursuantto Rule 24b-2 of the Securities Exchange Act of 1934, as amended. applicable to Gilead under this Agreement. Gilead shall, upon the written request of Agenus, assign any such sublicense (to the extentnot terminated pursuant to the preceding sentence) to Agenus or its Affiliates and, upon such assignment, Agenus or its Affiliates, asapplicable, shall assume such sublicense;(h)each Party shall comply with the return and destruction obligations with respect to ConfidentialInformation and any Know-How of the other Party that are in its or its Affiliates’, sublicensees’ or Third Party contractors’ possessionor control in accordance with Article 11;(i)to the extent that Gilead is manufacturing the Terminated Licensed Product as of the effective date oftermination, then, upon the election of Agenus, exercised by written notice to Gilead no later than [******] following the effectivedate of termination, the Parties shall negotiate and use good-faith efforts to enter into:(1)a supply agreement (and a corresponding quality agreement with customary terms andconditions) pursuant to which Gilead would supply Agenus’s requirements of the Terminated Licensed Product [******] and whichwould include such other mutually agreed terms as are customary for agreements of such type; or(2)an agreement under which Gilead would provide, and cause its Affiliates to provide,[******];(j)to the extent that a Third Party manufacturer is manufacturing the Terminated Licensed Product as of theeffective date of termination, then, to the extent Gilead has the right to do so under its agreements with its Third Party manufacturers,upon the election of Agenus, exercised by written notice to Gilead no later than [******] following the effective date of termination, and at Agenus’s expense, Gilead shall [******];(k)upon the election of Agenus, exercised by written notice to Gilead no later than [******] following theeffective date of termination, at Agenus’s expense, Gilead shall assign, and shall cause its Affiliates and Sublicensees to assign, toAgenus or its designee, all of Gilead’s rights under Third Party contracts relating to the Development, Manufacture, orCommercialization of the Terminated Licensed Product, to the extent that such contracts can be assigned without the counterparty’sconsent and to the extent such contracts relate solely to the Terminated Licensed Product. To the extent that such consent is required,[******]; and Agenus shall assume Gilead’s obligations under such assigned contracts, except to the extent such obligations relate tothe period of performance prior to assignment or to any breach of such agreements by Gilead, its Affiliates, or its Sublicensees; and(l)if, as of the effective date of termination, Gilead or its Affiliates are conducting any Clinical Trials forthe Terminated Licensed Product, then the Parties shall in good faith discuss and agree upon the appropriate completion or transition ofsuch Clinical Trials to Agenus, subject to Applicable Law.41 Source: AGENUS INC, 10-K, March 18, 2019Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results.[******] - Certain confidential information contained in this document, marked by brackets, is filed with the Securities and Exchange Commission pursuantto Rule 24b-2 of the Securities Exchange Act of 1934, as amended. 14.5.2Termination by Gilead for Material Breach or Bankruptcy. Upon termination of this Agreementwith respect to a Terminated Licensed Product by Gilead in accordance with Section 14.2 or Section 14.4:(a)the licenses granted by Agenus to Gilead pursuant to Section 8.1 with respect to the TerminatedLicensed Product shall terminate and Gilead shall not have any rights under the Agenus IP with respect to such Terminated LicensedProduct;(b)Gilead shall be released from its Development, Manufacturing, and Commercialization obligationsunder this Agreement with respect to the Terminated Licensed Product, including with respect to Section 2.2 and Section 2.3; and(c)Each Party shall comply with the return and destruction obligations with respect to ConfidentialInformation and any Know-How of the other Party that are in its or its Affiliates’, sublicensees’ or Third Party contractors’ possessionor control in accordance with Article 11.14.6[******]Surviving Provisions.14.7.1Accrued Rights; Remedies. The expiration or termination of this Agreement for any reason shall bewithout prejudice to any rights that shall have accrued to the benefit of any Party prior to such expiration or termination, and any andall damages or remedies (whether at law or in equity) arising from any breach hereunder, each of which shall survive expiration ortermination of this Agreement. Such expiration or termination shall not relieve any Party from obligations which are expresslyindicated to survive expiration or termination of this Agreement. Except as otherwise expressly set forth in this Agreement, thetermination provisions of this Article are in addition to any other relief and remedies available to either Party under this Agreement, atlaw, or in equity.14.7.2Survival. Without limiting the provisions of Section 14.7.1, the rights and obligations of the Partiesset forth in the following Sections and Articles of this Agreement shall survive the expiration or termination of this Agreement (to theextent in effect as of the Effective Date), in addition to those other terms and conditions that are expressly stated to survive terminationor expiration of this Agreement: [******].ARTICLE 15MISCELLANEOUSSeverability. If one (1) or more of the terms or provisions of this Agreement is held by a court of competent jurisdiction to be void, invalid, orunenforceable in any situation in any jurisdiction, such holding shall not affect the validity or enforceability of the remaining terms andprovisions hereof or the validity or enforceability of the void, invalid, or unenforceable term or provision in any other situation or inany other jurisdiction, and the term or provision shall be considered severed from this Agreement solely for such situation and solely insuch jurisdiction, unless the void, invalid, or unenforceable term or provision is of such essential importance to this Agreement that it isto be reasonably assumed that the Parties would not have42 Source: AGENUS INC, 10-K, March 18, 2019Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results.[******] - Certain confidential information contained in this document, marked by brackets, is filed with the Securities and Exchange Commission pursuantto Rule 24b-2 of the Securities Exchange Act of 1934, as amended. entered into this Agreement without the void, invalid, or unenforceable term or provision. If the final judgment of such court declaresthat any term or provision hereof is void, invalid, or unenforceable, the Parties agree to: (a) reduce the scope, duration, area, orapplicability of the term or provision or to delete specific words or phrases to the minimum extent necessary to cause such term orprovision as so reduced or amended to be enforceable; and (b) make a good-faith effort to replace any void, invalid, or unenforceableterm or provision with a valid and enforceable term or provision such that the objectives contemplated by the Parties when entering thisAgreement may be realized.Notices. Any notice required or permitted to be given by this Agreement shall be in writing and in English and shall be: (a) delivered by handor by overnight courier with tracking capabilities; or (b) mailed postage prepaid by first class, registered, or certified mail, in each case,addressed as set forth below unless changed by notice so given:If to Gilead: Gilead Sciences, Inc.333 Lakeside DriveFoster City, CA 94404Attention: [******] With copies to: Gilead Sciences, Inc.333 Lakeside DriveFoster City, CA 94404Attention: [******] If to Agenus: Agenus Inc.3 Forbes RoadLexington, Massachusetts 02421-7305, USAAttention:Chief Executive Officer With copies to: Agenus Inc.3 Forbes RoadLexington, Massachusetts 02421-7305, USAAttention:General CounselAny such notice shall be deemed given on the date received, except any notice received after 5:30 p.m. (in the time zone of thereceiving Party) on a Business Day or received on a non-Business Day shall be deemed to have been received on the next BusinessDay. A Party may add, delete, or change the person or address to which notices should be sent at any time upon written noticedelivered to the other Parties in accordance with this Section 15.2.43 Source: AGENUS INC, 10-K, March 18, 2019Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results.[******] - Certain confidential information contained in this document, marked by brackets, is filed with the Securities and Exchange Commission pursuantto Rule 24b-2 of the Securities Exchange Act of 1934, as amended. Force Majeure. A Party shall not be liable for delay or failure in the performance of any of its obligations hereunder if such delay or failure is due to acause beyond the reasonable control of such Party, including acts of God, fires, earthquakes, acts of war, terrorism, or civil unrest, orhurricane or other inclement weather; provided, that the affected Party: (a) promptly notifies the other Party; and (b) shall use itscommercially reasonable efforts to avoid or remove such causes of non-performance and to mitigate the effect of such occurrence, andshall continue performance in accordance with the terms of this Agreement whenever such causes are removed. When suchcircumstances arise, the Parties shall negotiate in good faith any modifications of the terms of this Agreement that may be necessary orappropriate in order to arrive at an equitable solution.Assignment. Except as provided in this Section 15.4, this Agreement may not be assigned or otherwise transferred, nor may any right orobligation hereunder be assigned or transferred, by either Party without the consent of the other Party; provided, however, that (andnotwithstanding anything elsewhere in this Agreement to the contrary but without prejudice to Section 7.6.2) either Party may, withoutsuch consent, assign this Agreement and its rights and obligations hereunder in whole or in part: (a) to an Affiliate of such Party; (b) inconnection with the transfer or sale of all or substantially all of its assets or business related to the subject matter of this Agreement; or(c) pursuant to a merger or consolidation (or similar transaction) of the assigning Party. In addition, Gilead may, without the consent ofAgenus, assign its rights and obligations under this Agreement to a Third Party, where Gilead or its Affiliate divest rights to a LicensedProduct or Licensed Antibody. Any attempted assignment not in accordance with this Section 15.4 shall be void. In the event that apermitted assignment of this Agreement by a Party increases the tax liability of the other Party or any of its Affiliates over the amountof any Taxes that otherwise would have been payable in the absence of such assignment, the assigning Party shall reimburse the otherParty for the amount of such increased Tax liability.Waivers and Modifications. The failure of any Party to insist on the performance of any obligation hereunder shall not be deemed to be a waiver of suchobligation. Waiver of any breach of any provision hereof shall not be deemed to be a waiver of any other breach of such provision orany other provision on such occasion or any succeeding occasion. No waiver, modification, release, or amendment of any obligationunder or provision of this Agreement shall be valid or effective unless in writing and signed by the Parties.Choice of Law; Waiver of Jury Trial; Dispute Resolution; Jurisdiction.15.6.1Choice of Law. This Agreement and any dispute arising from the performance or breach hereofshall be governed by and interpreted in accordance with the laws of the State of New York, without giving effect to any choice of lawrules. The provisions of the United Nations Convention on Contracts for the International Sale of Goods shall not apply to thisAgreement or any subject matter hereof.Waiver of Jury Trial. THE PARTIES HEREBY WAIVE, AND COVENANT THAT THEY SHALL NOT ASSERT (WHETHER AS PLAINTIFF,DEFENDANT, OR OTHERWISE), ANY RIGHT TO TRIAL BY JURY IN ANY ACTION ARISING IN WHOLE OR INPART UNDER OR IN CONNECTION WITH THIS AGREEMENT, WHETHER NOW EXISTING OR HEREAFTERARISING, AND WHETHER44 Source: AGENUS INC, 10-K, March 18, 2019Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results.[******] - Certain confidential information contained in this document, marked by brackets, is filed with the Securities and Exchange Commission pursuantto Rule 24b-2 of the Securities Exchange Act of 1934, as amended. SOUNDING IN CONTRACT, TORT, OR OTHERWISE. THE PARTIES AGREE THAT ANY OF THEM MAY FILE ACOPY OF THIS PARAGRAPH WITH ANY COURT AS WRITTEN EVIDENCE OF THE KNOWING, VOLUNTARY, ANDBARGAINED-FOR AGREEMENT BETWEEN THE PARTIES IRREVOCABLY TO WAIVE ITS RIGHT TO TRIAL BYJURY IN ANY PROCEEDING WHATSOEVER BETWEEN THEM RELATING TO THIS AGREEMENT, AND SUCHPROCEEDING SHALL INSTEAD BE TRIED IN A COURT OF COMPETENT JURISDICTION BY A JUDGE SITTINGWITHOUT A JURY.15.6.3Dispute Resolution.(a)Except as otherwise set forth in this Agreement, in the event of an unresolved matter, dispute, or issuerelating to the breach or alleged breach or interpretation of this Agreement (“Dispute”), the Parties shall refer the Dispute to theExecutive Officers for discussion and resolution. If the Executive Officers are unable to resolve such Dispute within [******] of theDispute being referred to them by either Party in writing, then the Dispute shall be resolved as provided in Section 15.6.3(b) or Section15.6.3(c), as applicable.(b)Any unresolved Disputes between the Parties arising out of or in connection with this Agreement shallbe resolved by final and binding arbitration. Whenever a Party decides to institute arbitration proceedings, it shall give written notice tothat effect to the other Party. Arbitration shall be held in New York, New York, according to the Rules of Arbitration of theInternational Chamber of Commerce (“ICC Rules”) in effect at the Effective Date, except as they may be modified herein or bymutual agreement of the Parties. All arbitration proceedings shall be conducted by three (3) arbitrators unless otherwise mutuallyagreed by the Parties. The claimant and the respondent shall each nominate an arbitrator in accordance with the ICC Rules, and thethird arbitrator, who shall be the president of the arbitral tribunal, shall be appointed by the two (2) Party-appointed arbitrators inconsultation with the Parties. The Parties undertake to maintain confidentiality as to the existence of the arbitration proceedings and asto all submissions, correspondence, and evidence relating to the arbitration proceedings. This Section 15.6.3(b) shall survive thetermination of the arbitral proceedings. No arbitrator (nor any arbitral tribunal) shall [******]. Decisions of the arbitrator(s) shall befinal and binding on the Parties. Judgment on the award so rendered may be entered in any court of competent jurisdiction. The costsof the arbitration shall be shared by the Parties during the course of such arbitration, as assessed by the International Chamber ofCommerce, and shall be borne as determined by the arbitrator(s). With respect to any dispute over the [******], within [******] afterthe arbitrators are selected pursuant this Section 15.6.3(b), each Party shall provide the arbitrators and the other Party a proposal(including a written memorandum in support of its position) for the [******]. In rendering a decision regarding the [******], thearbitrators shall select the proposal which is more commercially reasonable under the circumstances (or, if a Party fails to submit aproposal within such [******] period, the other Party’s proposal).(c)Notwithstanding anything to the contrary, either Party may at any time seek to obtain preliminaryinjunctive relief or other applicable provisional relief from a court of competent jurisdiction with respect to an issue arising under thisAgreement if the rights of such Party would be prejudiced absent such relief. A request by a Party to a court of competent jurisdictionfor interim measures necessary to preserve the Party’s rights, including attachments45 Source: AGENUS INC, 10-K, March 18, 2019Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results.[******] - Certain confidential information contained in this document, marked by brackets, is filed with the Securities and Exchange Commission pursuantto Rule 24b-2 of the Securities Exchange Act of 1934, as amended. or injunctions, shall not be deemed incompatible with, or a waiver of, the agreement to mediate or arbitrate contained in thisSection 15.6.3(c), or the availability of interim measures of protection under the ICC Rules. Notwithstanding anything to the contraryin this Section 15.6.3(c), any disputes regarding the scope, validity, enforceability, or inventorship of any Patents shall be submitted forfinal resolution by a court of competent jurisdiction.Relationship of the Parties. Agenus and Gilead are independent contractors under this Agreement. Nothing contained herein is intended or is to be construed soas to constitute either Party as a partner, agent, or joint venturer of the other Party. Neither Agenus nor Gilead, respectively, shall haveany express or implied right or authority to assume or create any obligations on behalf of or in the name of Agenus and Gilead,respectively, or to bind Agenus and Gilead, respectively, to any contract, agreement, or undertaking with any Third Party.Fees and Expenses. Except as otherwise specified in this Agreement, each Party shall bear its own costs and expenses (including investment banking andlegal fees and expenses) incurred in connection with this Agreement and the transactions contemplated hereby.Third Party Beneficiaries. There are no express or implied Third Party beneficiaries hereunder. The provisions of this Agreement are for the exclusive benefitof the Parties, and no other person or entity shall have any right or claim against any Party by reason of these provisions or be entitledto enforce any of these provisions against any Party, except for the indemnification rights of the Agenus Indemnitees pursuant toSection 13.1 and Section 13.3 and the Gilead Indemnitees pursuant to Section 13.2 and Section 13.3.Entire Agreement. This Agreement, together with the attached Exhibits and Schedules, contains the entire agreement by the Parties with respect to thesubject matter hereof and supersedes any prior express or implied agreements, understandings, and representations, either oral orwritten, which may have related to the subject matter hereof in any way, including the Prior CDA and any and all term sheets relatingto the transactions contemplated by this Agreement and exchanged between the Parties prior to the Effective Date; provided, that thisAgreement shall not supersede the terms and provisions of the Prior CDA applicable to any period prior to the Effective Date.Counterparts. This Agreement may be executed in counterparts with the same effect as if both Parties had signed the same document. All suchcounterparts shall be deemed an original, shall be construed together, and shall constitute one (1) and the same instrument. Any suchcounterpart, to the extent delivered by means of facsimile by .pdf, .tif, .gif, .jpeg, or similar attachment to electronic mail (any suchdelivery, an “Electronic Delivery”) shall be treated in all manner and respects as an original executed counterpart and shall beconsidered to have the same binding legal effect as if it were the original signed version thereof delivered in person. No Party heretoshall raise the use of Electronic Delivery to deliver a signature or the fact that any signature or agreement or instrument was transmittedor communicated through the use of Electronic Delivery as a defense to the formation of a contract, and each Party forever waives anysuch defense, except to the extent that such defense relates to lack of authenticity.Equitable Relief; Cumulative Remedies. Notwithstanding anything to the contrary herein, the Parties shall be entitled to seek equitable relief, including injunction and46 Source: AGENUS INC, 10-K, March 18, 2019Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results.[******] - Certain confidential information contained in this document, marked by brackets, is filed with the Securities and Exchange Commission pursuantto Rule 24b-2 of the Securities Exchange Act of 1934, as amended. specific performance, as a remedy for any breach of this Agreement. Such remedies shall not be deemed to be the exclusive remediesfor a breach of this Agreement but shall be in addition to all other remedies available at law or in equity. The Parties further agree notto raise as a defense or objection to the request or granting of such relief that any breach of this Agreement is or would be compensableby an award of money damages. No remedy referred to in this Agreement is intended to be exclusive, but each shall be cumulativeand in addition to any other remedy referred to in this Agreement or otherwise available under Applicable Law.Interpretation.15.13.1Generally. This Agreement has been diligently reviewed by and negotiated by and between theParties, and in such negotiations each of the Parties has been represented by competent (in-house or external) counsel, and the finalagreement contained herein, including the language whereby it has been expressed, represents the joint efforts of the Parties and theircounsel. Accordingly, in interpreting this Agreement or any provision hereof, no presumption shall apply against any Party as beingresponsible for the wording or drafting of this Agreement or any such provision, and ambiguities, if any, in this Agreement shall not beconstrued against any Party, irrespective of which Party may be deemed to have authored the ambiguous provision.15.13.2Definitions; Interpretation.(a)The definitions of the terms herein shall apply equally to the singular and plural forms of the termsdefined and, where a word or phrase is defined herein, each of its other grammatical forms shall have a corresponding meaning.(b)Whenever the context may require, any pronoun shall include the corresponding masculine, feminine,and neuter forms.(c)The word “will” shall be construed to have the same meaning and effect as the word “shall.”(d)The words “including,” “includes,” “include,” “for example,” and “e.g.,” and words of similar import,shall be deemed to be followed by the words “without limitation.”(e)The word “or” shall be interpreted to mean “and/or,” unless the context requires otherwise.(f)The words “hereof,” “herein,” and “herewith,” and words of similar import, shall, unless otherwisestated, be construed to refer to this Agreement as a whole and not to any particular provision of this Agreement.(g)Unless the context requires otherwise or otherwise specifically provided: (i) all references herein toArticles, Sections, or Schedules shall be construed to refer to Articles, Sections, and Schedules of this Agreement; and (ii) reference inany Section to any subclauses are references to such subclauses of such Section.47 Source: AGENUS INC, 10-K, March 18, 2019Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results.[******] - Certain confidential information contained in this document, marked by brackets, is filed with the Securities and Exchange Commission pursuantto Rule 24b-2 of the Securities Exchange Act of 1934, as amended. 15.13.3Subsequent Events. Unless the context requires otherwise: (a) any definition of or reference toany agreement, instrument, or other document herein shall be construed as referring to such agreement, instrument, or other documentas from time to time amended, supplemented, or otherwise modified (subject to any restrictions on such amendments, supplements, ormodifications set forth herein); (b) any reference to any Applicable Law herein shall be construed as referring to such Applicable Lawas from time to time enacted, repealed, or amended; and (c) subject to Section 15.4, any reference herein to any Person shall beconstrued to include the Person’s successors and assigns.15.13.4Headings. Headings, captions, and the table of contents are for convenience only and shall not beused in the interpretation or construction of this Agreement.15.13.5 Prior Drafts. No prior draft of this Agreement shall be used in the interpretation or construction ofthis Agreement.Further Assurances. Each Party shall execute, acknowledge, and deliver such further instruments, and do all such other ministerial, administrative, orsimilar acts, as may be reasonably necessary or appropriate in order to carry out the expressly stated purposes and the clear intent ofthis Agreement.Extension to Affiliates. Except as expressly set forth otherwise in this Agreement, each Party shall have the right to extend the rights and obligations grantedin this Agreement to one or more of its Affiliates. All applicable terms and provisions of this Agreement, except this right to extend,shall apply to any such Affiliate to which this Agreement has been extended to the same extent as such terms and provisions apply tothe Party extending such rights and obligations. The Party extending the rights and obligations granted hereunder shall remainprimarily liable for any acts or omissions of any of its Affiliates.[Signature Page Follows]48 Source: AGENUS INC, 10-K, March 18, 2019Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results.[******] - Certain confidential information contained in this document, marked by brackets, is filed with the Securities and Exchange Commission pursuantto Rule 24b-2 of the Securities Exchange Act of 1934, as amended. IN WITNESS WHEREOF, and intending to be legally bound hereby, the Parties have caused this LICENSE AGREEMENT to beexecuted by their respective duly authorized officers as of the Execution Date.AGENUS INC.GILEAD SCIENCES, INC. By: /s/ Garo Armen, Ph.D.By: /s/ John G. McHutchison, MDName: Garo Armen, Ph.D.Name: John G. McHutchison, MDTitle: Chairman and CEOTitle: Chief Scientific Officer, Head of R&D [Signature Page to License Agreement] Source: AGENUS INC, 10-K, March 18, 2019Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results.[******] - Certain confidential information contained in this document, marked by brackets, is filed with the Securities and Exchange Commission pursuantto Rule 24b-2 of the Securities Exchange Act of 1934, as amended.Exhibit 10.26 OPTION AND LICENSE AGREEMENT (AGEN1223)by and betweenAGENUS INC.andGILEAD SCIENCES, INC.dated as of December 20, 2018 Source: AGENUS INC, 10-K, March 18, 2019Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results.[******] - Certain confidential information contained in this document, marked by brackets, is filed with the Securities and Exchange Commission pursuantto Rule 24b-2 of the Securities Exchange Act of 1934, as amended.TABLE OF CONTENTSPage ARTICLE 1 DEFINITIONS1ARTICLE 2 OPTION23 2.1General23 2.2Activities Prior to the Option Effective Date23 2.3Data Package24 2.4Option Exercise26 2.5Antitrust Filings26 2.6Option Exercise Closing; Effectiveness26 2.7Gilead Development Plan and Gilead Development Budget27 ARTICLE 3 GOVERNANCE27 3.1Joint Steering Committee27 3.2Sub-Committees28 ARTICLE 4 DEVELOPMENT29 4.1Responsibility29 4.2Gilead Development Plan and Gilead Development Budget29 4.3Development Diligence29 4.4Development Updates Outside of Profit-Share Term29 ARTICLE 5 REGULATORY29 5.1Regulatory Matters29 5.2Regulatory Materials30 5.3Right of Reference; Access to Data30 ARTICLE 6 COMMERCIALIZATION31 6.1General31 6.2Certain Agenus U.S. Co-Commercialization Activities31 ARTICLE 7 MANUFACTURING; PHARMACOVIGILANCE32 7.1General32 7.2Supply Agreement32 7.3Pharmacovigilance32 ARTICLE 8 ASSISTANCE; TRANSITION; UPSTREAM LICENSE AGREEMENTS32 8.1Assistance32 8.2Know-How Transfer33 8.3Licensed Products Inventory Transfer33 8.4Manufacturing Technology Transfer33 8.5Assignment of Agreements34 8.6Upstream License Agreements34 ARTICLE 9 FINANCIAL TERMS34 9.1Upfront Payment34 Source: AGENUS INC, 10-K, March 18, 2019Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results.[******] - Certain confidential information contained in this document, marked by brackets, is filed with the Securities and Exchange Commission pursuantto Rule 24b-2 of the Securities Exchange Act of 1934, as amended.TABLE OF CONTENTS(continued)Page 9.2Option Fee34 9.3Profit-Share35 9.4Development Costs Reconciliation37 9.5Profit (Loss) Reconciliation37 9.6Milestones38 9.7Sales Milestones40 9.8Royalties40 9.9Invoice and Payment of Royalty Payments43 9.10Additional Payment Terms43 9.11Records; Audit Rights44 9.12Upstream License Agreements and Development and Manufacturing Agreements45 9.13Non-Refundable and Non-Creditable Payments45 ARTICLE 10 LICENSES; EXCLUSIVITY45 10.1Licenses to Gilead; Upstream License Agreements45 10.2Subcontracting; Sublicenses46 10.3Rights Retained by the Parties46 10.4No Implied Licenses46 10.5Exclusivity47 ARTICLE 11 INTELLECTUAL PROPERTY47 11.1Inventorship and Ownership47 11.2Prosecution and Maintenance47 11.3Enforcement49 11.4Defense50 11.5Recovery51 11.6Trademarks51 11.7Patent Extensions51 11.8Acknowledgement51 ARTICLE 12 CONFIDENTIALITY52 12.1Nondisclosure52 12.2Exceptions52 12.3Authorized Disclosure53 12.4Terms of this Agreement54 12.5Securities Filings; Disclosure under Applicable Law54 12.6Publicity54 12.7Use of Names55 12.8Clinical Trials Registry55 ARTICLE 13 REPRESENTATIONS AND WARRANTIES; COVENANTS55 13.1Representations and Warranties of Each Party55 13.2Representations and Warranties of Agenus56 13.3Representation and Warranty of Gilead59 13.4Covenants59 13.5Disclaimer60 ii Source: AGENUS INC, 10-K, March 18, 2019Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results.[******] - Certain confidential information contained in this document, marked by brackets, is filed with the Securities and Exchange Commission pursuantto Rule 24b-2 of the Securities Exchange Act of 1934, as amended.TABLE OF CONTENTS(continued)PageARTICLE 14 INDEMNIFICATION; INSURANCE61 14.1Indemnification by Gilead61 14.2Indemnification by Agenus61 14.3Certain Damages62 14.4Procedure62 14.5Insurance63 14.6LIMITATION OF LIABILITY64 ARTICLE 15 TERM AND TERMINATION64 15.1Term; Expiration64 15.2Termination for Material Breach65 15.3Termination at Will66 15.4Termination for Bankruptcy66 15.5Effects of Termination66 15.6[******]69 15.7Surviving Provisions69 ARTICLE 16 MISCELLANEOUS70 16.1Severability70 16.2Notices70 16.3Force Majeure71 16.4Assignment71 16.5Waivers and Modifications71 16.6Choice of Law; Waiver of Jury Trial; Dispute Resolution; Jurisdiction71 16.7Waiver of Jury Trial72 16.8Relationship of the Parties73 16.9Fees and Expenses73 16.10Third Party Beneficiaries73 16.11Entire Agreement73 16.12Counterparts73 16.13Equitable Relief; Cumulative Remedies73 16.14Interpretation74 16.15Further Assurances75 16.16Extension to Affiliates75 SCHEDULES Schedule 1.15:[******]Schedule 1.114:[******]Schedule 1.117:[******]Schedule 6.2:[******]Schedule 10.1.3:[******]Schedule 11.8:[******]Schedule 13.2:[******]Schedule 13.2.15:[******]iii Source: AGENUS INC, 10-K, March 18, 2019Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results.[******] - Certain confidential information contained in this document, marked by brackets, is filed with the Securities and Exchange Commission pursuantto Rule 24b-2 of the Securities Exchange Act of 1934, as amended.TABLE OF CONTENTS(continued)PageSchedule 14.2.4:[******] EXHIBIT Exhibit A:[******]Exhibit B:[******]iv Source: AGENUS INC, 10-K, March 18, 2019Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results.[******] - Certain confidential information contained in this document, marked by brackets, is filed with the Securities and Exchange Commission pursuantto Rule 24b-2 of the Securities Exchange Act of 1934, as amended. OPTION AND LICENSE AGREEMENT(AGEN1223)This OPTION AND LICENSE AGREEMENT (this “Agreement”) is entered into as of December 20, 2018 (the“Execution Date”) by and between Agenus Inc., a Delaware corporation (“Agenus”) and Gilead Sciences, Inc., a Delaware corporation(“Gilead”). Agenus and Gilead are each referred to herein by name or as a “Party” or, collectively, as the “Parties.”RECITALSWHEREAS, Agenus Controls the Agenus IP (each, as defined below);WHEREAS, Gilead wishes to obtain, and Agenus wishes to grant, an option to license the Agenus IP with respect toLicensed Products in the Field in the Territory (each, as defined below) on the terms and conditions set forth in this Agreement;WHEREAS, simultaneously with entering into this Agreement, the Parties are entering into the License Agreement and theOption and License Agreement (AGEN2373) (each, as defined below); andWHEREAS, simultaneously with entering into this Agreement, the Parties are entering into a stock purchase agreement andcertain related agreements, pursuant to which Agenus will issue and Gilead will purchase shares of capital stock of Agenus on the termsand conditions set forth therein (the “Stock Purchase Agreement”).NOW, THEREFORE, in consideration of the foregoing and the mutual agreements set forth below, and for other good andvaluable consideration, the receipt and sufficiency of which are hereby acknowledged, the Parties hereby agree as follows:ARTICLE 1DEFINITIONSUnless specifically set forth to the contrary herein, the following terms shall have the respective meanings set forth below.1.1“Accounting Standards” means U.S. generally accepted accounting principles in effect at the relevant time,consistently applied.1.2“Acquired Person” has the meaning set forth in Section 1.34.1.3[******]1.4“Additional Active” has the meaning set forth in Section 1.39.1.5“Additional Development Costs” has the meaning set forth in Section 9.3.4(a).1.6“Affiliate” means any Person which, directly or indirectly through one (1) or more intermediaries, controls, iscontrolled by, or is under common control with a Party. For purposes of this Section 1.6 only, the term “control” (including, withcorrelative meanings, the terms “controlled by” and “under common control with”) as used with respect to a Person means: (a) director indirect ownership of fifty percent (50%) or more of the voting securities or other voting interest of any Person (including attributionfrom related parties); or (b) the possession, directly or indirectly, of the power to direct, or cause1 Source: AGENUS INC, 10-K, March 18, 2019Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results.[******] - Certain confidential information contained in this document, marked by brackets, is filed with the Securities and Exchange Commission pursuantto Rule 24b-2 of the Securities Exchange Act of 1934, as amended. the direction of, the management and policies of such Person, whether through ownership of voting securities, by contract, as a generalpartner, as a manager, or otherwise.1.7“Agenus” has the meaning set forth in the Preamble.1.8“Agenus Development Costs” has the meaning set forth in Section 9.4.1.9“Agenus Development Plan” means the initial, high-level plan for the Development of the Licensed Antibodiesand the Licensed Products set forth on Exhibit A, as such plan may be amended from time to time in accordance with this Agreement.1.10[******]1.11“Agenus Indemnitees” has the meaning set forth in Section 14.1.1.12“Agenus IP” means the Agenus Patents and the Agenus Know-How. [******].1.13“Agenus Know-How” means any Know-How Controlled by Agenus or any of its Affiliates as of the ExecutionDate or thereafter during the Term which is [******] for the Development, Manufacture, or Commercialization of the LicensedProducts in the Field in the Territory.1.14[******].1.15“Agenus Patents” means, collectively, [******]. Without limiting the foregoing, Schedule 1.15 sets forth acomplete and accurate list of all Agenus Patents as of the Execution Date, which list identifies [******]. Schedule 1.15 shall be updatedas necessary from time to time to reflect the then-current Agenus Patents, [******].1.16[******]1.17“Agreement” has the meaning set forth in the Preamble.1.18“Agreement Payments” has the meaning set forth in Section 9.10.2(a).1.19“ANDA” means an abbreviated new drug application filed pursuant to the requirements of the FDA pursuant to21 C.F.R. Part 314 to obtain regulatory approval for a product in the United States, or the equivalent application or filing in anothercountry (as applicable).1.20“Annual Net Sales” means, on a Licensed Product-by-Licensed Product basis, total Net Sales by Gilead, itsAffiliates, and its Sublicensees in the Territory of such Licensed Product in a particular Calendar Year, calculated in accordance withAccounting Standards.1.21“Antibody” means one or more molecules which comprise or consist of one or more immunoglobulin domains,or fragment(s) thereof, that [******].1.22“Antitrust Filings” has the meaning set forth in Section 2.4.1.23“Antitrust Law” means any federal, state, or foreign statutes, rules, regulations, orders, or decrees that aredesigned to prohibit, restrict, or regulate actions having the purpose or effect of monopolization, lessening of competition, or restraint oftrade, including the HSR Act. 2 Source: AGENUS INC, 10-K, March 18, 2019Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results.[******] - Certain confidential information contained in this document, marked by brackets, is filed with the Securities and Exchange Commission pursuantto Rule 24b-2 of the Securities Exchange Act of 1934, as amended. 1.24“Applicable Law” means all applicable laws, statutes, rules, regulations, treaties (including tax treaties), orders,judgments or ordinances having the effect of law of any national, multinational, federal, state, provincial, county, city, or other politicalsubdivision, including, to the extent applicable, GCP, GLP, and GMP, as well as all applicable data protection and privacy laws, rules,and regulations, including, to the extent applicable, the United States Department of Health and Human Services privacy rules under theHealth Insurance Portability and Accountability Act and the Health Information Technology for Economic and Clinical Health Act andthe EU Data Protection Directive (Council Directive 95/46/EC) and applicable laws implementing the EU Data Protection Directive andthe General Data Protection Regulation (2016/679), the Foreign Corrupt Practices Act of 1977, or any comparable laws in any country,and all export control laws.1.25“Audited Party” has the meaning set forth in Section 9.11.2.1.26“Auditing Party” has the meaning set forth in Section 9.11.2.1.27“Auditor” has the meaning set forth in Section 9.11.2.1.28“Biosimilar Product” means, [******].1.29“Bispecific Antibody” means a molecule, or a covalently linked plurality of molecules, which comprise(s) two(2) different [******], one of which [******] and the other of which [******].1.30“BLA” means a Biologics License Application filed with the FDA in the United States with respect to a LicensedProduct, as defined in Title 21 of the U.S. Code of Federal Regulations, Section 601.2 et seq., or any non-U.S. counterpart of theforegoing.1.31“Business Day” means any day other than: (a) a Saturday or Sunday or any day on which commercial banks inBoston, Massachusetts, and San Francisco, California, are authorized or required by Applicable Law to remain closed; or (b) December26 through December 31.1.32“Calendar Quarter” means each of the three (3) month periods ending March 31, June 30, September 30, andDecember 31; provided, that: (a) the first Calendar Quarter of the Term shall extend from the Effective Date to the end of the firstcomplete such three (3)-month period thereafter; and (b) the final Calendar Quarter of the Term shall end on the last day of the Term.1.33“Calendar Year” means the period beginning on the Effective Date and ending on December 31 of the calendaryear in which the Effective Date falls, and thereafter each successive period of twelve (12) consecutive calendar months beginning onJanuary 1 and ending on December 31; provided, that the final Calendar Year of the Term shall end on the last day of the Term.1.34[******]1.35“Clinical Trial” means any human clinical trial of a pharmaceutical or biological product.1.36“Clinical Trial Criteria” means, [******].1.37“Code” has the meaning set forth in Section 15.4.2.1.38“COGS” means, with respect to the supply of a Profit-Share Product, the product of the Standard Cost ofManufacturing of such Profit-Share Product and the number of units of such Profit-Share Product.3 Source: AGENUS INC, 10-K, March 18, 2019Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results.[******] - Certain confidential information contained in this document, marked by brackets, is filed with the Securities and Exchange Commission pursuantto Rule 24b-2 of the Securities Exchange Act of 1934, as amended. 1.39“Combination Product” means: (a) a product that contains a Licensed Product and one (1) or more [******](each, an “Additional Active”); or (b) a Licensed Product that is co-packaged or combined with one (1) or more Additional Actives,and such Licensed Product and Additional Actives are sold for a single price.1.40“Commercialization” means any and all activities directed to the commercialization of a product, includingmarketing, detailing, promotion, market research, distributing, order processing, handling returns and recalls, booking sales, customerservice, administering, and commercially selling such product, importing, exporting, and transporting such product for commercial sale,and seeking Pricing Approval of a product (if applicable), whether before or after Regulatory Approval has been obtained, as well allregulatory compliance with respect to the foregoing. For clarity, Commercialization does not include: (a) Manufacturing; or (b) anyClinical Trials and other trials commenced after Regulatory Approval. When used as a verb, “Commercialize” means to engage inCommercialization.1.41“Commercialization Budget” means the high-level budget for conducting Commercialization of the LicensedProducts in the U.S. in accordance with the Commercialization Plan [******], in each case, during the Profit-Share Term, as suchbudget may be amended from time to time in accordance with this Agreement.1.42“Commercialization Plan” means the high-level plan for the Commercialization of the Licensed Products in theU.S. [******], in each case, during the Profit-Share Term, as such plan may be amended from time to time in accordance with thisAgreement.1.43“Commercially Reasonable Efforts” means, with respect to [******].1.44“Competing Product” means any product, [******].1.45“Compulsory License” means, with respect to a Licensed Product in a country or territory, a license, or rightsgranted to a Third Party by a governmental agency within such country or territory to sell or offer for sale such Licensed Product insuch country or territory under any Patents or Know-How owned or controlled by either Party or its Affiliates, without direct or indirectauthorization from such Party or its Affiliates.1.46“Compulsory Licensee” means a Third Party granted a Compulsory License.1.47“Confidential Information” means, with respect to a Party, all confidential and proprietary information,including chemical or biological materials, chemical structures, sequence information, commercialization plans, correspondence,customer lists, data, development plans, formulae, improvements, Inventions, Know-How, processes, regulatory filings, reports,strategies, techniques, or other information, in each case, that are disclosed by or on behalf of such Party to the other Party pursuant tothis Agreement, regardless of whether any of the foregoing are marked “confidential” or “proprietary” or communicated to the otherParty by or on behalf of the disclosing Party in oral, written, visual, graphic, or electronic form.1.48“Control,” “Controls,” or “Controlled” means with respect to any Patent, Know-How, other intellectualproperty right, or Confidential Information, the ability of a Party or its Affiliates, as applicable (whether through ownership or license(other than a license granted in this Agreement)) to grant to the other Party the licenses or sublicenses as provided herein, or tootherwise disclose such intellectual property right or Confidential Information to the other Party, without violating the terms of anythen-existing agreement with any Third Party at the time such Party or its Affiliates, as applicable, would be required hereunder to grantthe other Party such license or sublicenses as provided herein or to otherwise4 Source: AGENUS INC, 10-K, March 18, 2019Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results.[******] - Certain confidential information contained in this document, marked by brackets, is filed with the Securities and Exchange Commission pursuantto Rule 24b-2 of the Securities Exchange Act of 1934, as amended. disclose such intellectual property right or Confidential Information to the other Party. Notwithstanding the foregoing, a Party will bedeemed not to Control any Patent, Know-How, other intellectual property right, Confidential Information, compound, or molecule(including any antibody) that is [******] except: [******].1.49“Cover” means, with reference to [******], that the making, using, offering to sell, selling, importing, orexporting of such product would [******].1.50“Cure Period” has the meaning set forth in Section 15.2.1.1.51“Damages” means all losses, costs, claims, damages, judgments, liabilities, and expenses (including reasonableattorneys’ fees and other reasonable out-of-pocket costs in connection therewith).1.52“Data Package” means:1.52.1[******]1.52.2[******]1.53“Data Package Request Notice” has the meaning set forth in Section 2.3.2(a).1.54“Default” means: (a) any material breach, violation, or default; (b) the existence of circumstances or theoccurrence of an event that with the passage of time or the giving of notice or both would constitute a material breach, violation, ordefault; or (c) the existence of circumstances or the occurrence of an event that, with or without the passage of time or the giving ofnotice or both, would give rise to a right of termination, renegotiation, acceleration, or material change of terms.1.55[******]1.56“Detail” means an interactive face-to-face visit by an authorized salesperson or agent (each, a “SalesRepresentative”) with a healthcare provider having prescribing authority and who is within the target audience, during which approveduses, safety, effectiveness, contraindications, side effects, warnings, or other relevant characteristics of a pharmaceutical or biologicalproduct are discussed in an effort to increase prescribing preferences of a pharmaceutical or biological product for its approved uses.Details shall not include: (a) activities conducted by medical support staff; or (b) e-details, activities conducted at conventions or similargatherings, or activities performed by market development specialists, managed care account directors, and other personnel notperforming face-to-face sales calls or not specifically trained with respect to a pharmaceutical or biological product. “Detailing” meansthe act of performing Details.1.57“Development” means: (a) research activities (including drug discovery, identification, or synthesis) with respectto a product; or (b) preclinical and clinical drug development activities and other development activities with respect to a product,including test method development and stability testing, toxicology, formulation, process development, qualification and validation,quality assurance, quality control, Clinical Trials (including Clinical Trials and other trials commenced after Regulatory Approval),statistical analysis and report writing, the preparation and submission of INDs and MAAs, regulatory affairs with respect to theforegoing, and all other activities necessary or useful or otherwise requested or required by a Regulatory Authority or as a condition orin support of obtaining or maintaining a Regulatory Approval. For clarity, “Development” does not include Manufacturing. Whenused as a verb, “Develop” means to engage in Development.5 Source: AGENUS INC, 10-K, March 18, 2019Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results.[******] - Certain confidential information contained in this document, marked by brackets, is filed with the Securities and Exchange Commission pursuantto Rule 24b-2 of the Securities Exchange Act of 1934, as amended. 1.58“Development and Manufacturing Agreement” means any contract or agreement, other than any UpstreamLicense Agreement, between Agenus (or any of its Affiliates, as applicable) and any Third Party which is related to the Development orManufacture of any Licensed Antibody or Licensed Product.1.59“Development Costs” means, with respect to the Profit-Share Product: (a) those FTE Costs and Third PartyExpenses, in each case, [******]; and (b) Other Expenses [******].1.60“Disclosing Party” has the meaning set forth in Section 12.1.1.61“Dispute” has the meaning set forth in Section 16.7.1(a).1.62“Dollars” or “$” means the legal tender of the United States.1.63“Early Exercise Comment Notice” has the meaning set forth in Section 2.3.2(b).1.64“Effective Date” has the meaning set forth in Section 15.1.1.1.65“Electronic Delivery” has the meaning set forth in Section 16.12.1.66“EMA” has the meaning set forth in Section 1.186.1.67“EU” means all countries that are officially recognized as member states of the European Union at any particulartime.1.68“EU Regulatory Approval” means Regulatory Approval [******] of a Licensed Product by EMA or therelevant Regulatory Authority in [******] of the Major European Markets.1.69“Execution Date” has the meaning set forth in the Preamble.1.70“Executive Officers” means: (a) with respect to Agenus, [******] or his/her designee or successor withequivalent responsibilities; and (b) with respect to Gilead, [******] or his/her designee or successor with equivalent responsibilities.1.71“Existing Development and Manufacturing Agreement” means any Development and ManufacturingAgreement in effect as of the Execution Date.1.72“Existing Regulatory Materials” has the meaning set forth in Section 5.2.1.1.73“Existing Upstream License Agreements” has the meaning set forth in Section 1.226.1.74“FDA” has the meaning set forth in Section 1.186.1.75“Field” means any and all uses or purposes, including the treatment, prophylaxis, palliation, diagnosis, orprevention of any human or animal disease, disorder, or condition.1.76“First Commercial Sale” means, on a Licensed Product-by-Licensed Product and country-by-country basis, thefirst sale of such Licensed Product in such country for use or consumption by the general public (following receipt of all RegulatoryApprovals that are required in order to sell such Licensed Product in such country) and for which any of Gilead or its Affiliates orSublicensees has invoiced sales of Licensed Products in the Territory; provided, however, that the following shall not constitute a FirstCommercial Sale: [******].6 Source: AGENUS INC, 10-K, March 18, 2019Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results.[******] - Certain confidential information contained in this document, marked by brackets, is filed with the Securities and Exchange Commission pursuantto Rule 24b-2 of the Securities Exchange Act of 1934, as amended. 1.77[******]1.78“FTE” means the equivalent of a full-time employee’s performance of [******] hours of work time over aCalendar Year [******].1.79“FTE Costs” means an amount equal to the product of the FTE Rate and actual FTEs who performed work underthe Gilead Development Plan or the Commercialization Plan (calculated in accordance with Section 1.78). For clarity, the cost ofactivities of contract personnel shall be charged as Third Party Expenses.1.80“FTE Rate” means a mutually agreed-upon cost (or applicable cost within a schedule of costs) per FTE, whichshall be [******].1.81[******]1.82“GCP” means the applicable then-current ethical and scientific quality standards for designing, conducting,recording, and reporting Clinical Trials as are required by applicable Regulatory Authorities or Applicable Law in the relevantjurisdiction, including, in the United States, Good Clinical Practices established through FDA guidances, and, outside the United States,Guidelines for Good Clinical Practice – ICH Harmonized Tripartite Guideline (ICH E6).1.83“Gilead” has the meaning set forth in the Preamble.1.84“Gilead Development Budget” means the high-level budget for conducting U.S. Development of the LicensedProducts pursuant to the Gilead Development Plan [******], in each case, to the extent during the Profit-Share Term, as such budgetmay be amended from time to time in accordance with this Agreement.1.85“Gilead Development Plan” means (a) the plan for the Development of the Licensed Products [******], in eachcase, during the Profit-Share Term, as such plan may be amended from time to time in accordance with this Agreement, which planshall describe [******], as such plan may be amended from time to time in accordance with this Agreement.1.86“Gilead Indemnitees” has the meaning set forth in Section 14.2.1.87[******]1.88“GLP” means the applicable then-current good laboratory practice standards as are required by applicableRegulatory Authorities or Applicable Law in the relevant jurisdiction, including, in the United States, those promulgated or endorsed bythe FDA in U.S. 21 C.F.R. Part 58, or the equivalent thereof as promulgated or endorsed by the applicable Regulatory Authoritiesoutside of the United States.1.89“GMP” means all applicable then-current good manufacturing practice standards relating for fine chemicals,intermediates, bulk products, or finished pharmaceutical or biological products, as are required by applicable Regulatory Authorities orApplicable Law in the relevant jurisdiction, including, as applicable: (a) all applicable requirements detailed in the FDA’s current GoodManufacturing Practices regulations, U.S. 21 C.F.R. Parts 210 and 211; (b) all applicable requirements detailed in the EMA’s “TheRules Governing Medicinal Products in the European Community, Volume IV, Good Manufacturing Practice for Medicinal Products;”and (c) all Applicable Law promulgated by any Governmental Authority having jurisdiction over the manufacture of the applicablecompound or pharmaceutical or biological product, as applicable.7 Source: AGENUS INC, 10-K, March 18, 2019Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results.