Exhibit 10.28

 

SECOND RESTATED COLLABORATION AGREEMENT

 

THIS SECOND RESTATED COLLABORATION AGREEMENT (this “Agreement”), dated as of
April 12, 2004, the “Revision Date”, is made between ABGENIX, INC., a Delaware
corporation (“ABX”), having a place of business at 7601 Dumbarton Circle,
Fremont, California 94555, and CURAGEN CORPORATION, a Delaware corporation
(“CuraGen”), having a place of business at 555 Long Wharf Drive, New Haven,
Connecticut 06511, with respect to the following facts:

 

RECITALS

 

A. The parties entered into the Collaboration Agreement effective as of
December 8, 1999 (the “Original Agreement”) and a Restated Collaboration
Agreement effective as of November 27, 2000, as subsequently amended on
January 23, 2001, January 16, 2002 and January 10, 2003 (the “Restated
Agreement”).

 

B. The parties desire to amend the Restated Agreement in certain respects
effective as of the date hereof, and for convenience to restate the Restated
Agreement, on the terms and conditions set forth below.

 

NOW THEREFORE, in consideration of the foregoing premises and the mutual
covenants set forth below, the parties amend the Restated Agreement and agree as
follows:

 

1. DEFINITIONS

 

For purposes of this Agreement, the terms set forth in this Article 1 shall have
the respective meanings set forth below:

 

1.1 “ABX In-License” shall mean a license, sublicense or other agreement under
which ABX acquired rights to the ABX Patent Rights or ABX Know-How, specifically
including (a) that certain license agreement between ABX and the Medical
Research Council, dated December 14, 1998 (as amended or restated from time to
time), (b) that certain license agreement between ABX and Babraham Bioscience
Technologies Limited dated May 14, 2002 (as amended or restated from time to
time) and (c) that certain license agreement between ABX and ImmunoGen, Inc.
dated September 5, 2000 (as amended or restated from time to time) (the
“ImmunoGen Agreement”) .

 

1.2 “ABX Know-How” shall mean, collectively, all inventions, discoveries, data,
information, methods, techniques, technology and other results, whether or not
patentable but which are not generally known, regarding ABX Technology and
Information. All ABX Know-How shall be Confidential Information of ABX.

 

1.3 “ABX Licensed Antigens” shall mean all ABX Optioned Antigens for which ABX
has exercised an option to obtain a commercial license pursuant to Article 7
below, and “ABX Licensed Antigen” shall mean any one of the ABX Licensed
Antigens.

 

Portions of this Exhibit were omitted and have been filed separately with the
Secretary of the Commission pursuant to the Company’s application requesting
confidential Investment under Rule 24b-2 under the Securities Exchange Act of
1934.

 

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1.4 “ABX Optioned Antigens” shall mean all antigens which are selected from the
Eligible Antigens by ABX pursuant to Article 5 below (or otherwise pursuant to
the Extended Research Program), for which CuraGen has the right to grant ABX the
commercial license under Article 7 below, and which are not Licensed Antigens,
and “ABX Optioned Antigen” shall mean any one of the ABX Optioned Antigens.

 

1.5 “ABX Patent Claim” shall mean a Patent Claim within the Licensed ABX
Intellectual Property Rights.

 

1.6 “ABX Patent Rights” shall mean, collectively, (a) all patents and patent
applications listed on Exhibit A and any foreign counterparts claiming priority
thereof; (b) all patent applications heretofore or hereafter filed in any
country which claim (and only to the extent they claim) ABX Technology and
Information or the use thereof; (c) all patents that have issued or in the
future issue from any of the foregoing patent applications, including without
limitation utility models, design patents and certificates of invention; and
(d) all divisionals, continuations, continuations-in-part, reissues, renewals,
supplemental protection certificates, extensions or additions to any such
patents and patent applications.

 

1.7 “ABX Product” shall mean, with respect to any ABX Licensed Antigen, any
product comprising (a) an Antibody or Antibody Equivalent which binds to such
ABX Licensed Antigen; or (b) Genetic Material that encodes such an Antibody or
Antibody Equivalent, wherein, in respect of each ABX Product, said Genetic
Material does not encode multiple antibodies.

 

1.8 “ABX Technology and Information” shall mean, collectively,
(a) [*******************************]; (b) [*******************************];
(c) [*******************************], and
(d) [*******************************].
[*****************************************************************].

 

1.9 “Affiliate” shall mean, with respect to any person or entity, any other
person or entity which controls, is controlled by or is under common control
with such person or entity. A person or entity shall be regarded as in control
of another entity if it owns or controls at least fifty percent (50%) of the
equity securities of the subject entity entitled to vote in the election of
directors (or, in the case of an entity that is not a corporation, for the
election of the corresponding managing authority).

 

1.10 “Antibody” shall mean a composition comprising (a) a whole antibody, or any
fragment thereof, derived from the XenoMouse Animals hereunder; or (b) a whole
antibody, or any fragment thereof, which is derived from a whole antibody or any
fragment thereof, which itself is derived from the XenoMouse Animals hereunder
or which is derived from the Genetic Material encoding or derived from, or the
amino acid sequences of or derived from, a whole antibody or any fragment
thereof, which itself is derived from the XenoMouse Animals hereunder.

