Item 1.01. Entry into a Material Definitive Agreement.
On June 23, 2014, TG Therapeutics, Inc. (the "Company") entered into an exclusive licensing agreement (the "Agreement") with Ligand Pharmaceuticals Incorporated ("Ligand") for the development and commercialization of Ligand's interleukin-1 receptor associated kinase-4 ("IRAK-4") inhibitor technology, which currently is in preclinical development for potential use against certain cancers and autoimmune diseases. IRAK-4 is a serine/threonine protein kinase that is a key downstream signaling component of the interleukin-1 receptor and multiple toll-like receptors.
Under the terms of the Agreement, Ligand will receive 125,000 shares of Company common stock, par value $0.001, as an upfront license fee. Ligand will also be eligible to receive maximum potential milestone payments of approximately $207 million upon the achievement of specific clinical, regulatory and commercial milestone events. Additionally, Ligand will be entitled to royalties on the Company's future net sales of licensed products containing IRAK-4 inhibitors. The basic royalty rate for licensed products covered by Ligand's issued patents will be 6\% for annual sales of up to $1 billion and 9.5\% for annual sales in excess of that threshold.
Additionally, Opus Point Partners, LLC, who identified the opportunity and advised the Company on the transaction, will also be entitled to receive a 1\% royalty for annual sales of up to $1 billion.
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