[******] - Certain confidential information contained in this document, marked by brackets, is filed with the Securities and Exchange Commission pursuantto Rule 24b-2 of the Securities Exchange Act of 1934, as amended. 1.90“Governmental Authority” means any: (a) federal, state, local, municipal, foreign, or other government; (b)governmental or quasi-governmental authority of any nature (including any agency, board, body, branch, bureau, commission, council,department, entity, governmental division, instrumentality, office, officer, official, organization, representative, subdivision, unit, andany court or other tribunal); (c) multinational governmental organization or body; or (d) entity or body exercising, or entitled toexercise, any executive, legislative, judicial, administrative, regulatory, police, military, or taxing authority or power of any nature.1.91[******]1.92“HSR Act” means the Hart-Scott-Rodino Antitrust Improvements Act of 1976 (15 U.S.C. § 18a).1.93“ICC Rules” has the meaning set forth in Section 16.7.1(b).1.94[******]1.95[******]1.96“IND” means an investigational new drug application (including any amendment or supplement thereto)submitted to the FDA pursuant to U.S. 21 C.F.R. Part 312, including any amendments thereto. References herein to IND shall include,to the extent applicable, any comparable filing(s) outside the U.S. for the investigation of any product in any other country or group ofcountries (such as a Clinical Trial Application in the EU).1.97“IND Acceptance” means, with respect to an IND, the earlier of: (a) receipt by a Party, its Affiliate or aSublicensee of written confirmation from a Regulatory Authority or other applicable Person that Clinical Trials may proceed under suchIND; or (b) expiration of the applicable waiting period after which Clinical Trials may proceed under such IND.1.98“Indemnification Claim Notice” has the meaning set forth in Section 14.4.1.1.99“Indemnitee” has the meaning set forth in Section 14.4.1.1.100“Indemnitor” has the meaning set forth in Section 14.4.1.1.101[******]1.102[******]1.103“Indication” means [******].1.104“Information Request Notice” has the meaning set forth in Section 2.3.1.1.105“Infringement” has the meaning set forth in Section 11.3.1.1.106“Initial Licensed Antibody” has the meaning set forth in Section 1.117(i).1.107“Initial Licensed Product” means the Licensed Product that constitutes, incorporates, comprises, or containsthe Initial Licensed Antibody [******].1.108[******]8 Source: AGENUS INC, 10-K, March 18, 2019Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results.[******] - Certain confidential information contained in this document, marked by brackets, is filed with the Securities and Exchange Commission pursuantto Rule 24b-2 of the Securities Exchange Act of 1934, as amended. 1.109“Invention” means any process, method, composition of matter, article of manufacture, discovery, or findingthat is conceived or reduced to practice.1.110“Joint IP” has the meaning set forth in Section 11.1.1.111“Joint Patents” has the meaning set forth in Section 11.1.1.112“JSC” has the meaning set forth in Section 3.1.1.1.113“Know-How” means algorithms, data, information, Inventions, knowledge, methods (including methods of useor administration or dosing), practices, results, software, techniques, technology, and trade secrets, including analytical and qualitycontrol data, analytical methods (including applicable reference standards), assays, batch records, chemical structures and formulations,compositions of matter, formulae, materials, manufacturing data, pharmacological, toxicological and clinical test data and results,processes, reports, research data, research tools, sequences, standard operating procedures, and techniques, in each case, whetherpatentable or not, and, in each case, tangible manifestations thereof.1.114“Knowledge” means, with respect to Agenus, [******]1.115“License Agreement” means the License Agreement, dated the date hereof, by and between the Parties, withrespect to the antibody known as AGEN1423.1.116“License Agreement Effective Date” means the Effective Date as defined under the License Agreement.1.117“Licensed Antibody” means: (i) the Bispecific Antibody known as AGEN1223 [******] as described in moredetail on Schedule 1.117 (the “Initial Licensed Antibody”) and (ii) any other Bispecific Antibody: [******].1.118[******]1.119“Licensed Product” means [******] product that [******] a Licensed Antibody, [******].1.120“Licensed Product Marks” has the meaning set forth in Section 11.6.1.121[******]1.122[******]1.123“MAA” means a Marketing Authorization Application, BLA, or similar application, as applicable, and allamendments and supplements thereto, submitted to the FDA, EMA, or any equivalent filing in a country or regulatory jurisdiction otherthan the U.S. or EU with the applicable Regulatory Authority, to obtain marketing approval for a pharmaceutical or biological product,in a country or in a group of countries.1.124“Major European Markets” means [******].1.125“Manufacture” means all activities related to the manufacturing of a product or any component or ingredientthereof, including the production, manufacture, processing, filling, finishing, packaging, labeling, shipping, and holding of product orany intermediate thereof, including process9 Source: AGENUS INC, 10-K, March 18, 2019Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results.[******] - Certain confidential information contained in this document, marked by brackets, is filed with the Securities and Exchange Commission pursuantto Rule 24b-2 of the Securities Exchange Act of 1934, as amended. development, process qualification and validation, scale-up, commercial manufacture and analytic development, productcharacterization, stability testing, quality assurance, and quality control.1.126“Manufacturing CMO” means a Third Party designee of Gilead which performs, or will perform,Manufacturing services with respect to any Licensed Product.1.127“Material Amendment” has the meaning set forth in Section 9.3.4(a).1.128“Material Breach” means a breach of this Agreement which [******].1.129“Milestone Event” has the meaning set forth in Section 9.6.1.1.130“Milestone Payment” has the meaning set forth in Section 9.6.1.1.131[******]1.132[******]:1.132.1[******]1.132.2[******]1.132.3[******]1.132.4[******]1.132.5[******]1.132.6[******]1.132.7[******]1.132.8[******]1.133[******]1.134“Operating Expenses” means, with respect to a Profit-Share Product, [******]. Operating Expenses shall bedetermined [******].1.135“Option” has the meaning set forth in Section 2.1.1.136“Option and License Agreements” means, collectively, this Agreement and the Option and License Agreement(AGEN2373).1.137“Option and License Agreement (AGEN2373)” means the Option and License Agreement, dated the datehereof, by and between the Parties, with respect to the antibody known as AGEN2373.1.138“Option Closing Date” has the meaning set forth in Section 2.6.1.1.139“Option Early Exercise Review Period” has the meaning set forth in Section 2.3.2(a).10 Source: AGENUS INC, 10-K, March 18, 2019Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results.[******] - Certain confidential information contained in this document, marked by brackets, is filed with the Securities and Exchange Commission pursuantto Rule 24b-2 of the Securities Exchange Act of 1934, as amended. 1.140“Option Effective Date” has the meaning set forth in Section 2.4.1.141“Option Exercise” has the meaning set forth in Section 2.4.1.142“Option Exercise Date” has the meaning set forth in Section 2.5.1.143“Option Exercise Notice” has the meaning set forth in Section 2.4.1.144“Option Period” means the period of time commencing on the Effective Date and ending upon the earlier of:(a) [******], as such period may be extended pursuant to Section 2.3; and (b) [******].1.145“Ordinary Course Agreement” means [******].1.146“Other Expenses” means, with respect to a Profit-Share Product, the following items, to the extent [******].1.147[******].1.148[******].1.149“Outstanding Profit-Share Costs” has the meaning set forth in Section 9.3.5(c)(3).1.150[******].1.151“Party” has the meaning set forth in the Preamble.1.152“Patent Extensions” has the meaning set forth in Section 11.7.1.153“Patents” means: (a) U.S. patents and patent applications in any country or supranational jurisdictionworldwide; (b) any substitutions, divisionals, continuations, continuations‑in‑part, reissues, renewals, registrations, confirmations, andthe like of any such patents or patent applications; (c) foreign counterparts of any of the foregoing; and (d) any and all extensions orrestorations by existing or future extension or restoration mechanisms, including revalidations, reissues, re-examinations andextensions, including any supplementary protection certificates of any of the foregoing.1.154“Payee” means a Party receiving a payment under this Agreement.1.155“Payor” means a Party owing or making a payment under this Agreement.1.156“Person” means any individual, partnership, joint venture, limited liability company, corporation, firm, trust,association, unincorporated organization, governmental authority or agency, or any other entity not specifically listed herein.1.157“Phase 1 Clinical Trial” means [******].1.158“Phase 1b Clinical Trial” means [******].1.159“Phase 2 Clinical Trial” means [******].1.160[******]1.161[******]11 Source: AGENUS INC, 10-K, March 18, 2019Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results.[******] - Certain confidential information contained in this document, marked by brackets, is filed with the Securities and Exchange Commission pursuantto Rule 24b-2 of the Securities Exchange Act of 1934, as amended. 1.162[******]1.163[******]1.164[******]1.165[******]1.166[******]1.167[******]1.168“Pricing Approval” means any approval, agreement, determination, or decision establishing prices that can becharged to consumers for a pharmaceutical or biological product or that will be reimbursed by Governmental Authorities for apharmaceutical or biological product, in each case, in a country where Governmental Authorities approve or determine pricing forpharmaceutical or biological products for reimbursement or otherwise.1.169“Prior CDA” means that certain mutual confidentiality agreement, by and between Agenus Inc. and Gileaddated [******], as amended by (i) that certain letter agreement dated [******] between Agenus Inc. and Gilead, [******]and (ii) thatcertain letter agreement between Agenus Inc. and Gilead dated [******].1.170“Profit (Loss)” means, with respect to the Profit-Share Product, Net Sales plus Sublicense Revenues, less COGSless Operating Expenses, in each case, solely to the extent incurred with respect to the U.S.1.171“Profit-Share” has the meaning set forth in Section 9.3.1.1.172“Profit-Share Effective Date” means the [******] of the [******] following the [******] in which Agenusdelivers the Profit-Share Option Exercise Notice in accordance with Section 9.3.2.1.173“Profit-Share Opt-Out Effective Date” means the [******] of the [******] following the [******] in whichAgenus delivers the Profit-Share Opt-Out Notice in accordance with Section 9.3.5(a).1.174“Profit-Share Opt-Out Notice” has the meaning set forth in Section 9.3.5(a).1.175“Profit-Share Opt-Out Option” has the meaning set forth in Section 9.3.5(a).1.176“Profit-Share Opt-Out Option Exercise Deadline” has the meaning set forth in Section 9.3.5(a).1.177“Profit-Share Option” has the meaning set forth in Section 9.3.1.1.178“Profit-Share Option Exercise Deadline” has the meaning set forth in Section 9.3.1.1.179“Profit-Share Option Exercise Notice” has the meaning set forth in Section 9.3.2.1.180“Profit-Share Product” means the Initial Licensed Product for which Agenus has exercised the Profit-ShareOption in accordance with Section 9.3.2, but only for so long as the Profit-Share Term for such Initial Licensed Product remains ineffect, after which such Initial Licensed Product shall automatically become a Royalty-Bearing Product.12 Source: AGENUS INC, 10-K, March 18, 2019Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results.[******] - Certain confidential information contained in this document, marked by brackets, is filed with the Securities and Exchange Commission pursuantto Rule 24b-2 of the Securities Exchange Act of 1934, as amended. 1.181“Profit-Share Term” means the period of time commencing on the Profit-Share Effective Date and expiringupon the earliest of: (a) the Profit-Share Opt-Out Effective Date; (b) the Profit-Share Termination Effective Date; and (c) expiration ofthe Royalty Term with respect to the Profit-Share Product in the U.S.1.182“Profit-Share Termination Effective Date” has the meaning set forth in Section 9.3.5(b).1.183“Prosecution and Maintenance” or “Prosecute and Maintain” means, with regard to a Patent, the preparation,filing, prosecution, and maintenance of such Patent, as well as re-examinations, reissues, appeals, and requests for patent termadjustments with respect to such Patent, together with the initiation or defense of interferences, oppositions, inter partes review,derivations, re-examinations, post-grant proceedings, and other similar proceedings [******] with respect to the particular Patent, andany appeals therefrom. For clarification, “Prosecution and Maintenance” or “Prosecute and Maintain” shall not include any otherenforcement actions taken with respect to a Patent.1.184“Receiving Party” shall have the meaning set forth in Section 12.1.1.185“Regulatory Approval” means, all approvals, licenses, and authorizations of the applicable RegulatoryAuthority necessary for the marketing and sale of a pharmaceutical or biological product for a particular Indication in a country orregion (including separate Pricing Approvals, as necessary), and including the approvals by the applicable Regulatory Authority of anyexpansion or modification of the label for such Indication.1.186“Regulatory Authority” means any national or supranational Governmental Authority, including the U.S. Foodand Drug Administration (and any successor entity thereto) (the “FDA”) in the U.S., the European Medicines Agency (and anysuccessor entity thereto) (the “EMA”) in the EU, or any health regulatory authority in any country or region that is a counterpart to theforegoing agencies, in each case, that holds responsibility for development and commercialization of, and the granting of RegulatoryApproval for, a pharmaceutical or biological product in such country or region.1.187[******]1.188“Regulatory Materials” means the regulatory registrations, applications, authorizations, and approvals(including approvals of MAAs, INDs, supplements and amendments, pre- and post-approvals, Pricing Approvals, and labelingapprovals), Regulatory Approvals, and other submissions made to or with any Regulatory Authority, including drug master files, forresearch, development (including the conduct of Clinical Trials), manufacture, or commercialization of a pharmaceutical or biologicalproduct in a regulatory jurisdiction, together with all related correspondence to or from any Regulatory Authority and all documentsreferenced in the complete regulatory chronology for each MAA, IND, and foreign equivalents of any of the foregoing.1.189“Rejection Event” has the meaning set forth in Section 15.4.1.1.190“ROW” means all of the countries in the Territory other than the United States.1.191“Royalty-Bearing Product” means any Licensed Product other than a Profit-Share Product.1.192“Royalty Floor” means [******].13 Source: AGENUS INC, 10-K, March 18, 2019Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results.[******] - Certain confidential information contained in this document, marked by brackets, is filed with the Securities and Exchange Commission pursuantto Rule 24b-2 of the Securities Exchange Act of 1934, as amended. 1.193“Royalty Term” means, on a Licensed Product-by-Licensed Product and country-by-country basis, the periodof time commencing on the First Commercial Sale of any Licensed Product in such country and expiring upon the latest of: [******].1.194“Royalty Territory” means: (a) the Territory, with respect to Royalty-Bearing Products; and (b) the ROW, withrespect to Profit-Share Products.1.195“Sales Milestone Event” has the meaning set forth in Section 9.7.1.1.196“Sales Milestone Payment” has the meaning set forth in Section 9.7.1.1.197“Sales Representative” has the meaning set forth in Section 1.55.1.198“Securities Regulators” has the meaning set forth in Section 12.3.1(a).1.199[******]1.200[******]1.201[******]1.202[******]1.203“Settlement Sublicensee” means a Third Party that is granted a license or sublicense under a settlementagreement between such Third Party and a Party, any of its Affiliates, or any of its or their respective licensees or sublicensees, whichagreement was entered into in connection with an ANDA settlement or similar agreement.1.204“Standard Cost of Manufacturing” means, with respect to the Profit-Share Product for a given Calendar Year,[******].1.205“Stock Purchase Agreement” has the meaning set forth in the Recitals.1.206“Sublicense Revenues” means all amounts received by Gilead from a Sublicensee in consideration for asublicense under the licenses granted to Gilead pursuant to this Agreement to Develop and Commercialize Licensed Products in theU.S., excluding: [******].1.207“Sublicensee” means, with respect to Gilead, a Third Party to whom Gilead has granted a sublicense or license,either directly or indirectly, under the Agenus IP licensed to Gilead by Agenus pursuant to this Agreement, to Develop, Manufacture, orCommercialize the Licensed Products in the Field in the Territory, but excluding: (a) any Third Party acting solely as a distributor; and(b) Agenus and any of its Affiliates.1.208“Supply Agreement” has the meaning set forth in Section 7.2.1.209“Taxes” has the meaning set forth in Section 9.10.2.1.210“Term” has the meaning set forth in Section 15.1.1.1.211“Terminated Licensed Product” means: (a) in the case of the termination of this Agreement with respect to aLicensed Product pursuant to Section 15.2 or Section 15.3, the Licensed Product subject to such termination; (b) in the case of thetermination of this Agreement with respect to a14 Source: AGENUS INC, 10-K, March 18, 2019Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results.[******] - Certain confidential information contained in this document, marked by brackets, is filed with the Securities and Exchange Commission pursuantto Rule 24b-2 of the Securities Exchange Act of 1934, as amended. country pursuant to Section 15.2 or Section 15.3, all Licensed Products in the country subject to such termination; and (c) in the case oftermination of this Agreement in its entirety, all Licensed Products in all countries in the Territory.1.212“Territory” means worldwide.1.213“Third Party” means any Person other than Agenus or Gilead that is not an Affiliate of Agenus or of Gilead.1.214“Third Party Claim” means any and all suits, claims, actions, proceedings, or demands brought by a ThirdParty.1.215“Third Party Expenses” means [******].1.216“Third Party Infringement Claim” has the meaning set forth in Section 11.4.1.1.217“Transferred Inventory” has the meaning set forth in Section 8.3.1.218“Transfer Taxes” has the meaning set forth in Section 9.10.2(a).1.219“Transition Period” has the meaning set forth in Section 8.1.1.220“U.S. Co-Commercialization Agreement” has the meaning set forth in Section 6.2.1.221“U.S. Co-Commercialization Negotiation Period” has the meaning set forth in Section 6.2.1.222“U.S. Co-Commercialization Notice” has the meaning set forth in Section 6.2.1.223“U.S. Co-Commercialization Option” has the meaning set forth in Section 6.2.1.224“U.S. Development” means, with respect to the Profit-Share Product, Development activities intended tosupport the filing of an MAA (including any supplement or amendment thereto) for the Profit-Share Product in the U.S.1.225“United States” or “U.S.” means the United States of America and all of its territories and possessions.1.226“Upstream License Agreement” means any contract or agreement with a Third Party pursuant to whichAgenus in-licenses or otherwise maintains Control of Patents, Know-How, or other intellectual property rights that constitute Agenus IPfor purposes of this Agreement, including such Upstream License Agreements set forth on Schedule 13.2.15 (“Existing UpstreamLicense Agreements”) and any Upstream License Agreements which become such pursuant to Section 8.6.1.227“Valid Claim” means, (a) with respect to a pending application, [******]; and (b) with respect to an issuedPatent, a claim of such patent that has not expired, lapsed, been cancelled, or abandoned, or been dedicated to the public, disclaimed, orheld unenforceable, invalid, revoked, or cancelled by a court or administrative agency of competent jurisdiction in an order or decisionfrom which no appeal has been or can be taken, including through opposition, reexamination, reissue, disclaimer, inter partes review,post grant procedures, or similar proceedings.15 Source: AGENUS INC, 10-K, March 18, 2019Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results.[******] - Certain confidential information contained in this document, marked by brackets, is filed with the Securities and Exchange Commission pursuantto Rule 24b-2 of the Securities Exchange Act of 1934, as amended. 1.228“[******]” means a [******] of a [******] of an [******] and a [******] of an [******] that [******].ARTICLE 2OPTIONGeneral. Agenus hereby grants to Gilead an exclusive option, during the Option Period, to obtain an exclusive license, under theAgenus IP, to Develop, Manufacture, and Commercialize Licensed Products in the Field in the Territory on the terms and conditionsprovided in this Agreement (the “Option”).Activities Prior to the Option Effective Date.2.2.1Development. Prior to the Option Effective Date, Agenus shall be solely responsiblefor the Development (and Manufacture, or having Manufactured, for the purposes thereof) of the Licensed Antibodies and the LicensedProducts; provided, that Agenus shall use Commercially Reasonable Efforts to Develop the Licensed Antibodies and the LicensedProducts and Manufacture or have Manufactured necessary quantities thereof in accordance with: (a) the Agenus Development Plan, asmay be amended from time to time by mutual agreement of the Parties or to the extent required by Applicable Law or any relevantRegulatory Authority; (b) the Clinical Trial Criteria; and (c) the reasonable directions of the JSC. Subject to Section 2.2.5, all suchDevelopment and associated Manufacturing shall be [******]. The Agenus Development Plan shall remain in effect unless and untilamended as provided herein. From the Effective Date until the Option Effective Date, the JSC shall review and discuss potentialamendments to the Agenus Development Plan at least [******]. In addition, the Parties will agree upon an amendment to the AgenusDevelopment Plan in order to ensure that such plan is designed to enable Agenus to, during the Option Period, provide Gilead with theData Package with respect to the first completed Phase 1b Clinical Trial of an Initial Licensed Product which meets the Clinical TrialCriteria.2.2.2Prosecution and Maintenance of Agenus Patents. Prior to the Option Effective Dateand subject to Section 11.2.1, Agenus shall [******] Prosecute and Maintain the Agenus Patents [******].2.2.3Information-Sharing. Prior to the Option Effective Date, at each meeting of the JSC oras otherwise agreed by the Parties, Agenus will provide the JSC with written reports or presentations summarizing its activities withrespect to the Development and associated Manufacture of the Licensed Antibodies and the Licensed Products. Each report orpresentation will cover such activities since the previous JSC meeting, including a summary of results, information, and data generatedand any material developments and activities planned with respect to the Licensed Antibodies or the Licensed Products. Upon requestby the JSC or by Gilead, Agenus will provide the JSC with such other then-existing information and such additional access to recordswith respect to the Licensed Antibodies and the Licensed Products as the JSC or Gilead may reasonably request, including theunderlying information used to support such summaries.2.2.4[******]2.2.5Supply of Licensed Products for Phase 2 Clinical Trial. During the Option Period,Gilead may request, by written notice to Agenus, that Agenus, either itself or through a mutually-acceptable Third Party contractmanufacturer, Manufacture Initial Licensed Product for purposes of a Phase 2 Clinical Trial (as determined in Gilead’s reasonablediscretion) to be conducted following the Option Effective Date. Following such request, and [******], Agenus shall [******], eitheritself or through a mutually-acceptable Third Party contract manufacturer, to Manufacture such supply. Gilead shall reimburse Agenusfor the16 Source: AGENUS INC, 10-K, March 18, 2019Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results.[******] - Certain confidential information contained in this document, marked by brackets, is filed with the Securities and Exchange Commission pursuantto Rule 24b-2 of the Securities Exchange Act of 1934, as amended. [******]. Agenus shall, upon Gilead’s request, promptly terminate, or cause to be terminated, the Manufacture of supply (if any) by aThird Party contract manufacturer pursuant to this Section 2.2.5; provided, that Gilead shall reimburse Agenus for [******]. To theextent Manufacturing under this Section 2.2.5 is performed by Agenus (rather than a Third Party contract manufacturer), the terms onwhich Gilead will purchase such Initial Licensed Products will be [******]. All Initial License Product Manufactured pursuant to thisSection 2.2.5 shall remain in the possession and control of Agenus unless and until the Option Effective Date occurs.2.2.6[******].Data Package.2.3.1Completion of Phase 1b Clinical Trial.(a)Agenus shall provide Gilead with the Data Package with respect to the first completedPhase 1b Clinical Trial of an Initial Licensed Product which meets the Clinical Trial Criteria promptly following the completion of suchPhase 1b Clinical Trial.(b)Within [******] after the Effective Date, Gilead shall [******].(c)Notwithstanding Section 2.3.2(b), from Gilead’s receipt of the Data Package until theexpiration of the Option Period, Gilead may provide Agenus with written notice requesting then-existing additional information withrespect to the Licensed Antibodies or applicable Licensed Products, or a discussion with Agenus representative(s) who have therelevant knowledge and information regarding the Licensed Antibodies or the applicable Licensed Products, reasonably required inorder to understand such Data Package or to evaluate whether to exercise the Option (each, an “Information RequestNotice”). Agenus shall use all reasonable efforts to provide such information or hold such discussion as promptly as practicable but inany event within [******] after receipt of such Information Request Notice. If the Information Request Notice is provided during the[******], to the extent that Agenus has not provided such information in any material respect or has failed to hold such discussionwithin the [******] period, Gilead shall notify Agenus thereof and the Option Period shall be extended by [******].2.3.2Prior to Completion of Phase 1b Clinical Trial.(a)Notwithstanding Section 2.3.1, [******] during the period from the Effective Date untilthe first completed Phase 1b Clinical Trial of an Initial Licensed Product which meets the Clinical Trial Criteria, Gilead may providewritten notice to Agenus requesting a Data Package (each, a “Data Package Request Notice”). Promptly, but in any event within[******]following receipt of such Data Package Request Notice, Agenus shall deliver to Gilead such Data Package. Beginning uponreceipt of the Data Package, Gilead shall have a period of [******] to review the Data Package (as such period may be extended inaccordance with Section 2.3.2(b), the “Option Early Exercise Review Period”).(b)From time to time during the Option Early Exercise Review Period, Gilead may provideAgenus with written notice requesting additional then-existing information with respect to the Licensed Antibodies or the applicableLicensed Products, or a discussion with Agenus representative(s) who have the relevant knowledge and information regarding theLicensed Antibodies or Licensed Products, reasonably required in order to understand such Data Package or to evaluate whether toexercise the Option (each, an “Early Exercise Comment Notice”), and Agenus will provide such information or hold such discussionas promptly as practicable but in any event within [******] after receipt of such Early Exercise Comment Notice. If an Early ExerciseComment Notice is provided during the first [******] of the Option Early Exercise Review Period, to the extent that Agenus has notprovided such information in any material17 Source: AGENUS INC, 10-K, March 18, 2019Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results.[******] - Certain confidential information contained in this document, marked by brackets, is filed with the Securities and Exchange Commission pursuantto Rule 24b-2 of the Securities Exchange Act of 1934, as amended. respect or has failed to hold such discussion within the [******] period, Gilead shall notify Agenus thereof and the Option EarlyExercise Review Period shall be extended by [******].(c)Notwithstanding Section 2.3.2(b), if, following delivery of a Data Package RequestNotice, Gilead has not exercised the Option within the Option Early Exercise Review Period applicable to such Data Package RequestNotice, then Gilead may submit a new Data Package Request Notice, in which case Section 2.3.2(a) shall apply to such new DataPackage Request Notice.Option Exercise. Gilead may exercise the Option (the “Option Exercise”) at any time during the Option Period by providing written noticethereof (the “Option Exercise Notice”) to Agenus. Gilead shall deliver, together the Option Exercise Notice, a notice to Agenus whichidentifies the filings, notices, applications, or other submissions, if any, under Antitrust Law which Gilead determines are necessary oradvisable in connection with the Option Exercise (“Antitrust Filings”) and Agenus shall deliver an updated Schedule 13.2 as of theOption Exercise Date to the extent that Gilead has not received the Data Package as of such date. Gilead’s rights and obligationshereunder in connection with the Option Exercise (including any licenses to be granted in connection therewith) shall become effectiveonly upon the Option Closing Date (the “Option Effective Date”). If no Option Exercise occurs pursuant to Section 2.4 within theOption Period, then Gilead shall have no further rights with respect to Licensed Antibodies and Licensed Products under thisAgreement.Antitrust Filings. As soon as reasonably practicable following date on which Gilead provides the Option Exercise Notice to Agenus in accordance withSection 2.4 (the “Option Exercise Date”) and in any event within [******] thereof, each of Agenus and Gilead shall prepare andsubmit any Antitrust Filings, if any, including any such required filings under the HSR Act and the rules promulgated thereunder, withrespect to the Option Exercise. In connection with any such Antitrust Filings, the Parties shall furnish promptly to the United StatesFederal Trade Commission, the Antitrust Division of the United States Department of Justice, and any other applicable GovernmentalAuthority any additional information requested within their authority under the HSR Act or other Antitrust Law, use reasonable effortsto obtain antitrust clearance for the transactions contemplated hereunder as soon as practicable with respect to the Option Exercise, andotherwise cooperate with each other in the governmental antitrust clearance process. [******] fees in connection with any filings underthis Section 2.5, and [******] attorneys’ fees and other expenses in connection therewith.Option Exercise Closing; Effectiveness. 2.6.1Option Exercise Closing. The closing of the transactions contemplated by this Agreement inconnection with the Option Exercise (including any licenses to be granted in connection therewith) shall take place remotely via theelectronic exchange of documents and signatures as soon as practical, but no later than the [******] following the date on which all ofthe conditions precedent set forth in Section 2.6.2 have been satisfied or waived by the applicable Party (other than Section 2.6.2(c),which can only be satisfied or waived at the closing), or at such other time and place as Agenus and Gilead may agree upon in writing(the “Option Closing Date”).2.6.2Conditions to Option Effectiveness. The obligation of the Parties to consummate the transactionscontemplated by this Agreement in connection with the Option Exercise (including any licenses to be granted in connection therewith)is subject to the satisfaction by each Party of the following conditions, any or all of which may be waived in whole or in part by theother Party in its sole discretion, subject to Applicable Law:(a)the expiration or termination of all applicable waiting period(s) and any other requiredclearances under the Antitrust Filings, if any, including under the HSR Act;18 Source: AGENUS INC, 10-K, March 18, 2019Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results.[******] - Certain confidential information contained in this document, marked by brackets, is filed with the Securities and Exchange Commission pursuantto Rule 24b-2 of the Securities Exchange Act of 1934, as amended. (b)the representations and warranties made by such Party in Sections 13.1 and 13.2 (withrespect to Agenus) and Sections 13.1 and 13.3 (with respect to Gilead) shall be true and correct in all material respects as of the OptionEffective Date, as updated by any updated Schedule 13.2 that Agenus may deliver as of the Option Effective Date and, with respect toAgenus as such Party, Agenus shall have performed and complied in all material respects with the covenants set forth in Section 13.4.2;and(c)the provision by each Party to the other Party of an officer’s certificate certifying thesatisfaction of the condition in Section 2.6.2(b) with respect to such Party.Gilead Development Plan and Gilead Development Budget. Promptly following the Option Effective Date, Gilead shall provide to Agenus the initial Gilead Development Plan, including the initialGilead Development Budget. ARTICLE 3GOVERNANCEJoint Steering Committee.3.1.1Establishment; Responsibilities. Within [******] after the Effective Date, the Partiesshall establish a joint steering committee (the “JSC”) as more fully described in this Section 3.1. The JSC shall serve as a forum tofacilitate communications between the Parties and, to the extent provided in this Section 3.1, shall have review and decision-makingresponsibilities, as well as general oversight of the relevant activities, with respect to: (a) Development (and Manufacture, or havingManufactured, for the purposes thereof) of the Licensed Antibodies and the Licensed Products prior to the Option Effective Date; and(b) the Development and Commercialization of the Profit-Share Product during the Profit-Share Term. In particular, the JSC shall: (i)review and discuss potential amendments to the Agenus Development Plan in accordance with Section 2.2.1; (ii) request, receive, andreview information and access to records with respect to the Licensed Antibodies and the Licensed Products prior to the OptionEffective Date in accordance with Section 2.2.3; (iii) review, discuss, and approve any amendment to the Gilead Development Plan,including the Gilead Development Budget, in accordance with Section 4.2; (iv) adopt and approve the Commercialization Plan(including the Commercialization Budget), including any amendments thereto, in accordance with Section 6.1; and (v) review anddiscuss, from time to time, [******].3.1.2Representatives. The JSC shall be comprised of [******] (or such other number ofrepresentatives as the Parties may mutually agree; provided, that Gilead and Agenus shall at all times have an equal number ofrepresentatives on the JSC) from each of Gilead and Agenus. Each representative of a Party shall have sufficient seniority and expertiseto participate on the JSC as determined in such Party’s reasonable judgment. Gilead shall have the right to designate the chairperson ofthe JSC from among its [******] JSC representatives. Each Party may replace any or all of its representatives on the JSC at any timeupon written notice to the other Party in accordance with Section 16.2. Each Party may, upon receiving the other Party’s prior writtenconsent (not to be unreasonably withheld, conditioned, or delayed), invite non-JSC representatives of such Party and any Third Party toattend meetings of the JSC; provided, that any such non-JSC representative or Third Party is bound by obligations of confidentiality,non-disclosure, and non-use no less restrictive than those set forth in Article 12, and obligations as to ownership of inventions and dataconsistent with those set forth in this Agreement, prior to attending any such meeting. 3.1.3Meetings. The first scheduled meeting of the JSC shall be held no later than [******]after establishment of the JSC unless otherwise agreed by the Parties. After the first scheduled meeting of the JSC until the time atwhich the JSC is disbanded in accordance with Section 3.1.5, the JSC shall meet in person or telephonically at least [******], or moreor less frequently as the Parties agree, on19 Source: AGENUS INC, 10-K, March 18, 2019Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results.[******] - Certain confidential information contained in this document, marked by brackets, is filed with the Securities and Exchange Commission pursuantto Rule 24b-2 of the Securities Exchange Act of 1934, as amended. such dates and at such places and times as provided herein or as the Parties shall agree; provided, that representatives of the JSC shall inany event meet at least [******] per Calendar Year in person. The representatives of the JSC may also convene or be consulted fromtime to time by means of telecommunications, video conferences, electronic mail, or correspondence, as deemed necessary orappropriate. Each Party shall bear all costs and expenses it incurs in regard to participating in all meetings of the JSC, including alltravel and living expenses.3.1.4Minutes. Gilead shall be responsible for preparing and circulating minutes of eachmeeting of the JSC, setting forth, inter alia, an overview of the discussions at the meeting. A draft of such minutes shall be circulatedby Gilead to all representatives of the JSC within [******] after the applicable meeting. Such minutes shall be effective only after suchminutes have been approved by both Parties in writing. Definitive minutes of all JSC meetings shall be approved and finalized no laterthan [******] after the meeting to which the minutes pertain.3.1.5Decisions. Except as otherwise set forth in this Agreement, for matters over which theJSC has decision-making authority, all decisions of the JSC shall be made by consensus, with each Party having one (1)vote. Decisions of the JSC made at a meeting shall be recorded in the definitive minutes for such meeting approved by both Parties asset forth in Section 3.1.4. If the JSC cannot agree on any such matter, then either Party may, by providing written notice to the otherParty, have such matter referred to the Executive Officers for resolution. If the Executive Officers are unable to resolve the matterwithin [******] (or such other longer time frame that the Executive Officers may otherwise agree upon) after the matter is referred tothem in accordance with this Section 3.1.5, then: [******]; provided, that, [******] shall not have the right to: (i) make a decision thatis stated to require the mutual agreement or mutual consent of the Parties; (ii) amend, modify, interpret, or waive the terms of thisAgreement or the U.S. Co-Commercialization Agreement, or otherwise act in contravention of the terms of this Agreement; (iii) resolveany dispute regarding whether a Milestone Event or a Sales Milestone Event set forth herein has been achieved; or (iv) require [******]to perform any act that it reasonably believes to be inconsistent with Applicable Law. 3.1.6Disbandment. The JSC shall remain in effect from the date on which it is established inaccordance with Section 3.1.1 and shall automatically disband on the earlier of: (a) the Profit-Share Option Exercise Deadline, ifAgenus does not exercise the Profit-Share Option in accordance with Section 9.3.2; or (b) the expiration of the Profit-Share Term, ifAgenus exercises the Profit-Share Option in accordance with Section 9.3.2.Sub-Committees. The JSC may, at any time that it deems necessary or appropriate, establish additional joint committees (including, e.g.,[******]) and delegate such of its responsibilities as it determines appropriate to such joint committees. Any such joint committeesshall automatically be disbanded upon the disbandment of the JSC in accordance with Section 3.1.6.ARTICLE 4DEVELOPMENTFrom and after the Option Effective Date: Responsibility. Subject to the terms and conditions of this Agreement, Gilead shall have the sole right (and shall solely control, at itsdiscretion), itself or with or through its Affiliates, Sublicensees, or other Third Parties, to Develop the Licensed Products in the Field inthe Territory. Subject to Section 9.3, all such Development shall be at [******].20 Source: AGENUS INC, 10-K, March 18, 2019Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results.[******] - Certain confidential information contained in this document, marked by brackets, is filed with the Securities and Exchange Commission pursuantto Rule 24b-2 of the Securities Exchange Act of 1934, as amended. Gilead Development Plan and Gilead Development Budget. During the Profit-Share Term: (a) the JSC shall review and discuss potential amendments to the Gilead Development Plan, includingthe Gilead Development Budget, at least [******]; and (b) subject to Section 3.1.5, the JSC shall have the authority to approve anyamendment to the Gilead Development Plan, including the Gilead Development Budget.Development Diligence. [******]Development Updates Outside of Profit-Share Term. From the expiration of the Profit-Share Term, if any, and continuing until the date on which Gilead has submitted an MAAto the applicable Regulatory Authority for [******] Licensed Product [******], Gilead shall submit to Agenus, [******], a writtenreport with respect to the Licensed Products summarizing: [******].ARTICLE 5REGULATORYRegulatory Matters.5.1.1Responsibility.(a)Prior to the Option Effective Date, Agenus shall have the sole right (and shall solely control, at itsdiscretion but subject to JSC input and approval), itself or with or through its Affiliates or other Third Parties to prepare, and submit toapplicable Regulatory Authorities, all Regulatory Materials, for Licensed Products.(b)From and after the Option Effective Date, and subject to the terms and conditions of this Agreement, Gilead shall have the sole right (and shall solely control, at its discretion), itself or with or through its Affiliates, Sublicensees, or otherThird Parties, to: (i) prepare, and submit to applicable Regulatory Authorities, all Regulatory Materials for Licensed Products; and (ii)obtain and maintain all Regulatory Approvals for Licensed Products.5.1.2Communications with Regulatory Authorities. For clarity and without limiting Section5.1.1:(a)Prior to the Option Effective Date, (i) Agenus shall have the exclusive right to correspond orcommunicate with Regulatory Authorities regarding the Licensed Products, (ii) unless required by Applicable Law, Gilead, its Affiliates,and its permitted subcontractors shall not correspond or communicate with Regulatory Authorities regarding any Licensed Productwithout first obtaining Agenus’ prior written consent, and (iii) if Gilead, its Affiliates, or its permitted subcontractors receive anycorrespondence or other communication from a Regulatory Authority regarding a Licensed Product, Gilead shall provide Agenus withaccess to or copies of all such material written or electronic correspondence promptly after its receipt.(b)From and after the Option Effective Date, (i) Gilead shall have the exclusive right to correspond orcommunicate with Regulatory Authorities regarding the Licensed Products, (ii) unless required by Applicable Law, Agenus, itsAffiliates, and its permitted subcontractors shall not correspond or communicate with Regulatory Authorities regarding any LicensedProduct without first obtaining Gilead’s prior written consent, and (iii) if Agenus, its Affiliates, or its permitted subcontractors receiveany correspondence or other communication from a Regulatory Authority regarding a Licensed Product, Agenus shall provide Gileadwith access to or copies of all such material written or electronic correspondence promptly after its receipt.21 Source: AGENUS INC, 10-K, March 18, 2019Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results.[******] - Certain confidential information contained in this document, marked by brackets, is filed with the Securities and Exchange Commission pursuantto Rule 24b-2 of the Securities Exchange Act of 1934, as amended. 5.1.3Agenus Support. From and after the Option Effective Date, Agenus shall [******] tosupport Gilead as may be reasonably requested by Gilead from time to time in connection with Gilead’s preparation, submission toRegulatory Authorities and maintenance of Regulatory Materials for Licensed Products, including, upon Gilead’s reasonable request,attending meetings with Regulatory Authorities regarding any Licensed Product.Regulatory Materials.5.2.1Pre-Option Exercise Regulatory Materials. Agenus shall solely own any and allRegulatory Materials for the Licensed Products made, generated or filed prior to the Option Effective Date (the “Existing RegulatoryMaterials”). Except to the extent notified otherwise in writing by Gilead, after the Option Effective Date, Agenus shall assign andtransfer (and hereby does assign and transfer), or cause to be assigned and transferred to the extent not owned by Agenus, to Gilead (orits designee), no later than [******] after the Option Effective Date any and all Existing Regulatory Materials, including providing true,accurate, and complete hard or electronic copies thereof to Gilead. From and after such assignment and transfer, Gilead (or its designee)shall have the sole right, in its sole discretion, to file, maintain, and hold title to all Existing Regulatory Materials.5.2.2New Regulatory Materials. All Regulatory Materials generated or arising from or inconnection with activities under this Agreement after the Option Effective Date with respect to Licensed Products shall be owned byand held in the name of Gilead or its designee, and, except for Existing Regulatory Materials (which are addressed in Section 5.2.1),and any such Regulatory Materials issued in the name of Agenus, its Affiliates or contractors shall promptly following the OptionEffective Date be assigned by Agenus to Gilead or its designee to the extent permitted by Applicable Law or, in the event assignment isnot permitted under Applicable Law, held in trust for, or for the sole benefit of, Gilead or its designee.Right of Reference; Access to Data.5.3.1From and after the Option Effective Date and prior to the time at which RegulatoryMaterials are transferred and assigned to Gilead or its designee, or in the event of failure to transfer and assign any Regulatory Materialsto Gilead or its designee, as required by Section 5.2.1 or Section 5.2.2, Gilead and its designees shall have, and Agenus (on behalf ofitself and its Affiliates) hereby grants to Gilead and its designees, access and a right of reference (without any further action required onthe part of Agenus, its Affiliates or contractors, whose authorization to file this consent with any Regulatory Authority is herebygranted) to all such Regulatory Materials and all data contained or referenced therein for Gilead and its designees to exercise its rightsand perform its obligations under this Agreement with respect to Licensed Products. In all cases, from and after the Option EffectiveDate, Gilead and its designees shall have access to all data contained or referenced in all such Regulatory Materials, and Agenus shallensure that Gilead and its designees are afforded such access.5.3.2Upon transfer and assignment of the Existing Regulatory Materials and the datacontained or referenced therein to Gilead or its designee in accordance with Section 5.2.1, Gilead shall grant and hereby grants toAgenus and its designees a right of reference (without any further action required on the part of Gilead, its Affiliates or contractors,whose authorization to file this right of reference with any Regulatory Authority is hereby granted) to any INDs transferred andassigned to Gilead as an Existing Regulatory Material and all data contained or referenced therein, solely for Agenus and its designeesto Develop and seek and maintain Regulatory Approvals of [******].22 Source: AGENUS INC, 10-K, March 18, 2019Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results.[******] - Certain confidential information contained in this document, marked by brackets, is filed with the Securities and Exchange Commission pursuantto Rule 24b-2 of the Securities Exchange Act of 1934, as amended. ARTICLE 6COMMERCIALIZATIONGeneral. Subject to the terms and conditions of this Agreement, from and after the Option Effective Date, Gilead shall have, subjectto Section 6.2, the sole right (and shall solely control, at its discretion), itself or with or through its Affiliates, Sublicensees, or otherThird Parties, to Commercialize the Licensed Products in the Field in the Territory. Subject to Section 9.3, all such Commercializationshall be at [******]. During the Profit-Share Term, such Commercialization activities in the U.S. shall be conducted in accordance withthe Commercialization Plan and the Commercialization Budget, which shall be adopted and approved (including any amendmentsthereto), from time to time by the JSC.Certain Agenus U.S. Co-Commercialization Activities. If Agenus exercises the Profit-Share Option, it shall have the option (the “U.S. Co-Commercialization Option”), exercisable byproviding written notice to Gilead (the “U.S. Co-Commercialization Notice”) in the Profit-Share Option Exercise Notice, to performcertain Commercialization-related activities with respect to the Profit-Share Product in the United States as set forth in Schedule 6.2. IfAgenus does not exercise the U.S. Co-Commercialization Option in accordance with this Section 6.2, then such option will be deemedirrevocably waived. If Agenus exercises the U.S. Co-Commercialization Option, the Parties shall negotiate in good-faith for up to[******] Gilead’s receipt of the U.S. Co-Commercialization Notice (the “U.S. Co-Commercialization Negotiation Period”) the termsof a definitive agreement addressing such activities, which agreement will include the terms set forth in Schedule 6.2 (the “U.S. Co-Commercialization Agreement”) and such other mutually agreed terms and conditions as are customary for agreements of such typewhich are consistent with the terms and conditions of this Agreement, including Schedule 6.2. The U.S. Co-CommercializationAgreement shall include: [******].ARTICLE 7MANUFACTURING; PHARMACOVIGILANCEGeneral.7.1.1Subject to the terms and conditions of this Agreement, prior to the Option EffectiveDate, Agenus shall have the sole right (and shall solely control, at its discretion), itself or with or through its Affiliates, Sublicensees, orother Third Parties, to Manufacture the Licensed Products in the Field in the Territory. Subject to Section 2.2.5, prior to the OptionEffective Date, all such Manufacturing shall be [******].7.1.2Subject to the terms and conditions of this Agreement, from and after the OptionEffective Date, Gilead shall have the sole right (and shall solely control, at its discretion), itself or with or through its Affiliates,Sublicensees, or other Third Parties, to Manufacture the Licensed Products in the Field in the Territory. Subject to Section 9.3, from andafter the Option Effective Date, all such Manufacturing shall be [******].Supply Agreement. At the election of Gilead exercisable by written notice to Agenus within [******] of the Option Effective Date, and subjectto any manufacturing capacity constraints that Agenus may have at the time of such request, the Parties shall conduct good-faithdiscussions regarding the terms of a supply agreement (and a corresponding quality agreement with customary terms and conditions)pursuant to which Agenus would supply the Licensed Products to Gilead for its Clinical Trials (the “Supply Agreement”). [******]. Inaddition, the Supply Agreement shall otherwise include mutually agreed terms as are customary for agreements of such type.23 Source: AGENUS INC, 10-K, March 18, 2019Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results.