TUM Arbitration

On January 12, 2015, the Company filed a reply brief in response to TUM’s defense. The arbitration panel held its first hearing in Munich, Germany on January 20, 2015, however the arbitration panel did not come to a conclusion on whether TUM is the proper respondent in the action or on the merits of the case. The panel had previously indicated that it will first decide the issue of whether TUM is the proper respondent in this action. The panel resolved that the value in dispute for both parties’ claims and counterclaims would be fixed at €3.5 million ($4.2 million), as the calculation of the outstanding Out-Licensing Fee also impacts future payments. The Company submitted a reply brief responding to TUM’s defense and counterclaim to the panel on March 3, 2015. TUM must submit a rebuttal brief by March 31, 2015. The Company believes the amount in dispute is without merit and such subsequent events does not impact the probable loss accrued for as of December 31, 2014.