Backup Supplier. Upon request by Arcus at any time during the Term, WuXi shall reasonably cooperate and promptly perform any technical transfer and validation activities reasonably necessary to enable Arcus’s designated backup supplier to supply Licensed Product, including any component thereof. Prior to the expiration of the Manufacturing Exclusivity Period, Arcus may procure supply of drug substance for Licensed Product from its designated backup supplier solely in the event WuXi is not able to supply Arcus with drug substance for Licensed Products in accordance with the terms of the Manufacturing Agreement. From and after such time as WuXi resumes its ability to provide accepted orders for drug substance for Licensed Products in accordance with the terms of the Manufacturing Agreement, Arcus may continue to utilize the aforementioned backup supplier to provide up to ​ percent (​) of Arcus’s needs for drug substance for Licensed Products on an ongoing basis. The Manufacturing Agreement(s) will provide further terms and conditions regarding any such backup supplier. For the avoidance of doubt, Arcus’s use of such backup supplier in accordance with this [Section 3.2] shall not be deemed a Transfer Election nor be subject to the increased royalty rates set forth below.

Backup Supplier. Upon request by Arcus at any time during the Term, WuXi shall reasonably cooperate and promptly perform any technical transfer and validation activities reasonably necessary to enable Arcus’ designated backup supplier to supply Licensed Product. Prior to the expiration of the Manufacturing Exclusivity Period, Arcus may procure supply from its designated backup supplier solely in the event WuXi is not able to supply Arcus with Licensed Products in accordance with the terms of the Manufacturing Agreement. From and after such time as WuXi resumes its ability to provide accepted orders for Licensed Products in accordance with the terms of the Manufacturing Agreement, Arcus may continue to utilize the aforementioned backup supplier to provide up to ​ percent (​) of Arcus’ needs on an ongoing basis. The Manufacturing Agreement(s) will provide further terms and conditions regarding any such backup supplier. For the avoidance of doubt, Arcus’s use of such backup supplier in accordance with this Section 3.2 shall not be deemed a Transfer Election nor be subject to the increased royalty rates set forth below.

“3.2.2 The Manufacturing Agreement(s) shall provide for Arcus’ appointment of WuXi as its exclusive manufacturer of drug substance of Licensed Products from and after the effective date of the Manufacturing Agreement(s) until Arcus makes a Transfer Election under [Section 3.2.3], where the Transfer Election is permitted only on or after ​ (the “Manufacturing Exclusivity Period”), subject to (i) WuXi’s ability to provide such drug substance for Licensed Products in accordance with agreed-upon specifications, in the quantities, and on the timeframes reasonably requested by Arcus and according to the prices set forth in [Exhibit 4] to the License Agreement (subject to a maximum increase of ​ percent (​) in any one calendar year prior to First Commercial Sale and ​ percent (​) in any one calendar year beginning upon First Commercial Sale); (ii) Arcus’s right to engage a backup supplier to provide Licensed Products as further set forth in this [Section 3.2]; and (iii) Arcus’s sublicensees rights to utilize their own manufacturing resources as further set forth in this [Section 3.2]. The Parties acknowledge and agree that drug substance manufacturing encompasses only those activities from cell bank vial thaw through freezing of drug substance, such as expansion of cells from a frozen vial, production in a bioreactor, harvest, purification, and bulk fill/freezing.