[******] - Certain confidential information contained in this document, marked by brackets, is filed with the Securities and Exchange Commission pursuantto Rule 24b-2 of the Securities Exchange Act of 1934, as amended. Pharmacovigilance. No later than [******], the Parties shall enter into a pharmacovigilance agreement in customary form in order to, amongother things, coordinate safety matters and share of safety information with respect to the Licensed Products.ARTICLE 8ASSISTANCE; TRANSITION; UPSTREAM LICENSE AGREEMENTSAssistance. From and after the Option Effective Date, Agenus shall, and shall cause its Affiliates to, cooperate with Gilead and itsdesignees and provide reasonable assistance to Gilead and its designees to transition Development and Manufacturing activities withrespect to Initial Licensed Products to Gilead and its designees to the extent reasonably requested by Gilead, including by: (a) providingGilead and its designees reasonable assistance with respect to Development, regulatory, and Manufacturing transition matters related tothe Initial Licensed Products; and (b) providing Gilead and its designees with reasonable access by teleconference or in‑person (asrequested by Gilead) to Agenus personnel (and personnel of its Affiliates and Third Party contractors) involved in Development,regulatory, or Manufacturing matters related to the Initial Licensed Products to assist with the transition and answer questions related tothe Initial Licensed Products. Agenus shall provide the assistance described in this Article 8, with qualified personnel and at Gilead’sreasonable request, [******] (the “Transition Period”); provided, that Agenus shall, and shall cause its Affiliates to, complete theactivities assigned to, or otherwise contemplated to be completed by, Agenus under the Tech Transfer Plan which have not beencompleted as of the expiration of the Transition Period, and shall cooperate in good faith with Gilead and its designees and providereasonable assistance to Gilead and its designees after expiration of the Transition Period to address any issues arising out of or notaddressed by the transition activities contemplated by this Section 8.1, which issues are materially and adversely impacting Gilead’sability to assume responsibility for the Development and Manufacture of the Initial Licensed Products in accordance with thisAgreement.Know-How Transfer. Without limiting the provisions of Section 8.1, as soon as reasonably practicable following the Option Exercise Date (but inno event later than [******] following the Option Exercise Date), the Parties shall agree on and commence performance of a plan (the“Tech Transfer Plan”), pursuant to which Agenus shall promptly, following the Option Effective Date and the Tech Transfer Plan’sagreement and execution, disclose to Gilead and its designees in English, including by providing hard or electronic copies thereof,[******].Licensed Products Inventory Transfer. Without limiting the provisions of Section 8.1, upon Gilead’s written request and at no additional cost to Gilead, Agenusshall promptly following the Option Effective Date assign and transfer to Gilead or its designee and deliver to Gilead or its designee, ata location to be specified by Gilead, the inventory of the Licensed Products held at such time by or on behalf of Agenus or its Affiliates(including any such inventory held at any contract manufacturer or any other location) (the “Transferred Inventory”), along with allapplicable manufacturing, GMP and shelf-life information in accordance with the Tech Transfer Plan.Manufacturing Technology Transfer. Without limiting the other provisions of Article 8, as soon as reasonably practicable following the Option Effective Date (butin no event later than as required under the Tech Transfer Plan), Agenus shall transfer, and thereafter continue, during the TransitionPeriod as may be reasonably requested by Gilead from time to time, the transfer (from Agenus, its Affiliates, or its Third Party contractmanufacturers) to Gilead and its designees copies in English (in writing or in an electronic format) of [******] as of the OptionEffective Date that is [******] to the Manufacture of the Licensed Products, in order to enable Gilead and its designees to Manufacturethe Licensed Products, including, if desired by Gilead, to replicate the process employed by or on behalf of Agenus prior to the OptionEffective Date to Manufacture the Licensed Products. Such transfers shall be in accordance with the Tech Transfer Plan in which theParties have identified [******] required for Manufacture, or [******]24 Source: AGENUS INC, 10-K, March 18, 2019Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results.[******] - Certain confidential information contained in this document, marked by brackets, is filed with the Securities and Exchange Commission pursuantto Rule 24b-2 of the Securities Exchange Act of 1934, as amended. for the Development and Manufacture of the Licensed Products; provided, that, if Gilead reasonably believes that any materials whichare not identified in the Tech Transfer Plan are [******] for the Manufacture, or are [******] for the Development or Manufacture, ofthe Licensed Products (but excluding [******]), then Agenus shall cooperate in good faith with Gilead to provide such materials toGilead. In addition, at the reasonable request of Gilead from time to time, Agenus shall make its employees and consultants (includingpersonnel of its Affiliates and Third Party contract manufacturers) available to Gilead and its designees to provide reasonableconsultation and technical assistance in order to ensure an orderly transition of the Manufacturing technology and operations to Gileadand its designees and to assist Gilead and its designees in the Manufacture of the Licensed Products. [******].Assignment of Agreements. After the Option Effective Date, Agenus shall, or shall cause its Affiliates to, as applicable, to the extent legally permissible(provided, that, to the extent consent is required from the relevant counterparty, Agenus shall, or shall cause its Affiliates to, asapplicable, [******]): (a) assign to Gilead or its designee any or all (as designated by Gilead) Development and ManufacturingAgreements; or (b) assist Gilead or its Affiliate in entering into new agreements directly with the counterparties to any or allDevelopment and Manufacturing Agreements to cover the subject matter of such Development and Manufacturing Agreements, asapplicable, in each case ((a) and (b)), to the extent requested by Gilead in writing. If any Development and Manufacturing Agreementis assigned to Gilead, Agenus shall be solely responsible for, and shall indemnify and hold harmless Gilead and all other GileadIndemnitees from and against any costs and other Damages arising from, or relating to, any such Development and ManufacturingAgreement as a result of, or in connection with, events or occurrences prior to the date of such assignment (including any payments thataccrued prior to the date of such assignment but which do not become payable until after the date of such assignment).Upstream License Agreements. In the event that after the Option Effective Date Agenus enters into a contract or agreement with a Third Party pursuant towhich Agenus in-licenses or otherwise acquires Control of any Patents, Know-How, or other intellectual property rights that wouldconstitute Agenus IP for purposes of this Agreement, then Agenus shall promptly provide Gilead with notice and a copy of theapplicable license or other contract or agreement with the Third Party. Within [******] following receipt of such notice, Gilead shalldecide, in its sole discretion, whether or not to accept such Patents, Know-How, or other intellectual property as Agenus IP licensedunder this Agreement and provide Agenus written notice of such decision. In the event of acceptance, such Patents, Know-How, orother intellectual property shall constitute Agenus IP licensed to Gilead under this Agreement, such agreement shall thereafter beincluded within the definition of Upstream License Agreements, and [******] shall be responsible for any payments arising thereunder[******] (provided, that, [******]). In the event that Gilead does not accept such Third Party agreement as an Upstream LicenseAgreement (including by failing to respond within such [******] period), Gilead and its Affiliates shall have no obligations withrespect to such Third Party agreement and such Patents, Know-How or other intellectual property shall not constitute Agenus IPlicensed to Gilead hereunder.ARTICLE 9FINANCIAL TERMSUpfront Payment. No later than [******] after the Effective Date, Gilead shall pay to Agenus a one (1)-time, non-refundable, and non-creditable payment of [******] in immediately available funds by wire transfer, in accordance with wire instructions to be provided inwriting by Agenus to Gilead on or before the Effective Date.Option Fee. No later than [******] after the Option Effective Date, Gilead shall pay to Agenus a one (1)-time, non-refundable, and non-creditable payment of [******] in immediately available25 Source: AGENUS INC, 10-K, March 18, 2019Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results.[******] - Certain confidential information contained in this document, marked by brackets, is filed with the Securities and Exchange Commission pursuantto Rule 24b-2 of the Securities Exchange Act of 1934, as amended. funds by wire transfer, in accordance with wire instructions to be provided in writing by Agenus to Gilead no later than [******] afterthe Option Effective Date.Profit-Share.9.3.1General; Limitation. From and after the Option Effective Date, Agenus shall have theoption, exercisable by written notice provided to Gilead in accordance with Section 9.3.2 at any time until [******] following the laterof: (a) the Option Effective Date; and (b) [******] (such end date, the “Profit-Share Option Exercise Deadline” and such option, the“Profit-Share Option”), to share in Development Costs and Profit (Loss) (the “Profit-Share”) with respect to the Profit-Share Productin the U.S. Agenus may only exercise one (1) Profit-Share Option under this Agreement and the Option and License Agreement(AGEN2373). Once Agenus exercises the Profit-Share Option under one (1) of the Option and License Agreements, Agenus’s right toexercise the Profit-Share Option under the other Option and License Agreement shall irrevocably terminate. In addition, if Agenusexercises its Profit-Share Option under this Agreement, then from and after Agenus’ delivery of the Profit-Share Opt-Out Notice inaccordance with Section 9.3.5(a) or Gilead’s delivery of the Profit-Share termination notice in accordance with Section 9.3.5(b), asapplicable, Agenus’ right to exercise the Profit-Share Option under the Option and License Agreement (AGEN2373) shall irrevocablyterminate. [******].9.3.2Exercise. In the event that Agenus wishes to exercise the Profit-Share Option, it shalldeliver written notice to Gilead of its election (the “Profit-Share Option Exercise Notice”) no later than the Profit-Share OptionExercise Deadline. If Agenus does not deliver the Profit-Share Option Exercise Notice in accordance with this Section 9.3.2, thenAgenus’s right to exercise the Profit-Share Option will be deemed irrevocably waived.9.3.3Effects of Exercise. If the Profit-Share Option is exercised, then, during the Profit-Share Term:(a)The Parties shall share responsibility for Development Costs as follows: (i) Gilead shall bear [******]percent ([******]%) of such Development Costs; and (ii) Agenus shall bear [******] percent ([******]%) of such DevelopmentCosts;(b)The Parties shall share Profit (Loss) as follows: (i) Gilead shall bear (and be entitled to)[******] percent ([******]%) of Profit (Loss); and (ii) Agenus shall bear (and be entitled to) [******] percent ([******]%) of Profit(Loss); and(c)Agenus shall be entitled to receive Milestone Payments, Sales Milestone Payments, androyalty payments with respect to such Profit-Share Product in accordance with Section 9.6, Section 9.7, and Section 9.8.9.3.4Deferred Development Costs.(a)In the event that, during the Profit-Share Term and prior to the date on which an MAA for the first Profit-Share Product is submitted in the United States, the Gilead Development Budget is amended in accordance with Section 4.2 such thatthe amount of Development Costs for which Agenus is responsible pursuant to Section 9.3.3(a) pursuant to the Gilead DevelopmentBudget in effect immediately following such amendment exceeds [******] percent ([******]%) of the amount of Development Costsfor which Agenus was responsible pursuant to the Gilead Development Budget in effect immediately prior to such amendment (eachsuch amendment, a “Material Amendment” and such amount of excess Development Costs, “Additional Development Costs”), then[******].26 Source: AGENUS INC, 10-K, March 18, 2019Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results.[******] - Certain confidential information contained in this document, marked by brackets, is filed with the Securities and Exchange Commission pursuantto Rule 24b-2 of the Securities Exchange Act of 1934, as amended. (b)Gilead shall have the right, in its sole discretion, to deduct all [******].(c)[******].9.3.5Agenus Opt-Out; Gilead Termination.(a)Agenus-Opt-Out. In the event that Agenus has exercised the Profit-Share Option inaccordance with Section 9.3.2, it shall have the one (1)-time option to elect to irrevocably opt-out of the Profit-Share (the “Profit-ShareOpt-Out Option”) in accordance with this Section 9.3.5(a). The Profit-Share Opt-Out Option shall be exercisable by Agenus at anytime from [******] until [******] (the “Profit-Share Opt-Out Option Exercise Deadline”). In the event that Agenus wishes toexercise the Profit-Share Opt-Out Option, it shall deliver written notice to Gilead of its election (the “Profit-Share Opt-Out Notice”) nolater than the Profit-Share Opt-Out Option Exercise Deadline. If Agenus does not deliver the Profit-Share Opt-Out Notice in accordancewith this Section 9.3.5(a), then Agenus’s right to exercise the Profit-Share Opt-Out Option will be deemed irrevocably waived.(b)Gilead Termination. Gilead may terminate the Profit-Share in accordance with thisSection 9.3.5(b) if, at any time during the Profit-Share Term, Agenus fails to reimburse Gilead for its share of Agenus DevelopmentCosts or Profit (Loss) in accordance with Section 9.4 or Section 9.5.3, as applicable; provided, that Agenus has not cured such failurewithin [******] after the date on which Gilead provides written notice to Agenus of such failure, which notice shall describe suchfailure in reasonable detail and shall state Gilead’s intention to terminate the Profit-Share. Any such termination of the Profit-Shareunder this Section 9.3.5(b) shall become effective at the end of the [******] period (the “Profit-Share Termination Effective Date”),unless Agenus has cured such failure prior to the expiration of such [******] period.(c)Effects of Agenus Opt-Out or Gilead Termination. From and after the Profit-Share Opt-Out EffectiveDate or the Profit-Share Termination Effective Date, as applicable, with respect to a Profit-Share Product:(1)The Profit-Share shall no longer be in effect;(2)Any Milestone Payments or Sales Milestone Payments, in each case, that would have becomedue and payable during the Profit-Share Term with respect to the Profit-Share Product if such Profit-Share Product were a Royalty-Bearing Product will be deemed irrevocably waived;(3)The U.S. Co-Commercialization Agreement (if then in effect) shall terminate in accordancewith its terms; and(4)Gilead shall promptly invoice Agenus for any Agenus Development Costs or Profit (Loss)incurred prior to the Profit-Share Opt-Out Effective Date or Profit-Share Termination Effective Date (as applicable) which have not beenreimbursed by Agenus to Gilead in accordance with Section 9.4 or Section 9.5.3, as applicable (the “Outstanding Profit-ShareCosts”), and Agenus will reimburse Gilead for the Outstanding Profit-Share Costs within [******] of receipt of such invoice; provided,that if Agenus fails to reimburse Gilead for the Outstanding Profit-Share Costs within such [******] period, then Gilead shall have theright, in its sole discretion, to deduct [******] any Outstanding Profit-Share Costs which have not been reimbursed by Agenus from[******]. For clarity, any liabilities or obligations of Agenus, including its obligation to pay a portion of Agenus Development Costs inaccordance with Section 9.3.3(a) or a portion of Profit (Loss) in accordance with Section 9.3.3(b), which have accrued prior to theProfit-Share Opt-Out Effective Date or the Profit-Share Termination Effective27 Source: AGENUS INC, 10-K, March 18, 2019Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results.[******] - Certain confidential information contained in this document, marked by brackets, is filed with the Securities and Exchange Commission pursuantto Rule 24b-2 of the Securities Exchange Act of 1934, as amended. Date, as applicable, shall survive the exercise of the Profit-Share Opt-Out Option or the Profit-Share Termination Effective Date, asapplicable.(5)If, as of the Profit-Share Termination Effective Date, any [******] have not been offset byGilead in accordance with Section 9.3.4(b), such [******] shall become due and payable no later than [******].Development Costs Reconciliation. Within [******] following the last day of each [******] during the Profit-Share Term, Gilead will provide to Agenus:(a) an expense report detailing all Development Costs incurred for the Profit-Share Product during such [******]; and (b) an invoice forthe portion of such Development Costs payable by Agenus under Section 9.3.3(a) (the “Agenus Development Costs”) for such[******]. Agenus will reimburse Gilead for its share of such Agenus Development Costs for such [******] within [******] of receiptof each such invoice.Profit (Loss) Reconciliation.9.5.1During the Profit-Share Term, following the First Commercial Sale of the Profit-ShareProduct, Agenus shall furnish to Gilead a written report for each [******] showing the Operating Expenses incurred by Agenus withrespect to the U.S. during the reporting [******]. Such reports shall be due no later than [******] following the end of each [******].9.5.2Gilead shall furnish to Agenus a written report for each [******] showing the amountand calculation of the Profit (Loss) payable under this Agreement for such [******] in sufficient detail to allow Agenus to verify theamount of Profit (Loss) paid by Gilead with respect to such [******] Quarter, including the total gross amount invoiced for the Profit-Share Product sold in the U.S., the Net Sales of the Profit-Share Product in the U.S., COGS with respect to the Profit-Share Product forthe U.S., and the Operating Expenses incurred by each of Gilead and Agenus with respect to the U.S. Such reports shall be due no laterthan [******] following the end of each [******].9.5.3Gilead shall perform a reconciliation, as may be further detailed in the U.S. Co-Commercialization Agreement, to ensure that each Party bears and receives its share of Profit (Loss) as set forth in Section 9.3.3(b).Profit (Loss) shown to have accrued by each report provided under Section 9.5.2 and, subject to prompt resolution of any good faithdispute as to the accuracy of such reconciliation, Gilead’s reconciliation shall be due and payable within [******] of the date suchreport is due. If the Profit (Loss) for a [******] is negative, Gilead shall submit an invoice to Agenus for its share of such Profit (Loss).Agenus shall pay such invoice within [******] of receipt.9.5.4The terms of this Agreement which are relevant for the purposes of determining andallocating Development Costs and Profit (Loss), including the applicable defined terms in Article 1 and payment and reconciliationmechanisms, may be amended in Gilead’s reasonable discretion during the U.S. Co-Commercialization Negotiation Period solely toensure that such terms comply with Accounting Standards then in effect; provided, that: (a) Gilead provides any such proposedamendments to Agenus [******]; and (b) such proposed amendments [******].Milestones.9.6.1Milestones. Subject to the terms of this Section 9.6.1, Section 9.6.2, and Section9.10.1, Gilead shall pay the applicable amount set forth in the table below in this Section 9.6.1 associated with each milestone eventdescribed below (each event, a “Milestone Event” and each payment, a “Milestone Payment”) with respect to the first (and only thefirst) Royalty-Bearing Product or Profit-Share Product, as applicable, to achieve such Milestone Event under this Agreement:28 Source: AGENUS INC, 10-K, March 18, 2019Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results.[******] - Certain confidential information contained in this document, marked by brackets, is filed with the Securities and Exchange Commission pursuantto Rule 24b-2 of the Securities Exchange Act of 1934, as amended. Development Milestone EventDevelopmentMilestone Payment –Royalty-BearingProductDevelopmentMilestone Payment– Profit-ShareProduct(a)[******][******][******](b)[******][******][******](c)[******][******][******](d)[******][******][******]Regulatory Milestone EventRegulatory MilestonePayment – Royalty-Bearing ProductRegulatoryMilestone Payment– Profit-ShareProduct(e)[******][******][******](f)[******][******][******](g)[******][******][******] Each Milestone Payment shall be non-refundable, non-creditable, and payable a maximum of one (1) time as set forth in thetable above, regardless of the number of Royalty-Bearing Products or Profit-Share Products, as applicable, which achieve the applicableMilestone Event (i.e., a maximum of [******] Milestone Payments may be made pursuant to this Section 9.6.1 with respect to Royalty-Bearing Products and a maximum of [******] Milestone Payments may be made pursuant to this Section 9.6.1 with respect to Profit-Share Products), and no Milestone Payment shall be due hereunder for subsequent or repeated achievement of any such MilestoneEvent, including where Milestone Event is first achieved by a Royalty-Bearing Product and is subsequently achieved by a Profit-ShareProduct (and vice versa). Subject to Section 9.3.5(c)(2), upon the achievement of any Milestone Event listed in Section [******] above, any of theMilestone Event(s) listed in such Sections: (i) which are listed earlier in the table above than the achieved Milestone Event; and (ii) forwhich the applicable Milestone Payment(s) has not been previously paid, shall become due and payable together with the MilestonePayment due in connection with such achieved Milestone Event; provided, that if the achieved Milestone Event is the Milestone Eventlisted in Section [******] above, the Milestone Payment due in connection with the achievement of the Milestone Event listed inSection [******] shall not become due and payable together with the Milestone Payment due in connection with such achievedMilestone Event. If the Milestone Event listed in Section [******] above is achieved prior to the achievement of the Milestone Eventlisted in Section [******] above, then the Milestone Payment corresponding to the Milestone Event listed in Section [******] aboveshall become due and payable together with the Milestone Payment due in connection with the achievement of the Milestone Eventlisted in Section [******] above.Further, if a [******] for a [******] does not constitute a [******] at the time of its [******], then subject to the otherterms of this Section 9.6.1, such [******] shall be deemed a [******] and the Milestone Event listed in Section [******] or Section[******], as applicable, for such Indication shall be deemed achieved (to the extent not previously achieved) on the [******] for such[******].For the avoidance of doubt, the maximum amount payable by Gilead pursuant to this Section 9.6.1 is [******] (with respectto Royalty-Bearing Products) or [******] (with respect to Profit-Share Products), as applicable, assuming that each Milestone Event inthis Section 9.6.1 were achieved, but in no event shall the aggregate Milestone Payment due in connection with this Section 9.6.1exceed [******].29 Source: AGENUS INC, 10-K, March 18, 2019Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results.[******] - Certain confidential information contained in this document, marked by brackets, is filed with the Securities and Exchange Commission pursuantto Rule 24b-2 of the Securities Exchange Act of 1934, as amended. 9.6.2Invoice and Payment of Milestone Payments.(a)In the event that Gilead, its Affiliates, or its Sublicensees under this Agreement achievesa Milestone Event, it shall notify Agenus thereof within [******] of such achievement. Following Agenus’s receipt of notice fromGilead that Gilead has achieved a Milestone Event, Agenus shall invoice Gilead for the applicable Milestone Payment, and Gilead shallpay such Milestone Payment within [******] after receipt of such invoice.(b)In the event that Agenus or its Affiliates achieves a Milestone Event, Agenus shall notifyGilead thereof within [******] of such achievement and invoice Gilead for the applicable Milestone Payment, and Gilead, subject toprompt resolution of any good faith dispute as to whether such Milestone Event has been achieved, shall pay such Milestone Paymentwithin [******] after receipt of such invoice.Sales Milestones.9.7.1Sales Milestones. Subject to the terms of this Section 9.7.1 and Section 9.10.2(b),Gilead shall notify Agenus within [******] after the end of the [******] during which a given milestone event described below in thisSection 9.7.1 (each, a “Sales Milestone Event”) was first achieved by Gilead under this Agreement, and Gilead shall thereafter pay theapplicable amounts set forth below associated with the applicable Sales Milestone Event in accordance with Section 9.7.2 (each, a“Sales Milestone Payment”):Sales Milestone EventSales Milestone Payment(a)[******][******](b)[******][******](c)[******][******](d)[******][******]Each Sales Milestone Payment shall be non-refundable, non-creditable, and payable a maximum of one (1) time as set forthin the table above, regardless of the number of times the applicable Sales Milestone Event was achieved (i.e., a maximum of [******]Sales Milestone Payments may be made pursuant to this Section 9.7.1), and no Sales Milestone Payment shall be due hereunder forsubsequent or repeated achievement of any such Sales Milestone Event. Upon achievement of any Sales Milestone Event listed in[******] above, any previously listed Sales Milestone Event for which the applicable Milestone Payment has not been paid shall be duetogether with the Milestone Payment due in connection with such achieved Sales Milestone Event. For the avoidance of doubt, themaximum amount payable by Gilead pursuant to this Section 9.7.1 is [******], assuming that each Sales Milestone Event in thisSection 9.7.1 were achieved. [******].9.7.2Invoice and Payment of Sales Milestone Payments. Following Agenus’s receipt ofnotice from Gilead that Gilead has achieved a Sales Milestone Event, Agenus shall invoice Gilead for the applicable Sales MilestonePayment, and Gilead shall pay such Sales Milestone Payment within [******] after receipt of the invoice therefor.Royalties.9.8.1Royalty Rates. Subject to the terms of this Section 9.8.1 and Section 9.10.2(b), Gileadshall pay Agenus royalties on Annual Net Sales in the Royalty Territory, on a Licensed Product-by-Licensed Product basis, during theapplicable Royalty Term, equal to the following portions of Annual Net Sales of the applicable Licensed Product multiplied by theapplicable royalty rate set forth below for such portion of Annual Net Sales in the Royalty Territory during the applicable Royalty Termfor each such30 Source: AGENUS INC, 10-K, March 18, 2019Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results.[******] - Certain confidential information contained in this document, marked by brackets, is filed with the Securities and Exchange Commission pursuantto Rule 24b-2 of the Securities Exchange Act of 1934, as amended. Licensed Product. For clarity, the royalties (and royalty tiers) shall be calculated separately on a Licensed Product-by-Licensed Productbasis.Portion of Annual Net Sales in the Royalty Territory for a given LicensedProduct in a given Calendar YearRoyalty Ratei.[******][******]ii.[******][******]iii.[******][******]iv.[******][******]The applicable royalty rate set forth in the table above shall apply only to that portion of the Annual Net Sales in the RoyaltyTerritory of a given Licensed Product during a given Calendar Year that falls within the indicated range. [******].9.8.2Royalty Term. Gilead’s royalty obligations to Agenus under Section 9.8.1 shall apply,on a Licensed Product-by-Licensed Product and country-by-country basis, only during the applicable Royalty Term for such LicensedProduct in such country. Following the expiration of the applicable Royalty Term for a given Licensed Product in a given country: (a)no further royalties shall be payable with respect to sales of such Licensed Product in such country; and (b) the license granted toGilead under this Agreement with respect to such Licensed Product in such country shall become fully paid-up, perpetual, irrevocable,and royalty-free in accordance with Section 15.1.2(b)(1).9.8.3Royalty Reductions.(a)[******](b)[******]9.8.4Offset for Third Party Payments.(a)[******](b)[******]9.8.5Royalty Floor.(a)[******](b)[******](c)[******](d)[******]Invoice and Payment of Royalty Payments. Starting on the date of First Commercial Sale of a Licensed Product in the Territory, Gilead shall furnish to Agenus a[******] written report for each subsequent [******] showing the Net Sales of all Licensed Products and the royalty payments due toAgenus on such sales. Each such royalty report shall be due within [******] after the end of the relevant [******]. Each royaltyreport shall describe [******]. Within [******] following the delivery of the applicable [******] report, Agenus shall invoice Gileadfor the royalties due to Agenus with respect to Net31 Source: AGENUS INC, 10-K, March 18, 2019Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results.[******] - Certain confidential information contained in this document, marked by brackets, is filed with the Securities and Exchange Commission pursuantto Rule 24b-2 of the Securities Exchange Act of 1934, as amended. Sales for such [******] as set forth in such royalty report and Gilead shall pay such amounts to Agenus within [******] followingGilead’s receipt of such invoice.Additional Payment Terms.9.10.1Currency. All payments hereunder shall be made in Dollars by wire transfer to a bankdesignated in writing by the Payee no later than [******] prior to the date by which the applicable payment must be made. Conversionof sales recorded in local currencies to Dollars shall be performed in compliance with Accounting Standards and the Payor’s normalpractices used to prepare its audited financial statements.9.10.2Taxes; Withholding.(a)Generally. Except as set forth in this Section 9.10.2, the Payee shall be liable for allincome and other taxes (including interest) (“Taxes”) imposed upon any payments made by the Payor to Payee under this Agreement(“Agreement Payments”). The amounts set forth herein are exclusive of all applicable sales or use, goods and services, value added,consumption or other similar fees or taxes (“Transfer Taxes”) arising on the Agreement Payments, and the Payor shall be responsiblefor and pay any such Transfer Taxes imposed on it with respect to the Agreement Payments due to the Payee hereunder.(b)Tax Withholding. If Applicable Law requires the withholding of Taxes, the Payor shallsubtract the amount thereof from the Agreement Payments and remit such withheld amount to the relevant Governmental Authority in atimely manner; provided, however, that before making such withholding, the Payor shall use reasonable efforts to give the Payee noticeof the intention to make such withholding. For the avoidance of doubt, Payor’s remittance of such withheld Taxes, together withpayment to the Payee of the remaining Agreement Payments, shall constitute Payor’s full satisfaction of Agreement Payments under thisAgreement. The Payor shall promptly (as available) submit to the Payee appropriate proof of payment of the withheld Taxes as well asthe official receipts within a reasonable period of time. The Payor shall provide the Payee reasonable assistance in establishingentitlement to a reduction to, or elimination of, such withholding of Taxes under Applicable Law, including under the benefit of anypresent or future treaty against double taxation, and the Payor shall provide the Payee with reasonable assistance in seeking refund ofsuch withheld Taxes. Notwithstanding the foregoing, if, as a result of Payor (i) assigning this Agreement, (ii) extending its rights orobligations pursuant to Section 16.16, or (iii) changing its domicile, additional Taxes become due that would not have otherwise beendue hereunder with respect to Agreement Payments, Payor shall be responsible for all such additional withholding Taxes and shall payPayee such amounts as are necessary to ensure that Payee receives the same amount as it would have received had no such assignmentor change in domicile been made. [******].(c)Tax Cooperation. The Parties shall cooperate with respect to all documentation requiredby any taxing authority or reasonably requested by either Party to secure a reduction in the rate of applicable withholding taxes.Records; Audit Rights.Records. Each Party shall keep complete, true, and accurate books and records in accordance with its AccountingStandards in relation to this Agreement, including with respect to Gilead, its Affiliates, and cause its Sublicensees, in relation to NetSales, royalties, Milestone Payments, Sales Milestone Payments, Development Costs, and Profit (Loss). Each Party shall keep suchbooks and records for at least [******] following the Calendar Year to which they pertain or for such longer period of time as requiredunder any Applicable Law.9.11.2Audit Rights. Subject to the other terms of this Section 9.11.2, during the Term, at therequest of a Party (the “Auditing Party”), which shall not be made more frequently than [******] per32 Source: AGENUS INC, 10-K, March 18, 2019Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results.[******] - Certain confidential information contained in this document, marked by brackets, is filed with the Securities and Exchange Commission pursuantto Rule 24b-2 of the Securities Exchange Act of 1934, as amended. [******], upon at least [******] prior written notice from the Auditing Party, and at the expense of the Auditing Party, the other Party(the “Audited Party”) shall permit an independent, nationally-recognized certified public accountant selected by the Auditing Party andreasonably acceptable to the Audited Party (the “Auditor”) to inspect, during regular business hours, the relevant records required to bemaintained by the Audited Party under Section 9.11.1 or otherwise reasonably necessary to verify the accuracy of royalty reports forsuch Calendar Year; provided, that such audit right shall not apply to records beyond [******] from the end of the Calendar Year towhich they pertain [******]. Prior to its inspection, the Auditor shall enter into a confidentiality agreement with both Parties havingobligations of confidentiality and non-use no less restrictive than those set forth in Article 12 and limiting the disclosure and use of suchinformation by such accountant to authorized representatives of the Parties and the purposes germane to Section 9.11.1. The Auditorshall report to the Auditing Party only whether the particular amounts being audited were accurate and, if not, the amount of anydiscrepancy, and the Auditor shall not report any other information to the Auditing Party. The Auditing Party shall treat the results ofany the Auditor’s review of the Audited Party’s records as Confidential Information of the Audited Party subject to the terms of Article12. In the event such audit leads to the discovery of a discrepancy to the Auditing Party’s detriment, the Audited Party shall, within[******] after receipt of such report from the Auditor, pay any undisputed amount of the discrepancy. The Auditing Party shall paythe Auditor’s full cost of the audit unless the underpayment of amounts due the Auditing Party is more than [******], in which case theAudited Party shall pay the reasonable cost charged by the Auditor for such review. Any undisputed overpayments by Gilead orAgenus, as applicable, revealed by an examination shall be paid by the applicable Party within [******] of its receipt of the applicablereport. [******].9.11.3[******]Upstream License Agreements and Development and Manufacturing Agreements. Notwithstanding anything to the contrary under this Agreement, but subject to Section 8.5 and Section 8.6, Agenus shall besolely responsible for all costs and payments of any kind (including all upfront fees, annual payments, milestone payments, and royaltypayments) arising under any agreements between Agenus (or any of its Affiliates) and any Third Party, including under: (a) anyExisting Upstream License Agreements and any other Upstream License Agreements, unless and until (in the case of such otherUpstream License Agreements) such agreements have been accepted by Gilead pursuant to Section 8.6; and (b) any Development andManufacturing Agreements, unless and until such agreements have been assigned to Gilead pursuant to Section 8.5, as applicable.9.13[******] ARTICLE 10LICENSES; EXCLUSIVITYLicenses to Gilead; Upstream License Agreements.10.1.1Licenses to Gilead.(a)Licensed Products. Effective as of the Option Effective Date and subject to the terms and conditions ofthis Agreement, Agenus hereby grants to Gilead a royalty-bearing, exclusive, transferrable (solely pursuant to Section 16.4), andsublicenseable (through multiple tiers) license, under the Agenus IP, to Develop, Manufacture, and Commercialize the LicensedProducts in the Field in the Territory.33 Source: AGENUS INC, 10-K, March 18, 2019Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results.[******] - Certain confidential information contained in this document, marked by brackets, is filed with the Securities and Exchange Commission pursuantto Rule 24b-2 of the Securities Exchange Act of 1934, as amended. (b)[******]10.1.2Exclusion. For the avoidance of doubt, Agenus does not grant to Gilead pursuant tothis Agreement any license under or rights to any intellectual property rights Controlled by Agenus or its Affiliates to Develop,Manufacture or Commercialize any product that [******].10.1.3Upstream License Agreements. To the extent that the licenses granted by Agenus toGilead under the Agenus IP pursuant to Section 10.1.1 constitute (a) the grant of a sublicense to Gilead of certain Agenus IP that is notowned by Agenus or any of its Affiliates, but that is in-licensed by Agenus or any such Affiliate from a Third Party licensor pursuant toan Upstream License Agreement or (b) the license of certain Agenus IP that is otherwise encumbered by obligations that would bebinding on Gilead by their terms, then Gilead shall comply, and shall cause its Affiliates and Sublicensees to comply, with the specificobligations applicable to sublicensees under such Upstream License Agreement(s) [******].Subcontracting; Sublicenses.Subcontracting. Gilead may subcontract to Affiliates or Third Parties the performance of tasks and obligations related to Gilead’sDevelopment, Manufacture, and Commercialization of the Licensed Products under this Agreement as Gilead deems appropriate, whichsubcontract may include a sublicense of Agenus IP rights necessary for the performance of the subcontract as reasonably required.Sublicenses. Gilead shall provide Agenus with [******] of each agreement with a Third Party Sublicensee (other than any agreementwith a Third Party subcontractor entered into in the ordinary course of business) within [******] after the execution thereof; provided,that Gilead may [******]. Each sublicense shall require the applicable Sublicensee to comply with applicable terms and conditions ofthis Agreement. Gilead shall remain liable for any action or failure to act by any Sublicensee or Affiliate if such action or failure to actwould have constituted a breach of this Agreement if committed by Gilead. Rights Retained by the Parties. Each Party retains all rights under Patents, Know-How, or other intellectual property rights Controlled by such Party whichare not expressly granted to the other Party pursuant to this Agreement. Notwithstanding the foregoing, after the Option Effective Date,[******] may [******].No Implied Licenses. Except as otherwise expressly provided in this Agreement, under no circumstances shall a Party or any of its Affiliates, as aresult of this Agreement, obtain any ownership interest, license, or other right in or to any Patents, Know-How, or other intellectualproperty rights of the other Party, including tangible or intangible items owned, controlled, or developed by the other Party, or providedby the other Party to the receiving Party at any time, in each case, pursuant to this Agreement.Exclusivity. 10.5.1General. Subject to Section 10.5.2, [******], Agenus shall not, and shall cause itsAffiliates not to, [******].10.5.2[******]34 Source: AGENUS INC, 10-K, March 18, 2019Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results.[******] - Certain confidential information contained in this document, marked by brackets, is filed with the Securities and Exchange Commission pursuantto Rule 24b-2 of the Securities Exchange Act of 1934, as amended. ARTICLE 11INTELLECTUAL PROPERTYInventorship and Ownership. The determination of inventorship under this Agreement shall be made in accordance with U.S. patent laws. As betweenthe Parties, all Inventions made or created solely by a Party’s or any of its Affiliates’ employees, independent contractors, orconsultants, in the course of conducting activities under this Agreement, together with all intellectual property rights therein, shall beowned by such Party. All Inventions made or created jointly by each Party’s (or any of its Affiliates’) employees, independentcontractors, or consultants, in the course of conducting activities under this Agreement, together with all Patents therein (“JointPatents”), shall be jointly owned by the Parties (“Joint IP”). Joint IP shall be owned jointly by Gilead and Agenus on the basis of anequal, undivided interest [******] and shall be deemed to be Controlled by each Party, subject to the licenses granted under thisAgreement. Notwithstanding anything to the contrary herein, each Party shall have the right to use such Joint IP, or license such JointIP to its Affiliates or any Third Party, or sell or otherwise transfer its interest in such Joint IP to its Affiliates or a Third Party, in eachcase, without the consent of the other Party, so long as such use, sale, license, or transfer is subject to the licenses granted pursuant tothis Agreement and is otherwise consistent with this Agreement.Prosecution and Maintenance..11.2.1Pre-Option Effective Date. Prior to the Option Effective Date, subject to Section2.2.2, [******] shall [******] at its [******]. [******] shall [******]. [******] shall [******] with a [******], and shall [******]consistent with this Agreement [******].11.2.2Post-Option Effective Date. On and after the Option Effective Date:(a)[******](1)[******](2)[******](b)[******](1)[******](2)[******]11.2.3Cooperation. Each Party hereby agrees to reasonably cooperate with one another with respect to theProsecution and Maintenance of the Agenus Patents for which such Party is responsible pursuant to this Agreement, including by: (a)making its employees, and using reasonable efforts to make its licensees, sublicensees, independent contractors, agents and consultants,reasonably available to the other Party (or to the other Party’s authorized attorneys, agents or representatives), to the extent reasonablynecessary to enable such Party to undertake Prosecution and Maintenance of Patents as contemplated by this Agreement; and (b)endeavoring in good faith to coordinate its efforts with the other Party [******].35 Source: AGENUS INC, 10-K, March 18, 2019Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results.[******] - Certain confidential information contained in this document, marked by brackets, is filed with the Securities and Exchange Commission pursuantto Rule 24b-2 of the Securities Exchange Act of 1934, as amended. 11.2.4[******]. Agenus shall, to the extent [******], use reasonable efforts, by means of[******], as reasonably determined based on [******].Enforcement.11.3.1Notice. Each Party shall promptly notify the other Party of any infringement by aThird Party of any Agenus Patent in the Territory of which it becomes aware, including any declaratory judgment, opposition, or similaraction alleging the invalidity, unenforceability, or non-infringement with respect to such Agenus Patent (“Infringement”). Withoutlimiting the foregoing, Gilead shall deliver to Agenus any certification that Gilead receives pursuant to 42 U.S.C. § 262(l) or suchsimilar laws as may exist in jurisdictions other than the United States (a “Biosimilar Notice”) with respect to a Licensed Product within[******] after receipt thereof.11.3.2Pre-Option Effective Date. Prior to the Option Effective Date, [******] shall have[******], but not [******], to [******] in connection with [******]. [******]shall have the right to [******].11.3.3Post-Option Effective Date. On and after the Option Effective Date:(a)[******](b)[******](1)[******](2)[******](3)[******]Defense.11.4.1Notice. Each Party shall promptly notify the other Party of any claim alleging that theDevelopment, Manufacture, or Commercialization of the Licensed Products in the Territory infringes, misappropriates, or otherwiseviolates any Patents, Know-How, or other intellectual property rights of any Third Party (“Third Party Infringement Claim”). In anysuch instance, the Parties shall as soon as practicable thereafter discuss in good faith the best response to such notice of such ThirdParty Infringement Claim.11.4.2Pre-Option Effective Date. Prior to the Option Effective Date, [******] shall havethe [******]; provided, that, [******]. [******] shall have the right to [******].11.4.3Post-Option Effective Date. On and after the Option Effective Date, [******] shallhave the [******]; provided, that, [******].Recovery.11.5.1Any recovery received as a result of any action under Section 11.3.3(a) or Section 11.4.3, asapplicable, shall be allocated in the following order: [******].11.5.2Any recovery received as a result of any action under Section 11.3.2, Section 11.3.3(b), or Section11.4.2, as applicable, shall be allocated in the following order: [******].36 Source: AGENUS INC, 10-K, March 18, 2019Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results.[******] - Certain confidential information contained in this document, marked by brackets, is filed with the Securities and Exchange Commission pursuantto Rule 24b-2 of the Securities Exchange Act of 1934, as amended. Trademarks. [******] shall have the right, but not the obligation, to brand the Licensed Products using trademarks and trade names[******] for the Licensed Products, which may vary within the Territory (the “Licensed Product Marks”). [******] and shall[******].Patent Extensions. [******] shall: (a) with respect to requests [******]; and (b) with respect to all other requests, [******], in each case,patent term restoration (including under the Drug Price Competition and Patent Term Restoration Act), supplemental protectioncertificates or their equivalents, and patent term extensions consistent with this Agreement (collectively, “Patent Extensions”) withrespect to the Agenus Patents, where applicable, [******]. If requested by [******] or in the event that [******], [******] shall[******] to [******] for such Patent Extensions [******], and [******] shall [******].11.8[******] 11.9[******] ARTICLE 12CONFIDENTIALITYNondisclosure. Each Party agrees that a Party (the “Receiving Party”) which receives the Confidential Information of the other Party (the“Disclosing Party”) pursuant to this Agreement shall: (a) maintain in confidence such Confidential Information using not less than theefforts that such Receiving Party uses to maintain in confidence its own proprietary information of similar kind and value, but in noevent less than a reasonable degree of efforts; (b) not disclose such Confidential Information to any Third Party without first obtainingthe prior written consent of the Disclosing Party, except for disclosures expressly permitted pursuant to this Article 12; and (c) not usesuch Confidential Information for any purpose except those permitted under this Agreement, including, in the case of Gilead, theexercise of the rights and licenses granted to Gilead hereunder. The obligations of confidentiality, non-disclosure, and non-use underthis Section 12.1 shall be in full force and effect from the Execution Date until [******] following the expiration of the Term. TheReceiving Party shall return all copies of or destroy the Confidential Information of the Disclosing Party disclosed or transferred to it bythe Disclosing Party pursuant to this Agreement, within [******] after the expiration or termination of this Agreement; provided,however, that a Party may retain: (i) Confidential Information of the Disclosing Party to exercise rights and licenses which expresslysurvive such termination or expiration pursuant to this Agreement; and (ii) one (1) copy of all other Confidential Information inarchives solely for the purpose of establishing the contents thereof. In addition, [******] shall keep confidential, and shall cause itsAffiliates and its and their employees, consultants, licensees, sublicensees, professional advisors, and Affiliates to keep confidential,[******] to the extent [******] on confidentiality terms at least as protective as the confidentiality provisions of this Agreement[******].Exceptions.12.2.1General. Section 12.1 shall not apply with respect to any portion of the ConfidentialInformation of the Disclosing Party to the extent that such Confidential Information:(a)was known to the Receiving Party or any of its Affiliates, as evidenced by writtenrecords, without any obligation to keep it confidential or any restriction on its use, prior to disclosure by the Disclosing Party;37 Source: AGENUS INC, 10-K, March 18, 2019Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results.[******] - Certain confidential information contained in this document, marked by brackets, is filed with the Securities and Exchange Commission pursuantto Rule 24b-2 of the Securities Exchange Act of 1934, as amended. (b)is subsequently disclosed to the Receiving Party or any of its Affiliates by a Third Partylawfully in possession thereof and without any obligation to keep it confidential or any restriction on its use;(c)is published by a Third Party or otherwise becomes publicly available or enters the publicdomain, either before or after it is disclosed to the Receiving Party, without any breach by the Receiving Party of its obligationshereunder; or(d)is independently developed by or for the Receiving Party or any of its Affiliates, asevidenced by written records, without reference to or reliance upon the Disclosing Party’s Confidential Information.Any combination of features or disclosures shall not be deemed to fall within the foregoing exclusions merely because individualfeatures are published or available to the general public or in the rightful possession of the Receiving Party unless the combination itselfand principle of operation are published or available to the general public or in the rightful possession of the Receiving Party.Authorized Disclosure.12.3.1Disclosure. Notwithstanding Section 12.1, the Receiving Party may discloseConfidential Information belonging to the Disclosing Party in the following instances:(a)subject to Section 12.5, to comply with Applicable Law (including the rules andregulations of the U.S. Securities and Exchange Commission or any national securities exchange in any jurisdiction in the Territory)(collectively, the “Securities Regulators”) or with judicial process (including prosecution or defense of litigation) if, in the reasonableopinion of the Receiving Party’s counsel, such disclosure is necessary for such compliance or for such judicial process (includingprosecution or defense of litigation);(b)disclosure to governmental or other regulatory agencies in order to obtain Patents, toobtain or maintain approval to conduct Clinical Trials, or to market the Licensed Products under this Agreement, in each case, inaccordance with this Agreement; provided, that reasonable steps are taken to ensure confidential treatment of such ConfidentialInformation to the extent available;(c)disclosure to any of its officers, employees, consultants, agents, or Affiliates, and: (i) inthe case of [******], any [******], (ii) in the case of [******], [******], any [******], and (iii) in the case of either Party, to suchParty’s actual or potential acquirers, investors, or lenders as part of their due diligence investigations; provided, that, prior to any suchdisclosure, each such disclosee is bound by written obligations of confidentiality, non-disclosure, and non-use no less restrictive thanthe obligations set forth in this Article 12 to maintain the confidentiality thereof and not to use such Confidential Information except asexpressly permitted by this Agreement; provided, however, that, in each of the above situations in this Section 12.3.1(c), the ReceivingParty shall remain responsible for any failure by any Person who receives Confidential Information from such Receiving Party pursuantto this Section 12.3.1(c) to treat such Confidential Information as required under this Article 12; and(d)disclosure to its advisors (including attorneys and accountants) in connection withactivities under this Agreement; provided, that, prior to any such disclosure, each such disclosee is bound by written obligations ofconfidentiality, non-disclosure, and non-use no less restrictive than the obligations set forth in this Article 12 (provided, however, thatin the case of legal advisors, no written agreement shall be required), to maintain the confidentiality thereof and not to use suchConfidential Information except as expressly permitted by this Agreement; provided, however, that, in each of the above situations inthis38 Source: AGENUS INC, 10-K, March 18, 2019Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results.[******] - Certain confidential information contained in this document, marked by brackets, is filed with the Securities and Exchange Commission pursuantto Rule 24b-2 of the Securities Exchange Act of 1934, as amended. Section 12.3.1(d), the Receiving Party shall remain responsible for any failure by any Person who receives Confidential Informationfrom such Receiving Party pursuant to this Section 12.3.1(d) to treat such Confidential Information as required under this Article 12.12.3.2Terms of Disclosure. If and whenever any Confidential Information is disclosed inaccordance with this Section 12.3, such disclosure shall not cause any such information to cease to be Confidential Information, exceptto the extent that such disclosure results in a public disclosure of such information other than by breach of this Agreement.Terms of this Agreement. The Parties agree that this Agreement and the terms hereof shall be deemed to be Confidential Information of both Agenusand Gilead, and each Party agrees not to disclose this Agreement or any terms hereof without obtaining the prior written consent of theother Party; provided, that each Party may disclose this Agreement or any terms hereof in accordance with the provisions of Section12.3 or Section 12.5, as applicable.Securities Filings; Disclosure under Applicable Law. Each Party acknowledges and agrees that the other Party may submit this Agreement to, or file this Agreement with, theSecurities Regulators or to other Persons as may be required by Applicable Law, and if a Party submits this Agreement to, or files thisAgreement with, any Securities Regulator or other Person as may be required by Applicable Law, such Party agrees to consult with theother Party with respect to the preparation and submission of a confidential treatment request for this Agreement. Notwithstanding theforegoing, if a Party is required by any Securities Regulator or other Person as may be required by Applicable Law to make a disclosureof the terms of this Agreement in a filing or other submission as required by such Securities Regulator or such other Person, and suchParty has: (a) provided copies of the disclosure to the other Party reasonably in advance under the circumstances of such filing or otherdisclosure; (b) promptly notified the other Party in writing of such requirement and any respective timing constraints; and (c) given theother Party reasonable time under the circumstances from the date of provision of copies of such disclosure to comment upon andrequest confidential treatment for such disclosure, then such Party shall have the right to make such disclosure at the time and in themanner reasonably determined by its counsel to be required by the Securities Regulator or the other Person. Notwithstanding theforegoing, if a Party seeks to make a disclosure as required by a Securities Regulator or other Person as may be required by ApplicableLaw as set forth in this Section 12.5 and the other Party provides comments in accordance with this Section 12.5, the Party seeking tomake such disclosure or its counsel, as the case may be, shall use good-faith efforts to incorporate such comments.Publicity.12.6.1Subject to Section 12.3, Section 12.5, and this Section 12.6.1, [******]; provided,that [******]. The contents of any press release, publication, or other public statement that has been reviewed and approved by[******] may be re-released by [******] without first obtaining [******] prior written consent in accordance with this Section 12.6.1.12.6.2[******]; provided, that, subject to Sections 12.3 and 12.5, any such [******].[******] shall use [******]. If [******] shall first [******], subject to and in accordance with Section 12.3 and Section 12.5, asapplicable.12.6.3Notwithstanding the foregoing Sections 12.6.1 and 12.6.2, the Parties shall mutuallyagree to a press release or public announcement regarding this Agreement and the terms hereof, such press release or publicannouncement to be issued promptly (but in no event later than [******]) after the Execution Date, or as otherwise agreed by theParties. Either Party shall be authorized to use the information disclosed in any mutually approved press release or publicannouncement without the need to seek further consent or approval thereof from the other Party.39 Source: AGENUS INC, 10-K, March 18, 2019Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results.[******] - Certain confidential information contained in this document, marked by brackets, is filed with the Securities and Exchange Commission pursuantto Rule 24b-2 of the Securities Exchange Act of 1934, as amended. Use of Names. Except as otherwise expressly set forth herein, neither Party (or any of its respective Affiliates) shall use the name,trademark, trade name, or logo of the other Party or any of its Affiliates, or its or their respective employees, in any publicity,promotion, news release, or other public disclosure relating to this Agreement or its subject matter, without first obtaining the priorwritten consent of the other Party; provided, that such consent shall not be required to the extent use thereof may be required byApplicable Law, including the rules of any securities exchange or market on which a Party’s or its Affiliate’s securities are listed ortraded. Each Party shall be authorized to use the name, trademark, trade name, or logo of the other Party in the manner that such otherParty has previously approved, without the need to seek further consent or approval thereof from the other Party.Clinical Trials Registry. For clarity, Gilead, its Affiliates, and its designees shall [******]. The Parties shall [******].ARTICLE 13REPRESENTATIONS AND WARRANTIES; COVENANTS Representations and Warranties of Each Party. Each Party hereby represents and warrants to the other Party, as of the Execution Date, the Option Exercise Date, and theOption Effective Date, that:13.1.1such Party is duly organized, validly existing, and in good standing under theApplicable Law of the jurisdiction of its formation and has full corporate power and authority to enter into this Agreement and to carryout the provisions hereof;13.1.2such Party has taken all necessary corporate action on its part to authorize theexecution and delivery of this Agreement and the performance of its obligations hereunder;13.1.3this Agreement has been duly executed and delivered on behalf of such Party andconstitutes a legal, valid, and binding obligation, enforceable against it in accordance with its terms, except to the extent thatenforcement of the rights and remedies created hereby is subject to: (i) bankruptcy, insolvency, reorganization, moratorium, and othersimilar laws of general application affecting the rights and remedies of creditors; or (ii) laws governing specific performance, injunctiverelief, and other equitable remedies;13.1.4the execution, delivery, and performance of this Agreement by such Party does not breach or conflict with any agreement or any provision thereof, or any instrument or understanding, oral or written, to which such Party(or any of its Affiliates) is a party or by which such Party (or any of its Affiliates) is bound, nor violate any Applicable Law of anyGovernmental Authority having jurisdiction over such Party (or any of its Affiliates);13.1.5no government authorization, consent, approval, license, exemption of or filing orregistration with any court or governmental department, commission, board, bureau, agency, or instrumentality, domestic or foreign,under any Applicable Law currently in effect, is or shall be necessary for, or in connection with, the transactions contemplated by thisAgreement, or for the performance by it of its obligations under this Agreement, except: (i) as may be required to conduct ClinicalTrials or to seek or obtain Regulatory Approvals or applicable Regulatory Materials; or (ii) as set forth in Section 2.6.2(a); and13.1.6it has obtained all necessary authorizations, consents, and approvals of any ThirdParty that is required to be obtained by it for, or in connection with, the transactions contemplated by this Agreement, or for theperformance by it of its obligations under this Agreement, except: (i) as may be required to conduct Clinical Trials or to seek or obtainRegulatory Approvals or applicable Regulatory Materials; or (ii) as set forth in Section 2.6.2(a).40 Source: AGENUS INC, 10-K, March 18, 2019Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results.[******] - Certain confidential information contained in this document, marked by brackets, is filed with the Securities and Exchange Commission pursuantto Rule 24b-2 of the Securities Exchange Act of 1934, as amended. Representations and Warranties of Agenus. Except as set forth on Schedule 13.2, Agenus hereby represents and warrants to Gilead, as of the Execution Date, theOption Exercise Date, and the Option Effective Date, that:13.2.1(i) Schedule 1.14 sets forth a complete and accurate list of all Agenus Patents; and (ii)[******];13.2.2[******]13.2.3[******]13.2.4[******]13.2.5[******]13.2.6[******]13.2.7all of Agenus’s and its Affiliates’ officers, employees, and consultants: (i) haveexecuted agreements or have existing obligations under Applicable Law requiring assignment to Agenus or its Affiliates of allinventions made during the course of and as the result of their association with Agenus or its Affiliates, as applicable, and obligating theindividual to assign to Agenus or its Affiliate, as applicable, all Inventions made during the course of performance under thisAgreement; [******]; and [******] have executed agreements or have existing obligations under Applicable Law obligating theindividual to maintain as confidential Agenus’s Confidential Information as well as confidential information of other parties (includingof Gilead and its Affiliates) that such individual may receive in its performance under this Agreement, to the extent required to supportAgenus’s obligations under this Agreement;13.2.8neither Agenus nor its Affiliates have [******] by the [******];13.2.9[******]13.2.10[******]13.2.11there are no [******] proceedings [******], or governmental investigationspending or, to the Knowledge of Agenus, threatened against Agenus or its Affiliates which could reasonably be expected to adverselyaffect or restrict the ability of Agenus to consummate or perform the transactions contemplated under this Agreement, [******];13.2.12[******]13.2.13[******]13.2.14neither Agenus nor its Affiliates have entered into any agreement under whichAgenus or its Affiliates: (i) has obtained a license or sublicense of rights from a Third Party to any Agenus IP; or (ii) has granted alicense, sublicense, option, or right to a Third Party that remains in effect to Develop, Manufacture, or Commercialize any LicensedProduct, in each case (i) and (ii), with the exception of the Existing Upstream License Agreements, the Existing Development andManufacturing Agreements, and Ordinary Course Agreements;41 Source: AGENUS INC, 10-K, March 18, 2019Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results.[******] - Certain confidential information contained in this document, marked by brackets, is filed with the Securities and Exchange Commission pursuantto Rule 24b-2 of the Securities Exchange Act of 1934, as amended. 13.2.15Schedule 13.2.15 sets forth a complete and accurate list of the Existing UpstreamLicense Agreements, other than Ordinary Course Agreements, in effect as of the Execution Date. Agenus has provided Gilead or itscounsel true, correct, and complete copies of each such Existing Upstream License Agreement, subject to redaction of certain terms notnecessary to determining Gilead’s rights or obligations as a sublicensee of Agenus. Each such Existing Upstream License Agreement isin full force and effect, and there has been no Default of or under any such Existing Upstream License Agreement as a result of anyaction or omission of Agenus or its Affiliates or, to the Knowledge of Agenus, the actions or omissions of any Third Party. Agenus hasnot waived any of its rights under any such Existing Upstream License Agreement to which it is party. The entry into this Agreementand the contemplated activities of the Parties hereunder will not adversely affect Agenus’s rights under any Existing Upstream LicenseAgreement;13.2.16other than the Existing Upstream License Agreements and the ExistingDevelopment and Manufacturing Agreements, Agenus (or its Affiliates, as applicable) has not entered into any material agreementrelating to (i) the Development, Manufacture, or Commercialization of any Licensed Product [******];13.2.17Agenus has disclosed to Gilead all material information and data, and all materialcorrespondences sent to or received from any Regulatory Authority in the possession or control of Agenus or its Affiliates, in each case,related to any Licensed Product to the extent permitted under the Prior CDA;13.2.18except [******] or otherwise in performance of the Agenus Development Plan,Agenus has not obtained, or filed, any INDs, MAAs, or Regulatory Approvals or any other form of regulatory application for theconduct of Clinical Trials, marketing, or other purpose, for any Licensed Product, and no other Person has obtained, or filed for, anysuch INDs, MAAs, or Regulatory Approvals for such Licensed Products; and13.2.19[******]Representation and Warranty of Gilead. Gilead hereby represents and warrants to Agenus, as of the Execution Date, the Option Exercise Date, and the Option Effective Date,that there are no claims, judgments, settlements, litigations, suits, actions, disputes, arbitration, judicial, or legal, administrative, or otherproceedings or governmental investigations pending or, to the knowledge of Gilead, threatened against Gilead which would reasonablybe expected to adversely affect or restrict the ability of Gilead to consummate or perform the transactions contemplated under thisAgreement.Covenants.13.4.1Mutual Covenants.(a)Each Party hereby covenants to the other Party that such Party and its Affiliates shall perform itsactivities pursuant to this Agreement in compliance (and shall ensure compliance by any of its Sublicensees and subcontractors) with allApplicable Law, including, to the extent applicable, GCP, GLP, and GMP.(b)Each Party shall immediately notify the other Party in writing if any debarment under Section 335a ofTitle 21 of United States Code comes to its attention with respect to any person employed or otherwise used in any capacity forperforming any activities under this Agreement, and shall promptly remove such person or entity from performing any activities relatedto or in connection with the Agenus Development Plan or the Gilead Development Plan, to the extent applicable, or this Agreement.42 Source: AGENUS INC, 10-K, March 18, 2019Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results.[******] - Certain confidential information contained in this document, marked by brackets, is filed with the Securities and Exchange Commission pursuantto Rule 24b-2 of the Securities Exchange Act of 1934, as amended. 13.4.2Additional Agenus Covenants. Agenus hereby covenants to Gilead that:(a)Neither Agenus nor any of its Affiliates shall grant any right or license to any Third Partyrelating to: (i) one (1) or more of the intellectual property rights within the Agenus IP; or (ii) any other right with respect to anyLicensed Product, in either case (i) or (ii), which would conflict with, [******], any of the rights or licenses granted to Gileadhereunder;(b)[******](c)[******](d)Agenus shall: (i) without limiting Agenus’s other obligations under this Agreement,maintain Control of all Agenus IP licensed or sublicensed to Gilead under each Existing Upstream License Agreement to the extent ofAgenus’s Control of such Agenus IP as of the Execution Date, the Option Exercise Date, and the Option Effective Date, as applicable;and (ii) not terminate, breach, or otherwise Default under, or amend or modify any Existing Upstream License Agreement in a mannerthat would permit the counterparty thereto to terminate such Existing Upstream License Agreement or otherwise diminish the scope orexclusivity of the rights or licenses granted to Gilead with respect to any Agenus IP ([******]);(e)[******](f)[******](g)Agenus shall use commercially reasonable efforts to fulfill its obligations [******] to the extent thatfailure to do so would materially adversely affect Gilead or its rights hereunder; and(h)Agenus shall promptly furnish Gilead with copies of all communications received by Agenus [******],as well as all material reports and other communications that Agenus [******], in each case, to the extent any such communications orreports could reasonably affect the rights or obligations of Gilead under this Agreement. Agenus shall give Gilead, upon its request, areasonable opportunity to review and comment upon such reports or communications before [******] and Agenus shall consider ingood faith any reasonable comments timely provided by Gilead.Disclaimer. EXCEPT AS OTHERWISE EXPRESSLY PROVIDED IN THIS AGREEMENT, NEITHER PARTY MAKES ANYREPRESENTATIONS OR EXTENDS ANY WARRANTY OF ANY KIND, EITHER EXPRESS OR IMPLIED (AND EACH PARTYHEREBY EXPRESSLY DISCLAIMS ANY AND ALL REPRESENTATIONS AND WARRANTIES NOT EXPRESSLY PROVIDED INTHIS AGREEMENT), INCLUDING WITH RESPECT TO ANY PATENTS OR KNOW-HOW, INCLUDING WARRANTIES OFVALIDITY OR ENFORCEABILITY, MERCHANTABILITY, FITNESS FOR A PARTICULAR USE OR PURPOSE, PERFORMANCE,AND NON-INFRINGEMENT OF ANY THIRD PARTY PATENT OR OTHER INTELLECTUAL PROPERTY RIGHT. WITHOUTLIMITING THE FOREGOING, THE PARTIES AGREE THAT THE MILESTONE EVENTS, SALES MILESTONE EVENTS, AND NETSALES LEVELS SET FORTH IN THIS AGREEMENT OR THAT HAVE OTHERWISE BEEN DISCUSSED BY THE PARTIES AREMERELY INTENDED TO DEFINE THE MILESTONE PAYMENTS, SALES MILESTONE PAYMENTS, AND ROYALTYOBLIGATIONS IF SUCH MILESTONE EVENTS, SALES MILESTONE EVENTS, OR NET SALES LEVELS AREACHIEVED. NEITHER PARTY MAKES ANY REPRESENTATION OR WARRANTY, EITHER EXPRESS OR IMPLIED, THAT ITWILL BE ABLE TO SUCCESSFULLY DEVELOP, MANUFACTURE, OR COMMERCIALIZE ANY LICENSED43 Source: AGENUS INC, 10-K, March 18, 2019Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results.[******] - Certain confidential information contained in this document, marked by brackets, is filed with the Securities and Exchange Commission pursuantto Rule 24b-2 of the Securities Exchange Act of 1934, as amended. PRODUCT OR, IF COMMERCIALIZED, THAT ANY PARTICULAR SALES LEVEL OR PROFIT (LOSS) OF SUCH LICENSEDPRODUCT WILL BE ACHIEVED.ARTICLE 14INDEMNIFICATION; INSURANCEIndemnification by Gilead. Gilead shall indemnify, defend, and hold harmless Agenus, its Affiliates, and its and their respective directors, officers,employees, agents, successors, and assigns (collectively, the “Agenus Indemnitees”) from and against any and all Damages to theextent arising out of or relating to, directly or indirectly, any Third Party Claim based upon:14.1.1[******]14.1.2[******]14.1.3[******]provided, however, that, in each case of [******], such indemnity shall not apply to the extent Agenus has an indemnificationobligation pursuant to [******] for such Damages.Indemnification by Agenus. Agenus shall indemnify and hold harmless Gilead, its Affiliates, and its and their respective directors, officers, employees,agents, successors, and assigns (collectively, the “Gilead Indemnitees”), from and against any and all Damages to the extent arising outof or relating to, directly or indirectly, any Third Party Claim based upon:14.2.1[******]14.2.2[******]14.2.3[******]14.2.4[******]14.2.5[******]14.2.6[******]provided, however, that, in each case of [******] such indemnity shall not apply to the extent Gilead has an indemnification obligationpursuant to [******] for such Damages.Certain Damages. Notwithstanding the foregoing Section 14.1 and Section 14.2, any Damages in connection with any Third Party Claimincurred by or rendered against either Party or its Affiliates or other of such Party’s indemnitee’s (Agenus Indemnitees or GileadIndemnitees, as applicable) to the extent arising from or occurring as a result of Development, Manufacture, or Commercializationactivities with respect to any Profit-Share Product in the United States shall constitute [******]. If either Party learns of any Third PartyClaim with respect to Damages covered by this Section 14.3, such Party shall provide the other Party with prompt written notice thereof.Procedure.14.4.1If a Party is seeking indemnification under Section 14.1 or Section 14.2, as applicable(the “Indemnitee”), it shall inform the other Party (the “Indemnitor”) of the claim giving rise44 Source: AGENUS INC, 10-K, March 18, 2019Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results.[******] - Certain confidential information contained in this document, marked by brackets, is filed with the Securities and Exchange Commission pursuantto Rule 24b-2 of the Securities Exchange Act of 1934, as amended. to the obligation to indemnify pursuant to Section 14.1 or Section 14.2, as applicable, as soon as reasonably practicable after receivingnotice of the claim (an “Indemnification Claim Notice”); provided, that any delay or failure to provide such notice shall not constitutea waiver or release of, or otherwise limit, the Indemnitee’s rights to indemnification under Section 14.1 or Section 14.2, as applicable,except to the extent that such delay or failure materially prejudices the Indemnitor’s ability to defend against the relevant claims.14.4.2The Indemnitor shall have the right, upon written notice given to the Indemniteewithin [******] after receipt of the Indemnification Claim Notice (and, where the Indemnitor is Agenus, subject to receipt of Gilead’sprior written consent), to assume the defense of any such claim for which the Indemnitee is seeking indemnification pursuant to Section14.1 or Section 14.2, as applicable. The Indemnitee shall cooperate with the Indemnitor and the Indemnitor’s insurer as the Indemnitormay reasonably request, and at the Indemnitor’s cost and expense. The Indemnitee shall have the right to participate, at its ownexpense and with counsel of its choice, in the defense of any claim or suit that has been assumed by the Indemnitor.14.4.3The Indemnitor shall not settle any claim without first obtaining the prior writtenconsent of the Indemnitee, not to be unreasonably withheld, conditioned, or delayed; provided, however, that the Indemnitor shall notbe required to obtain such consent if the settlement: (a) involves only the payment of money and shall not result in the Indemnitee (orother Agenus Indemnitees or Gilead Indemnitees, as applicable) becoming subject to injunctive or other similar type of relief; (b) doesnot require an admission by the Indemnitee (or other Agenus Indemnitees or Gilead Indemnitees, as applicable); and (c) does notadversely affect the intellectual property Controlled by, or the rights or licenses granted to the Indemnitee (or its Affiliate) under thisAgreement. The Indemnitee shall not settle or compromise any such claim without first obtaining the prior written consent of theIndemnitor.14.4.4If the Parties cannot agree as to the application of Section 14.1 or Section 14.2, asapplicable, to any claim, pending the resolution of the dispute pursuant to Section 16.6, the Parties may conduct separate defenses ofsuch claims, with each Party retaining the right to claim indemnification from the other Party in accordance with Section 14.1 or Section14.2, as applicable, upon resolution of the underlying claim. In each case, the Indemnitee shall reasonably cooperate with theIndemnitor and shall make available to the Indemnitor all pertinent information under the control of the Indemnitee, which informationshall be subject to Article 12.Insurance.14.5.1Insurance Maintained by each Party. During the Term, each Party shall have andmaintain in full force and effect, at its own expense, insurance coverage to include:(a)Commercial general liability insurance, including personal and advertising injury, withlimits of liability not less than [******]. General liability limit requirements may be satisfied by a combination of primary and umbrellaor excess liability insurance coverage; and(b)Workers’ compensation insurance in compliance with Applicable Law (including thelocal law requirements of the state or jurisdiction in which the work is to be performed). Employer’s liability insurance in amounts notless than [******]. Where permitted by Applicable Law, such policies shall contain a waiver of the insurer’s subrogation rights againstthe non-insured Party.45 Source: AGENUS INC, 10-K, March 18, 2019Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results.[******] - Certain confidential information contained in this document, marked by brackets, is filed with the Securities and Exchange Commission pursuantto Rule 24b-2 of the Securities Exchange Act of 1934, as amended. 14.5.2Additional Requirements.(a)Additional Insured. Each Party shall name the other Party as an additional insured on theinsurance policies maintained pursuant to Section 14.5.1(a), either by endorsement or blanket additional insured endorsement.(b)Evidence of Insurance. Each Party will provide evidence of insurance maintainedpursuant to this Section 14.5 on request of the other Party.(c)Notice of Cancellation. Each Party will provide the other Party a notice of insurancepolicy cancellation in accordance with the provisions of the applicable insurance policy maintained pursuant to this Section 14.5.(d)Policy Type. Insurance policies maintained pursuant to this Section 14.5 should beoccurrence type. If policies maintained pursuant to this Section 14.5 are claims made, then insurance shall be maintained for at least[******] following expiration or termination of this Agreement.(e)Insurance Carrier Rating. All insurance maintained pursuant to this Section 14.5 will beunderwritten by companies with an AM best rating of at least [******].[******]14.6[******] ARTICLE 15TERM AND TERMINATIONTerm; Expiration.15.1.1Term. Except for the terms and conditions of Article 1 (to the extent the definitions are used in thefollowing provisions), Article 12, Article 13, Article 16, this Section 15.1.1, and Section 15.7.1 (all of which shall become effective onthe Execution Date), this Agreement shall become effective on the License Agreement Effective Date (the “Effective Date”); provided,that, unless earlier terminated in accordance with this Article 15, this Agreement shall remain in effect and expire upon the earliest of:(a) the expiration of the Option Period, if Gilead does not exercise the Option in accordance with Section 2.4; (b) the delivery of writtennotice of termination by a Party to the other Party, where the Option Effective Date has not occurred on or prior to [******] after theOption Exercise Date; and (c) on or after the Option Effective Date: (i) for Royalty-Bearing Products, on a Royalty-Bearing Product-by-Royalty-Bearing Product and country-by-country basis, upon the expiration of the Royalty Term with respect to such Royalty-BearingProduct in such country; and (ii) for Profit-Share Products, on a Profit-Share Product-by-Profit-Share Product basis, upon the expirationof the Profit-Share Term with respect to such Profit-Share Product (the “Term”).15.1.2Effect of Expiration.(a)Upon the expiration of the Term pursuant to Section 15.1.1(a) or Section 15.1.1(b):(1)subject to Section 15.1.2(a)(2) and Section 15.7, all rights and obligations of the Parties underthis Agreement shall terminate, except as set forth in this Article 15; and46 Source: AGENUS INC, 10-K, March 18, 2019Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results.[******] - Certain confidential information contained in this document, marked by brackets, is filed with the Securities and Exchange Commission pursuantto Rule 24b-2 of the Securities Exchange Act of 1934, as amended. (2)[******](b)Upon the expiration of the Term pursuant to Section 15.1.1(c), the following terms shall apply:(1)Licenses after Licensed Product Expiration. Upon the expiration of the Term pursuant toSection 15.1.1(c) with respect to (i) a given Royalty-Bearing Product in a given country or (ii) a given Profit-Share Product, the licenseset forth in Section 10.1.1(a) with respect to such Royalty-Bearing Product in such country or such Profit-Share Product in the U.S., asapplicable, shall become fully paid-up, perpetual, irrevocable, and royalty-free.(2)Licenses after Expiration of Agreement. Upon the expiration of the Term with respect to thisAgreement in its entirety pursuant to Section 15.1.1(c), the license set forth in Section 10.1.1(a) with respect to all Licensed Products inall countries in the Territory shall become fully paid-up, perpetual, irrevocable, and royalty-free.Termination for Material Breach.15.2.1Material Breach. This Agreement may be terminated in its entirety or on a LicensedProduct-by-Licensed Product or country-by-country basis by a Party for a Material Breach by the other Party; provided, that thebreaching Party has not cured such breach within [******] after the date of written notice to the breaching Party of such breach (the“Cure Period”), which notice shall describe such breach in reasonable detail and shall state the non-breaching Party’s intention toterminate this Agreement (in its entirety or on a Licensed Product-by-Licensed Product or country-by-country basis). Notwithstandingthe foregoing, for any breach of this Agreement with respect to any undisputed payment obligation, the Cure Period shall be[******]. Any termination of this Agreement (in its entirety or on a Licensed Product-by-Licensed Product or country-by-countrybasis) under this Section 15.2.1 shall become effective [******], unless the breaching Party has cured such breach prior to theexpiration of such Cure Period, or, if such breach is not susceptible to cure within the Cure Period, then, except with respect to anybreach of any undisputed payment obligation, such Cure Period shall be extended for [******].15.2.2Disagreement as to Material Breach. Notwithstanding Section 15.2.1, if the Parties ingood faith disagree as to whether there has been a Material Breach of this Agreement, then: (a) the Party that disputes whether there hasbeen a Material Breach may contest the allegation by referring such matter, within [******] following its receipt of notice of allegedMaterial Breach, for resolution in accordance with Section 16.7.1(a); (b) the relevant Cure Period with respect to such alleged MaterialBreach shall be [******].Termination at Will. Gilead may terminate this Agreement at will, in its sole discretion, in its entirety or on a Licensed Product-by-LicensedProduct or country-by-country basis at any time upon [******] prior written notice to Agenus.Termination for Bankruptcy.15.4.1If either Party makes a general assignment for the benefit of, or an arrangement orcomposition generally with, its creditors, appoints or suffers appointment of an examiner or of a receiver or trustee over all orsubstantially all of its property, passes a resolution for its winding up, or files a petition under any bankruptcy or insolvency act or lawor has any such petition filed against it which is not dismissed, discharged, bonded, or stayed within [******] after the filing thereofand seeks to reject this Agreement, (a “Rejection Event”), the other Party may treat this Agreement as terminated by such rejection,effective immediately upon written notice to such Party.47 Source: AGENUS INC, 10-K, March 18, 2019Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results.[******] - Certain confidential information contained in this document, marked by brackets, is filed with the Securities and Exchange Commission pursuantto Rule 24b-2 of the Securities Exchange Act of 1934, as amended. 15.4.2For purposes of Section 365(n) of the U.S. Bankruptcy Code (the “Code”) and anysimilar laws in any other country, all rights and licenses granted under or pursuant to any Section of this Agreement are rights to“intellectual property” (as defined in Section 101(35A) of the Code). The Parties agree that the licensee of such rights under thisAgreement will retain and may fully exercise all of its protections, rights and elections under the Code and any similar laws in any othercountry. Each Party hereby acknowledges that (a) copies of research data, (b) laboratory samples, (c) product samples, (d) formulas,(e) laboratory notes and notebooks, (f) data and results related to clinical trials, (g) regulatory filings and approvals, (h) rights ofreference in respect of regulatory filings and approvals, (i) pre-clinical research data and results, and (j) marketing, advertising andpromotional materials, in each case, that relate to such intellectual property, constitute “embodiments” of such intellectual propertypursuant to Section 365(n) of the Code, and that the licensee will be entitled to a complete duplicate of (or complete access to, asappropriate) any such intellectual property and all embodiments of such intellectual property, and the same, if not already in itspossession, will be promptly delivered to it upon its written request therefor and election under Bankruptcy Code Section 365(n)(1)(B)to retain the licenses granted by Agenus to Gilead hereunder in the event of Agenus’s rejection of this Agreement, unless the licensorelects to continue to perform all of its obligations under this Agreement. The provisions of this Section 15.4.2 are without prejudice toany rights the non-subject Party may have arising under the Code, laws of other jurisdictions governing insolvency and bankruptcy, orother Applicable Law. The Parties agree that they intend the following rights to extend to the maximum extent permitted by law,including for purposes of the Code and any similar laws in any other country: (x) the right of access to any intellectual property(including all embodiments thereof) of the licensor, or any Third Party with whom the licensor contracts to perform an obligation ofsuch licensor under this Agreement which is necessary for the Development or Commercialization of a Licensed Product; (y) the rightto contract directly with any Third Party described in (x) to complete the contracted work, and (z) the right to cure any breach of ordefault under any such agreement with a Third Party and set off the costs thereof against amounts payable to such licensor under thisAgreement.Effects of Termination.15.5.1Termination by Gilead at Will or by Agenus for Material Breach or Bankruptcy. Upon terminationof this Agreement with respect to a Terminated Licensed Product: (a) by Gilead, in accordance with Section 15.3; or (b) by Agenus, inaccordance with Section 15.2 or Section 15.4.(a)the license granted by Agenus to Gilead pursuant to Section 10.1.1(a) with respect to theTerminated Licensed Product shall terminate and Gilead shall not have any rights to use or exercise any rights under the Agenus IP withrespect to such Terminated Licensed Product;(b)Gilead shall be released from its Development, Manufacturing, and Commercializationobligations under this Agreement with respect to the Terminated Licensed Product, including with respect to Section 4.3 and Section4.4;(c)Gilead shall as soon as reasonably practicable transfer and assign (to the extentpermitted) to Agenus all Regulatory Materials owned and controlled by Gilead or its Affiliates, in each case, at Agenus’s cost, to theextent solely related to the Terminated Licensed Product and necessary for Developing, Manufacturing, or Commercializing suchTerminated Licensed Product in the Field in the Territory; provided, that Gilead may retain a copy of such items for its records;(d)[******](e)upon receipt by Gilead from Agenus of written notice no later than the [******], the Parties shall[******];48 Source: AGENUS INC, 10-K, March 18, 2019Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results.[******] - Certain confidential information contained in this document, marked by brackets, is filed with the Securities and Exchange Commission pursuantto Rule 24b-2 of the Securities Exchange Act of 1934, as amended. (f)in the event that Gilead does not receive written notice from Agenus within [******] pursuant to Section15.5.1(e), then [******];(g)in the case of termination of this Agreement in its entirety, any and all sublicenseagreements entered into by Gilead or any of its Affiliates with a Sublicensee pursuant to this Agreement shall survive such terminationof this Agreement, except to the extent that: (i) any such Sublicensee is in material breach of this Agreement or such sublicense; or (ii)Agenus elects to grant such Sublicensee a direct license of the sublicensed rights on the same terms applicable to Gilead under thisAgreement. Gilead shall, upon the written request of Agenus, assign any such sublicense (to the extent not terminated pursuant to thepreceding sentence) to Agenus or its Affiliates and, upon such assignment, Agenus or its Affiliates, as applicable, shall assume suchsublicense;(h)each Party shall comply with the return and destruction obligations with respect toConfidential Information and any Know-How of the other Party that are in its or its Affiliates’, sublicensees’ or Third Party contractors’possession or control in accordance with Article 12;(i)to the extent that Gilead is manufacturing the Terminated Licensed Product as of theeffective date of termination, then, upon the election of Agenus, exercised by written notice to Gilead no later than [******] followingthe effective date of termination, the Parties shall negotiate and use good-faith efforts to enter into:(1)a supply agreement (and a corresponding quality agreement with customary terms andconditions) pursuant to which Gilead would supply Agenus’s requirements of the Terminated Licensed Product [******] and whichwould include such other mutually agreed terms as are customary for agreements of such type; or(2)an agreement under which Gilead would provide, and cause its Affiliates to provide,[******];(j)to the extent that a Third Party manufacturer is manufacturing the Terminated LicensedProduct as of the effective date of termination, then, to the extent Gilead has the right to do so under its agreements with its Third Partymanufacturers, upon the election of Agenus, exercised by written notice to Gilead no later than [******] following the effective date oftermination, and at Agenus’s expense, Gilead shall [******]; (k)upon the election of Agenus, exercised by written notice to Gilead no later than [******]following the effective date of termination, at Agenus’s expense, Gilead shall assign, and shall cause its Affiliates and Sublicensees toassign, to Agenus or its designee, all of Gilead’s rights under Third Party contracts relating to the Development, Manufacture, orCommercialization of the Terminated Licensed Product, to the extent that such contracts can be assigned without the counterparty’sconsent and to the extent such contracts relate solely to the Terminated Licensed Product. To the extent that such consent is required,[******]; and Agenus shall assume Gilead’s obligations under such assigned contracts, except to the extent such obligations relate tothe period of performance prior to assignment or to any breach of such agreements by Gilead, its Affiliates, or its Sublicensees; and(l)if, as of the effective date of termination, Gilead or its Affiliates are conducting anyClinical Trials for the Terminated Licensed Product, then the Parties shall in good faith discuss and agree upon the appropriatecompletion or transition of such Clinical Trials to Agenus, subject to Applicable Law.49 Source: AGENUS INC, 10-K, March 18, 2019Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results.[******] - Certain confidential information contained in this document, marked by brackets, is filed with the Securities and Exchange Commission pursuantto Rule 24b-2 of the Securities Exchange Act of 1934, as amended. 15.5.2Termination by Gilead for Material Breach or Bankruptcy. Upon termination of this Agreement withrespect to a Terminated Licensed Product by Gilead in accordance with Section 15.2 or Section 15.4:(a)the licenses granted by Agenus to Gilead pursuant to Section 10.1.1(a) with respect to theTerminated Licensed Product shall terminate and Gilead shall not have any rights under the Agenus IP with respect to such TerminatedLicensed Product;(b)Gilead shall be released from its Development, Manufacturing, and Commercializationobligations under this Agreement with respect to the Terminated Licensed Product, including with respect to Section 4.3 and Section4.4; and(c)Each Party shall comply with the return and destruction obligations with respect to ConfidentialInformation and any Know-How of the other Party that are in its or its Affiliates’, sublicensees’ or Third Party contractors’ possession orcontrol in accordance with Article 12.15.6[******]Surviving Provisions.15.7.1Accrued Rights; Remedies. The expiration or termination of this Agreement for anyreason shall be without prejudice to any rights that shall have accrued to the benefit of any Party prior to such expiration or termination,and any and all damages or remedies (whether at law or in equity) arising from any breach hereunder, each of which shall surviveexpiration or termination of this Agreement. Such expiration or termination shall not relieve any Party from obligations which areexpressly indicated to survive expiration or termination of this Agreement. Except as otherwise expressly set forth in this Agreement,the termination provisions of this Article are in addition to any other relief and remedies available to either Party under this Agreement,at law, or in equity.15.7.2Survival. Without limiting the provisions of Section 15.7.1, the rights and obligationsof the Parties set forth in the following Sections and Articles of this Agreement shall survive the expiration or termination of thisAgreement (to the extent in effect as of the Effective Date), in addition to those other terms and conditions that are expressly stated tosurvive termination or expiration of this Agreement: [******].ARTICLE 16MISCELLANEOUSSeverability. If one (1) or more of the terms or provisions of this Agreement is held by a court of competent jurisdiction to be void,invalid, or unenforceable in any situation in any jurisdiction, such holding shall not affect the validity or enforceability of the remainingterms and provisions hereof or the validity or enforceability of the void, invalid, or unenforceable term or provision in any othersituation or in any other jurisdiction, and the term or provision shall be considered severed from this Agreement solely for suchsituation and solely in such jurisdiction, unless the void, invalid, or unenforceable term or provision is of such essential importance tothis Agreement that it is to be reasonably assumed that the Parties would not have entered into this Agreement without the void, invalid,or unenforceable term or provision. If the final judgment of such court declares that any term or provision hereof is void, invalid, orunenforceable, the Parties agree to: (a) reduce the scope, duration, area, or applicability of the term or provision or to delete specificwords or phrases to the minimum extent necessary to cause such term or provision as so reduced or amended to be enforceable; and (b)make a good-faith effort to replace any void,50 Source: AGENUS INC, 10-K, March 18, 2019Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results.[******] - Certain confidential information contained in this document, marked by brackets, is filed with the Securities and Exchange Commission pursuantto Rule 24b-2 of the Securities Exchange Act of 1934, as amended. invalid, or unenforceable term or provision with a valid and enforceable term or provision such that the objectives contemplated by theParties when entering this Agreement may be realized.Notices. Any notice required or permitted to be given by this Agreement shall be in writing and in English and shall be: (a)delivered by hand or by overnight courier with tracking capabilities; or (b) mailed postage prepaid by first class, registered, or certifiedmail, in each case, addressed as set forth below unless changed by notice so given:If to Gilead:Gilead Sciences, Inc.333 Lakeside DriveFoster City, CA 94404Attention: [******]With copies to:Gilead Sciences, Inc.333 Lakeside DriveFoster City, CA 94404Attention: [******]If to Agenus:Agenus Inc.3 Forbes RoadLexington, Massachusetts 02421-7305, USAAttention:Chief Executive OfficerWith copies to:Agenus Inc.3 Forbes RoadLexington, Massachusetts 02421-7305, USAAttention:General Counsel Any such notice shall be deemed given on the date received, except any notice received after 5:30 p.m. (in the time zone of thereceiving Party) on a Business Day or received on a non-Business Day shall be deemed to have been received on the next BusinessDay. A Party may add, delete, or change the person or address to which notices should be sent at any time upon written noticedelivered to the other Parties in accordance with this Section 16.2.Force Majeure. A Party shall not be liable for delay or failure in the performance of any of its obligations hereunder if such delay or failureis due to a cause beyond the reasonable control of such Party, including acts of God, fires, earthquakes, acts of war, terrorism, or civilunrest, or hurricane or other inclement weather; provided, that the affected Party: (a) promptly notifies the other Party; and (b) shall useits commercially reasonable efforts to avoid or remove such causes of non-performance and to mitigate the effect of such occurrence,and shall continue performance in accordance with the terms of this Agreement whenever such causes are removed. When suchcircumstances arise, the Parties shall negotiate in good faith any modifications of the terms of this Agreement that may be necessary orappropriate in order to arrive at an equitable solution.51 Source: AGENUS INC, 10-K, March 18, 2019Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results.[******] - Certain confidential information contained in this document, marked by brackets, is filed with the Securities and Exchange Commission pursuantto Rule 24b-2 of the Securities Exchange Act of 1934, as amended. Assignment. Except as provided in this Section 16.4, this Agreement may not be assigned or otherwise transferred, nor may any right orobligation hereunder be assigned or transferred, by either Party without the consent of the other Party; provided, however, that (andnotwithstanding anything elsewhere in this Agreement to the contrary but without prejudice to Section 9.10.2(b)) either Party may,without such consent, assign this Agreement and its rights and obligations hereunder in whole or in part: (a) to an Affiliate of suchParty; (b) in connection with the transfer or sale of all or substantially all of its assets or business related to the subject matter of thisAgreement; or (c) pursuant to a merger or consolidation (or similar transaction) of the assigning Party. In addition, Gilead may, withoutthe consent of Agenus, assign its rights and obligations under this Agreement to a Third Party, where Gilead or its Affiliate divest rightsto a Licensed Product or Licensed Antibody. Any attempted assignment not in accordance with this Section 16.4 shall be void. In theevent that a permitted assignment of this Agreement by a Party increases the tax liability of the other Party or any of its Affiliates overthe amount of any Taxes that otherwise would have been payable in the absence of such assignment, the assigning Party shallreimburse the other Party for the amount of such increased Tax liability.Waivers and Modifications. The failure of any Party to insist on the performance of any obligation hereunder shall not be deemed to be a waiver ofsuch obligation. Waiver of any breach of any provision hereof shall not be deemed to be a waiver of any other breach of suchprovision or any other provision on such occasion or any succeeding occasion. No waiver, modification, release, or amendment of anyobligation under or provision of this Agreement shall be valid or effective unless in writing and signed by the Parties.Choice of Law; Waiver of Jury Trial; Dispute Resolution; Jurisdiction.16.6.1Choice of Law. This Agreement and any dispute arising from the performance orbreach hereof shall be governed by and interpreted in accordance with the laws of the State of New York, without giving effect to anychoice of law rules. The provisions of the United Nations Convention on Contracts for the International Sale of Goods shall not applyto this Agreement or any subject matter hereof.Waiver of Jury Trial. THE PARTIES HEREBY WAIVE, AND COVENANT THAT THEY SHALL NOT ASSERT (WHETHER AS PLAINTIFF,DEFENDANT, OR OTHERWISE), ANY RIGHT TO TRIAL BY JURY IN ANY ACTION ARISING IN WHOLE OR IN PART UNDEROR IN CONNECTION WITH THIS AGREEMENT, WHETHER NOW EXISTING OR HEREAFTER ARISING, AND WHETHERSOUNDING IN CONTRACT, TORT, OR OTHERWISE. THE PARTIES AGREE THAT ANY OF THEM MAY FILE A COPY OFTHIS PARAGRAPH WITH ANY COURT AS WRITTEN EVIDENCE OF THE KNOWING, VOLUNTARY, AND BARGAINED-FORAGREEMENT BETWEEN THE PARTIES IRREVOCABLY TO WAIVE ITS RIGHT TO TRIAL BY JURY IN ANY PROCEEDINGWHATSOEVER BETWEEN THEM RELATING TO THIS AGREEMENT, AND SUCH PROCEEDING SHALL INSTEAD BE TRIEDIN A COURT OF COMPETENT JURISDICTION BY A JUDGE SITTING WITHOUT A JURY.16.7.1Dispute Resolution.(a)Except as otherwise set forth in this Agreement, in the event of an unresolved matter,dispute, or issue relating to the breach or alleged breach or interpretation of this Agreement (“Dispute”), the Parties shall refer theDispute to the Executive Officers for discussion and resolution. If the Executive Officers are unable to resolve such Dispute within[******] of the Dispute being referred to them by either Party in writing, then the Dispute shall be resolved as provided inSection 16.7.1(b) or Section 16.7.1(c), as applicable.52 Source: AGENUS INC, 10-K, March 18, 2019Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results.[******] - Certain confidential information contained in this document, marked by brackets, is filed with the Securities and Exchange Commission pursuantto Rule 24b-2 of the Securities Exchange Act of 1934, as amended. (b)Any unresolved Disputes between the Parties arising out of or in connection with thisAgreement shall be resolved by final and binding arbitration. Whenever a Party decides to institute arbitration proceedings, it shall givewritten notice to that effect to the other Party. Arbitration shall be held in New York, New York, according to the Rules of Arbitrationof the International Chamber of Commerce (“ICC Rules”) in effect at the Effective Date, except as they may be modified herein or bymutual agreement of the Parties. All arbitration proceedings shall be conducted by three (3) arbitrators unless otherwise mutuallyagreed by the Parties. The claimant and the respondent shall each nominate an arbitrator in accordance with the ICC Rules, and thethird arbitrator, who shall be the president of the arbitral tribunal, shall be appointed by the two (2) Party-appointed arbitrators inconsultation with the Parties. The Parties undertake to maintain confidentiality as to the existence of the arbitration proceedings and asto all submissions, correspondence, and evidence relating to the arbitration proceedings. This Section 16.7.1(b) shall survive thetermination of the arbitral proceedings. No arbitrator (nor any arbitral tribunal) shall [******]. Decisions of the arbitrator(s) shall befinal and binding on the Parties. Judgment on the award so rendered may be entered in any court of competent jurisdiction. The costsof the arbitration shall be shared by the Parties during the course of such arbitration, as assessed by the International Chamber ofCommerce, and shall be borne as determined by the arbitrator(s). With respect to any dispute over the [******], within [******] afterthe arbitrators are selected pursuant this Section 16.7.1(b), each Party shall provide the arbitrators and the other Party a proposal(including a written memorandum in support of its position) for the [******]. In rendering a decision regarding the [******], thearbitrators shall select the proposal which is more commercially reasonable under the circumstances (or, if a Party fails to submit aproposal within such [******] period, the other Party’s proposal).(c)Notwithstanding anything to the contrary, either Party may at any time seek to obtainpreliminary injunctive relief or other applicable provisional relief from a court of competent jurisdiction with respect to an issue arisingunder this Agreement if the rights of such Party would be prejudiced absent such relief. A request by a Party to a court of competentjurisdiction for interim measures necessary to preserve the Party’s rights, including attachments or injunctions, shall not be deemedincompatible with, or a waiver of, the agreement to mediate or arbitrate contained in this Section 16.7.1(c), or the availability of interimmeasures of protection under the ICC Rules. Notwithstanding anything to the contrary in this Section 16.7.1(c), any disputes regardingthe scope, validity, enforceability, or inventorship of any Patents shall be submitted for final resolution by a court of competentjurisdiction.Relationship of the Parties. Agenus and Gilead are independent contractors under this Agreement. Nothing contained herein is intended or is to beconstrued so as to constitute either Party as a partner, agent, or joint venturer of the other Party. Neither Agenus nor Gilead,respectively, shall have any express or implied right or authority to assume or create any obligations on behalf of or in the name ofAgenus and Gilead, respectively, or to bind Agenus and Gilead, respectively, to any contract, agreement, or undertaking with any ThirdParty.Fees and Expenses. Except as otherwise specified in this Agreement, each Party shall bear its own costs and expenses (including investmentbanking and legal fees and expenses) incurred in connection with this Agreement and the transactions contemplated hereby.Third Party Beneficiaries. There are no express or implied Third Party beneficiaries hereunder. The provisions of this Agreement are for theexclusive benefit of the Parties, and no other person or entity shall have any right or claim against any Party by reason of theseprovisions or be entitled to enforce any of these provisions against any Party, except for the indemnification rights of the AgenusIndemnitees pursuant to Section 14.1 and Section 14.4 and the Gilead Indemnitees pursuant to Section 14.2 and Section 14.4.53 Source: AGENUS INC, 10-K, March 18, 2019Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results.[******] - Certain confidential information contained in this document, marked by brackets, is filed with the Securities and Exchange Commission pursuantto Rule 24b-2 of the Securities Exchange Act of 1934, as amended. Entire Agreement. This Agreement, together with the attached Exhibits and Schedules, contains the entire agreement by the Parties withrespect to the subject matter hereof and supersedes any prior express or implied agreements, understandings, and representations, eitheroral or written, which may have related to the subject matter hereof in any way, including the Prior CDA and any and all term sheetsrelating to the transactions contemplated by this Agreement and exchanged between the Parties prior to the Effective Date; provided,that this Agreement shall not supersede the terms and provisions of the Prior CDA applicable to any period prior to the Effective Date. Counterparts. This Agreement may be executed in counterparts with the same effect as if both Parties had signed the same document. Allsuch counterparts shall be deemed an original, shall be construed together, and shall constitute one (1) and the same instrument. Anysuch counterpart, to the extent delivered by means of facsimile by .pdf, .tif, .gif, .jpeg, or similar attachment to electronic mail (any suchdelivery, an “Electronic Delivery”) shall be treated in all manner and respects as an original executed counterpart and shall beconsidered to have the same binding legal effect as if it were the original signed version thereof delivered in person. No Party heretoshall raise the use of Electronic Delivery to deliver a signature or the fact that any signature or agreement or instrument was transmittedor communicated through the use of Electronic Delivery as a defense to the formation of a contract, and each Party forever waives anysuch defense, except to the extent that such defense relates to lack of authenticity.Equitable Relief; Cumulative Remedies. Notwithstanding anything to the contrary herein, the Parties shall be entitled to seek equitable relief, including injunctionand specific performance, as a remedy for any breach of this Agreement. Such remedies shall not be deemed to be the exclusiveremedies for a breach of this Agreement but shall be in addition to all other remedies available at law or in equity. The Parties furtheragree not to raise as a defense or objection to the request or granting of such relief that any breach of this Agreement is or would becompensable by an award of money damages. No remedy referred to in this Agreement is intended to be exclusive, but each shall becumulative and in addition to any other remedy referred to in this Agreement or otherwise available under Applicable Law.Interpretation.16.14.1Generally. This Agreement has been diligently reviewed by and negotiated by andbetween the Parties, and in such negotiations each of the Parties has been represented by competent (in-house or external) counsel, andthe final agreement contained herein, including the language whereby it has been expressed, represents the joint efforts of the Partiesand their counsel. Accordingly, in interpreting this Agreement or any provision hereof, no presumption shall apply against any Party asbeing responsible for the wording or drafting of this Agreement or any such provision, and ambiguities, if any, in this Agreement shallnot be construed against any Party, irrespective of which Party may be deemed to have authored the ambiguous provision.16.14.2Definitions; Interpretation.(a)The definitions of the terms herein shall apply equally to the singular and plural forms ofthe terms defined and, where a word or phrase is defined herein, each of its other grammatical forms shall have a correspondingmeaning.(b)Whenever the context may require, any pronoun shall include the correspondingmasculine, feminine, and neuter forms.(c)The word “will” shall be construed to have the same meaning and effect as the word“shall.”54 Source: AGENUS INC, 10-K, March 18, 2019Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results.[******] - Certain confidential information contained in this document, marked by brackets, is filed with the Securities and Exchange Commission pursuantto Rule 24b-2 of the Securities Exchange Act of 1934, as amended. (d)The words “including,” “includes,” “include,” “for example,” and “e.g.,” and words ofsimilar import, shall be deemed to be followed by the words “without limitation.”(e)The word “or” shall be interpreted to mean “and/or,” unless the context requiresotherwise.(f)The words “hereof,” “herein,” and “herewith,” and words of similar import, shall, unlessotherwise stated, be construed to refer to this Agreement as a whole and not to any particular provision of this Agreement.(g)Unless the context requires otherwise or otherwise specifically provided: (i) allreferences herein to Articles, Sections, Schedules, or Exhibits shall be construed to refer to Articles, Sections, Schedules, and Exhibits ofthis Agreement; and (ii) reference in any Section to any subclauses are references to such subclauses of such Section.16.14.3Subsequent Events. Unless the context requires otherwise: (a) any definition of orreference to any agreement, instrument, or other document herein shall be construed as referring to such agreement, instrument, orother document as from time to time amended, supplemented, or otherwise modified (subject to any restrictions on such amendments,supplements, or modifications set forth herein); (b) any reference to any Applicable Law herein shall be construed as referring to suchApplicable Law as from time to time enacted, repealed, or amended; and (c) subject to Section 16.4, any reference herein to any Personshall be construed to include the Person’s successors and assigns.16.14.4Headings. Headings, captions, and the table of contents are for convenience onlyand shall not be used in the interpretation or construction of this Agreement.16.14.5Prior Drafts. No prior draft of this Agreement shall be used in the interpretation orconstruction of this Agreement.Further Assurances. Each Party shall execute, acknowledge, and deliver such further instruments, and do all such other ministerial,administrative, or similar acts, as may be reasonably necessary or appropriate in order to carry out the expressly stated purposes and theclear intent of this Agreement.Extension to Affiliates. Except as expressly set forth otherwise in this Agreement, each Party shall have the right to extend the rights andobligations granted in this Agreement to one or more of its Affiliates. All applicable terms and provisions of this Agreement, exceptthis right to extend, shall apply to any such Affiliate to which this Agreement has been extended to the same extent as such terms andprovisions apply to the Party extending such rights and obligations. The Party extending the rights and obligations granted hereundershall remain primarily liable for any acts or omissions of any of its Affiliates.[Signature Page Follows]55 Source: AGENUS INC, 10-K, March 18, 2019Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results.[******] - Certain confidential information contained in this document, marked by brackets, is filed with the Securities and Exchange Commission pursuantto Rule 24b-2 of the Securities Exchange Act of 1934, as amended. IN WITNESS WHEREOF, and intending to be legally bound hereby, the Parties have caused this OPTION AND LICENSEAGREEMENT (AGEN1223) to be executed by their respective duly authorized officers as of the Execution Date.AGENUS INC.GILEAD SCIENCES, INC. By: /s/ Garo Armen, Ph.D.By: /s/ John G. McHutchison, MDName: Garo Armen, Ph.D.Name: John G. McHutchison, MDTitle: Chairman and CEOTitle: Chief Scientific Officer, Head of R&D [Signature Page to Option and License Agreement (AGEN1223)] Source: AGENUS INC, 10-K, March 18, 2019Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results.[******] - Certain confidential information contained in this document, marked by brackets, is filed with the Securities and Exchange Commission pursuantto Rule 24b-2 of the Securities Exchange Act of 1934, as amended.Exhibit 10.27 OPTION AND LICENSE AGREEMENT (AGEN2373)by and betweenAGENUS INC.andGILEAD SCIENCES, INC.dated as of December 20, 2018 Source: AGENUS INC, 10-K, March 18, 2019Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results.[******] - Certain confidential information contained in this document, marked by brackets, is filed with the Securities and Exchange Commission pursuantto Rule 24b-2 of the Securities Exchange Act of 1934, as amended.TABLE OF CONTENTSPageARTICLE 1 DEFINITIONS1 ARTICLE 2 OPTION23 2.1General23 2.2Activities Prior to the Option Effective Date23 2.3Data Package24 2.4Option Exercise25 2.5Antitrust Filings26 2.6Option Exercise Closing; Effectiveness26 2.7Gilead Development Plan and Gilead Development Budget27 ARTICLE 3 GOVERNANCE27 3.1Joint Steering Committee27 3.2Sub-Committees28 ARTICLE 4 DEVELOPMENT28 4.1Responsibility28 4.2Gilead Development Plan and Gilead Development Budget28 4.3Development Diligence29 4.4Development Updates Outside of Profit-Share Term29 ARTICLE 5 REGULATORY29 5.1Regulatory Matters29 5.2Regulatory Materials30 5.3Right of Reference; Access to Data30 6.1General31 6.2Certain Agenus U.S. Co-Commercialization Activities31 ARTICLE 7 MANUFACTURING; PHARMACOVIGILANCE31 7.1General31 7.2Supply Agreement32 7.3Pharmacovigilance32 ARTICLE 8 ASSISTANCE; TRANSITION; UPSTREAM LICENSE AGREEMENTS32 8.1Assistance32 8.2Know-How Transfer32 8.3Licensed Products Inventory Transfer33 8.4Manufacturing Technology Transfer33 8.5Assignment of Agreements33 8.6Upstream License Agreements34 ARTICLE 9 FINANCIAL TERMS34 9.1Upfront Payment34 9.2Option Fee34 9.3Profit-Share34 9.4Development Costs Reconciliation37 9.5Profit (Loss) Reconciliation37 Source: AGENUS INC, 10-K, March 18, 2019Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results.[******] - Certain confidential information contained in this document, marked by brackets, is filed with the Securities and Exchange Commission pursuantto Rule 24b-2 of the Securities Exchange Act of 1934, as amended.TABLE OF CONTENTS(continued)Page 9.6Milestones38 9.7Sales Milestones39 9.8Royalties40 9.9Invoice and Payment of Royalty Payments43 9.10Additional Payment Terms43 9.11Records; Audit Rights44 9.12Upstream License Agreements and Development and Manufacturing Agreements45 9.13Non-Refundable and Non-Creditable Payments45 ARTICLE 10 LICENSES; EXCLUSIVITY45 10.1Licenses to Gilead; Exclusion; Upstream License Agreements45 10.2Subcontracting; Sublicenses46 10.3Rights Retained by the Parties46 10.4No Implied Licenses46 10.5Exclusivity46 ARTICLE 11 INTELLECTUAL PROPERTY47 11.1Inventorship and Ownership47 11.2Prosecution and Maintenance47 11.3Enforcement48 11.4Defense48 11.5Recovery49 11.6Trademarks49 11.7Patent Extensions49 ARTICLE 12 CONFIDENTIALITY50 12.1Nondisclosure50 12.2Exceptions50 12.3Authorized Disclosure51 12.4Terms of this Agreement52 12.5Securities Filings; Disclosure under Applicable Law52 12.6Publicity52 12.7Use of Names53 12.8Clinical Trials Registry53 ARTICLE 13 REPRESENTATIONS AND WARRANTIES; COVENANTS53 13.1Representations and Warranties of Each Party53 13.2Representations and Warranties of Agenus54 13.3Representation and Warranty of Gilead56 13.4Covenants57 13.5Disclaimer59 ARTICLE 14 INDEMNIFICATION; INSURANCE59 14.1Indemnification by Gilead59 14.2Indemnification by Agenus60 14.3Certain Damages60 ii Source: AGENUS INC, 10-K, March 18, 2019Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results.[******] - Certain confidential information contained in this document, marked by brackets, is filed with the Securities and Exchange Commission pursuantto Rule 24b-2 of the Securities Exchange Act of 1934, as amended.TABLE OF CONTENTS(continued)Page 14.4Procedure60 14.5Insurance61 14.6LIMITATION OF LIABILITY62 ARTICLE 15 TERM AND TERMINATION62 15.1Term; Expiration62 15.2Termination for Material Breach63 15.3Termination at Will64 15.4Termination for Bankruptcy64 15.5Effects of Termination65 15.6[******]67 15.7Surviving Provisions67 ARTICLE 16 MISCELLANEOUS69 16.1Severability69 16.2Notices69 16.3Force Majeure70 16.4Assignment70 16.5Waivers and Modifications70 16.6Choice of Law; Waiver of Jury Trial; Dispute Resolution; Jurisdiction70 16.7Waiver of Jury Trial70 16.8Relationship of the Parties72 16.9Fees and Expenses72 16.10Third Party Beneficiaries72 16.11Entire Agreement72 16.12Counterparts72 16.13Equitable Relief; Cumulative Remedies72 16.14Interpretation72 16.15Further Assurances73 16.16Extension to Affiliates74 SCHEDULES iii Source: AGENUS INC, 10-K, March 18, 2019Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results.[******] - Certain confidential information contained in this document, marked by brackets, is filed with the Securities and Exchange Commission pursuantto Rule 24b-2 of the Securities Exchange Act of 1934, as amended.TABLE OF CONTENTS(continued)PageSchedule 1.8:[******]Schedule 1.9:[******]Schedule 1.17:[******]Schedule 1.113:[******]Schedule 1.116:[******]Schedule 6.2:[******]Schedule 10.1.3:[******]Schedule 13.2:[******]Schedule 13.2.15:[******]EXHIBITExhibit A:[******]Exhibit B:[******] iv Source: AGENUS INC, 10-K, March 18, 2019Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results.[******] - Certain confidential information contained in this document, marked by brackets, is filed with the Securities and Exchange Commission pursuant to Rule 24b-2 of theSecurities Exchange Act of 1934, as amended.OPTION AND LICENSE AGREEMENT(AGEN2373)This OPTION AND LICENSE AGREEMENT (this “Agreement”) is entered into as of December 20, 2018 (the“Execution Date”) by and between Agenus Inc., a Delaware corporation (“Agenus”) and Gilead Sciences, Inc., a Delaware corporation(“Gilead”). Agenus and Gilead are each referred to herein by name or as a “Party” or, collectively, as the “Parties.”RECITALSWHEREAS, Agenus Controls the Agenus IP (each, as defined below);WHEREAS, Gilead wishes to obtain, and Agenus wishes to grant, an option to license the Agenus IP with respect toLicensed Products in the Field in the Territory (each, as defined below) on the terms and conditions set forth in this Agreement;WHEREAS, simultaneously with entering into this Agreement, the Parties are entering into the License Agreement and theOption and License Agreement (AGEN1223) (each, as defined below); andWHEREAS, simultaneously with entering into this Agreement, the Parties are entering into a stock purchase agreement andcertain related agreements, pursuant to which Agenus will issue and Gilead will purchase shares of capital stock of Agenus on the termsand conditions set forth therein (the “Stock Purchase Agreement”).NOW, THEREFORE, in consideration of the foregoing and the mutual agreements set forth below, and for other good andvaluable consideration, the receipt and sufficiency of which are hereby acknowledged, the Parties hereby agree as follows:ARTICLE 1DEFINITIONSUnless specifically set forth to the contrary herein, the following terms shall have the respective meanings set forth below.1.1“Accounting Standards” means U.S. generally accepted accounting principles in effect at the relevant time,consistently applied.1.2“Acquired Person” has the meaning set forth in Section 1.33.1.3[******]1.4“Additional Active” has the meaning set forth in Section 1.39.1.5“Additional Development Costs” has the meaning set forth in Section 9.3.4(a).1.6“Affiliate” means any Person which, directly or indirectly through one (1) or more intermediaries, controls, iscontrolled by, or is under common control with a Party. For purposes of this Section 1.6 only, the term “control” (including, withcorrelative meanings, the terms “controlled by” and “under common control with”) as used with respect to a Person means: (a) director indirect ownership of fifty percent (50%) or more of the voting securities or other voting interest of any Person (including attributionfrom related parties); or (b) the possession, directly or indirectly, of the power to direct, or cause1 Source: AGENUS INC, 10-K, March 18, 2019Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results.[******] - Certain confidential information contained in this document, marked by brackets, is filed with the Securities and Exchange Commission pursuant to Rule 24b-2 of theSecurities Exchange Act of 1934, as amended.the direction of, the management and policies of such Person, whether through ownership of voting securities, by contract, as a generalpartner, as a manager, or otherwise.1.7“AGEN2373” has the meaning set forth in Section 1.116(i).1.8[******]1.9“AGEN2373 Criteria” means the criteria set forth on Schedule 1.9, as may be amended from time to time bymutual agreement of the Parties.1.10“Agenus” has the meaning set forth in the Preamble.1.11[******]1.12“Agenus Development Costs” has the meaning set forth in Section 9.4.1.13“Agenus Development Plan” means the initial, high-level plan for the Development of the Licensed Antibodiesand the Licensed Products set forth on Exhibit A, as such plan may be amended from time to time in accordance with this Agreement.1.14“Agenus Indemnitees” has the meaning set forth in Section 14.1.1.15“Agenus IP” means the Agenus Patents and the Agenus Know-How. [******].1.16“Agenus Know-How” means any Know-How Controlled by Agenus or any of its Affiliates as of the ExecutionDate or thereafter during the Term which is [******] for the Development, Manufacture, or Commercialization of the LicensedProducts in the Field in the Territory.1.17“Agenus Patents” means any and all Patents Controlled by Agenus or its Affiliates as of the Execution Date or atany time during the Term, including Agenus’s interest in any and all Joint Patents, which are [******] for the Development,Manufacture, or Commercialization of any Licensed Product in the Field in the Territory. Without limiting the foregoing, Schedule 1.17sets forth a complete and accurate2 Source: AGENUS INC, 10-K, March 18, 2019Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results.[******] - Certain confidential information contained in this document, marked by brackets, is filed with the Securities and Exchange Commission pursuant to Rule 24b-2 of theSecurities Exchange Act of 1934, as amended.list of all Agenus Patents as of the Execution Date. Schedule 1.17 shall be updated as necessary from time to time to reflect the then-current Agenus Patents.1.18“Agreement” has the meaning set forth in the Preamble.1.19“Agreement Payments” has the meaning set forth in Section 9.10.2(a).1.20“ANDA” means an abbreviated new drug application filed pursuant to the requirements of the FDA pursuant to21 C.F.R. Part 314 to obtain regulatory approval for a product in the United States, or the equivalent application or filing in anothercountry (as applicable).1.21“Annual Net Sales” means, on a Licensed Product-by-Licensed Product basis, total Net Sales by Gilead, itsAffiliates, and its Sublicensees in the Territory of such Licensed Product in a particular Calendar Year, calculated in accordance withAccounting Standards.1.22“Antitrust Filings” has the meaning set forth in Section 2.4.1.23“Antitrust Law” means any federal, state, or foreign statutes, rules, regulations, orders, or decrees that aredesigned to prohibit, restrict, or regulate actions having the purpose or effect of monopolization, lessening of competition, or restraint oftrade, including the HSR Act. 1.24“Applicable Law” means all applicable laws, statutes, rules, regulations, treaties (including tax treaties), orders,judgments or ordinances having the effect of law of any national, multinational, federal, state, provincial, county, city, or other politicalsubdivision, including, to the extent applicable, GCP, GLP, and GMP, as well as all applicable data protection and privacy laws, rules,and regulations, including, to the extent applicable, the United States Department of Health and Human Services privacy rules under theHealth Insurance Portability and Accountability Act and the Health Information Technology for Economic and Clinical Health Act andthe EU Data Protection Directive (Council Directive 95/46/EC) and applicable laws implementing the EU Data Protection Directive andthe General Data Protection Regulation (2016/679), the Foreign Corrupt Practices Act of 1977, or any comparable laws in any country,and all export control laws.1.25“Audited Party” has the meaning set forth in Section 9.11.2.1.26“Auditing Party” has the meaning set forth in Section 9.11.2.1.27“Auditor” has the meaning set forth in Section 9.11.2.1.28“Biosimilar Product” means, [******].1.29“BLA” means a Biologics License Application filed with the FDA in the United States with respect to a LicensedProduct, as defined in Title 21 of the U.S. Code of Federal Regulations, Section 601.2 et seq., or any non-U.S. counterpart of theforegoing.1.30“Business Day” means any day other than: (a) a Saturday or Sunday or any day on which commercial banks inBoston, Massachusetts, and San Francisco, California, are authorized or required by Applicable Law to remain closed; or (b) December26 through December 31.1.31“Calendar Quarter” means each of the three (3) month periods ending March 31, June 30, September 30, andDecember 31; provided, that: (a) the first Calendar Quarter of the Term shall extend3 Source: AGENUS INC, 10-K, March 18, 2019Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results.[******] - Certain confidential information contained in this document, marked by brackets, is filed with the Securities and Exchange Commission pursuant to Rule 24b-2 of theSecurities Exchange Act of 1934, as amended.from the Effective Date to the end of the first complete such three (3)-month period thereafter; and (b) the final Calendar Quarter of theTerm shall end on the last day of the Term.1.32“Calendar Year” means the period beginning on the Effective Date and ending on December 31 of the calendaryear in which the Effective Date falls, and thereafter each successive period of twelve (12) consecutive calendar months beginning onJanuary 1 and ending on December 31; provided, that the final Calendar Year of the Term shall end on the last day of the Term.1.33[******]1.34[******]1.35“Clinical Trial” means any human clinical trial of a pharmaceutical or biological product.1.36“Clinical Trial Criteria” means, [******].1.37“Code” has the meaning set forth in Section 15.4.2.1.38“COGS” means, with respect to the supply of a Profit-Share Product, the product of the Standard Cost ofManufacturing of such Profit-Share Product and the number of units of such Profit-Share Product.1.39“Combination Product” means: (a) a product that contains a Licensed Product and one (1) or more activepharmaceutical or biological ingredients that are not Licensed Antibodies (each, an “Additional Active”); or (b) a Licensed Product thatis co-packaged or combined with one (1) or more Additional Actives, and such Licensed Product and Additional Actives are sold for asingle price.1.40“Commercialization” means any and all activities directed to the commercialization of a product, includingmarketing, detailing, promotion, market research, distributing, order processing, handling returns and recalls, booking sales, customerservice, administering, and commercially selling such product, importing, exporting, and transporting such product for commercial sale,and seeking Pricing Approval of a product (if applicable), whether before or after Regulatory Approval has been obtained, as well allregulatory compliance with respect to the foregoing. For clarity, Commercialization does not include: (a) Manufacturing; or (b) anyClinical Trials and other trials commenced after Regulatory Approval. When used as a verb, “Commercialize” means to engage inCommercialization.1.41“Commercialization Budget” means the high-level budget for conducting Commercialization of the LicensedProducts in the U.S. in accordance with the Commercialization Plan4 Source: AGENUS INC, 10-K, March 18, 2019Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results.[******] - Certain confidential information contained in this document, marked by brackets, is filed with the Securities and Exchange Commission pursuant to Rule 24b-2 of theSecurities Exchange Act of 1934, as amended.[******], in each case, during the Profit-Share Term, as such budget may be amended from time to time in accordance with thisAgreement.1.42“Commercialization Plan” means the high-level plan for the Commercialization of the Licensed Products in theU.S. [******], in each case, during the Profit-Share Term, as such plan may be amended from time to time in accordance with thisAgreement.1.43“Commercially Reasonable Efforts” means, with respect to [******].1.44“Competing Product” means any product, [******].1.45[******]1.46“Compulsory License” means, with respect to a Licensed Product in a country or territory, a license, or rightsgranted to a Third Party by a governmental agency within such country or territory to sell or offer for sale such Licensed Product insuch country or territory under any Patents or Know-How owned or controlled by either Party or its Affiliates, without direct or indirectauthorization from such Party or its Affiliates.1.47“Compulsory Licensee” means a Third Party granted a Compulsory License.1.48“Confidential Information” means, with respect to a Party, all confidential and proprietary information,including chemical or biological materials, chemical structures, sequence information, commercialization plans, correspondence,customer lists, data, development plans, formulae, improvements, Inventions, Know-How, processes, regulatory filings, reports,strategies, techniques, or other information, in each case, that are disclosed by or on behalf of such Party to the other Party pursuant tothis Agreement, regardless of whether any of the foregoing are marked “confidential” or “proprietary” or communicated to the otherParty by or on behalf of the disclosing Party in oral, written, visual, graphic, or electronic form.1.49“Control,” “Controls,” or “Controlled” means with respect to any Patent, Know-How, other intellectualproperty right, or Confidential Information, the ability of a Party or its Affiliates, as applicable (whether through ownership or license(other than a license granted in this Agreement)) to grant to the other Party the licenses or sublicenses as provided herein, or tootherwise disclose such intellectual property right or Confidential Information to the other Party, without violating the terms of anythen-existing agreement with any Third Party at the time such Party or its Affiliates, as applicable, would be required hereunder to grantthe other Party such license or sublicenses as provided herein or to otherwise disclose such intellectual property right or ConfidentialInformation to the other Party. Notwithstanding the foregoing, a Party will be deemed not to Control any Patent, Know-How, otherintellectual property5 Source: AGENUS INC, 10-K, March 18, 2019Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results.[******] - Certain confidential information contained in this document, marked by brackets, is filed with the Securities and Exchange Commission pursuant to Rule 24b-2 of theSecurities Exchange Act of 1934, as amended.right, Confidential Information, compound, or molecule (including any antibody) that is [******] except: [******].1.50“Cover” means, with reference to [******], that the making, using, offering to sell, selling, importing, orexporting of such product would [******].1.51“Cure Period” has the meaning set forth in Section 15.2.1.1.52“Damages” means all losses, costs, claims, damages, judgments, liabilities, and expenses (including reasonableattorneys’ fees and other reasonable out-of-pocket costs in connection therewith).1.53“Data Package” means:1.53.1[******]1.53.2[******]1.54“Data Package Request Notice” has the meaning set forth in Section 2.3.2(a).1.55“Default” means: (a) any material breach, violation, or default; (b) the existence of circumstances or theoccurrence of an event that with the passage of time or the giving of notice or both would constitute a material breach, violation, ordefault; or (c) the existence of circumstances or the occurrence of an event that, with or without the passage of time or the giving ofnotice or both, would give rise to a right of termination, renegotiation, acceleration, or material change of terms.1.56[******]1.57“Detail” means an interactive face-to-face visit by an authorized salesperson or agent (each, a “SalesRepresentative”) with a healthcare provider having prescribing authority and who is within the target audience, during which approveduses, safety, effectiveness, contraindications, side effects, warnings, or other relevant characteristics of a pharmaceutical or biologicalproduct are discussed in an effort to increase prescribing preferences of a pharmaceutical or biological product for its approved uses.Details shall not include: (a) activities conducted by medical support staff; or (b) e-details, activities conducted at conventions or similargatherings, or activities performed by market development specialists, managed care account directors, and other personnel notperforming face-to-face sales calls or not specifically trained with respect to a pharmaceutical or biological product. “Detailing” meansthe act of performing Details.1.58“Development” means: (a) research activities (including drug discovery, identification, or synthesis) with respectto a product; or (b) preclinical and clinical drug development activities and other development activities with respect to a product,including test method development and stability testing, toxicology, formulation, process development, qualification and validation,quality assurance, quality control, Clinical Trials (including Clinical Trials and other trials commenced after Regulatory Approval),statistical analysis and report writing, the preparation and submission of INDs and MAAs, regulatory affairs with respect to theforegoing, and all other activities necessary or useful or otherwise requested or required by a Regulatory Authority or as a condition orin support of obtaining or maintaining a Regulatory Approval. For clarity, “Development” does not include Manufacturing. Whenused as a verb, “Develop” means to engage in Development.1.59“Development and Manufacturing Agreement” means any contract or agreement, other than any UpstreamLicense Agreement, between Agenus (or any of its Affiliates, as applicable) and any6 Source: AGENUS INC, 10-K, March 18, 2019Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results.[******] - Certain confidential information contained in this document, marked by brackets, is filed with the Securities and Exchange Commission pursuant to Rule 24b-2 of theSecurities Exchange Act of 1934, as amended.Third Party which is related to the Development or Manufacture of any Licensed Antibody or Licensed Product.1.60“Development Costs” means, with respect to the Profit-Share Product: (a) those FTE Costs and Third PartyExpenses, in each case, [******]; and (b) Other Expenses [******].1.61“Disclosing Party” has the meaning set forth in Section 12.1.1.62“Dispute” has the meaning set forth in Section 16.7.1(a).1.63“Dollars” or “$” means the legal tender of the United States.1.64“Early Exercise Comment Notice” has the meaning set forth in Section 2.3.2(b).1.65“Effective Date” has the meaning set forth in Section 15.1.1.1.66“Electronic Delivery” has the meaning set forth in Section 16.12.1.67“EMA” has the meaning set forth in Section 1.181.1.68“EU” means all countries that are officially recognized as member states of the European Union at any particulartime.1.69“EU Regulatory Approval” means Regulatory Approval [******] of a Licensed Product by EMA or therelevant Regulatory Authority in [******] of the Major European Markets.1.70“Execution Date” has the meaning set forth in the Preamble.1.71“Executive Officers” means: (a) with respect to Agenus, [******] or his/her designee or successor withequivalent responsibilities; and (b) with respect to Gilead, [******] or his/her designee or successor with equivalent responsibilities.1.72“Existing Development and Manufacturing Agreement” means any Development and ManufacturingAgreement in effect as of the Execution Date.1.73“Existing Regulatory Materials” has the meaning set forth in Section 5.2.1.1.74“Existing Upstream License Agreements” has the meaning set forth in Section 1.221.1.75“FDA” has the meaning set forth in Section 1.181.1.76“Field” means any and all uses or purposes, including the treatment, prophylaxis, palliation, diagnosis, orprevention of any human or animal disease, disorder, or condition.1.77“First Commercial Sale” means, on a Licensed Product-by-Licensed Product and country-by-country basis, thefirst sale of such Licensed Product in such country for use or consumption by the general public (following receipt of all RegulatoryApprovals that are required in order to sell such Licensed Product in such country) and for which any of Gilead or its Affiliates orSublicensees has invoiced7 Source: AGENUS INC, 10-K, March 18, 2019Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results.[******] - Certain confidential information contained in this document, marked by brackets, is filed with the Securities and Exchange Commission pursuant to Rule 24b-2 of theSecurities Exchange Act of 1934, as amended.sales of Licensed Products in the Territory; provided, however, that the following shall not constitute a First Commercial Sale: [******].1.78[******]1.79“FTE” means the equivalent of a full-time employee’s performance of [******] hours of work time over aCalendar Year [******].1.80“FTE Costs” means an amount equal to the product of the FTE Rate and actual FTEs who performed work underthe Gilead Development Plan or the Commercialization Plan (calculated in accordance with Section 1.79). For clarity, the cost ofactivities of contract personnel shall be charged as Third Party Expenses.1.81“FTE Rate” means a mutually agreed-upon cost (or applicable cost within a schedule of costs) per FTE, whichshall be [******].1.82[******]1.83“GCP” means the applicable then-current ethical and scientific quality standards for designing, conducting,recording, and reporting Clinical Trials as are required by applicable Regulatory Authorities or Applicable Law in the relevantjurisdiction, including, in the United States, Good Clinical Practices established through FDA guidances, and, outside the United States,Guidelines for Good Clinical Practice – ICH Harmonized Tripartite Guideline (ICH E6).1.84“Gilead” has the meaning set forth in the Preamble.1.85“Gilead Development Budget” means the high-level budget for conducting U.S. Development of the LicensedProducts pursuant to the Gilead Development Plan [******], in each case, to the extent during the Profit-Share Term, as such budgetmay be amended from time to time in accordance with this Agreement.1.86“Gilead Development Plan” means (a) the plan for the Development of the Licensed Products [******], in eachcase, during the Profit-Share Term, as such plan may be amended from time to time in accordance with this Agreement, which planshall describe [******], as such plan may be amended from time to time in accordance with this Agreement.1.87“Gilead Indemnitees” has the meaning set forth in Section 14.2.1.88“GLP” means the applicable then-current good laboratory practice standards as are required by applicableRegulatory Authorities or Applicable Law in the relevant jurisdiction, including, in the United States, those promulgated or endorsed bythe FDA in U.S. 21 C.F.R. Part 58, or the equivalent thereof as promulgated or endorsed by the applicable Regulatory Authoritiesoutside of the United States.1.89“GMP” means all applicable then-current good manufacturing practice standards relating for fine chemicals,intermediates, bulk products, or finished pharmaceutical or biological products, as are required by applicable Regulatory Authorities orApplicable Law in the relevant jurisdiction, including, as applicable: (a) all applicable requirements detailed in the FDA’s current GoodManufacturing Practices regulations, U.S. 21 C.F.R. Parts 210 and 211; (b) all applicable requirements detailed in the EMA’s “TheRules Governing Medicinal Products in the European Community, Volume IV, Good Manufacturing Practice for Medicinal Products;”and (c) all Applicable Law promulgated by any Governmental Authority8 Source: AGENUS INC, 10-K, March 18, 2019Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results.[******] - Certain confidential information contained in this document, marked by brackets, is filed with the Securities and Exchange Commission pursuant to Rule 24b-2 of theSecurities Exchange Act of 1934, as amended.having jurisdiction over the manufacture of the applicable compound or pharmaceutical or biological product, as applicable.1.90“Governmental Authority” means any: (a) federal, state, local, municipal, foreign, or other government; (b)governmental or quasi-governmental authority of any nature (including any agency, board, body, branch, bureau, commission, council,department, entity, governmental division, instrumentality, office, officer, official, organization, representative, subdivision, unit, andany court or other tribunal); (c) multinational governmental organization or body; or (d) entity or body exercising, or entitled toexercise, any executive, legislative, judicial, administrative, regulatory, police, military, or taxing authority or power of any nature.1.91[******]1.92“HSR Act” means the Hart-Scott-Rodino Antitrust Improvements Act of 1976 (15 U.S.C. § 18a).1.93“ICC Rules” has the meaning set forth in Section 16.7.1(b).1.94“IND” means an investigational new drug application (including any amendment or supplement thereto)submitted to the FDA pursuant to U.S. 21 C.F.R. Part 312, including any amendments thereto. References herein to IND shall include,to the extent applicable, any comparable filing(s) outside the U.S. for the investigation of any product in any other country or group ofcountries (such as a Clinical Trial Application in the EU).1.95“IND Acceptance” means, with respect to an IND, the earlier of: (a) receipt by a Party, its Affiliate or aSublicensee of written confirmation from a Regulatory Authority or other applicable Person9 Source: AGENUS INC, 10-K, March 18, 2019Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results.[******] - Certain confidential information contained in this document, marked by brackets, is filed with the Securities and Exchange Commission pursuant to Rule 24b-2 of theSecurities Exchange Act of 1934, as amended.that Clinical Trials may proceed under such IND; or (b) expiration of the applicable waiting period after which Clinical Trials mayproceed under such IND.1.96“Indemnification Claim Notice” has the meaning set forth in Section 14.4.1.1.97“Indemnitee” has the meaning set forth in Section 14.4.1.1.98“Indemnitor” has the meaning set forth in Section 14.4.1.1.99[******]1.100[******]1.101“Indication” means [******].1.102“Information Request Notice” has the meaning set forth in Section 2.3.1.1.103“Infringement” has the meaning set forth in Section 11.3.1.1.104“Initial Licensed Antibody” has the meaning set forth in Section 1.116(i).1.105“Initial Licensed Product” means the Licensed Product that constitutes, incorporates, comprises, or containsthe Initial Licensed Antibody [******].1.106[******]1.107“Invention” means any process, method, composition of matter, article of manufacture, discovery, or findingthat is conceived or reduced to practice.1.108“Joint IP” has the meaning set forth in Section 11.1.1.109“Joint Patents” has the meaning set forth in Section 11.1.1.110“JSC” has the meaning set forth in Section 3.1.1.1.111[******]1.112“Know-How” means algorithms, data, information, Inventions, knowledge, methods (including methods of useor administration or dosing), practices, results, software, techniques, technology, and trade secrets, including analytical and qualitycontrol data, analytical methods (including applicable reference standards), assays, batch records, chemical structures and formulations,compositions of matter, formulae, materials, manufacturing data, pharmacological, toxicological and clinical test data and results,10 Source: AGENUS INC, 10-K, March 18, 2019Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results.[******] - Certain confidential information contained in this document, marked by brackets, is filed with the Securities and Exchange Commission pursuant to Rule 24b-2 of theSecurities Exchange Act of 1934, as amended.processes, reports, research data, research tools, sequences, standard operating procedures, and techniques, in each case, whetherpatentable or not, and, in each case, tangible manifestations thereof.1.113“Knowledge” means, with respect to Agenus, [******].1.114“License Agreement” means the License Agreement, dated the date hereof, by and between the Parties, withrespect to the antibody known as AGEN1423.1.115“License Agreement Effective Date” means the Effective Date as defined under the License Agreement.1.116“Licensed Antibody” means: (i) the [******] antibody known as AGEN2373 [******] as described in moredetail on Schedule 1.116 (the “Initial Licensed Antibody”) and (ii) [******].1.117“Licensed Product” means [******] product that [******]. For clarity, (i) [******], and (ii) for the purposesof this Section 1.117, [******].1.118“Licensed Product Marks” has the meaning set forth in Section 11.6.1.119“MAA” means a Marketing Authorization Application, BLA, or similar application, as applicable, and allamendments and supplements thereto, submitted to the FDA, EMA, or any equivalent filing in a country or regulatory jurisdiction otherthan the U.S. or EU with the applicable Regulatory Authority, to obtain marketing approval for a pharmaceutical or biological product,in a country or in a group of countries.1.120“Major European Markets” means [******].1.121“Manufacture” means all activities related to the manufacturing of a product or any component or ingredientthereof, including the production, manufacture, processing, filling, finishing, packaging, labeling, shipping, and holding of product orany intermediate thereof, including process11 Source: AGENUS INC, 10-K, March 18, 2019Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results.[******] - Certain confidential information contained in this document, marked by brackets, is filed with the Securities and Exchange Commission pursuant to Rule 24b-2 of theSecurities Exchange Act of 1934, as amended.development, process qualification and validation, scale-up, commercial manufacture and analytic development, productcharacterization, stability testing, quality assurance, and quality control.1.122“Manufacturing CMO” means a Third Party designee of Gilead which performs, or will perform,Manufacturing services with respect to any Licensed Product.1.123“Material Amendment” has the meaning set forth in Section 9.3.4(a).1.124“Material Breach” means a breach of this Agreement which [******].1.125“Milestone Event” has the meaning set forth in Section 9.6.1.1.126“Milestone Payment” has the meaning set forth in Section 9.6.1.1.127[******]1.128“Net Sales” means [******]:1.128.1[******]1.128.2[******]1.128.3[******]1.128.4[******]1.128.5[******]1.128.6[******]1.128.7[******]1.128.8[******]1.129[******]1.130“Operating Expenses” means, with respect to a Profit-Share Product, [******]. Operating Expenses shall bedetermined [******].1.131“Option” has the meaning set forth in Section 2.1.1.132“Option and License Agreements” means, collectively, this Agreement and the Option and License Agreement(AGEN1223).1.133“Option and License Agreement (AGEN1223)” means the Option and License Agreement, dated the datehereof, by and between the Parties, with respect to the antibody known as AGEN1223.1.134“Option Closing Date” has the meaning set forth in Section 2.6.1.1.135“Option Early Exercise Review Period” has the meaning set forth in Section 2.3.2(a).12 Source: AGENUS INC, 10-K, March 18, 2019Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results.[******] - Certain confidential information contained in this document, marked by brackets, is filed with the Securities and Exchange Commission pursuant to Rule 24b-2 of theSecurities Exchange Act of 1934, as amended.1.136“Option Effective Date” has the meaning set forth in Section 2.4.1.137“Option Exercise” has the meaning set forth in Section 2.4.1.138“Option Exercise Date” has the meaning set forth in Section 2.5.1.139“Option Exercise Notice” has the meaning set forth in Section 2.4.1.140“Option Period” means the period of time commencing on the Effective Date and ending upon the earlier of:(a) [******], as such period may be extended pursuant to Section 2.3; and (b) [******].1.141“Ordinary Course Agreement” means [******].1.142“Other Expenses” means, with respect to a Profit-Share Product, the following items, to the extent [******].1.143[******]1.144[******]1.145“Outstanding Profit-Share Costs” has the meaning set forth in Section 9.3.5(c)(3).1.146“Party” has the meaning set forth in the Preamble.1.147“Patent Extensions” has the meaning set forth in Section 11.7.1.148“Patents” means: (a) U.S. patents and patent applications in any country or supranational jurisdictionworldwide; (b) any substitutions, divisionals, continuations, continuations‑in‑part, reissues, renewals, registrations, confirmations, andthe like of any such patents or patent applications; (c) foreign counterparts of any of the foregoing; and (d) any and all extensions orrestorations by existing or future13 Source: AGENUS INC, 10-K, March 18, 2019Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results.[******] - Certain confidential information contained in this document, marked by brackets, is filed with the Securities and Exchange Commission pursuant to Rule 24b-2 of theSecurities Exchange Act of 1934, as amended.extension or restoration mechanisms, including revalidations, reissues, re-examinations and extensions, including any supplementaryprotection certificates of any of the foregoing.1.149“Payee” means a Party receiving a payment under this Agreement.1.150“Payor” means a Party owing or making a payment under this Agreement.1.151“Person” means any individual, partnership, joint venture, limited liability company, corporation, firm, trust,association, unincorporated organization, governmental authority or agency, or any other entity not specifically listed herein.1.152“Phase 1 Clinical Trial” means [******].1.153“Phase 1b Clinical Trial” means [******].1.154“Phase 2 Clinical Trial” means [******].1.155[******]1.156[******]1.157[******]1.158[******]1.159[******]1.160[******]1.161[******]1.162[******]1.163“Pricing Approval” means any approval, agreement, determination, or decision establishing prices that can becharged to consumers for a pharmaceutical or biological product or that will be reimbursed by Governmental Authorities for apharmaceutical or biological product, in each case, in a country where Governmental Authorities approve or determine pricing forpharmaceutical or biological products for reimbursement or otherwise.1.164“Prior CDA” means that certain mutual confidentiality agreement, by and between Agenus Inc. and Gileaddated [******], as amended by (i) that certain letter agreement dated [******]14 Source: AGENUS INC, 10-K, March 18, 2019Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results.[******] - Certain confidential information contained in this document, marked by brackets, is filed with the Securities and Exchange Commission pursuant to Rule 24b-2 of theSecurities Exchange Act of 1934, as amended.between Agenus Inc. and Gilead, [******] and (ii) that certain letter agreement between Agenus Inc. and Gilead dated [******].1.165“Profit (Loss)” means, with respect to the Profit-Share Product, Net Sales plus Sublicense Revenues, less COGSless Operating Expenses, in each case, solely to the extent incurred with respect to the U.S.1.166“Profit-Share” has the meaning set forth in Section 9.3.1.1.167“Profit-Share Effective Date” means the [******] of the [******] following the [******] in which Agenusdelivers the Profit-Share Option Exercise Notice in accordance with Section 9.3.2.1.168“Profit-Share Opt-Out Effective Date” means the [******] of the [******] following the [******] in whichAgenus delivers the Profit-Share Opt-Out Notice in accordance with Section 9.3.5(a).1.169“Profit-Share Opt-Out Notice” has the meaning set forth in Section 9.3.5(a).1.170“Profit-Share Opt-Out Option” has the meaning set forth in Section 9.3.5(a).1.171“Profit-Share Opt-Out Option Exercise Deadline” has the meaning set forth in Section 9.3.5(a).1.172“Profit-Share Option” has the meaning set forth in Section 9.3.1.1.173“Profit-Share Option Exercise Deadline” has the meaning set forth in Section 9.3.1.1.174“Profit-Share Option Exercise Notice” has the meaning set forth in Section 9.3.2.1.175“Profit-Share Product” means the Initial Licensed Product for which Agenus has exercised the Profit-ShareOption in accordance with Section 9.3.2, but only for so long as the Profit-Share Term for such Initial Licensed Product remains ineffect, after which such Initial Licensed Product shall automatically become a Royalty-Bearing Product.1.176“Profit-Share Term” means the period of time commencing on the Profit-Share Effective Date and expiringupon the earliest of: (a) the Profit-Share Opt-Out Effective Date; (b) the Profit-Share Termination Effective Date; and (c) expiration ofthe Royalty Term with respect to the Profit-Share Product in the U.S.1.177“Profit-Share Termination Effective Date” has the meaning set forth in Section 9.3.5(b).1.178“Prosecution and Maintenance” or “Prosecute and Maintain” means, with regard to a Patent, the preparation,filing, prosecution, and maintenance of such Patent, as well as re-examinations, reissues, appeals, and requests for patent termadjustments with respect to such Patent, together with the initiation or defense of interferences, oppositions, inter partes review,derivations, re-examinations, post-grant proceedings, and other similar proceedings [******] with respect to the particular Patent, andany appeals therefrom. For clarification, “Prosecution and Maintenance” or “Prosecute and Maintain” shall not include any otherenforcement actions taken with respect to a Patent.1.179“Receiving Party” shall have the meaning set forth in Section 12.1.1.180“Regulatory Approval” means, all approvals, licenses, and authorizations of the applicable RegulatoryAuthority necessary for the marketing and sale of a pharmaceutical or biological15 Source: AGENUS INC, 10-K, March 18, 2019Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results.[******] - Certain confidential information contained in this document, marked by brackets, is filed with the Securities and Exchange Commission pursuant to Rule 24b-2 of theSecurities Exchange Act of 1934, as amended.product for a particular Indication in a country or region (including separate Pricing Approvals, as necessary), and including theapprovals by the applicable Regulatory Authority of any expansion or modification of the label for such Indication.1.181“Regulatory Authority” means any national or supranational Governmental Authority, including the U.S. Foodand Drug Administration (and any successor entity thereto) (the “FDA”) in the U.S., the European Medicines Agency (and anysuccessor entity thereto) (the “EMA”) in the EU, or any health regulatory authority in any country or region that is a counterpart to theforegoing agencies, in each case, that holds responsibility for development and commercialization of, and the granting of RegulatoryApproval for, a pharmaceutical or biological product in such country or region.1.182[******]1.183“Regulatory Materials” means the regulatory registrations, applications, authorizations, and approvals(including approvals of MAAs, INDs, supplements and amendments, pre- and post-approvals, Pricing Approvals, and labelingapprovals), Regulatory Approvals, and other submissions made to or with any Regulatory Authority, including drug master files, forresearch, development (including the conduct of Clinical Trials), manufacture, or commercialization of a pharmaceutical or biologicalproduct in a regulatory jurisdiction, together with all related correspondence to or from any Regulatory Authority and16 Source: AGENUS INC, 10-K, March 18, 2019Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results.[******] - Certain confidential information contained in this document, marked by brackets, is filed with the Securities and Exchange Commission pursuant to Rule 24b-2 of theSecurities Exchange Act of 1934, as amended.all documents referenced in the complete regulatory chronology for each MAA, IND, and foreign equivalents of any of the foregoing.1.184“Rejection Event” has the meaning set forth in Section 15.4.1.1.185“ROW” means all of the countries in the Territory other than the United States.1.186“Royalty-Bearing Product” means any Licensed Product other than a Profit-Share Product.1.187“Royalty Floor” means [******].1.188“Royalty Term” means, on a Licensed Product-by-Licensed Product and country-by-country basis, the periodof time commencing on the First Commercial Sale of any Licensed Product in such country and expiring upon the latest of: [******].1.189“Royalty Territory” means: (a) the Territory, with respect to Royalty-Bearing Products; and (b) the ROW, withrespect to Profit-Share Products.1.190“Sales Milestone Event” has the meaning set forth in Section 9.7.1.1.191“Sales Milestone Payment” has the meaning set forth in Section 9.7.1.1.192“Sales Representative” has the meaning set forth in Section 1.56.1.193“Securities Regulators” has the meaning set forth in Section 12.3.1(a).1.194[******]1.195[******]1.196[******]1.197[******]1.198“Settlement Sublicensee” means a Third Party that is granted a license or sublicense under a settlementagreement between such Third Party and a Party, any of its Affiliates, or any of its or their respective licensees or sublicensees, whichagreement was entered into in connection with an ANDA settlement or similar agreement.1.199“Standard Cost of Manufacturing” means, with respect to the Profit-Share Product for a given Calendar Year,[******].1.200“Stock Purchase Agreement” has the meaning set forth in the Recitals.1.201“Sublicense Revenues” means all amounts received by Gilead from a Sublicensee in consideration for asublicense under the licenses granted to Gilead pursuant to this Agreement to Develop and Commercialize Licensed Products in theU.S., excluding: [******].1.202“Sublicensee” means, with respect to Gilead, a Third Party to whom Gilead has granted a sublicense or license,either directly or indirectly, under the Agenus IP licensed to Gilead by Agenus pursuant to this Agreement, to Develop, Manufacture, orCommercialize the Licensed Products in the Field17 Source: AGENUS INC, 10-K, March 18, 2019Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results.[******] - Certain confidential information contained in this document, marked by brackets, is filed with the Securities and Exchange Commission pursuant to Rule 24b-2 of theSecurities Exchange Act of 1934, as amended.in the Territory, but excluding: (a) any Third Party acting solely as a distributor; and (b) Agenus and any of its Affiliates.1.203“Supply Agreement” has the meaning set forth in Section 7.2.1.204“Taxes” has the meaning set forth in Section 9.10.2.1.205“Term” has the meaning set forth in Section 15.1.1.1.206“Terminated Licensed Product” means: (a) in the case of the termination of this Agreement with respect to aLicensed Product pursuant to Section 15.2 or Section 15.3, the Licensed Product subject to such termination; (b) in the case of thetermination of this Agreement with respect to a country pursuant to Section 15.2 or Section 15.3, all Licensed Products in the countrysubject to such termination; and (c) in the case of termination of this Agreement in its entirety, all Licensed Products in all countries inthe Territory.1.207“Territory” means worldwide.1.208“Third Party” means any Person other than Agenus or Gilead that is not an Affiliate of Agenus or of Gilead.1.209“Third Party Claim” means any and all suits, claims, actions, proceedings, or demands brought by a ThirdParty.1.210“Third Party Expenses” means [******].1.211“Third Party Infringement Claim” has the meaning set forth in Section 11.4.1.1.212“Transferred Inventory” has the meaning set forth in Section 8.3.1.213“Transfer Taxes” has the meaning set forth in Section 9.10.2(a).1.214“Transition Period” has the meaning set forth in Section 8.1.1.215“U.S. Co-Commercialization Agreement” has the meaning set forth in Section 6.2.1.216“U.S. Co-Commercialization Negotiation Period” has the meaning set forth in Section 6.2.1.217“U.S. Co-Commercialization Notice” has the meaning set forth in Section 6.2.1.218“U.S. Co-Commercialization Option” has the meaning set forth in Section 6.2.1.219“U.S. Development” means, with respect to the Profit-Share Product, Development activities intended tosupport the filing of an MAA (including any supplement or amendment thereto) for the Profit-Share Product in the U.S.1.220“United States” or “U.S.” means the United States of America and all of its territories and possessions.1.221“Upstream License Agreement” means any contract or agreement with a Third Party pursuant to whichAgenus in-licenses or otherwise maintains Control of Patents, Know-How, or other18 Source: AGENUS INC, 10-K, March 18, 2019Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results.[******] - Certain confidential information contained in this document, marked by brackets, is filed with the Securities and Exchange Commission pursuant to Rule 24b-2 of theSecurities Exchange Act of 1934, as amended.intellectual property rights that constitute Agenus IP for purposes of this Agreement, including such Upstream License Agreements setforth on Schedule 13.2.15 (“Existing Upstream License Agreements”) and any Upstream License Agreements which become suchpursuant to Section 8.6.1.222“Valid Claim” means, (a) with respect to a pending application, [******]; and (b) with respect to an issuedPatent, a claim of such patent that has not expired, lapsed, been cancelled, or abandoned, or been dedicated to the public, disclaimed, orheld unenforceable, invalid, revoked, or cancelled by a court or administrative agency of competent jurisdiction in an order or decisionfrom which no appeal has been or can be taken, including through opposition, reexamination, reissue, disclaimer, inter partes review,post grant procedures, or similar proceedings.1.223[******]ARTICLE 2OPTIONGeneral. Agenus hereby grants to Gilead an exclusive option, during the Option Period, to obtain an exclusive license, under theAgenus IP, to Develop, Manufacture, and Commercialize Licensed Products in the Field in the Territory on the terms and conditionsprovided in this Agreement (the “Option”).Activities Prior to the Option Effective Date.Development. Prior to the Option Effective Date, Agenus shall be solely responsible for the Development (and Manufacture, orhaving Manufactured, for the purposes thereof) of the Licensed Antibodies and the Licensed Products; provided, that Agenus shall useCommercially Reasonable Efforts to Develop the Licensed Antibodies and the Licensed Products and Manufacture or haveManufactured necessary quantities thereof in accordance with: (a) the Agenus Development Plan, as may be amended from time to timeby mutual agreement of the Parties or to the extent required by Applicable Law or any relevant Regulatory Authority; (b) the ClinicalTrial Criteria; and (c) the reasonable directions of the JSC. Subject to Section 2.2.5, all such Development and associatedManufacturing shall be at [******]. The Agenus Development Plan shall remain in effect unless and until amended as provided herein.From the Effective Date until the Option Effective Date, the JSC shall review and discuss potential amendments to the AgenusDevelopment Plan at least [******]. In addition, the Parties will agree upon an amendment to the Agenus Development Plan in order toensure that such plan is designed to enable Agenus to, during the Option Period, provide Gilead with the Data Package with respect tothe first completed Phase 1b Clinical Trial of an Initial Licensed Product which meets the Clinical Trial Criteria.Prosecution and Maintenance of Agenus Patents. Prior to the Option Effective Date and subject to Section 11.2.1, Agenus shall [******] Prosecute and Maintainthe Agenus Patents [******]; [******].Information-Sharing. Prior to the Option Effective Date, at each meeting of the JSC or as otherwise agreed by the Parties, Agenus willprovide the JSC with written reports or presentations summarizing its activities with respect to the Development and associatedManufacture of the Licensed Antibodies and the Licensed Products. Each report or presentation will cover such activities since theprevious JSC meeting, including a summary of results, information, and data generated and any material developments and activitiesplanned with respect to the Licensed Antibodies or the Licensed Products. Upon request by the JSC or by Gilead, Agenus will providethe JSC with such other then-existing information and such additional access to records with respect to the Licensed Antibodies and theLicensed19 Source: AGENUS INC, 10-K, March 18, 2019Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results.[******] - Certain confidential information contained in this document, marked by brackets, is filed with the Securities and Exchange Commission pursuant to Rule 24b-2 of theSecurities Exchange Act of 1934, as amended.Products as the JSC or Gilead may reasonably request, including the underlying information used to support such summaries.2.2.4[******]Supply of Licensed Products for Phase 2 Clinical Trial. During the Option Period, Gilead may request, by written notice to Agenus, that Agenus, either itself or througha mutually-acceptable Third Party contract manufacturer, Manufacture Initial Licensed Product for purposes of a Phase 2 Clinical Trial(as determined in Gilead’s reasonable discretion) to be conducted following the Option Effective Date. Following such request, and[******], Agenus shall [******], either itself or through a mutually-acceptable Third Party contract manufacturer, to Manufacture suchsupply. Gilead shall reimburse Agenus for the [******]. Agenus shall, upon Gilead’s request, promptly terminate, or cause to beterminated, the Manufacture of supply (if any) by a Third Party contract manufacturer pursuant to this Section 2.2.5; provided, thatGilead shall reimburse Agenus for [******]. To the extent Manufacturing under this Section 2.2.5 is performed by Agenus (rather thana Third Party contract manufacturer), the terms on which Gilead will purchase such Initial Licensed Products will be [******]. AllInitial License Product Manufactured pursuant to this Section 2.2.5 shall remain in the possession and control of Agenus unless anduntil the Option Effective Date occurs.2.2.6[******]Data Package.Completion of Phase 1b Clinical Trial.(a)Agenus shall provide Gilead with the Data Package with respect to the first completed Phase 1b ClinicalTrial of an Initial Licensed Product which meets the Clinical Trial Criteria promptly following the completion of such Phase 1b ClinicalTrial.(b)Within [******] after the Effective Date, Gilead shall [******].(c)Notwithstanding Section 2.3.2(b), from Gilead’s receipt of the Data Package until the expiration of theOption Period, Gilead may provide Agenus with written notice requesting then-existing additional information with respect to theLicensed Antibodies or applicable Licensed Products, or a discussion with Agenus representative(s) who have the relevant knowledgeand information regarding the Licensed Antibodies or the applicable Licensed Products, reasonably required in order to understandsuch Data Package or to evaluate whether to exercise the Option (each, an “Information Request Notice”). Agenus shall use allreasonable efforts to provide such information or hold such discussion as promptly as practicable but in any event within [******] afterreceipt of such Information Request Notice. If the Information Request Notice is provided during the [******], to the extent thatAgenus has not provided such information in any material respect or has failed to hold such discussion within the [******] period,Gilead shall notify Agenus thereof and the Option Period shall be extended by [******].Prior to Completion of Phase 1b Clinical Trial.(a)Notwithstanding Section 2.3.1, [******] during the period from the Effective Date until the firstcompleted Phase 1b Clinical Trial of an Initial Licensed Product which meets the Clinical Trial Criteria, Gilead may provide writtennotice to Agenus requesting a Data Package (each, a “Data Package Request Notice”). Promptly, but in any event within [******]following receipt of such Data Package Request Notice, Agenus shall deliver to Gilead such Data Package. Beginning upon receipt ofthe20 Source: AGENUS INC, 10-K, March 18, 2019Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results.[******] - Certain confidential information contained in this document, marked by brackets, is filed with the Securities and Exchange Commission pursuant to Rule 24b-2 of theSecurities Exchange Act of 1934, as amended.Data Package, Gilead shall have a period of [******] to review the Data Package (as such period may be extended in accordance withSection 2.3.2(b), the “Option Early Exercise Review Period”).(b)From time to time during the Option Early Exercise Review Period, Gilead may provide Agenus withwritten notice requesting additional then-existing information with respect to the Licensed Antibodies or the applicable LicensedProducts, or a discussion with Agenus representative(s) who have the relevant knowledge and information regarding the LicensedAntibodies or Licensed Products, reasonably required in order to understand such Data Package or to evaluate whether to exercise theOption (each, an “Early Exercise Comment Notice”), and Agenus will provide such information or hold such discussion as promptlyas practicable but in any event within [******] after receipt of such Early Exercise Comment Notice. If an Early Exercise CommentNotice is provided during the first [******] of the Option Early Exercise Review Period, to the extent that Agenus has not providedsuch information in any material respect or has failed to hold such discussion within [******], Gilead shall notify Agenus thereof andthe Option Early Exercise Review Period shall be extended by [******].(c)Notwithstanding Section 2.3.2(b), if, following delivery of a Data Package Request Notice, Gilead hasnot exercised the Option within the Option Early Exercise Review Period applicable to such Data Package Request Notice, then Gileadmay submit a new Data Package Request Notice, in which case Section 2.3.2(a) shall apply to such new Data Package Request Notice. Option Exercise. Gilead may exercise the Option (the “Option Exercise”) at any time during the Option Period by providing written noticethereof (the “Option Exercise Notice”) to Agenus. Gilead shall deliver, together the Option Exercise Notice, a notice to Agenus whichidentifies the filings, notices, applications, or other submissions, if any, under Antitrust Law which Gilead determines are necessary oradvisable in connection with the Option Exercise (“Antitrust Filings”), and Agenus shall deliver an updated Schedule 13.2 as of theOption Exercise Date to the extent that Gilead has not received the Data Package as of such date. Gilead’s rights and obligationshereunder in connection with the Option Exercise (including any licenses to be granted in connection therewith) shall become effectiveonly upon the Option Closing Date (the “Option Effective Date”). If no Option Exercise occurs pursuant to Section 2.4 within theOption Period, then Gilead shall have no further rights with respect to Licensed Antibodies and Licensed Products under thisAgreement.Antitrust Filings. As soon as reasonably practicable following date on which Gilead provides the Option Exercise Notice to Agenus inaccordance with Section 2.4 (the “Option Exercise Date”) and in any event within [******] thereof, each of Agenus and Gilead shallprepare and submit any Antitrust Filings, if any, including any such required filings under the HSR Act and the rules promulgatedthereunder, with respect to the Option Exercise. In connection with any such Antitrust Filings, the Parties shall furnish promptly to theUnited States Federal Trade Commission, the Antitrust Division of the United States Department of Justice, and any other applicableGovernmental Authority any additional information requested within their authority under the HSR Act or other Antitrust Law, usereasonable efforts to obtain antitrust clearance for the transactions contemplated hereunder as soon as practicable with respect to theOption Exercise, and otherwise cooperate with each other in the governmental antitrust clearance process. [******] fees in connectionwith any filings under this Section 2.5, and [******] attorneys’ fees and other expenses in connection therewith.Option Exercise Closing; Effectiveness.Option Exercise Closing. The closing of the transactions contemplated by this Agreement in connection with the Option Exercise(including any licenses to be granted in connection therewith) shall take place remotely via the electronic exchange of documents andsignatures as soon as practical, but no later than [******] following the date on which all of the conditions precedent set forth in21 Source: AGENUS INC, 10-K, March 18, 2019Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results.[******] - Certain confidential information contained in this document, marked by brackets, is filed with the Securities and Exchange Commission pursuant to Rule 24b-2 of theSecurities Exchange Act of 1934, as amended.Section 2.6.2 have been satisfied or waived by the applicable Party (other than Section 2.6.2(c), which can only be satisfied or waivedat the closing), or at such other time and place as Agenus and Gilead may agree upon in writing (the “Option Closing Date”).Conditions to Option Effectiveness. The obligation of the Parties to consummate the transactions contemplated by this Agreement in connection withthe Option Exercise (including any licenses to be granted in connection therewith) is subject to the satisfaction by each Party of thefollowing conditions, any or all of which may be waived in whole or in part by the other Party in its sole discretion, subject toApplicable Law:(a)the expiration or termination of all applicable waiting period(s) and any other required clearances underthe Antitrust Filings, if any, including under the HSR Act;(b)the representations and warranties made by such Party in Sections 13.1 and 13.2 (with respect toAgenus) and Sections 13.1 and 13.3 (with respect to Gilead) shall be true and correct in all material respects as of the Option EffectiveDate, as updated by any updated Schedule 13.2 that Agenus may deliver as of the Option Effective Date and, with respect to Agenus assuch Party, Agenus shall have performed and complied in all material respects with the covenants set forth in Section 13.4.2; and(c)the provision by each Party to the other Party of an officer’s certificate certifying the satisfaction of thecondition in Section 2.6.2(b) with respect to such Party.Gilead Development Plan and Gilead Development Budget. Promptly following the Option Effective Date, Gilead shall provide to Agenus the initial Gilead Development Plan,including the initial Gilead Development Budget. ARTICLE 3GOVERNANCEJoint Steering Committee.Establishment; Responsibilities. Within [******] after the Effective Date, the Parties shall establish a joint steering committee (the “JSC”) as morefully described in this Section 3.1. The JSC shall serve as a forum to facilitate communications between the Parties and, to the extentprovided in this Section 3.1, shall have review and decision-making responsibilities, as well as general oversight of the relevantactivities, with respect to: (a) Development (and Manufacture, or having Manufactured, for the purposes thereof) of the LicensedAntibodies and the Licensed Products prior to the Option Effective Date; and (b) the Development and Commercialization of the Profit-Share Product during the Profit-Share Term. In particular, the JSC shall: (i) review and discuss potential amendments to the AgenusDevelopment Plan in accordance with Section 2.2.1; (ii) request, receive, and review information and access to records with respect tothe Licensed Antibodies and the Licensed Products prior to the Option Effective Date in accordance with Section 2.2.3; (iii) review,discuss, and approve any amendment to the Gilead Development Plan, including the Gilead Development Budget, in accordance withSection 4.2; and (iv) adopt and approve the Commercialization Plan (including the Commercialization Budget), including anyamendments thereto, in accordance with Section 6.1.Representatives. The JSC shall be comprised of [******] (or such other number of representatives as the Parties may mutuallyagree; provided, that Gilead and Agenus shall at all times have an equal number of representatives on the JSC) from each of Gilead andAgenus. Each representative of a Party shall have sufficient seniority and expertise to participate on the JSC as determined in suchParty’s reasonable judgment. Gilead shall have the right to designate the chairperson of the JSC from among its22 Source: AGENUS INC, 10-K, March 18, 2019Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results.[******] - Certain confidential information contained in this document, marked by brackets, is filed with the Securities and Exchange Commission pursuant to Rule 24b-2 of theSecurities Exchange Act of 1934, as amended.[******] JSC representatives. Each Party may replace any or all of its representatives on the JSC at any time upon written notice to theother Party in accordance with Section 16.2. Each Party may, upon receiving the other Party’s prior written consent (not to beunreasonably withheld, conditioned, or delayed), invite non-JSC representatives of such Party and any Third Party to attend meetings ofthe JSC; provided, that any such non-JSC representative or Third Party is bound by obligations of confidentiality, non-disclosure, andnon-use no less restrictive than those set forth in Article 12, and obligations as to ownership of inventions and data consistent with thoseset forth in this Agreement, prior to attending any such meeting. Meetings. The first scheduled meeting of the JSC shall be held no later than [******] after establishment of the JSC unlessotherwise agreed by the Parties. After the first scheduled meeting of the JSC until the time at which the JSC is disbanded in accordancewith Section 3.1.6, the JSC shall meet in person or telephonically at least [******], or more or less frequently as the Parties agree, onsuch dates and at such places and times as provided herein or as the Parties shall agree; provided, that representatives of the JSC shall inany event meet at least [******] per Calendar Year in person. The representatives of the JSC may also convene or be consulted fromtime to time by means of telecommunications, video conferences, electronic mail, or correspondence, as deemed necessary orappropriate. Each Party shall bear all costs and expenses it incurs in regard to participating in all meetings of the JSC, including alltravel and living expenses.Minutes. Gilead shall be responsible for preparing and circulating minutes of each meeting of the JSC, setting forth, interalia, an overview of the discussions at the meeting. A draft of such minutes shall be circulated by Gilead to all representatives of theJSC within [******] after the applicable meeting. Such minutes shall be effective only after such minutes have been approved by bothParties in writing. Definitive minutes of all JSC meetings shall be approved and finalized no later than [******] after the meeting towhich the minutes pertain.Decisions. Except as otherwise set forth in this Agreement, for matters over which the JSC has decision-making authority, alldecisions of the JSC shall be made by consensus, with each Party having one (1) vote. Decisions of the JSC made at a meeting shall berecorded in the definitive minutes for such meeting approved by both Parties as set forth in Section 3.1.4. If the JSC cannot agree onany such matter, then either Party may, by providing written notice to the other Party, have such matter referred to the ExecutiveOfficers for resolution. If the Executive Officers are unable to resolve the matter within [******] (or such other longer time frame thatthe Executive Officers may otherwise agree upon) after the matter is referred to them in accordance with this Section 3.1.5, then:[******]; provided, that, [******] shall not have the right to: (i) make a decision that is stated to require the mutual agreement ormutual consent of the Parties; (ii) amend, modify, interpret, or waive the terms of this Agreement or the U.S. Co-CommercializationAgreement, or otherwise act in contravention of the terms of this Agreement; (iii) resolve any dispute regarding whether a MilestoneEvent or a Sales Milestone Event set forth herein has been achieved; or (iv) require [******] to perform any act that it reasonablybelieves to be inconsistent with Applicable Law. Disbandment. The JSC shall remain in effect from the date on which it is established in accordance with Section 3.1.1 and shallautomatically disband on the earlier of: (a) the Profit-Share Option Exercise Deadline, if Agenus does not exercise the Profit-ShareOption in accordance with Section 9.3.2; or (b) the expiration of the Profit-Share Term, if Agenus exercises the Profit-Share Option inaccordance with Section 9.3.2.Sub-Committees. The JSC may, at any time that it deems necessary or appropriate, establish additional joint committees and delegate such ofits responsibilities as it determines appropriate23 Source: AGENUS INC, 10-K, March 18, 2019Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results.[******] - Certain confidential information contained in this document, marked by brackets, is filed with the Securities and Exchange Commission pursuant to Rule 24b-2 of theSecurities Exchange Act of 1934, as amended.to such joint committees. Any such joint committees shall automatically be disbanded upon the disbandment of the JSC in accordancewith Section 3.1.6.ARTICLE 4DEVELOPMENTFrom and after the Option Effective Date:Responsibility. Subject to the terms and conditions of this Agreement, Gilead shall have the sole right (and shall solely control, at itsdiscretion), itself or with or through its Affiliates, Sublicensees, or other Third Parties, to Develop the Licensed Products in the Field inthe Territory. Subject to Section 9.3, all such Development shall be at [******].Gilead Development Plan and Gilead Development Budget. During the Profit-Share Term: (a) the JSC shall review and discuss potential amendments to the Gilead Development Plan,including the Gilead Development Budget, at least [******]; and (b) subject to Section 3.1.5, the JSC shall have the authority toapprove any amendment to the Gilead Development Plan, including the Gilead Development Budget.Development Diligence. Subject to the terms and conditions of this Agreement, Gilead, itself or with or through its Affiliates or Sublicensees or otherThird Parties, shall [******].Development Updates Outside of Profit-Share Term. From the expiration of the Profit-Share Term, if any, and continuing until the date on which Gilead has submitted an MAAto the applicable Regulatory Authority for [******], Gilead shall submit to Agenus, [******], a written report with respect to theLicensed Products summarizing: [******].ARTICLE 5REGULATORYRegulatory Matters.Responsibility.(a)Prior to the Option Effective Date, Agenus shall have the sole right (and shall solelycontrol, at its discretion but subject to JSC input and approval), itself or with or through its Affiliates or other Third Parties to prepare,and submit to applicable Regulatory Authorities, all Regulatory Materials, for Licensed Products.(b)From and after the Option Effective Date, and subject to the terms and conditions of thisAgreement, Gilead shall have the sole right (and shall solely control, at its discretion), itself or with or through its Affiliates,Sublicensees, or other Third Parties, to: (i) prepare, and submit to applicable Regulatory Authorities, all Regulatory Materials forLicensed Products; and (ii) obtain and maintain all Regulatory Approvals for Licensed Products.Communications with Regulatory Authorities. For clarity and without limiting Section 5.1.1:(a)Prior to the Option Effective Date, (i) Agenus shall have the exclusive right to correspondor communicate with Regulatory Authorities regarding the Licensed Products, (ii) unless required by Applicable Law, Gilead, itsAffiliates, and its permitted subcontractors shall not correspond or24 Source: AGENUS INC, 10-K, March 18, 2019Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results.[******] - Certain confidential information contained in this document, marked by brackets, is filed with the Securities and Exchange Commission pursuant to Rule 24b-2 of theSecurities Exchange Act of 1934, as amended.communicate with Regulatory Authorities regarding any Licensed Product without first obtaining Agenus’ prior written consent, and(iii) if Gilead, its Affiliates, or its permitted subcontractors receive any correspondence or other communication from a RegulatoryAuthority regarding a Licensed Product, Gilead shall provide Agenus with access to or copies of all such material written or electroniccorrespondence promptly after its receipt.(b)From and after the Option Effective Date, (i) Gilead shall have the exclusive right tocorrespond or communicate with Regulatory Authorities regarding the Licensed Products, (ii) unless required by Applicable Law,Agenus, its Affiliates, and its permitted subcontractors shall not correspond or communicate with Regulatory Authorities regarding anyLicensed Product without first obtaining Gilead’s prior written consent, and (iii) if Agenus, its Affiliates, or its permitted subcontractorsreceive any correspondence or other communication from a Regulatory Authority regarding a Licensed Product, Agenus shall provideGilead with access to or copies of all such material written or electronic correspondence promptly after its receipt.Agenus Support. From and after the Option Effective Date, Agenus shall [******] to support Gilead as may be reasonablyrequested by Gilead from time to time in connection with Gilead’s preparation, submission to Regulatory Authorities and maintenanceof Regulatory Materials for Licensed Products, including, upon Gilead’s reasonable request, attending meetings with RegulatoryAuthorities regarding any Licensed Product.Regulatory Materials.Pre-Option Exercise Regulatory Materials. Agenus shall solely own any and all Regulatory Materials for the Licensed Products made, generated or filedprior to the Option Effective Date (the “Existing Regulatory Materials”). Except to the extent notified otherwise in writing by Gilead,after the Option Effective Date, Agenus shall assign and transfer (and hereby does assign and transfer), or cause to be assigned andtransferred to the extent not owned by Agenus, to Gilead (or its designee), no later than [******] after the Option Effective Date anyand all Existing Regulatory Materials, including providing true, accurate, and complete hard or electronic copies thereof to Gilead.From and after such assignment and transfer, Gilead (or its designee) shall have the sole right, in its sole discretion, to file, maintain,and hold title to all Existing Regulatory Materials.New Regulatory Materials. All Regulatory Materials generated or arising from or in connection with activities under this Agreement after theOption Effective Date with respect to Licensed Products shall be owned by and held in the name of Gilead or its designee, and, exceptfor Existing Regulatory Materials (which are addressed in Section 5.2.1), and any such Regulatory Materials issued in the name ofAgenus, its Affiliates or contractors shall promptly following the Option Effective Date be assigned by Agenus to Gilead or its designeeto the extent permitted by Applicable Law or, in the event assignment is not permitted under Applicable Law, held in trust for, or for thesole benefit of, Gilead or its designee.Right of Reference; Access to Data.5.3.1From and after the Option Effective Date and prior to the time at which Regulatory Materials aretransferred and assigned to Gilead or its designee, or in the event of failure to transfer and assign any Regulatory Materials to Gilead orits designee, as required by Section 5.2.1 or Section 5.2.2, Gilead and its designees shall have, and Agenus (on behalf of itself and itsAffiliates) hereby grants to Gilead and its designees, access and a right of reference (without any further action required on the part ofAgenus, its Affiliates or contractors, whose authorization to file this consent with any Regulatory Authority is hereby granted) to allsuch Regulatory Materials and all data contained or referenced therein for Gilead25 Source: AGENUS INC, 10-K, March 18, 2019Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results.[******] - Certain confidential information contained in this document, marked by brackets, is filed with the Securities and Exchange Commission pursuant to Rule 24b-2 of theSecurities Exchange Act of 1934, as amended.and its designees to exercise its rights and perform its obligations under this Agreement with respect to Licensed Products. In all cases,from and after the Option Effective Date, Gilead and its designees shall have access to all data contained or referenced in all suchRegulatory Materials, and Agenus shall ensure that Gilead and its designees are afforded such access.Upon transfer and assignment of the Existing Regulatory Materials and the data contained or referenced therein toGilead or its designee in accordance with Section 5.2.1, Gilead shall grant and hereby grants to Agenus and its designees a right ofreference (without any further action required on the part of Gilead, its Affiliates or contractors, whose authorization to file this right ofreference with any Regulatory Authority is hereby granted) to any INDs transferred and assigned to Gilead as an Existing RegulatoryMaterial and all data contained or referenced therein, solely for Agenus and its designees to Develop and seek and maintain RegulatoryApprovals of [******].ARTICLE 6ARTICLE 6COMMERCIALIZATIONGeneral. Subject to the terms and conditions of this Agreement, from and after the Option Effective Date, Gilead shall have, subjectto Section 6.2, the sole right (and shall solely control, at its discretion), itself or with or through its Affiliates, Sublicensees, or otherThird Parties, to Commercialize the Licensed Products in the Field in the Territory. Subject to Section 9.3, all such Commercializationshall be at [******]. During the Profit-Share Term, such Commercialization activities in the U.S. shall be conducted in accordance withthe Commercialization Plan and the Commercialization Budget, which shall be adopted and approved (including any amendmentsthereto), from time to time by the JSC.Certain Agenus U.S. Co-Commercialization Activities. If Agenus exercises the Profit-Share Option, it shall have the option (the “U.S. Co-Commercialization Option”),exercisable by providing written notice to Gilead (the “U.S. Co-Commercialization Notice”) in the Profit-Share Option ExerciseNotice, to perform certain Commercialization-related activities with respect to the Profit-Share Product in the United States as set forth inSchedule 6.2. If Agenus does not exercise the U.S. Co-Commercialization Option in accordance with this Section 6.2, then such optionwill be deemed irrevocably waived. If Agenus exercises the U.S. Co-Commercialization Option, the Parties shall negotiate in good-faithfor up to [******] Gilead’s receipt of the U.S. Co-Commercialization Notice (the “U.S. Co-Commercialization Negotiation Period”)the terms of a definitive agreement addressing such activities, which agreement will include the terms set forth in Schedule 6.2 (the“U.S. Co-Commercialization Agreement”) and such other mutually agreed terms and conditions as are customary for agreements ofsuch type which are consistent with the terms and conditions of this Agreement, including Schedule 6.2. The U.S. Co-Commercialization Agreement shall include: [******].ARTICLE 7MANUFACTURING; PHARMACOVIGILANCEGeneral.Subject to the terms and conditions of this Agreement, prior to the Option Effective Date, Agenus shall have thesole right (and shall solely control, at its discretion), itself or with or through its Affiliates, Sublicensees, or other Third Parties, toManufacture the Licensed Products in the Field in the Territory. Subject to Section 2.2.5, prior to the Option Effective Date, all suchManufacturing shall be at [******].7.1.2Subject to the terms and conditions of this Agreement, from and after the Option Effective Date,Gilead shall have the sole right (and shall solely control, at its discretion), itself or with or through its Affiliates, Sublicensees, or otherThird Parties, to Manufacture the Licensed Products in the Field in the26 Source: AGENUS INC, 10-K, March 18, 2019Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results.[******] - Certain confidential information contained in this document, marked by brackets, is filed with the Securities and Exchange Commission pursuant to Rule 24b-2 of theSecurities Exchange Act of 1934, as amended.Territory. Subject to Section 9.3, from and after the Option Effective Date, all such Manufacturing shall be at [******].Supply Agreement. At the election of Gilead exercisable by written notice to Agenus within [******] of the Option Effective Date, and subjectto any manufacturing capacity constraints that Agenus may have at the time of such request, the Parties shall conduct good-faithdiscussions regarding the terms of a supply agreement (and a corresponding quality agreement with customary terms and conditions)pursuant to which Agenus would supply the Licensed Products to Gilead for its Clinical Trials (the “Supply Agreement”). [******]. Inaddition, the Supply Agreement shall otherwise include mutually agreed terms as are customary for agreements of such type.Pharmacovigilance. No later than [******], the Parties shall enter into a pharmacovigilance agreement in customary form in order to, amongother things, coordinate safety matters and share of safety information with respect to the Licensed Products.ARTICLE 8ASSISTANCE; TRANSITION; UPSTREAM LICENSE AGREEMENTSAssistance. From and after the Option Effective Date, Agenus shall, and shall cause its Affiliates to, cooperate with Gilead and itsdesignees and provide reasonable assistance to Gilead and its designees to transition Development and Manufacturing activities withrespect to Initial Licensed Products to Gilead and its designees to the extent reasonably requested by Gilead, including by: (a) providingGilead and its designees reasonable assistance with respect to Development, regulatory, and Manufacturing transition matters related tothe Initial Licensed Products; and (b) providing Gilead and its designees with reasonable access by teleconference or in‑person (asrequested by Gilead) to Agenus personnel (and personnel of its Affiliates and Third Party contractors) involved in Development,regulatory, or Manufacturing matters related to the Initial Licensed Products to assist with the transition and answer questions related tothe Initial Licensed Products. Agenus shall provide the assistance described in this Article 8, with qualified personnel and at Gilead’sreasonable request, until [******] (the “Transition Period”); provided, that Agenus shall, and shall cause its Affiliates to, complete theactivities assigned to, or otherwise contemplated to be completed by, Agenus under the Tech Transfer Plan which have not beencompleted as of the expiration of the Transition Period, and shall cooperate in good faith with Gilead and its designees and providereasonable assistance to Gilead and its designees after expiration of the Transition Period to address any issues arising out of or notaddressed by the transition activities contemplated by this Section 8.1, which issues are materially and adversely impacting Gilead’sability to assume responsibility for the Development and Manufacture of the Initial Licensed Products in accordance with thisAgreement.Know-How Transfer. Without limiting the provisions of Section 8.1, as soon as reasonably practicable following the Option Exercise Date (but inno event later than [******] following the Option Exercise Date), the Parties shall agree on and commence performance of a plan (the“Tech Transfer Plan”), pursuant to which Agenus shall promptly, following the Option Effective Date and the Tech Transfer Plan’sagreement and execution, disclose to Gilead and its designees in English, including by providing hard or electronic copies thereof,[******].Licensed Products Inventory Transfer. Without limiting the provisions of Section 8.1, upon Gilead’s written request and at no additional cost to Gilead, Agenusshall promptly following the Option Effective Date assign and transfer to Gilead or its designee and deliver to Gilead or its designee, ata location to be specified by Gilead, the inventory of the Licensed Products held at such time by or on behalf of Agenus or its Affiliates(including any such inventory held at any contract manufacturer or any other27 Source: AGENUS INC, 10-K, March 18, 2019Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results.[******] - Certain confidential information contained in this document, marked by brackets, is filed with the Securities and Exchange Commission pursuant to Rule 24b-2 of theSecurities Exchange Act of 1934, as amended.location) (the “Transferred Inventory”), along with all applicable manufacturing, GMP and shelf-life information in accordance withthe Tech Transfer Plan.Manufacturing Technology Transfer. Without limiting the other provisions of Article 8, as soon as reasonably practicable following the Option Effective Date (butin no event later than as required under the Tech Transfer Plan), Agenus shall transfer, and thereafter continue, during the TransitionPeriod as may be reasonably requested by Gilead from time to time, the transfer (from Agenus, its Affiliates, or its Third Party contractmanufacturers) to Gilead and its designees copies in English (in writing or in an electronic format) of [******] as of the OptionEffective Date that is [******] to the Manufacture of the Licensed Products, in order to enable Gilead and its designees to Manufacturethe Licensed Products, including, if desired by Gilead, to replicate the process employed by or on behalf of Agenus prior to the OptionEffective Date to Manufacture the Licensed Products. Such transfers shall be in accordance with the Tech Transfer Plan in which theParties have identified [******] required for Manufacture, or [******] for the Development and Manufacture of the Licensed Products;provided, that, if Gilead reasonably believes that any materials which are not identified in the Tech Transfer Plan are [******] for theManufacture, or are [******] for the Development or Manufacture, of the Licensed Products (but excluding [******]), then Agenusshall cooperate in good faith with Gilead to provide such materials to Gilead. In addition, at the reasonable request of Gilead from timeto time, Agenus shall make its employees and consultants (including personnel of its Affiliates and Third Party contract manufacturers)available to Gilead and its designees to provide reasonable consultation and technical assistance in order to ensure an orderly transitionof the Manufacturing technology and operations to Gilead and its designees and to assist Gilead and its designees in the Manufacture ofthe Licensed Products. [******].Assignment of Agreements. After the Option Effective Date, Agenus shall, or shall cause its Affiliates to, as applicable, to the extent legally permissible(provided, that, to the extent consent is required from the relevant counterparty, Agenus shall, or shall cause its Affiliates to, asapplicable, [******]): (a) assign to Gilead or its designee any or all (as designated by Gilead) Development and ManufacturingAgreements; or (b) assist Gilead or its Affiliate in entering into new agreements directly with the counterparties to any or allDevelopment and Manufacturing Agreements to cover the subject matter of such Development and Manufacturing Agreements, asapplicable, in each case ((a) and (b)), to the extent requested by Gilead in writing. If any Development and Manufacturing Agreementis assigned to Gilead, Agenus shall be solely responsible for, and shall indemnify and hold harmless Gilead and all other GileadIndemnitees from and against any costs and other Damages arising from, or relating to, any such Development and ManufacturingAgreement as a result of, or in connection with, events or occurrences prior to the date of such assignment (including any payments thataccrued prior to the date of such assignment but which do not become payable until after the date of such assignment).Upstream License Agreements. In the event that after the Option Effective Date Agenus enters into a contract or agreement with a Third Party pursuant towhich Agenus in-licenses or otherwise acquires Control of any Patents, Know-How, or other intellectual property rights that wouldconstitute Agenus IP for purposes of this Agreement, then Agenus shall promptly provide Gilead with notice and a copy of theapplicable license or other contract or agreement with the Third Party. Within [******] following receipt of such notice, Gilead shalldecide, in its sole discretion, whether or not to accept such Patents, Know-How, or other intellectual property as Agenus IP licensedunder this Agreement and provide Agenus written notice of such decision. In the event of acceptance, such Patents, Know-How, orother intellectual property shall constitute Agenus IP licensed to Gilead under this Agreement, such agreement shall thereafter beincluded within the definition of Upstream License Agreements, and [******] shall be responsible for any payments arising thereunder[******] (provided, that, [******]). In the event that Gilead does not accept such Third Party agreement as an Upstream LicenseAgreement (including by failing to respond within such [******] period), Gilead and its Affiliates shall have no obligations withrespect to28 Source: AGENUS INC, 10-K, March 18, 2019Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results.[******] - Certain confidential information contained in this document, marked by brackets, is filed with the Securities and Exchange Commission pursuant to Rule 24b-2 of theSecurities Exchange Act of 1934, as amended.such Third Party agreement and such Patents, Know-How or other intellectual property shall not constitute Agenus IP licensed to Gileadhereunder.ARTICLE 9FINANCIAL TERMSUpfront Payment. No later than [******] after the Effective Date, Gilead shall pay to Agenus a one (1)-time, non-refundable, and non-creditable payment of [******] in immediately available funds by wire transfer, in accordance with wire instructions to be provided inwriting by Agenus to Gilead on or before the Effective Date.Option Fee. No later than [******] after the Option Effective Date, Gilead shall pay to Agenus a one (1)-time, non-refundable, and non-creditable payment of [******] in immediately available funds by wire transfer, in accordance with wire instructions to be provided inwriting by Agenus to Gilead no later than [******] after the Option Effective Date.Profit-Share.General; Limitation. From and after the Option Effective Date, Agenus shall have the option, exercisable by written notice provided toGilead in accordance with Section 9.3.2 at any time until [******] following the later of: (a) the Option Effective Date; and (b)[******] (such end date, the “Profit-Share Option Exercise Deadline” and such option, the “Profit-Share Option”), to share inDevelopment Costs and Profit (Loss) (the “Profit-Share”) with respect to the Profit-Share Product in the U.S. Agenus may onlyexercise one (1) Profit-Share Option under this Agreement and the Option and License Agreement (AGEN1223). Once Agenusexercises the Profit-Share Option under one (1) of the Option and License Agreements, Agenus’s right to exercise the Profit-ShareOption under the other Option and License Agreement shall irrevocably terminate. In addition, if Agenus exercises its Profit-ShareOption under this Agreement, then from and after Agenus’ delivery of the Profit-Share Opt-Out Notice in accordance with Section9.3.5(a) or Gilead’s delivery of the Profit-Share termination notice in accordance with Section 9.3.5(b), as applicable, Agenus’ right toexercise the Profit-Share Option under the Option and License Agreement (AGEN1223) shall irrevocably terminate. [******].Exercise. In the event that Agenus wishes to exercise the Profit-Share Option, it shall deliver written notice to Gilead of itselection (the “Profit-Share Option Exercise Notice”) no later than the Profit-Share Option Exercise Deadline. If Agenus does notdeliver the Profit-Share Option29 Source: AGENUS INC, 10-K, March 18, 2019Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results.[******] - Certain confidential information contained in this document, marked by brackets, is filed with the Securities and Exchange Commission pursuant to Rule 24b-2 of theSecurities Exchange Act of 1934, as amended.Exercise Notice in accordance with this Section 9.3.2, then Agenus’s right to exercise the Profit-Share Option will be deemedirrevocably waived.Effects of Exercise. If the Profit-Share Option is exercised, then, during the Profit-Share Term:(a)The Parties shall share responsibility for Development Costs as follows: (i) Gilead shall bear [******]percent ([******]%) of such Development Costs; and (ii) Agenus shall bear [******] percent ([******]%) of such DevelopmentCosts;(b)The Parties shall share Profit (Loss) as follows: (i) Gilead shall bear (and be entitled to) [******] percent([******]%) of Profit (Loss); and (ii) Agenus shall bear (and be entitled to) [******] percent ([******]%) of Profit (Loss); and(c)Agenus shall be entitled to receive Milestone Payments, Sales Milestone Payments, and royaltypayments with respect to such Profit-Share Product in accordance with Section 9.6, Section 9.7, and Section 9.8.9.3.4[******](a)In the event that, during the Profit-Share Term and prior to the date on which an MAAfor the first Profit-Share Product is submitted in the United States, the Gilead Development Budget is amended in accordance withSection 4.2 such that the amount of Development Costs for which Agenus is responsible pursuant to Section 9.3.3(a) pursuant to theGilead Development Budget in effect immediately following such amendment exceeds [******] percent ([******]%) of the amount ofDevelopment Costs for which Agenus was responsible pursuant to the Gilead Development Budget in effect immediately prior to suchamendment (each such amendment, a “Material Amendment” and such amount of excess Development Costs, “AdditionalDevelopment Costs”), then [******].(b)Gilead shall have the right, in its sole discretion, to deduct all [******].(c)[******]Agenus Opt-Out; Gilead Termination.(a)Agenus-Opt-Out. In the event that Agenus has exercised the Profit-Share Option in accordance withSection 9.3.2, it shall have the one (1)-time option to elect to irrevocably opt-out of the Profit-Share (the “Profit-Share Opt-OutOption”) in accordance with this Section 9.3.5(a). The Profit-Share Opt-Out Option shall be exercisable by Agenus at any time from[******] until [******] (the “Profit-Share Opt-Out Option Exercise Deadline”). In the event that Agenus wishes to exercise theProfit-Share Opt-Out Option, it shall deliver written notice to Gilead of its election (the “Profit-Share Opt-Out Notice”) no later thanthe Profit-Share Opt-Out Option Exercise Deadline. If Agenus does not deliver the Profit-Share Opt-Out Notice in accordance with thisSection 9.3.5(a), then Agenus’s right to exercise the Profit-Share Opt-Out Option will be deemed irrevocably waived.(b)Gilead Termination. Gilead may terminate the Profit-Share in accordance with this Section 9.3.5(b) if, atany time during the Profit-Share Term, Agenus fails to reimburse Gilead for its share of Agenus Development Costs or Profit (Loss) inaccordance with Section 9.4 or Section 9.5.3, as applicable; provided, that Agenus has not cured such failure within [******] after thedate on which Gilead provides written notice to Agenus of such failure, which notice shall describe such failure in reasonable detail andshall state Gilead’s intention to terminate the Profit-Share. Any such termination of the Profit-30 Source: AGENUS INC, 10-K, March 18, 2019Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results.[******] - Certain confidential information contained in this document, marked by brackets, is filed with the Securities and Exchange Commission pursuant to Rule 24b-2 of theSecurities Exchange Act of 1934, as amended.Share under this Section 9.3.5(b) shall become effective at the end of the [******] period (the “Profit-Share Termination EffectiveDate”), unless Agenus has cured such failure prior to the expiration of such [******] period.(c)Effects of Agenus Opt-Out or Gilead Termination. From and after the Profit-Share Opt-Out EffectiveDate or the Profit-Share Termination Effective Date, as applicable, with respect to a Profit-Share Product:(1)The Profit-Share shall no longer be in effect;(2)Any Milestone Payments or Sales Milestone Payments, in each case, that would have becomedue and payable during the Profit-Share Term with respect to the Profit-Share Product if such Profit-Share Product were a Royalty-Bearing Product will be deemed irrevocably waived;(3)The U.S. Co-Commercialization Agreement (if then in effect) shall terminate in accordancewith its terms; and(4)Gilead shall promptly invoice Agenus for any Agenus Development Costs or Profit (Loss)incurred prior to the Profit-Share Opt-Out Effective Date or Profit-Share Termination Effective Date (as applicable) which have not beenreimbursed by Agenus to Gilead in accordance with Section 9.4 or Section 9.5.3, as applicable (the “Outstanding Profit-ShareCosts”), and Agenus will reimburse Gilead for the Outstanding Profit-Share Costs within [******] of receipt of such invoice; provided,that if Agenus fails to reimburse Gilead for the Outstanding Profit-Share Costs within such [******] period, then Gilead shall have theright, in its sole discretion, to deduct [******] any Outstanding Profit-Share Costs which have not been reimbursed by Agenus from[******]. For clarity, any liabilities or obligations of Agenus, including its obligation to pay a portion of Agenus Development Costs inaccordance with Section 9.3.3(a) or a portion of Profit (Loss) in accordance with Section 9.3.3(b), which have accrued prior to theProfit-Share Opt-Out Effective Date or the Profit-Share Termination Effective Date, as applicable, shall survive the exercise of the Profit-Share Opt-Out Option or the Profit-Share Termination Effective Date, as applicable.(5)If, as of the Profit-Share Termination Effective Date, any [******] have not been offset byGilead in accordance with Section 9.3.4(b), such [******] shall become due and payable no later than [******].Development Costs Reconciliation. Within [******] following the last day of each [******] during the Profit-Share Term, Gilead will provide to Agenus:(a) an expense report detailing all Development Costs incurred for the Profit-Share Product during such [******]; and (b) an invoice forthe portion of such Development Costs payable by Agenus under Section 9.3.3(a) (the “Agenus Development Costs”) for such[******]. Agenus will reimburse Gilead for its share of such Agenus Development Costs for such [******] within [******] of receiptof each such invoice.Profit (Loss) Reconciliation.9.5.1During the Profit-Share Term, following the First Commercial Sale of the Profit-Share Product, Agenusshall furnish to Gilead a written report for each [******] showing the Operating Expenses incurred by Agenus with respect to the U.S.during the reporting [******]. Such reports shall be due no later than [******] following the end of each [******].9.5.2Gilead shall furnish to Agenus a written report for each [******] showing the amount and calculationof the Profit (Loss) payable under this Agreement for such [******] in sufficient31 Source: AGENUS INC, 10-K, March 18, 2019Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results.[******] - Certain confidential information contained in this document, marked by brackets, is filed with the Securities and Exchange Commission pursuant to Rule 24b-2 of theSecurities Exchange Act of 1934, as amended.detail to allow Agenus to verify the amount of Profit (Loss) paid by Gilead with respect to such [******], including the total grossamount invoiced for the Profit-Share Product sold in the U.S., the Net Sales of the Profit-Share Product in the U.S., COGS with respectto the Profit-Share Product for the U.S., and the Operating Expenses incurred by each of Gilead and Agenus with respect to theU.S. Such reports shall be due no later than [******] following the end of each [******].9.5.3Gilead shall perform a reconciliation, as may be further detailed in the U.S. Co-CommercializationAgreement, to ensure that each Party bears and receives its share of Profit (Loss) as set forth in Section 9.3.3(b). Profit (Loss) shown tohave accrued by each report provided under Section 9.5.2 and, subject to prompt resolution of any good faith dispute as to the accuracyof such reconciliation, Gilead’s reconciliation shall be due and payable within [******] of the date such report is due. If the Profit(Loss) for a [******] is negative, Gilead shall submit an invoice to Agenus for its share of such Profit (Loss). Agenus shall pay suchinvoice within [******] of receipt.9.5.4The terms of this Agreement which are relevant for the purposes of determining and allocatingDevelopment Costs and Profit (Loss), including the applicable defined terms in Article 1 and payment and reconciliation mechanisms,may be amended in Gilead’s reasonable discretion during the U.S. Co-Commercialization Negotiation Period solely to ensure that suchterms comply with Accounting Standards then in effect; provided, that: (a) Gilead provides any such proposed amendments to Agenus[******]; and (b) such proposed amendments [******].Milestones.Milestones. Subject to the terms of this Section 9.6.1, Section 9.6.2, and Section 9.10.1, Gilead shall pay the applicableamount set forth in the table below in this Section 9.6.1 associated with each milestone event described below (each event, a “MilestoneEvent” and each payment, a “Milestone Payment”) with respect to the first (and only the first) Royalty-Bearing Product or Profit-ShareProduct, as applicable, to achieve such Milestone Event under this Agreement:Development Milestone EventDevelopment MilestonePayment – Royalty-Bearing ProductDevelopmentMilestone Payment –Profit-Share Product(a)[******][******][******](b)[******][******][******](c)[******][******][******](d)[******][******][******](e)[******][******][******]Regulatory Milestone EventRegulatory MilestonePayment – Royalty-Bearing ProductRegulatory MilestonePayment – Profit-Share Product(f)[******][******][******](g)[******][******][******](h)[******][******][******] Each Milestone Payment shall be non-refundable, non-creditable, and payable a maximum of one (1) time as set forth in thetable above, regardless of the number of Royalty-Bearing Products or Profit-Share Products, as applicable, which achieve the applicableMilestone Event (i.e., a maximum of [******] Milestone Payments may be made pursuant to this Section 9.6.1 with respect to Royalty-Bearing Products and a maximum of [******] Payments may be made pursuant to this Section 9.6.1 with respect to Profit-ShareProducts), and no Milestone Payment shall be due hereunder for subsequent or repeated achievement32 Source: AGENUS INC, 10-K, March 18, 2019Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results.[******] - Certain confidential information contained in this document, marked by brackets, is filed with the Securities and Exchange Commission pursuant to Rule 24b-2 of theSecurities Exchange Act of 1934, as amended.of any such Milestone Event, including where Milestone Event is first achieved by a Royalty-Bearing Product and is subsequentlyachieved by a Profit-Share Product (and vice versa). Subject to Section 9.3.5(c)(2), upon the achievement of any Milestone Event listed in Section [******] above, any of theMilestone Event(s) listed in such Sections: (i) which are listed earlier in the table above than the achieved Milestone Event; and (ii) forwhich the applicable Milestone Payment(s) has not been previously paid, shall become due and payable together with the MilestonePayment due in connection with such achieved Milestone Event; provided, that if the achieved Milestone Event is the Milestone Eventlisted in Section [******] above, the Milestone Payments due in connection with the achievement of the Milestone Events listed in[******] and [******] shall not become due and payable together with the Milestone Payment due in connection with such achievedMilestone Event. If the Milestone Event listed in Section [******] above is achieved prior to the achievement of the Milestone Eventlisted in Section [******] above, then the Milestone Payment corresponding to the Milestone Event listed in Section [******] aboveshall become due and payable together with the Milestone Payment due in connection with the achievement of the Milestone Eventlisted in Section [******] above.Further, if a [******] for a [******] does not constitute a [******] at the time of its [******], then subject to the otherterms of this Section 9.6.1, such [******] shall be deemed a [******] and the Milestone Event listed in Section [******] or Section[******], as applicable, for such [******] shall be deemed achieved (to the extent not previously achieved) on the [******] for such[******].For the avoidance of doubt, the maximum amount payable by Gilead pursuant to this Section 9.6.1 is [******] (with respectto Royalty-Bearing Products) or [******] (with respect to Profit-Share Products), as applicable, assuming that each Milestone Event inthis Section 9.6.1 were achieved, but in no event shall the aggregate Milestone Payment due in connection with this Section 9.6.1exceed [******].Invoice and Payment of Milestone Payments.(a)In the event that Gilead, its Affiliates, or its Sublicensees under this Agreement achieves a MilestoneEvent, it shall notify Agenus thereof within [******] of such achievement. Following Agenus’s receipt of notice from Gilead thatGilead has achieved a Milestone Event, Agenus shall invoice Gilead for the applicable Milestone Payment, and Gilead shall pay suchMilestone Payment within [******] after receipt of such invoice.(b)In the event that Agenus or its Affiliates achieves a Milestone Event, Agenus shall notify Gilead thereof(and, with respect to the achievement of Milestone Event 9.6.1(a), shall provide to Gilead any documentation which is necessary toevidence such achievement) within [******] of such achievement and invoice Gilead for the applicable Milestone Payment, andGilead, subject to prompt resolution of any good faith dispute as to whether such Milestone Event has been achieved (including, ifapplicable, [******]), shall pay such Milestone Payment within [******] after receipt of such invoice.Sales Milestones.Sales Milestones. Subject to the terms of this Section 9.7.1 and Section 9.10.2(b), Gilead shall notify Agenus within [******] afterthe end of the [******] during which a given milestone event described below in this Section 9.7.1 (each, a “Sales Milestone Event”)was first achieved by Gilead under this Agreement, and Gilead shall thereafter pay the applicable amounts set forth below associated33 Source: AGENUS INC, 10-K, March 18, 2019Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results.[******] - Certain confidential information contained in this document, marked by brackets, is filed with the Securities and Exchange Commission pursuant to Rule 24b-2 of theSecurities Exchange Act of 1934, as amended.with the applicable Sales Milestone Event in accordance with Section 9.7.2 (each, a “Sales Milestone Payment”):Sales Milestone EventSales Milestone Payment(a)[******][******](b)[******][******](c)[******][******](d)[******][******]Each Sales Milestone Payment shall be non-refundable, non-creditable, and payable a maximum of one (1) time as set forthin the table above, regardless of the number of times the applicable Sales Milestone Event was achieved (i.e., a maximum of [******]Sales Milestone Payments may be made pursuant to this Section 9.7.1), and no Sales Milestone Payment shall be due hereunder forsubsequent or repeated achievement of any such Sales Milestone Event. Upon achievement of any Sales Milestone Event listed in[******] above, any previously listed Sales Milestone Event for which the applicable Milestone Payment has not been paid shall be duetogether with the Milestone Payment due in connection with such achieved Sales Milestone Event. For the avoidance of doubt, themaximum amount payable by Gilead pursuant to this Section 9.7.1 is [******], assuming that each Sales Milestone Event in thisSection 9.7.1 were achieved. [******].Invoice and Payment of Sales Milestone Payments. Following Agenus’s receipt of notice from Gilead that Gilead has achieved a Sales Milestone Event, Agenus shallinvoice Gilead for the applicable Sales Milestone Payment, and Gilead shall pay such Sales Milestone Payment within [******] afterreceipt of the invoice therefor.Royalties.Royalty Rates. Subject to the terms of this Section 9.8.1 and Section 9.10.2(b), Gilead shall pay Agenus royalties on Annual NetSales in the Royalty Territory, on a Licensed Product-by-Licensed Product basis, during the applicable Royalty Term, equal to thefollowing portions of Annual Net Sales of the applicable Licensed Product multiplied by the applicable royalty rate set forth below forsuch portion of Annual Net Sales in the Royalty Territory during the applicable Royalty Term for each such Licensed Product. Forclarity, the royalties (and royalty tiers) shall be calculated separately on a Licensed Product-by-Licensed Product basis.Portion of Annual Net Sales in the Royalty Territory for a given LicensedProduct in a given Calendar YearRoyalty Ratei.[******][******]ii.[******][******]iii.[******][******]iv.[******][******]The applicable royalty rate set forth in the table above shall apply only to that portion of the Annual Net Sales in the RoyaltyTerritory of a given Licensed Product during a given Calendar Year that falls within the indicated range. [******].Royalty Term. Gilead’s royalty obligations to Agenus under Section 9.8.1 shall apply, on a Licensed Product-by-LicensedProduct and country-by-country basis, only during the applicable Royalty Term for such Licensed Product in such country. Followingthe expiration of the applicable Royalty Term for a given Licensed Product in a given country: (a) no further royalties shall be payablewith respect to sales of such Licensed Product in such country; and (b) the license granted to Gilead under34 Source: AGENUS INC, 10-K, March 18, 2019Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results.[******] - Certain confidential information contained in this document, marked by brackets, is filed with the Securities and Exchange Commission pursuant to Rule 24b-2 of theSecurities Exchange Act of 1934, as amended.this Agreement with respect to such Licensed Product in such country shall become fully paid-up, perpetual, irrevocable, and royalty-free in accordance with Section 15.1.2(b)(1).Royalty Reductions.(a)[******](b)[******]Offset for Third Party Payments.(a)[******](b)[******]Royalty Floor.(a)[******](b)[******](c)[******](d)[******]Invoice and Payment of Royalty Payments. Starting on the date of First Commercial Sale of a Licensed Product in the Territory, Gilead shall furnish to Agenus a[******] written report for each subsequent [******] showing the Net Sales of all Licensed Products and the royalty payments due toAgenus on such sales. Each such royalty report shall be due within [******] after the end of the relevant [******]. Each royaltyreport shall describe [******]. Within [******] following the delivery of the applicable [******] report, Agenus shall invoice Gileadfor the royalties due to Agenus with respect to Net Sales for such [******] as set forth in such royalty report and Gilead shall pay suchamounts to Agenus within [******] following Gilead’s receipt of such invoice.Additional Payment Terms.Currency. All payments hereunder shall be made in Dollars by wire transfer to a bank designated in writing by the Payee nolater than [******] prior to the date by which the applicable payment must be made. Conversion of sales recorded in local currenciesto Dollars shall be performed in compliance with Accounting Standards and the Payor’s normal practices used to prepare its auditedfinancial statements.Taxes; Withholding.(a)Generally. Except as set forth in this Section 9.10.2, the Payee shall be liable for all income and othertaxes (including interest) (“Taxes”) imposed upon any payments made by the Payor to Payee under this Agreement (“AgreementPayments”). The amounts set forth herein are exclusive of all applicable sales or use, goods and services, value added, consumption orother similar fees or taxes35 Source: AGENUS INC, 10-K, March 18, 2019Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results.[******] - Certain confidential information contained in this document, marked by brackets, is filed with the Securities and Exchange Commission pursuant to Rule 24b-2 of theSecurities Exchange Act of 1934, as amended.(“Transfer Taxes”) arising on the Agreement Payments, and the Payor shall be responsible for and pay any such Transfer Taxesimposed on it with respect to the Agreement Payments due to the Payee hereunder.(b)Tax Withholding. If Applicable Law requires the withholding of Taxes, the Payor shall subtract theamount thereof from the Agreement Payments and remit such withheld amount to the relevant Governmental Authority in a timelymanner; provided, however, that before making such withholding, the Payor shall use reasonable efforts to give the Payee notice of theintention to make such withholding. For the avoidance of doubt, Payor’s remittance of such withheld Taxes, together with payment tothe Payee of the remaining Agreement Payments, shall constitute Payor’s full satisfaction of Agreement Payments under thisAgreement. The Payor shall promptly (as available) submit to the Payee appropriate proof of payment of the withheld Taxes as well asthe official receipts within a reasonable period of time. The Payor shall provide the Payee reasonable assistance in establishingentitlement to a reduction to, or elimination of, such withholding of Taxes under Applicable Law, including under the benefit of anypresent or future treaty against double taxation, and the Payor shall provide the Payee with reasonable assistance in seeking refund ofsuch withheld Taxes. Notwithstanding the foregoing, if, as a result of Payor (i) assigning this Agreement, (ii) extending its rights orobligations pursuant to Section 16.16, or (iii) changing its domicile, additional Taxes become due that would not have otherwise beendue hereunder with respect to Agreement Payments, Payor shall be responsible for all such additional withholding Taxes and shall payPayee such amounts as are necessary to ensure that Payee receives the same amount as it would have received had no such assignmentor change in domicile been made. [******].(c)Tax Cooperation. The Parties shall cooperate with respect to all documentation requiredby any taxing authority or reasonably requested by either Party to secure a reduction in the rate of applicable withholding taxes.Records; Audit Rights.Records. Each Party shall keep complete, true, and accurate books and records in accordance with its AccountingStandards in relation to this Agreement, including with respect to Gilead, its Affiliates, and cause its Sublicensees, in relation to NetSales, royalties, Milestone Payments, Sales Milestone Payments, Development Costs, and Profit (Loss). Each Party shall keep suchbooks and records for at least [******] following the Calendar Year to which they pertain or for such longer period of time as requiredunder any Applicable Law.Audit Rights. Subject to the other terms of this Section 9.11.2, during the Term, at the request of a Party (the “Auditing Party”),which shall not be made more frequently than [******] per [******], upon at least [******] prior written notice from the AuditingParty, and at the expense of the Auditing Party, the other Party (the “Audited Party”) shall permit an independent, nationally-recognized certified public accountant selected by the Auditing Party and reasonably acceptable to the Audited Party (the “Auditor”) toinspect, during regular business hours, the relevant records required to be maintained by the Audited Party under Section 9.11.1 orotherwise reasonably necessary to verify the accuracy of royalty reports for such Calendar Year; provided, that such audit right shallnot apply to records beyond [******] from the end of the Calendar Year to which they pertain [******]. Prior to its inspection, theAuditor shall enter into a confidentiality agreement with both Parties having obligations of confidentiality and non-use no less restrictivethan those set forth in Article 12 and limiting the disclosure and use of such information by such accountant to authorizedrepresentatives of the Parties and the purposes germane to Section 9.11.1. The Auditor shall report to the Auditing Party only whetherthe particular amounts being audited were accurate and, if not, the amount of any discrepancy, and the Auditor shall not report anyother information to the Auditing Party. The Auditing Party shall treat the results of any the Auditor’s review of the Audited Party’srecords as Confidential Information of the Audited Party subject to the terms of Article 12. In the event such audit leads to thediscovery of a discrepancy to the Auditing Party’s detriment, the Audited Party36 Source: AGENUS INC, 10-K, March 18, 2019Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results.[******] - Certain confidential information contained in this document, marked by brackets, is filed with the Securities and Exchange Commission pursuant to Rule 24b-2 of theSecurities Exchange Act of 1934, as amended.shall, within [******] after receipt of such report from the Auditor, pay any undisputed amount of the discrepancy. The Auditing Partyshall pay the Auditor’s full cost of the audit unless the underpayment of amounts due the Auditing Party is more than [******], inwhich case the Audited Party shall pay the reasonable cost charged by the Auditor for such review. Any undisputed overpayments byGilead or Agenus, as applicable, revealed by an examination shall be paid by the applicable Party within [******] of its receipt of theapplicable report. [******].9.11.3[******]Upstream License Agreements and Development and Manufacturing Agreements. Notwithstanding anything to the contrary under this Agreement, but subject to Section 8.5 and Section 8.6, Agenus shall besolely responsible for all costs and payments of any kind (including all upfront fees, annual payments, milestone payments, and royaltypayments) arising under any agreements between Agenus (or any of its Affiliates) and any Third Party, including under: (a) anyExisting Upstream License Agreements and any other Upstream License Agreements, unless and until (in the case of such otherUpstream License Agreements) such agreements have been accepted by Gilead pursuant to Section 8.6; and (b) any Development andManufacturing Agreements, unless and until such agreements have been assigned to Gilead pursuant to Section 8.5, as applicable.9.13[******]ARTICLE 10LICENSES; EXCLUSIVITYLicenses to Gilead; Exclusion; Upstream License Agreements.Licenses to Gilead.(a)Licensed Products. Effective as of the Option Effective Date and subject to the terms andconditions of this Agreement, Agenus hereby grants to Gilead a royalty-bearing, exclusive, transferrable (solely pursuant to Section16.4), and sublicenseable (through multiple tiers) license, under the Agenus IP, to Develop, Manufacture, and Commercialize theLicensed Products in the Field in the Territory.(b)[******]10.1.2Exclusion. For the avoidance of doubt, Agenus does not grant to Gilead pursuant tothis Agreement any license under or rights to any intellectual property rights Controlled by Agenus or its Affiliates for the purposes ofDeveloping, Manufacturing, or Commercializing any product that [******].Upstream License Agreements. To the extent that the licenses granted by Agenus to Gilead under the Agenus IP pursuant to Section 10.1.1constitute (a) the grant of a sublicense to Gilead of certain Agenus IP that is not owned by Agenus or any of its Affiliates, but that is in-licensed by Agenus or any such Affiliate from a Third Party licensor pursuant to an Upstream License Agreement, or (b) the license ofcertain Agenus IP that is otherwise encumbered by obligations that would be binding on Gilead37 Source: AGENUS INC, 10-K, March 18, 2019Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results.[******] - Certain confidential information contained in this document, marked by brackets, is filed with the Securities and Exchange Commission pursuant to Rule 24b-2 of theSecurities Exchange Act of 1934, as amended.by their terms, then Gilead shall comply, and shall cause its Affiliates and Sublicensees to comply, with the specific obligationsapplicable to sublicensees under such Upstream License Agreement(s) [******].Subcontracting; Sublicenses.Subcontracting. Gilead may subcontract to Affiliates or Third Parties the performance of tasks and obligations related to Gilead’sDevelopment, Manufacture, and Commercialization of the Licensed Products under this Agreement as Gilead deems appropriate, whichsubcontract may include a sublicense of Agenus IP rights necessary for the performance of the subcontract as reasonably required.Sublicenses. Gilead shall provide Agenus with [******] of each agreement with a Third Party Sublicensee (other than anyagreement with a Third Party subcontractor entered into in the ordinary course of business) within [******] after the execution thereof;provided, that Gilead may [******]. Each sublicense shall require the applicable Sublicensee to comply with applicable terms andconditions of this Agreement. Gilead shall [******] would have constituted a breach of this Agreement if committed by Gilead. Rights Retained by the Parties. Each Party retains all rights under Patents, Know-How, or other intellectual property rights Controlled by such Party whichare not expressly granted to the other Party pursuant to this Agreement. Notwithstanding the foregoing, after the Option Effective Date,[******].No Implied Licenses. Except as otherwise expressly provided in this Agreement, under no circumstances shall a Party or any of its Affiliates, as aresult of this Agreement, obtain any ownership interest, license, or other right in or to any Patents, Know-How, or other intellectualproperty rights of the other Party, including tangible or intangible items owned, controlled, or developed by the other Party, or providedby the other Party to the receiving Party at any time, in each case, pursuant to this Agreement.Exclusivity.General. Subject to Section 10.5.2, [******], Agenus shall not, and shall cause its Affiliates not to, [******].10.5.2[******].ARTICLE 11INTELLECTUAL PROPERTYInventorship and Ownership. The determination of inventorship under this Agreement shall be made in accordance with U.S. patent laws. As betweenthe Parties, all Inventions made or created solely by a Party’s or any of its Affiliates’ employees, independent contractors, orconsultants, in the course of conducting activities under this Agreement, together with all intellectual property rights therein, shall beowned by such Party. All Inventions made or created jointly by each Party’s (or any of its Affiliates’) employees, independentcontractors, or consultants, in the course of conducting activities under this Agreement, together with all Patents therein (“JointPatents”), shall be jointly owned by the Parties (“Joint IP”). Joint IP shall be owned jointly by Gilead and Agenus on the basis of anequal, undivided interest38 Source: AGENUS INC, 10-K, March 18, 2019Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results.[******] - Certain confidential information contained in this document, marked by brackets, is filed with the Securities and Exchange Commission pursuant to Rule 24b-2 of theSecurities Exchange Act of 1934, as amended.[******] and shall be deemed to be Controlled by each Party, subject to the licenses granted under this Agreement. [******].Prosecution and Maintenance.Pre-Option Effective Date. Prior to the Option Effective Date, subject to Section 2.2.2, [******] shall [******] at its [******]. [******] shall [******]. [******] shall [******] with a [******], and shall [******] consistent with this Agreement [******].Post-Option Effective Date. On and after the Option Effective Date:(a)[******] shall [******]. [******] shall [******]. [******] shall [******] with a[******], and shall [******] consistent with this Agreement [******].(b)[******] shall [******], or [******]. [******] shall [******], in connection with[******]. In such event, [******] shall [******], to [******] or [******].11.2.3Cooperation. Each Party hereby agrees to reasonably cooperate with one another with respect to the Prosecution and Maintenance of the Agenus Patents for which such Party is responsible pursuant to this Agreement,including by: (a) making its employees, and using reasonable efforts to make its licensees, sublicensees, independent contractors,agents and consultants, reasonably available to the other Party (or to the other Party’s authorized attorneys, agents or representatives), tothe extent reasonably necessary to enable such Party to undertake Prosecution and Maintenance of Patents as contemplated by thisAgreement; and (b) endeavoring in good faith to coordinate its efforts with the other Party [******].Enforcement.Notice. Each Party shall promptly notify the other Party of any infringement by a Third Party of any Agenus Patent in theTerritory of which it becomes aware, including any declaratory judgment, opposition, or similar action alleging the invalidity,unenforceability, or non-infringement with respect to such Agenus Patent (“Infringement”). Without limiting the foregoing, Gileadshall deliver to Agenus any certification that Gilead receives pursuant to 42 U.S.C. § 262(l) or such similar laws as may exist injurisdictions other than the United States with respect to a Licensed Product within [******] after receipt thereof.Pre-Option Effective Date. Prior to the Option Effective Date, [******] shall have [******], but not [******], to [******] in connectionwith [******]. [******] shall have the right to [******].Post-Option Effective Date. On and after the Option Effective Date, [******] shall have [******], but not [******], to [******]. At the[******] of [******], [******] shall provide [******] in connection with [******] in connection with [******], including by[******]. [******] may [******] if [******]. [******] agrees to [******]. Additionally, [******] shall have the right to [******]at [******] and [******].Defense.Notice. Each Party shall promptly notify the other Party of any claim alleging that the Development, Manufacture, orCommercialization of the Licensed Products in the Territory infringes, misappropriates, or otherwise violates any Patents, Know-How,or other intellectual property rights of any Third Party (“Third Party Infringement Claim”). In any such instance, the Parties shall assoon as39 Source: AGENUS INC, 10-K, March 18, 2019Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results.Source: AGENUS INC, 10-K, March 18, 2019Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results.[******] - Certain confidential information contained in this document, marked by brackets, is filed with the Securities and Exchange Commission pursuant to Rule 24b-2 of theSecurities Exchange Act of 1934, as amended.practicable thereafter discuss in good faith the best response to such notice of such Third Party Infringement Claim. Pre-Option Effective Date. Prior to the Option Effective Date, [******] shall have [******]; provided, that, [******]. [******] shall havethe right to [******].Post-Option Effective Date. On and after the Option Effective Date, [******] shall have the [******]; provided, that, [******].Recovery.11.5.1Any recovery received as a result of any action under Section11.3.3 or Section11.4.3, as applicable, shall be allocated in the following order: [******].11.5.2Any recovery received as a result of any action under Section 11.3.2 or Section11.4.2, as applicable, shall be allocated in the following order: [******].Trademarks. [******] shall have the right, but not the obligation, to brand the Licensed Products using trademarks and trade names[******] for the Licensed Products, which may vary within the Territory (the “Licensed Product Marks”). [******].Patent Extensions. [******]: (a) with respect to requests [******]; and (b) with respect to all other requests, [******], in each case, patent term restoration (including under the Drug Price Competition and Patent Term Restoration Act), supplemental protection certificates or their equivalents, and patent term extensions consistent with this Agreement (collectively, “Patent Extensions”) with respect to the Agenus Patents, where applicable, [******]. If requested by [******] or in the event that [******], [******]shall [******] to [******] for such Patent Extensions [******], and [******] shall [******].ARTICLE 12CONFIDENTIALITYNondisclosure. Each Party agrees that a Party (the “Receiving Party”) which receives the Confidential Information of the other Party (the“Disclosing Party”) pursuant to this Agreement shall: (a) maintain in confidence such Confidential Information using not less than theefforts that such Receiving Party uses to maintain in confidence its own proprietary information of similar kind and value, but in noevent less than a reasonable degree of efforts; (b) not disclose such Confidential Information to any Third Party without first obtainingthe prior written consent of the Disclosing Party, except for disclosures expressly permitted pursuant to this Article 12; and (c) not usesuch Confidential Information for any purpose except those permitted under this Agreement, including, in the case of Gilead, theexercise of the rights and licenses granted to Gilead hereunder. The obligations of confidentiality, non-disclosure, and non-use underthis Section 12.1 shall be in full force and effect from the Execution Date until [******] following the expiration of the Term. TheReceiving Party shall return all copies of or destroy the Confidential Information of the Disclosing Party disclosed or transferred to it bythe Disclosing Party pursuant to this Agreement, within [******] after the expiration or termination of this Agreement; provided,however, that a Party may retain: (i) Confidential Information of the Disclosing Party to exercise rights and licenses which expresslysurvive such termination or expiration pursuant to this Agreement; and (ii) one (1) copy of all other Confidential Information inarchives solely for the purpose of establishing the contents thereof. In addition, [******] shall keep confidential, and shall cause itsAffiliates and its and their employees, consultants, licensees, sublicensees, professional advisors, and Affiliates to keep40 Source: AGENUS INC, 10-K, March 18, 2019Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results.[******] - Certain confidential information contained in this document, marked by brackets, is filed with the Securities and Exchange Commission pursuant to Rule 24b-2 of theSecurities Exchange Act of 1934, as amended.confidential, [******] to the extent [******] on confidentiality terms at least as protective as the confidentiality provisions of thisAgreement [******].Exceptions.General. Section 12.1 shall not apply with respect to any portion of the Confidential Information of the Disclosing Party tothe extent that such Confidential Information:(a)was known to the Receiving Party or any of its Affiliates, as evidenced by written records, without anyobligation to keep it confidential or any restriction on its use, prior to disclosure by the Disclosing Party;(b)is subsequently disclosed to the Receiving Party or any of its Affiliates by a Third Party lawfully inpossession thereof and without any obligation to keep it confidential or any restriction on its use;(c)is published by a Third Party or otherwise becomes publicly available or enters the public domain, eitherbefore or after it is disclosed to the Receiving Party, without any breach by the Receiving Party of its obligations hereunder; or(d)is independently developed by or for the Receiving Party or any of its Affiliates, as evidenced by writtenrecords, without reference to or reliance upon the Disclosing Party’s Confidential Information.Any combination of features or disclosures shall not be deemed to fall within the foregoing exclusions merely because individualfeatures are published or available to the general public or in the rightful possession of the Receiving Party unless the combination itselfand principle of operation are published or available to the general public or in the rightful possession of the Receiving Party.Authorized Disclosure.Disclosure. Notwithstanding Section 12.1, the Receiving Party may disclose Confidential Information belonging to theDisclosing Party in the following instances:(a)subject to Section 12.5, to comply with Applicable Law (including the rules and regulations of the U.S.Securities and Exchange Commission or any national securities exchange in any jurisdiction in the Territory) (collectively, the“Securities Regulators”) or with judicial process (including prosecution or defense of litigation) if, in the reasonable opinion of theReceiving Party’s counsel, such disclosure is necessary for such compliance or for such judicial process (including prosecution ordefense of litigation);(b)disclosure to governmental or other regulatory agencies in order to obtain Patents, to obtain or maintainapproval to conduct Clinical Trials, or to market the Licensed Products under this Agreement, in each case, in accordance with thisAgreement; provided, that reasonable steps are taken to ensure confidential treatment of such Confidential Information to the extentavailable;(c)disclosure to any of its officers, employees, consultants, agents, or Affiliates, and: (i) in the case of[******], any [******], (ii) in the case of [******], any [******], and (iii) in the case of either Party, to such Party’s actual orpotential acquirers, investors, or lenders as part of their due diligence investigations; provided, that, prior to any such disclosure, eachsuch disclosee is bound by written obligations of confidentiality, non-disclosure, and non-use no less restrictive than the obligations setforth41 Source: AGENUS INC, 10-K, March 18, 2019Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results.[******] - Certain confidential information contained in this document, marked by brackets, is filed with the Securities and Exchange Commission pursuant to Rule 24b-2 of theSecurities Exchange Act of 1934, as amended.in this Article 12 to maintain the confidentiality thereof and not to use such Confidential Information except as expressly permitted bythis Agreement; provided, however, that, in each of the above situations in this Section 12.3.1(c), the Receiving Party shall remainresponsible for any failure by any Person who receives Confidential Information from such Receiving Party pursuant to this Section12.3.1(c) to treat such Confidential Information as required under this Article 12; and(d)disclosure to its advisors (including attorneys and accountants) in connection with activities under thisAgreement; provided, that, prior to any such disclosure, each such disclosee is bound by written obligations of confidentiality, non-disclosure, and non-use no less restrictive than the obligations set forth in this Article 12 (provided, however, that in the case of legaladvisors, no written agreement shall be required), to maintain the confidentiality thereof and not to use such Confidential Informationexcept as expressly permitted by this Agreement; provided, however, that, in each of the above situations in this Section 12.3.1(d), theReceiving Party shall remain responsible for any failure by any Person who receives Confidential Information from such ReceivingParty pursuant to this Section 12.3.1(d) to treat such Confidential Information as required under this Article 12.Terms of Disclosure. If and whenever any Confidential Information is disclosed in accordance with this Section 12.3, such disclosureshall not cause any such information to cease to be Confidential Information, except to the extent that such disclosure results in a publicdisclosure of such information other than by breach of this Agreement.Terms of this Agreement. The Parties agree that this Agreement and the terms hereof shall be deemed to be Confidential Information of both Agenusand Gilead, and each Party agrees not to disclose this Agreement or any terms hereof without obtaining the prior written consent of theother Party; provided, that each Party may disclose this Agreement or any terms hereof in accordance with the provisions of Section12.3 or Section 12.5, as applicable.Securities Filings; Disclosure under Applicable Law. Each Party acknowledges and agrees that the other Party may submit this Agreement to, or file this Agreement with, theSecurities Regulators or to other Persons as may be required by Applicable Law, and if a Party submits this Agreement to, or files thisAgreement with, any Securities Regulator or other Person as may be required by Applicable Law, such Party agrees to consult with theother Party with respect to the preparation and submission of a confidential treatment request for this Agreement. Notwithstanding theforegoing, if a Party is required by any Securities Regulator or other Person as may be required by Applicable Law to make a disclosureof the terms of this Agreement in a filing or other submission as required by such Securities Regulator or such other Person, and suchParty has: (a) provided copies of the disclosure to the other Party reasonably in advance under the circumstances of such filing or otherdisclosure; (b) promptly notified the other Party in writing of such requirement and any respective timing constraints; and (c) given theother Party reasonable time under the circumstances from the date of provision of copies of such disclosure to comment upon andrequest confidential treatment for such disclosure, then such Party shall have the right to make such disclosure at the time and in themanner reasonably determined by its counsel to be required by the Securities Regulator or the other Person. Notwithstanding theforegoing, if a Party seeks to make a disclosure as required by a Securities Regulator or other Person as may be required by ApplicableLaw as set forth in this Section 12.5 and the other Party provides comments in accordance with this Section 12.5, the Party seeking tomake such disclosure or its counsel, as the case may be, shall use good-faith efforts to incorporate such comments.Publicity.12.6.1Subject to Section 12.3, Section 12.5, and this Section 12.6.1, [******]; provided, that[******]. The contents of any press release, publication, or other public statement that has been42 Source: AGENUS INC, 10-K, March 18, 2019Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results.[******] - Certain confidential information contained in this document, marked by brackets, is filed with the Securities and Exchange Commission pursuant to Rule 24b-2 of theSecurities Exchange Act of 1934, as amended.reviewed and approved by [******] may be re-released by [******] without first obtaining [******] prior written consent inaccordance with this Section 12.6.1.[******]; provided, that, subject to Sections 12.3 and 12.5, [******]. [******] shall use [******]. [******],[******] shall first [******], subject to and in accordance with Section 12.3 and Section 12.5, as applicable.12.6.3Notwithstanding the foregoing Sections 12.6.1 and 12.6.2, the Parties shall mutually agree to a pressrelease or public announcement regarding this Agreement and the terms hereof, such press release or public announcement to be issuedpromptly (but in no event later than [******]) after the Execution Date, or as otherwise agreed by the Parties. Either Party shall beauthorized to use the information disclosed in any mutually approved press release or public announcement without the need to seekfurther consent or approval thereof from the other Party.Use of Names. Except as otherwise expressly set forth herein, neither Party (or any of its respective Affiliates) shall use the name,trademark, trade name, or logo of the other Party or any of its Affiliates, or its or their respective employees, in any publicity,promotion, news release, or other public disclosure relating to this Agreement or its subject matter, without first obtaining the priorwritten consent of the other Party; provided, that such consent shall not be required to the extent use thereof may be required byApplicable Law, including the rules of any securities exchange or market on which a Party’s or its Affiliate’s securities are listed ortraded. Each Party shall be authorized to use the name, trademark, trade name, or logo of the other Party in the manner that such otherParty has previously approved, without the need to seek further consent or approval thereof from the other Party.Clinical Trials Registry. For clarity, Gilead, its Affiliates, and its designees [******]. The Parties [******].ARTICLE 13REPRESENTATIONS AND WARRANTIES; COVENANTS Representations and Warranties of Each Party. Each Party hereby represents and warrants to the other Party, as of the Execution Date, the Option Exercise Date, and theOption Effective Date, that:13.1.1such Party is duly organized, validly existing, and in good standing under the Applicable Law of thejurisdiction of its formation and has full corporate power and authority to enter into this Agreement and to carry out the provisionshereof;13.1.2such Party has taken all necessary corporate action on its part to authorize the execution and deliveryof this Agreement and the performance of its obligations hereunder;13.1.3this Agreement has been duly executed and delivered on behalf of such Party and constitutes a legal,valid, and binding obligation, enforceable against it in accordance with its terms, except to the extent that enforcement of the rights andremedies created hereby is subject to: (i) bankruptcy, insolvency, reorganization, moratorium, and other similar laws of generalapplication affecting the rights and remedies of creditors; or (ii) laws governing specific performance, injunctive relief, and otherequitable remedies;13.1.4the execution, delivery, and performance of this Agreement by such Party does not breach orconflict with any agreement or any provision thereof, or any instrument or understanding, oral or written, to which such Party (or any ofits Affiliates) is a party or by which such Party (or any of its43 Source: AGENUS INC, 10-K, March 18, 2019Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results.[******] - Certain confidential information contained in this document, marked by brackets, is filed with the Securities and Exchange Commission pursuant to Rule 24b-2 of theSecurities Exchange Act of 1934, as amended.Affiliates) is bound, nor violate any Applicable Law of any Governmental Authority having jurisdiction over such Party (or any of itsAffiliates);13.1.5no government authorization, consent, approval, license, exemption of or filing or registration withany court or governmental department, commission, board, bureau, agency, or instrumentality, domestic or foreign, under anyApplicable Law currently in effect, is or shall be necessary for, or in connection with, the transactions contemplated by this Agreement,or for the performance by it of its obligations under this Agreement, except: (i) as may be required to conduct Clinical Trials or to seekor obtain Regulatory Approvals or applicable Regulatory Materials; or (ii) as set forth in Section 2.6.2(a); and13.1.6it has obtained all necessary authorizations, consents, and approvals of any Third Party that isrequired to be obtained by it for, or in connection with, the transactions contemplated by this Agreement, or for the performance by it ofits obligations under this Agreement, except: (i) as may be required to conduct Clinical Trials or to seek or obtain RegulatoryApprovals or applicable Regulatory Materials; or (ii) as set forth in Section 2.6.2(a).Representations and Warranties of Agenus. Except as set forth on Schedule 13.2, Agenus hereby represents and warrants to Gilead, as of the Execution Date, theOption Exercise Date, and the Option Effective Date, that:13.2.1(i) Schedule 1.16 sets forth a complete and accurate list of all Agenus Patents; and [******];13.2.2[******]13.2.3Agenus has the full right and authority to grant all of the rights and licenses granted to Gilead (orpurported to be granted to Gilead) hereunder, [******] to any [******] relating to [******] that would [******];13.2.4[******]13.2.5[******]13.2.6[******]13.2.7all of Agenus’s and its Affiliates’ officers, employees, and consultants: (i) have executed agreementsor have existing obligations under Applicable Law requiring assignment to Agenus or its Affiliates of all inventions made during thecourse of and as the result of their association with Agenus or its Affiliates, as applicable, and obligating the individual to assign toAgenus or its Affiliate, as applicable, all Inventions made during the course of performance under this Agreement; [******] and[******] have executed agreements or have existing obligations under Applicable Law obligating the individual to maintain asconfidential Agenus’s Confidential Information as well as confidential information of other parties (including of Gilead and itsAffiliates) that such individual may receive in its44 Source: AGENUS INC, 10-K, March 18, 2019Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results.[******] - Certain confidential information contained in this document, marked by brackets, is filed with the Securities and Exchange Commission pursuant to Rule 24b-2 of theSecurities Exchange Act of 1934, as amended.performance under this Agreement, to the extent required to support Agenus’s obligations under this Agreement;13.2.8neither Agenus nor its Affiliates [******] would be [******];13.2.9[******];13.2.10[******];13.2.11there are no [******] proceedings [******], or governmental investigations pending or, to theKnowledge of Agenus, threatened against Agenus or its Affiliates which could reasonably be expected to adversely affect or restrict theability of Agenus to consummate or perform the transactions contemplated under this Agreement, [******];13.2.12[******]13.2.13[******]13.2.14neither Agenus nor its Affiliates have entered into any agreement under which Agenus or itsAffiliates: (i) has obtained a license or sublicense of rights from a Third Party to any Agenus IP; or (ii) has granted a license,sublicense, option, or right to a Third Party that remains in effect to Develop, Manufacture, or Commercialize any Licensed Product, ineach case (i) and (ii), with the exception of the Existing Upstream License Agreements, the Existing Development and ManufacturingAgreements, and Ordinary Course Agreements;13.2.15Schedule 13.2.15 sets forth a complete and accurate list of the Existing Upstream LicenseAgreements, other than Ordinary Course Agreements, in effect as of the Execution Date. Agenus has provided Gilead or its counseltrue, correct, and complete copies of each such Existing Upstream License Agreement, subject to redaction of certain terms notnecessary to determining Gilead’s rights or obligations as a sublicensee of Agenus. Each such Existing Upstream License Agreement isin full force and effect, and there has been no Default of or under any such Existing Upstream License Agreement as a result of anyaction or omission of Agenus or its Affiliates or, to the Knowledge of Agenus, the actions or omissions of any Third Party. Agenus hasnot waived any of its rights under any such Existing Upstream License Agreement to which it is party. The entry into this Agreementand the contemplated activities of the Parties hereunder will not adversely affect Agenus’s rights under any Existing Upstream LicenseAgreement;13.2.16other than the Existing Upstream License Agreements and the Existing Development andManufacturing Agreements, Agenus (or its Affiliates, as applicable) has not entered into any material agreement relating to (i) theDevelopment, Manufacture, or Commercialization of any Licensed Product [******];13.2.17Agenus has disclosed to Gilead all material information and data, and all material correspondencessent to or received from any Regulatory Authority in the possession or control of Agenus or its Affiliates, in each case, related to anyLicensed Product to the extent permitted under the Prior CDA;13.2.18except in performance of the Agenus Development Plan, Agenus has not obtained, or filed, anyINDs, MAAs, or Regulatory Approvals or any other form of regulatory application for the45 Source: AGENUS INC, 10-K, March 18, 2019Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results.[******] - Certain confidential information contained in this document, marked by brackets, is filed with the Securities and Exchange Commission pursuant to Rule 24b-2 of theSecurities Exchange Act of 1934, as amended.conduct of Clinical Trials, marketing, or other purpose, for any Licensed Product, and no other Person has obtained, or filed for, anysuch INDs, MAAs, or Regulatory Approvals for such Licensed Products; and[******]. Representation and Warranty of Gilead. Gilead hereby represents and warrants to Agenus, as of the Execution Date, the Option Exercise Date, and the OptionEffective Date, that there are no claims, judgments, settlements, litigations, suits, actions, disputes, arbitration, judicial, or legal,administrative, or other proceedings or governmental investigations pending or, to the knowledge of Gilead, threatened against Gileadwhich would reasonably be expected to adversely affect or restrict the ability of Gilead to consummate or perform the transactionscontemplated under this Agreement. 13.4Covenants.13.4.1Mutual Covenants.(a)Each Party hereby covenants to the other Party that such Party and its Affiliates shallperform its activities pursuant to this Agreement in compliance (and shall ensure compliance by any of its Sublicensees andsubcontractors) with all Applicable Law, including, to the extent applicable, GCP, GLP, and GMP.(b)Each Party shall immediately notify the other Party in writing if any debarment underSection 335a of Title 21 of United States Code comes to its attention with respect to any person employed or otherwise used in anycapacity for performing any activities under this Agreement, and shall promptly remove such person or entity from performing anyactivities related to or in connection with the Agenus Development Plan or the Gilead Development Plan, to the extent applicable, orthis Agreement.13.4.2Additional Agenus Covenants. Agenus hereby covenants to Gilead that:(a)Neither Agenus nor any of its Affiliates shall grant any right or license to any Third Party relating to: (i)one (1) or more of the intellectual property rights within the Agenus IP; or (ii) any other right with respect to any Licensed Product, ineither case (i) or (ii), which would conflict with [******], any of the rights or licenses granted to Gilead hereunder;(b)[******](c)[******](d)Agenus shall: (i) without limiting Agenus’s other obligations under this Agreement, maintain Control ofall Agenus IP licensed or sublicensed to Gilead under each Existing Upstream License Agreement to the extent of Agenus’s Control ofsuch Agenus IP as of the Execution Date, the Option Exercise Date, and the Option Effective Date, as applicable; and (ii) not terminate,breach, or otherwise Default under, or amend or modify any Existing Upstream License Agreement in a manner that would permit thecounterparty thereto to terminate such Existing Upstream License Agreement or46 Source: AGENUS INC, 10-K, March 18, 2019Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results.[******] - Certain confidential information contained in this document, marked by brackets, is filed with the Securities and Exchange Commission pursuant to Rule 24b-2 of theSecurities Exchange Act of 1934, as amended.otherwise diminish the scope or exclusivity of the rights or licenses granted to Gilead with respect to any Agenus IP [******];(e)[******](f)[******]Disclaimer. EXCEPT AS OTHERWISE EXPRESSLY PROVIDED IN THIS AGREEMENT, NEITHER PARTY MAKES ANYREPRESENTATIONS OR EXTENDS ANY WARRANTY OF ANY KIND, EITHER EXPRESS OR IMPLIED (AND EACH PARTYHEREBY EXPRESSLY DISCLAIMS ANY AND ALL REPRESENTATIONS AND WARRANTIES NOT EXPRESSLY PROVIDED INTHIS AGREEMENT), INCLUDING WITH RESPECT TO ANY PATENTS OR KNOW-HOW, INCLUDING WARRANTIES OFVALIDITY OR ENFORCEABILITY, MERCHANTABILITY, FITNESS FOR A PARTICULAR USE OR PURPOSE, PERFORMANCE,AND NON-INFRINGEMENT OF ANY THIRD PARTY PATENT OR OTHER INTELLECTUAL PROPERTY RIGHT. WITHOUTLIMITING THE FOREGOING, THE PARTIES AGREE THAT THE MILESTONE EVENTS, SALES MILESTONE EVENTS, AND NETSALES LEVELS SET FORTH IN THIS AGREEMENT OR THAT HAVE OTHERWISE BEEN DISCUSSED BY THE PARTIES AREMERELY INTENDED TO DEFINE THE MILESTONE PAYMENTS, SALES MILESTONE PAYMENTS, AND ROYALTYOBLIGATIONS IF SUCH MILESTONE EVENTS, SALES MILESTONE EVENTS, OR NET SALES LEVELS AREACHIEVED. NEITHER PARTY MAKES ANY REPRESENTATION OR WARRANTY, EITHER EXPRESS OR IMPLIED, THAT ITWILL BE ABLE TO SUCCESSFULLY DEVELOP, MANUFACTURE, OR COMMERCIALIZE ANY LICENSED PRODUCT OR, IFCOMMERCIALIZED, THAT ANY PARTICULAR SALES LEVEL OR PROFIT (LOSS) OF SUCH LICENSED PRODUCT WILL BEACHIEVED.ARTICLE 14INDEMNIFICATION; INSURANCEIndemnification by Gilead. Gilead shall indemnify, defend, and hold harmless Agenus, its Affiliates, and its and their respective directors, officers,employees, agents, successors, and assigns (collectively, the “Agenus Indemnitees”) from and against any and all Damages to theextent arising out of or relating to, directly or indirectly, any Third Party Claim based upon:14.1.1[******]14.1.2[******]14.1.3[******]provided, however, that, in each case of [******], such indemnity shall not apply to the extent Agenus has an indemnificationobligation pursuant to [******] for such Damages.Indemnification by Agenus. Agenus shall indemnify and hold harmless Gilead, its Affiliates, and its and their respective directors, officers, employees,agents, successors, and assigns47 Source: AGENUS INC, 10-K, March 18, 2019Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results.[******] - Certain confidential information contained in this document, marked by brackets, is filed with the Securities and Exchange Commission pursuant to Rule 24b-2 of theSecurities Exchange Act of 1934, as amended.(collectively, the “Gilead Indemnitees”), from and against any and all Damages to the extent arising out of or relating to, directly orindirectly, any Third Party Claim based upon:14.2.1[******]14.2.2[******]14.2.3[******]14.2.4[******]14.2.5[******]provided, however, that, in each case of [******] such indemnity shall not apply to the extent Gilead has an indemnification obligationpursuant to [******] for such Damages. Certain Damages. Notwithstanding the foregoing Section 14.1 and Section 14.2, any Damages in connection with any Third Party Claimincurred by or rendered against either Party or its Affiliates or other of such Party’s indemnitee’s (Agenus Indemnitees or GileadIndemnitees, as applicable) to the extent arising from or occurring as a result of Development, Manufacture, or Commercializationactivities with respect to any Profit-Share Product in the United States shall constitute [******]. If either Party learns of any Third PartyClaim with respect to Damages covered by this Section 14.3, such Party shall provide the other Party with prompt written notice thereof.Procedure.If a Party is seeking indemnification under Section 14.1 or Section 14.2, as applicable (the “Indemnitee”), it shallinform the other Party (the “Indemnitor”) of the claim giving rise to the obligation to indemnify pursuant to Section 14.1 or Section14.2, as applicable, as soon as reasonably practicable after receiving notice of the claim (an “Indemnification Claim Notice”);provided, that any delay or failure to provide such notice shall not constitute a waiver or release of, or otherwise limit, the Indemnitee’srights to indemnification under Section 14.1 or Section 14.2, as applicable, except to the extent that such delay or failure materiallyprejudices the Indemnitor’s ability to defend against the relevant claims.14.4.214.4.2The Indemnitor shall have the right, upon written notice given to the Indemnitee within [******]after receipt of the Indemnification Claim Notice (and, where the Indemnitor is Agenus, subject to receipt of Gilead’s prior writtenconsent), to assume the defense of any such claim for which the Indemnitee is seeking indemnification pursuant to Section 14.1 orSection 14.2, as applicable. The Indemnitee shall cooperate with the Indemnitor and the Indemnitor’s insurer as the Indemnitor mayreasonably request, and at the Indemnitor’s cost and expense. The Indemnitee shall have the right to participate, at its own expense andwith counsel of its choice, in the defense of any claim or suit that has been assumed by the Indemnitor.The Indemnitor shall not settle any claim without first obtaining the prior written consent of the Indemnitee, not tobe unreasonably withheld, conditioned, or delayed; provided, however, that the Indemnitor shall not be required to obtain such consentif the settlement: (a) involves only the payment of money and shall not result in the Indemnitee (or other Agenus Indemnitees or GileadIndemnitees, as applicable) becoming subject to injunctive or other similar type of relief; (b) does not require an admission by theIndemnitee (or other Agenus Indemnitees or Gilead Indemnitees, as applicable); and (c) does not adversely affect the intellectualproperty Controlled by, or the rights or licenses granted to48 Source: AGENUS INC, 10-K, March 18, 2019Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results.[******] - Certain confidential information contained in this document, marked by brackets, is filed with the Securities and Exchange Commission pursuant to Rule 24b-2 of theSecurities Exchange Act of 1934, as amended.the Indemnitee (or its Affiliate) under this Agreement. The Indemnitee shall not settle or compromise any such claim without firstobtaining the prior written consent of the Indemnitor.14.4.414.4.4If the Parties cannot agree as to the application of Section 14.1 or Section 14.2, as applicable, to anyclaim, pending the resolution of the dispute pursuant to Section 16.6, the Parties may conduct separate defenses of such claims, witheach Party retaining the right to claim indemnification from the other Party in accordance with Section 14.1 or Section 14.2, asapplicable, upon resolution of the underlying claim. In each case, the Indemnitee shall reasonably cooperate with the Indemnitor andshall make available to the Indemnitor all pertinent information under the control of the Indemnitee, which information shall be subjectto Article 12.Insurance.Insurance Maintained by each Party. During the Term, each Party shall have and maintain in full force and effect, at its own expense, insurancecoverage to include:(a)Commercial general liability insurance, including personal and advertising injury, with limits of liabilitynot less than [******]. General liability limit requirements may be satisfied by a combination of primary and umbrella or excessliability insurance coverage; and(b)Workers’ compensation insurance in compliance with Applicable Law (including the local lawrequirements of the state or jurisdiction in which the work is to be performed). Employer’s liability insurance in amounts not less than[******]. Where permitted by Applicable Law, such policies shall contain a waiver of the insurer’s subrogation rights against the non-insured Party.Additional Requirements.(a)Additional Insured. Each Party shall name the other Party as an additional insured on the insurancepolicies maintained pursuant to Section 14.5.1(a), either by endorsement or blanket additional insured endorsement.(b)Evidence of Insurance. Each Party will provide evidence of insurance maintained pursuant to thisSection 14.5 on request of the other Party.(c)Notice of Cancellation. Each Party will provide the other Party a notice of insurance policy cancellationin accordance with the provisions of the applicable insurance policy maintained pursuant to this Section 14.5.(d)Policy Type. Insurance policies maintained pursuant to this Section 14.5 should be occurrence type. Ifpolicies maintained pursuant to this Section 14.5 are claims made, then insurance shall be maintained for at least [******] followingexpiration or termination of this Agreement.(e)Insurance Carrier Rating. All insurance maintained pursuant to this Section 14.5 will be underwritten bycompanies with an AM best rating of at least [******].[******]49 Source: AGENUS INC, 10-K, March 18, 2019Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results.[******] - Certain confidential information contained in this document, marked by brackets, is filed with the Securities and Exchange Commission pursuant to Rule 24b-2 of theSecurities Exchange Act of 1934, as amended.14.6[******] ARTICLE 15TERM AND TERMINATIONTerm; Expiration.15.1.1Term. Except for the terms and conditions of Article 1 (to the extent the definitions are used in thefollowing provisions), Article 12, Article 13, Article 16, this Section 15.1.1, and Section 15.7.1 (all of which shall become effective onthe Execution Date), this Agreement shall become effective on the License Agreement Effective Date (the “Effective Date”); provided,that, unless earlier terminated in accordance with this Article 15, this Agreement shall remain in effect and expire upon the earliest of:(a) the expiration of the Option Period, if Gilead does not exercise the Option in accordance with Section 2.4; (b) the delivery of writtennotice of termination by a Party to the other Party, where the Option Effective Date has not occurred on or prior to [******] after theOption Exercise Date; and (c) on or after the Option Effective Date: (i) for Royalty-Bearing Products, on a Royalty-Bearing Product-by-Royalty-Bearing Product and country-by-country basis, upon the expiration of the Royalty Term with respect to such Royalty-BearingProduct in such country; and (ii) for Profit-Share Products, on a Profit-Share Product-by-Profit-Share Product basis, upon the expirationof the Profit-Share Term with respect to such Profit-Share Product (the “Term”).Effect of Expiration.(a)Upon the expiration of the Term pursuant to Section 15.1.1(a) or Section 15.1.1(b):(1)subject to Section 15.1.2(a)(2) and Section 15.7, all rights and obligations of the Parties underthis Agreement shall terminate, except as set forth in this Article 15; and(2)[******](b)Upon the expiration of the Term pursuant to Section 15.1.1(c), the following terms shallapply:(1)Licenses after Licensed Product Expiration. Upon the expiration of the Term pursuant toSection 15.1.1(c) with respect to (i) a given Royalty-Bearing Product in a given country or (ii) a given Profit-Share Product, the licenseset forth in Section 10.1.1(a) with respect to such Royalty-Bearing Product in such country or such Profit-Share Product in the U.S., asapplicable, shall become fully paid-up, perpetual, irrevocable, and royalty-free.(2)Licenses after Expiration of Agreement. Upon the expiration of the Term with respect to thisAgreement in its entirety pursuant to Section 15.1.1(c), the license set forth in Section 10.1.1(a) with respect to all Licensed Products inall countries in the Territory shall become fully paid-up, perpetual, irrevocable, and royalty-free.Termination for Material Breach.Material Breach. This Agreement may be terminated in its entirety or on a Licensed Product-by-Licensed Product or country-by-country basis by a Party for a Material Breach by the other Party; provided, that the breaching Party has not cured such breach within[******] after the date of50 Source: AGENUS INC, 10-K, March 18, 2019Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results.[******] - Certain confidential information contained in this document, marked by brackets, is filed with the Securities and Exchange Commission pursuant to Rule 24b-2 of theSecurities Exchange Act of 1934, as amended.written notice to the breaching Party of such breach (the “Cure Period”), which notice shall describe such breach in reasonable detailand shall state the non-breaching Party’s intention to terminate this Agreement (in its entirety or on a Licensed Product-by-LicensedProduct or country-by-country basis). Notwithstanding the foregoing, for any breach of this Agreement with respect to any undisputedpayment obligation, the Cure Period shall be [******]. Any termination of this Agreement (in its entirety or on a Licensed Product-by-Licensed Product or country-by-country basis) under this Section 15.2.1 shall become effective [******], unless the breaching Partyhas cured such breach prior to the expiration of such Cure Period, or, if such breach is not susceptible to cure within the Cure Period,then, except with respect to any breach of any undisputed payment obligation, such Cure Period shall be extended for [******].Disagreement as to Material Breach. Notwithstanding Section 15.2.1, if the Parties in good faith disagree as to whether there has been a MaterialBreach of this Agreement, then: (a) the Party that disputes whether there has been a Material Breach may contest the allegation byreferring such matter, within [******] following its receipt of notice of alleged Material Breach, for resolution in accordance withSection 16.7.1(a); (b) the relevant Cure Period with respect to such alleged Material Breach shall be [******].Termination at Will. Gilead may terminate this Agreement at will, in its sole discretion, in its entirety or on a Licensed Product-by-LicensedProduct or country-by-country basis at any time upon [******] prior written notice to Agenus.Termination for Bankruptcy.If either Party makes a general assignment for the benefit of, or an arrangement or composition generally with, itscreditors, appoints or suffers appointment of an examiner or of a receiver or trustee over all or substantially all of its property, passes aresolution for its winding up, or files a petition under any bankruptcy or insolvency act or law or has any such petition filed against itwhich is not dismissed, discharged, bonded, or stayed within [******] after the filing thereof and seeks to reject this Agreement, (a“Rejection Event”), the other Party may treat this Agreement as terminated by such rejection, effective immediately upon written noticeto such Party. For purposes of Section 365(n) of the U.S. Bankruptcy Code (the “Code”) and any similar laws in any othercountry, all rights and licenses granted under or pursuant to any Section of this Agreement are rights to “intellectual property” (asdefined in Section 101(35A) of the Code). The Parties agree that the licensee of such rights under this Agreement will retain and mayfully exercise all of its protections, rights and elections under the Code and any similar laws in any other country. Each Party herebyacknowledges that (a) copies of research data, (b) laboratory samples, (c) product samples, (d) formulas, (e) laboratory notes andnotebooks, (f) data and results related to clinical trials, (g) regulatory filings and approvals, (h) rights of reference in respect ofregulatory filings and approvals, (i) pre-clinical research data and results, and (j) marketing, advertising and promotional materials, ineach case, that relate to such intellectual property, constitute “embodiments” of such intellectual property pursuant to Section 365(n) ofthe Code, and that the licensee will be entitled to a complete duplicate of (or complete access to, as appropriate) any such intellectualproperty and all embodiments of such intellectual property, and the same, if not already in its possession, will be promptly delivered toit upon its written request therefor and election under Bankruptcy Code Section 365(n)(1)(B) to retain the licenses granted by Agenus toGilead hereunder in the event of Agenus’s rejection of this Agreement, unless the licensor elects to continue to perform all of itsobligations under this Agreement. The provisions of this Section 15.4.2 are without prejudice to any rights the non-subject Party mayhave arising under the Code, laws of other jurisdictions governing insolvency and bankruptcy, or other Applicable Law. The Partiesagree that they intend the following rights to extend to the maximum extent permitted by law, including for purposes of the Code andany similar laws in any other country: (x) the right of access to any intellectual property (including all embodiments thereof) of thelicensor, or any Third Party with whom the licensor contracts to perform an obligation of such licensor under this Agreement51 Source: AGENUS INC, 10-K, March 18, 2019Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results.[******] - Certain confidential information contained in this document, marked by brackets, is filed with the Securities and Exchange Commission pursuant to Rule 24b-2 of theSecurities Exchange Act of 1934, as amended.which is necessary for the Development or Commercialization of a Licensed Product; (y) the right to contract directly with any ThirdParty described in (x) to complete the contracted work, and (z) the right to cure any breach of or default under any such agreement witha Third Party and set off the costs thereof against amounts payable to such licensor under this Agreement.Effects of Termination.Termination by Gilead at Will or by Agenus for Material Breach or Bankruptcy. Upon termination of this Agreement with respect to a Terminated Licensed Product: (a) by Gilead, in accordancewith Section 15.3; or (b) by Agenus, in accordance with Section 15.2 or Section 15.4.(a)the license granted by Agenus to Gilead pursuant to Section 10.1.1(a) with respect to the TerminatedLicensed Product shall terminate and Gilead shall not have any rights to use or exercise any rights under the Agenus IP with respect tosuch Terminated Licensed Product;(b)Gilead shall be released from its Development, Manufacturing, and Commercialization obligations underthis Agreement with respect to the Terminated Licensed Product, including with respect to Section 4.3 and Section 4.4;(c)Gilead shall as soon as reasonably practicable transfer and assign (to the extent permitted) to Agenus allRegulatory Materials owned and controlled by Gilead or its Affiliates, in each case, at Agenus’s cost, to the extent solely related to theTerminated Licensed Product and necessary for Developing, Manufacturing, or Commercializing such Terminated Licensed Product inthe Field in the Territory; provided, that Gilead may retain a copy of such items for its records;(d)[******](e)upon receipt by Gilead from Agenus of written notice no later than the [******], the Parties [******];(f)in the event that Gilead does not receive written notice from Agenus within [******] pursuant to Section15.5.1(e), then [******];(g)in the case of termination of this Agreement in its entirety, any and all sublicense agreements enteredinto by Gilead or any of its Affiliates with a Sublicensee pursuant to this Agreement shall survive such termination of this Agreement,except to the extent that: (i) any such Sublicensee is in material breach of this Agreement or such sublicense; or (ii) Agenus elects togrant such Sublicensee a direct license of the sublicensed rights on the same terms applicable to Gilead under this Agreement. Gileadshall, upon the written request of Agenus, assign any such sublicense (to the extent not terminated pursuant to the preceding sentence)to Agenus or its Affiliates and, upon such assignment, Agenus or its Affiliates, as applicable, shall assume such sublicense;(h)each Party shall comply with the return and destruction obligations with respect to ConfidentialInformation and any Know-How of the other Party that are in its or its Affiliates’, sublicensees’ or Third Party contractors’ possession orcontrol in accordance with Article 12;(i)to the extent that Gilead is manufacturing the Terminated Licensed Product as of the effective date oftermination, then, upon the election of Agenus, exercised by written notice to Gilead no later than [******] following the effective dateof termination, the Parties shall negotiate and use good-faith efforts to enter into:(1)a supply agreement (and a corresponding quality agreement with customary terms andconditions) pursuant to which Gilead would supply Agenus’s requirements of the52 Source: AGENUS INC, 10-K, March 18, 2019Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results.[******] - Certain confidential information contained in this document, marked by brackets, is filed with the Securities and Exchange Commission pursuant to Rule 24b-2 of theSecurities Exchange Act of 1934, as amended.Terminated Licensed Product [******] and which would include such other mutually agreed terms as are customary for agreements ofsuch type; or(2)an agreement under which Gilead would provide, and cause its Affiliates to provide,[******];(j)to the extent that a Third Party manufacturer is manufacturing the Terminated Licensed Product as of theeffective date of termination, then, to the extent Gilead has the right to do so under its agreements with its Third Party manufacturers,upon the election of Agenus, exercised by written notice to Gilead no later than [******] following the effective date of termination,and at Agenus’s expense, Gilead shall [******]; (k)upon the election of Agenus, exercised by written notice to Gilead no later than [******] following theeffective date of termination, at Agenus’s expense, Gilead shall assign, and shall cause its Affiliates and Sublicensees to assign, toAgenus or its designee, all of Gilead’s rights under Third Party contracts relating to the Development, Manufacture, orCommercialization of the Terminated Licensed Product, to the extent that such contracts can be assigned without the counterparty’sconsent and to the extent such contracts relate solely to the Terminated Licensed Product. To the extent that such consent is required,[******]; and Agenus shall assume Gilead’s obligations under such assigned contracts, except to the extent such obligations relate tothe period of performance prior to assignment or to any breach of such agreements by Gilead, its Affiliates, or its Sublicensees; and(l)if, as of the effective date of termination, Gilead or its Affiliates are conducting any Clinical Trials for theTerminated Licensed Product, then the Parties shall in good faith discuss and agree upon the appropriate completion or transition ofsuch Clinical Trials to Agenus, subject to Applicable Law.Termination by Gilead for Material Breach or Bankruptcy. Upon termination of this Agreement with respect to a Terminated Licensed Product by Gilead in accordance withSection 15.2 or Section 15.4:(a)the licenses granted by Agenus to Gilead pursuant to Section 10.1.1(a) with respect to the TerminatedLicensed Product shall terminate and Gilead shall not have any rights under the Agenus IP with respect to such Terminated LicensedProduct;(b)Gilead shall be released from its Development, Manufacturing, and Commercialization obligations underthis Agreement with respect to the Terminated Licensed Product, including with respect to Section 4.3 and Section 4.4; and(c)Each Party shall comply with the return and destruction obligations with respect to ConfidentialInformation and any Know-How of the other Party that are in its or its Affiliates’, sublicensees’ or Third Party contractors’ possession orcontrol in accordance with Article 12.15.6[******] Surviving Provisions.Accrued Rights; Remedies. The expiration or termination of this Agreement for any reason shall be without prejudice to any rights that shallhave accrued to the benefit of any Party prior53 Source: AGENUS INC, 10-K, March 18, 2019Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results.[******] - Certain confidential information contained in this document, marked by brackets, is filed with the Securities and Exchange Commission pursuant to Rule 24b-2 of theSecurities Exchange Act of 1934, as amended.to such expiration or termination, and any and all damages or remedies (whether at law or in equity) arising from any breach hereunder,each of which shall survive expiration or termination of this Agreement. Such expiration or termination shall not relieve any Party fromobligations which are expressly indicated to survive expiration or termination of this Agreement. Except as otherwise expressly setforth in this Agreement, the termination provisions of this Article are in addition to any other relief and remedies available to eitherParty under this Agreement, at law, or in equity.Survival. Without limiting the provisions of Section 15.7.1, the rights and obligations of the Parties set forth in thefollowing Sections and Articles of this Agreement shall survive the expiration or termination of this Agreement (to the extent in effect asof the Effective Date), in addition to those other terms and conditions that are expressly stated to survive termination or expiration ofthis Agreement: [******].ARTICLE 16MISCELLANEOUSSeverability. If one (1) or more of the terms or provisions of this Agreement is held by a court of competent jurisdiction to be void,invalid, or unenforceable in any situation in any jurisdiction, such holding shall not affect the validity or enforceability of the remainingterms and provisions hereof or the validity or enforceability of the void, invalid, or unenforceable term or provision in any othersituation or in any other jurisdiction, and the term or provision shall be considered severed from this Agreement solely for suchsituation and solely in such jurisdiction, unless the void, invalid, or unenforceable term or provision is of such essential importance tothis Agreement that it is to be reasonably assumed that the Parties would not have entered into this Agreement without the void, invalid,or unenforceable term or provision. If the final judgment of such court declares that any term or provision hereof is void, invalid, orunenforceable, the Parties agree to: (a) reduce the scope, duration, area, or applicability of the term or provision or to delete specificwords or phrases to the minimum extent necessary to cause such term or provision as so reduced or amended to be enforceable; and (b)make a good-faith effort to replace any void, invalid, or unenforceable term or provision with a valid and enforceable term or provisionsuch that the objectives contemplated by the Parties when entering this Agreement may be realized.Notices. Any notice required or permitted to be given by this Agreement shall be in writing and in English and shall be: (a)delivered by hand or by overnight courier with tracking capabilities; or (b)54 Source: AGENUS INC, 10-K, March 18, 2019Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results.[******] - Certain confidential information contained in this document, marked by brackets, is filed with the Securities and Exchange Commission pursuant to Rule 24b-2 of theSecurities Exchange Act of 1934, as amended.mailed postage prepaid by first class, registered, or certified mail, in each case, addressed as set forth below unless changed by noticeso given:If to Gilead:Gilead Sciences, Inc.333 Lakeside DriveFoster City, CA 94404Attention: [******]With copies to:Gilead Sciences, Inc.333 Lakeside DriveFoster City, CA 94404Attention: [******]If to Agenus:Agenus Inc.3 Forbes RoadLexington, Massachusetts 02421-7305, USAAttention: Chief Executive OfficerWith copies to:Agenus Inc.3 Forbes RoadLexington, Massachusetts 02421-7305, USAAttention: General Counsel Any such notice shall be deemed given on the date received, except any notice received after 5:30 p.m. (in the time zone of thereceiving Party) on a Business Day or received on a non-Business Day shall be deemed to have been received on the next BusinessDay. A Party may add, delete, or change the person or address to which notices should be sent at any time upon written noticedelivered to the other Parties in accordance with this Section 16.2.Force Majeure. A Party shall not be liable for delay or failure in the performance of any of its obligations hereunder if such delay or failureis due to a cause beyond the reasonable control of such Party, including acts of God, fires, earthquakes, acts of war, terrorism, or civilunrest, or hurricane or other inclement weather; provided, that the affected Party: (a) promptly notifies the other Party; and (b) shall useits commercially reasonable efforts to avoid or remove such causes of non-performance and to mitigate the effect of such occurrence,and shall continue performance in accordance with the terms of this Agreement whenever such causes are removed. When suchcircumstances arise, the Parties shall negotiate in good faith any modifications of the terms of this Agreement that may be necessary orappropriate in order to arrive at an equitable solution.Assignment. Except as provided in this Section 16.4, this Agreement may not be assigned or otherwise transferred, nor may any right orobligation hereunder be assigned or transferred, by either Party without the consent of the other Party; provided, however, that (andnotwithstanding anything elsewhere in this Agreement to the contrary but without prejudice to Section 9.10.2(b)) either Party may,55 Source: AGENUS INC, 10-K, March 18, 2019Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results.[******] - Certain confidential information contained in this document, marked by brackets, is filed with the Securities and Exchange Commission pursuant to Rule 24b-2 of theSecurities Exchange Act of 1934, as amended.without such consent, assign this Agreement and its rights and obligations hereunder in whole or in part: (a) to an Affiliate of suchParty; (b) in connection with the transfer or sale of all or substantially all of its assets or business related to the subject matter of thisAgreement; or (c) pursuant to a merger or consolidation (or similar transaction) of the assigning Party. In addition, Gilead may, withoutthe consent of Agenus, assign its rights and obligations under this Agreement to a Third Party, where Gilead or its Affiliate divest rightsto a Licensed Product or Licensed Antibody. Any attempted assignment not in accordance with this Section 16.4 shall be void. In theevent that a permitted assignment of this Agreement by a Party increases the tax liability of the other Party or any of its Affiliates overthe amount of any Taxes that otherwise would have been payable in the absence of such assignment, the assigning Party shallreimburse the other Party for the amount of such increased Tax liability.Waivers and Modifications. The failure of any Party to insist on the performance of any obligation hereunder shall not be deemed to be a waiver ofsuch obligation. Waiver of any breach of any provision hereof shall not be deemed to be a waiver of any other breach of suchprovision or any other provision on such occasion or any succeeding occasion. No waiver, modification, release, or amendment of anyobligation under or provision of this Agreement shall be valid or effective unless in writing and signed by the Parties.Choice of Law; Waiver of Jury Trial; Dispute Resolution; Jurisdiction.Choice of Law. This Agreement and any dispute arising from the performance or breach hereof shall be governed by andinterpreted in accordance with the laws of the State of New York, without giving effect to any choice of law rules. The provisions ofthe United Nations Convention on Contracts for the International Sale of Goods shall not apply to this Agreement or any subject matterhereof.Waiver of Jury Trial. THE PARTIES HEREBY WAIVE, AND COVENANT THAT THEY SHALL NOT ASSERT (WHETHER AS PLAINTIFF,DEFENDANT, OR OTHERWISE), ANY RIGHT TO TRIAL BY JURY IN ANY ACTION ARISING IN WHOLE OR IN PART UNDEROR IN CONNECTION WITH THIS AGREEMENT, WHETHER NOW EXISTING OR HEREAFTER ARISING, AND WHETHERSOUNDING IN CONTRACT, TORT, OR OTHERWISE. THE PARTIES AGREE THAT ANY OF THEM MAY FILE A COPY OFTHIS PARAGRAPH WITH ANY COURT AS WRITTEN EVIDENCE OF THE KNOWING, VOLUNTARY, AND BARGAINED-FORAGREEMENT BETWEEN THE PARTIES IRREVOCABLY TO WAIVE ITS RIGHT TO TRIAL BY JURY IN ANY PROCEEDINGWHATSOEVER BETWEEN THEM RELATING TO THIS AGREEMENT, AND SUCH PROCEEDING SHALL INSTEAD BE TRIEDIN A COURT OF COMPETENT JURISDICTION BY A JUDGE SITTING WITHOUT A JURY.Dispute Resolution.(a)Except as otherwise set forth in this Agreement, in the event of an unresolved matter, dispute, or issuerelating to the breach or alleged breach or interpretation of this Agreement (“Dispute”), the Parties shall refer the Dispute to theExecutive Officers for discussion and resolution. If the Executive Officers are unable to resolve such Dispute within [******] of theDispute being referred to them by either Party in writing, then the Dispute shall be resolved as provided in Section 16.7.1(b) or Section16.7.1(c), as applicable.(b)Any unresolved Disputes between the Parties arising out of or in connection with this Agreement shallbe resolved by final and binding arbitration. Whenever a Party decides to institute arbitration proceedings, it shall give written notice tothat effect to the other Party. Arbitration shall be held in New York, New York, according to the Rules of Arbitration of theInternational Chamber of Commerce (“ICC Rules”) in effect at the Effective Date, except as they may be modified herein or by mutual56 Source: AGENUS INC, 10-K, March 18, 2019Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results.[******] - Certain confidential information contained in this document, marked by brackets, is filed with the Securities and Exchange Commission pursuant to Rule 24b-2 of theSecurities Exchange Act of 1934, as amended.agreement of the Parties. All arbitration proceedings shall be conducted by three (3) arbitrators unless otherwise mutually agreed by theParties. The claimant and the respondent shall each nominate an arbitrator in accordance with the ICC Rules, and the third arbitrator,who shall be the president of the arbitral tribunal, shall be appointed by the two (2) Party-appointed arbitrators in consultation with theParties. The Parties undertake to maintain confidentiality as to the existence of the arbitration proceedings and as to all submissions,correspondence, and evidence relating to the arbitration proceedings. This Section 16.7.1(b) shall survive the termination of the arbitralproceedings. No arbitrator (nor any arbitral tribunal) shall [******]. Decisions of the arbitrator(s) shall be final and binding on theParties. Judgment on the award so rendered may be entered in any court of competent jurisdiction. The costs of the arbitration shall beshared by the Parties during the course of such arbitration, as assessed by the International Chamber of Commerce, and shall be borneas determined by the arbitrator(s). With respect to any dispute over the [******], within [******] after the arbitrators are selectedpursuant this Section 16.7.1(b), each Party shall provide the arbitrators and the other Party a proposal (including a written memorandumin support of its position) for the [******]. In rendering a decision regarding the [******], the arbitrators shall select the proposalwhich is more commercially reasonable under the circumstances (or, if a Party fails to submit a proposal within such [******]period,the other Party’s proposal).(c)Notwithstanding anything to the contrary, either Party may at any time seek to obtain preliminaryinjunctive relief or other applicable provisional relief from a court of competent jurisdiction with respect to an issue arising under thisAgreement if the rights of such Party would be prejudiced absent such relief. A request by a Party to a court of competent jurisdictionfor interim measures necessary to preserve the Party’s rights, including attachments or injunctions, shall not be deemed incompatiblewith, or a waiver of, the agreement to mediate or arbitrate contained in this Section 16.7.1(c), or the availability of interim measures ofprotection under the ICC Rules. Notwithstanding anything to the contrary in this Section 16.7.1(c), any disputes regarding the scope,validity, enforceability, or inventorship of any Patents shall be submitted for final resolution by a court of competent jurisdiction.Relationship of the Parties. Agenus and Gilead are independent contractors under this Agreement. Nothing contained herein is intended or is to beconstrued so as to constitute either Party as a partner, agent, or joint venturer of the other Party. Neither Agenus nor Gilead,respectively, shall have any express or implied right or authority to assume or create any obligations on behalf of or in the name ofAgenus and Gilead, respectively, or to bind Agenus and Gilead, respectively, to any contract, agreement, or undertaking with any ThirdParty.Fees and Expenses. Except as otherwise specified in this Agreement, each Party shall bear its own costs and expenses (including investmentbanking and legal fees and expenses) incurred in connection with this Agreement and the transactions contemplated hereby.Third Party Beneficiaries. There are no express or implied Third Party beneficiaries hereunder. The provisions of this Agreement are for theexclusive benefit of the Parties, and no other person or entity shall have any right or claim against any Party by reason of theseprovisions or be entitled to enforce any of these provisions against any Party, except for the indemnification rights of the AgenusIndemnitees pursuant to Section 14.1 and Section 14.4 and the Gilead Indemnitees pursuant to Section 14.2 and Section 14.4.Entire Agreement. This Agreement, together with the attached Exhibits and Schedules, contains the entire agreement by the Parties withrespect to the subject matter hereof and supersedes any prior express or implied agreements, understandings, and representations, eitheroral or written, which may have related to the subject matter hereof in any way, including the Prior CDA and any and all term sheetsrelating to the transactions contemplated by this Agreement and exchanged between the Parties prior to the57 Source: AGENUS INC, 10-K, March 18, 2019Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results.[******] - Certain confidential information contained in this document, marked by brackets, is filed with the Securities and Exchange Commission pursuant to Rule 24b-2 of theSecurities Exchange Act of 1934, as amended.Effective Date; provided, that this Agreement shall not supersede the terms and provisions of the Prior CDA applicable to any periodprior to the Effective Date. Counterparts. This Agreement may be executed in counterparts with the same effect as if both Parties had signed the same document. Allsuch counterparts shall be deemed an original, shall be construed together, and shall constitute one (1) and the same instrument. Anysuch counterpart, to the extent delivered by means of facsimile by .pdf, .tif, .gif, .jpeg, or similar attachment to electronic mail (any suchdelivery, an “Electronic Delivery”) shall be treated in all manner and respects as an original executed counterpart and shall beconsidered to have the same binding legal effect as if it were the original signed version thereof delivered in person. No Party heretoshall raise the use of Electronic Delivery to deliver a signature or the fact that any signature or agreement or instrument was transmittedor communicated through the use of Electronic Delivery as a defense to the formation of a contract, and each Party forever waives anysuch defense, except to the extent that such defense relates to lack of authenticity.Equitable Relief; Cumulative Remedies. Notwithstanding anything to the contrary herein, the Parties shall be entitled to seek equitable relief, including injunctionand specific performance, as a remedy for any breach of this Agreement. Such remedies shall not be deemed to be the exclusiveremedies for a breach of this Agreement but shall be in addition to all other remedies available at law or in equity. The Parties furtheragree not to raise as a defense or objection to the request or granting of such relief that any breach of this Agreement is or would becompensable by an award of money damages. No remedy referred to in this Agreement is intended to be exclusive, but each shall becumulative and in addition to any other remedy referred to in this Agreement or otherwise available under Applicable Law.Interpretation.Generally. This Agreement has been diligently reviewed by and negotiated by and between the Parties, and in suchnegotiations each of the Parties has been represented by competent (in-house or external) counsel, and the final agreement containedherein, including the language whereby it has been expressed, represents the joint efforts of the Parties and their counsel. Accordingly,in interpreting this Agreement or any provision hereof, no presumption shall apply against any Party as being responsible for thewording or drafting of this Agreement or any such provision, and ambiguities, if any, in this58 Source: AGENUS INC, 10-K, March 18, 2019Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results.[******] - Certain confidential information contained in this document, marked by brackets, is filed with the Securities and Exchange Commission pursuant to Rule 24b-2 of theSecurities Exchange Act of 1934, as amended.Agreement shall not be construed against any Party, irrespective of which Party may be deemed to have authored the ambiguousprovision.Definitions; Interpretation.(a)The definitions of the terms herein shall apply equally to the singular and plural forms of the termsdefined and, where a word or phrase is defined herein, each of its other grammatical forms shall have a corresponding meaning.(b)Whenever the context may require, any pronoun shall include the corresponding masculine, feminine,and neuter forms.(c)The word “will” shall be construed to have the same meaning and effect as the word “shall.”(d)The words “including,” “includes,” “include,” “for example,” and “e.g.,” and words of similar import,shall be deemed to be followed by the words “without limitation.”(e)The word “or” shall be interpreted to mean “and/or,” unless the context requires otherwise.(f)The words “hereof,” “herein,” and “herewith,” and words of similar import, shall, unless otherwisestated, be construed to refer to this Agreement as a whole and not to any particular provision of this Agreement.(g)Unless the context requires otherwise or otherwise specifically provided: (i) all references herein toArticles, Sections, Schedules, or Exhibits shall be construed to refer to Articles, Sections, Schedules, and Exhibits of this Agreement;and (ii) reference in any Section to any subclauses are references to such subclauses of such Section.Subsequent Events. Unless the context requires otherwise: (a) any definition of or reference to any agreement, instrument, or otherdocument herein shall be construed as referring to such agreement, instrument, or other document as from time to time amended,supplemented, or otherwise modified (subject to any restrictions on such amendments, supplements, or modifications set forth herein);(b) any reference to any Applicable Law herein shall be construed as referring to such Applicable Law as from time to time enacted,repealed, or amended; and (c) subject to Section 16.4, any reference herein to any Person shall be construed to include the Person’ssuccessors and assigns.Headings. Headings, captions, and the table of contents are for convenience only and shall not be used in the interpretationor construction of this Agreement.Prior Drafts. No prior draft of this Agreement shall be used in the interpretation or construction of this Agreement.Further Assurances. Each Party shall execute, acknowledge, and deliver such further instruments, and do all such other ministerial,administrative, or similar acts, as may be reasonably necessary or appropriate in order to carry out the expressly stated purposes and theclear intent of this Agreement.Extension to Affiliates. Except as expressly set forth otherwise in this Agreement, each Party shall have the right to extend the rights andobligations granted in this Agreement to one or more of59 Source: AGENUS INC, 10-K, March 18, 2019Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results.[******] - Certain confidential information contained in this document, marked by brackets, is filed with the Securities and Exchange Commission pursuant to Rule 24b-2 of theSecurities Exchange Act of 1934, as amended.its Affiliates. All applicable terms and provisions of this Agreement, except this right to extend, shall apply to any such Affiliate towhich this Agreement has been extended to the same extent as such terms and provisions apply to the Party extending such rights andobligations. The Party extending the rights and obligations granted hereunder shall remain primarily liable for any acts or omissions ofany of its Affiliates.[Signature Page Follows]60 Source: AGENUS INC, 10-K, March 18, 2019Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results.[******] - Certain confidential information contained in this document, marked by brackets, is filed with the Securities and Exchange Commission pursuant to Rule 24b-2 of theSecurities Exchange Act of 1934, as amended.IN WITNESS WHEREOF, and intending to be legally bound hereby, the Parties have caused this OPTION AND LICENSEAGREEMENT (AGEN1223) to be executed by their respective duly authorized officers as of the Execution Date.AGENUS INC.GILEAD SCIENCES, INC. By: /s/ Garo Armen, Ph.D.By: /s/ John G. McHutchison, MDName: Garo Armen, Ph.D.Name: John G. McHutchison, MDTitle: Chairman and CEOTitle: Chief Scientific Officer, Head of R&D [Signature Page to Option and License Agreement (AGEN2373)]Source: AGENUS INC, 10-K, March 18, 2019Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results. EXHIBIT 21.1SUBSIDIARIES OF AGENUS INC.Antigenics LLC., a Delaware limited liability company and a wholly-owned subsidiary of Agenus Inc.Aronex Pharmaceuticals, Inc., a Delaware corporation and a wholly-owned subsidiary of Agenus Inc.Antigenics Therapeutics Limited, a company organized under the laws of Ireland and a wholly-owned subsidiary of Agenus Inc.Agenus Royalty Fund, LLC, a Delaware limited liability company and a wholly-owned subsidiary of Agenus Inc.Agenus Switzerland Inc., a joint stock company organized under the laws of Switzerland formerly known as 4-Antibody AG, and a wholly-ownedsubsidiary of Agenus Inc.Agenus West, LLC, a Delaware limited liability company and a wholly-owned subsidiary of Agenus Inc.Agenus UK Limited, a private limited company organized under the laws of England and Wales and a wholly-owned subsidiary of Agenus Inc.AgenTus Therapeutics, Inc., a Delaware corporation and a majority-owned subsidiary of Agenus Inc.AgenTus Therapeutics Limited, a private limited company organized under the laws of England and Wales and a wholly-owned subsidiary ofAgenTus Therapeutics, Inc.AgenTus Therapeutics HK Limited, a limited company organized under the laws of Hong Kong Special Administrative Region of the People’s Republic ofChina and a wholly-owned subsidiary of AgenTus Therapeutics, Inc.AgenTus Therapeutics SA, a company organized under the laws of Belgium and a wholly-owned subsidiary of AgenTus Therapeutics, Inc. Source: AGENUS INC, 10-K, March 18, 2019Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results. Exhibit 23.1Consent of Independent Registered Public Accounting FirmThe Board of DirectorsAgenus Inc.: We consent to the incorporation by reference in the registration statements (Nos. 333-40440, 333-40442, 333-50434, 333-69580, 333-106072, 333-115984,333-143807, 333-143808, 333-151745, 333-160084, 333-160087, 333-160088, 333-176609, 333-183066, 333-183067, 333-189926, 333-195851, 333-209074, 333-212889, and 333-228271) on Form S-8 and (Nos. 333-161277, 333-163221, 333-189534, 333-195852, 333-203807, 333-206513, 333-208135,333-208890, 333-209749, 333-209941, 333-215640, 333-221008, 333-221465, 333-222670, and 333-228273) on Form S-3 of Agenus Inc. of our reportsdated March 18, 2019, with respect to the consolidated balance sheets of Agenus Inc. and subsidiaries as of December 31, 2018 and 2017, and the relatedconsolidated statements of operations and comprehensive loss, convertible preferred stock and stockholders’ deficit, and cash flows for each of the years inthe three-year period ended December 31, 2018, and the related notes and the effectiveness of internal control over financial reporting as of December 31,2018, which reports appear in the December 31, 2018 Annual Report on Form 10-K of Agenus Inc. Our report on the consolidated financial statements refers to a change in accounting principle related to revenue recognition./s/ KPMG LLPBoston, MassachusettsMarch 18, 2019 Source: AGENUS INC, 10-K, March 18, 2019Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results. Exhibit 31.1Certification Pursuant to Rules 13a-14(a) and 15d-14(a) under the Securities Exchange Act of 1934, as amendedI, Garo H. Armen, certify that: 1.I have reviewed this Annual Report on Form 10-K of Agenus Inc.; 2.Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to makethe statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period coveredby this report; 3.Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all materialrespects the financial condition, results of operations and cash flows of the Registrant as of, and for, the periods presented in this report; 4.The Registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as definedin Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f)and 15d-15(f)) for the Registrant and have: a.designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under oursupervision, to ensure that material information relating to the Registrant, including its consolidated subsidiaries, is made known tous by others within those entities, particularly during the period in which this report is being prepared; b.designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed underour supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financialstatements for external purposes in accordance with U.S. generally accepted accounting principles; c.evaluated the effectiveness of the Registrant’s disclosure controls and procedures and presented in this report our conclusions aboutthe effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on suchevaluation; and d.disclosed in this report any change in the Registrant’s internal control over financial reporting that occurred during the Registrant’smost recent fiscal quarter (the Registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or isreasonably likely to materially affect, the Registrant’s internal control over financial reporting; and 5.The Registrant’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financialreporting, to the Registrant’s auditors and the audit committee of the Registrant’s board of directors (or persons performing the equivalentfunction): a.all significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which arereasonably likely to adversely affect the Registrant’s ability to record, process, summarize and report financial information; and b.any fraud, whether or not material, that involves management or other employees who have a significant role in the Registrant’sinternal control over financial reporting. Date:March 18, 2019 /s/ GARO H. ARMEN, PH.D. Garo H. Armen, Ph.D. Chief Executive Officer and Principal Executive Officer Source: AGENUS INC, 10-K, March 18, 2019Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results. Exhibit 31.2Certification Pursuant to Rules 13a-14(a) and 15d-14(a) under the Securities Exchange Act of 1934, as amendedI, Christian Cortis, certify that: 1.I have reviewed this Annual Report on Form 10-K of Agenus Inc.; 2.Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to makethe statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period coveredby this report; 3.Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all materialrespects the financial condition, results of operations and cash flows of the Registrant as of, and for, the periods presented in this report; 4.The Registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as definedin Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f)and 15d-15(f)) for the Registrant and have: a.designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under oursupervision, to ensure that material information relating to the Registrant, including its consolidated subsidiaries, is made known tous by others within those entities, particularly during the period in which this report is being prepared; b.designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed underour supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financialstatements for external purposes in accordance with U.S. generally accepted accounting principles; c.evaluated the effectiveness of the Registrant’s disclosure controls and procedures and presented in this report our conclusions aboutthe effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on suchevaluation; and d.disclosed in this report any change in the Registrant’s internal control over financial reporting that occurred during the Registrant’smost recent fiscal quarter (the Registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or isreasonably likely to materially affect, the Registrant’s internal control over financial reporting; and 5.The Registrant’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financialreporting, to the Registrant’s auditors and the audit committee of the Registrant’s board of directors (or persons performing the equivalentfunction): a.all significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which arereasonably likely to adversely affect the Registrant’s ability to record, process, summarize and report financial information; and b.any fraud, whether or not material, that involves management or other employees who have a significant role in the Registrant’sinternal control over financial reporting. Date:March 18, 2019 /s/ CHRISTIAN CORTIS, PH.D. Christian Cortis, Ph.D. Chief Strategy Officer and Head of Finance,Principal Financial Officer Source: AGENUS INC, 10-K, March 18, 2019Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results. Exhibit 32.1CertificationPursuant to 18 U.S.C. Section 1350,As Adopted Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002In connection with the Annual Report on Form 10-K of Agenus Inc. (the “Company”) for the year ended December 31, 2018 as filed with theSecurities and Exchange Commission on the date hereof (the “Report”), each of the undersigned to his/her knowledge hereby certifies, pursuant to 18 U.S.C.Section 1350, that: (i)The Report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934, as amended; and (ii)The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of theCompany. /s/ GARO H. ARMEN, PH.D. Garo H. Armen, Ph.D. Chief Executive Officer and Principal Executive Officer /s/ CHRISTIAN CORTIS, PH.D. Christian Cortis, Ph.D. Chief Strategy Officer and Head of Finance,Principal Financial OfficerDate: March 18, 2019A signed original of this written statement required by Section 906 has been provided to the Company and will be retained by the Company andfurnished to the Securities and Exchange Commission or its staff upon request.The foregoing certification is being furnished to the Securities and Exchange Commission as an exhibit to the Annual Report on Form 10-K for theyear ended December 31, 2018 and should not be considered filed as part of the Annual Report on Form 10-K. Source: AGENUS INC, 10-K, March 18, 2019Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results.

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