 

Portions of this Exhibit were omitted and have been filed separately with the
Secretary of the Commission pursuant to the Company’s application requesting
confidential Investment under Rule 24b-2 under the Securities Exchange Act of
1934.

 

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1.11 “Antibody Cells” shall mean all cells that contain, express, or secrete
antibodies or Genetic Materials that encode antibodies.

 

1.12 “Antibody Equivalent” shall mean (i) [***************************], or
(ii) [***************************]. For purposes of clarification, the following
are not [**************]: (a) [*******************************************] and
(b) [*******************************************].

 

1.13 “Antigen Specific Materials and Information” shall mean with respect to an
Antigen, collectively, (a) [***********************************************];
and (b) [*********************************************].

 

1.14 “Antigens” shall mean, collectively, the Research Antigens, Eligible
Antigens, Optioned Antigens and Licensed Antigens, and “Antigen” shall mean any
one of the Antigens.

 

1.15 “BLA” shall mean a Biologics License Application, Product License
Application, New Drug Application, or similar application for marketing approval
of a product for use in the Therapeutic Field submitted to the FDA, or its
foreign equivalent.

 

1.16 “Commercial Field” shall mean, collectively, the Therapeutic Field and the
Diagnostic Field.

 

1.17 “Confidential Information” shall mean, with respect to a party, all
information of any kind whatsoever, and all tangible and intangible embodiments
thereof of any kind whatsoever, which is disclosed by such party to the other
party pursuant to this Agreement, and (if disclosed in writing or other tangible
medium) is marked or identified in writing as confidential at the time of
disclosure to the receiving party or (if otherwise disclosed or if not so marked
or identified in writing) is identified as confidential at the time of
disclosure to the receiving party and is summarized and identified as
confidential in writing or by electronic means within thirty (30) days after
such disclosure. Notwithstanding the foregoing, Confidential Information of a
party shall not include information which, and only to the extent, the receiving
party can establish by written documentation or electronic records (a) has been
publicly known prior to disclosure of such information by the disclosing party
to the receiving party; (b) has become publicly known without fault on the part
of the receiving party, subsequent to disclosure of such information by the
disclosing party to the receiving party; (c) has been received by the receiving
party at any time from a source, other than the disclosing party, rightfully
having possession of and the right to disclose such information free of
confidentiality obligations; (d) has been otherwise known by the receiving party
free of confidentiality obligations prior to disclosure of such information by
the disclosing party to the receiving party; or (e) has been independently
developed (as demonstrated by contemporaneous written or electronic evidence
maintained in the ordinary course of business of the receiving party) by
employees or agents of the receiving party without access to or use of such
information disclosed by the disclosing party to the receiving party.

 

Portions of this Exhibit were omitted and have been filed separately with the
Secretary of the Commission pursuant to the Company’s application requesting
confidential Investment under Rule 24b-2 under the Securities Exchange Act of
1934.

 

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1.18 “CuraGen Databases” shall mean, collectively, all data, information and
materials (other than Research Program Technology and Information) related to
human Genetic Materials and the expression products thereof which as of the
Effective Date are contained in CuraGen’s SeqCalling Database or which at any
time during the term of this Agreement are added thereto. For purposes hereof,
the CuraGen SeqCalling Database shall include without limitation the following
data, information, and materials possessed, acquired or developed by CuraGen as
of the Effective Date or at any time during the term of this Agreement, the
acquisition or development of which has not been sponsored or directed by a
commercial Third Party to whom rights in such data, information, and materials
have been granted in advance (without breaching the exclusivity obligations of
this Agreement): (i) sequence data with respect to human Genetic Materials
(including expressed sequences) and expression products thereof; (ii) the tissue
or cellular distribution relating to such Genetic Materials, their expression
and expression products; (iii) literature publications and patent status (i.e.,
information related to CuraGen filing dates, priority of claim(s) and any
related patents and patent applications, and any information known by CuraGen
regarding Third Party patents and patent applications) related to such Genetic
Materials and expression products; (iv) the biological function of such Genetic
Materials and expression products; (v) clones, expression products, proteins,
cell lines and vectors related to such Genetic Materials and expression
products, and (vi) all of the data, information, and materials described in the
foregoing clauses (i) to (v) with respect to any homologs of such Genetic
Materials and expression products. As of the Effective Date, the CuraGen
SeqCalling Database includes at least [************************************].

 

1.19 “CuraGen Exclusive Antigen” shall mean an antigen (other than a Research
Antigen) or Research Antigen that is designated by CuraGen as a CuraGen
Exclusive Antigen in accordance with Section 4.6.

 

1.20 “CuraGen Know-How” shall mean, collectively, all inventions, discoveries,
data, information, methods, techniques, technology and other results, whether or
not patentable but which are not generally known, regarding CuraGen Technology
and Information. All CuraGen Know-How shall be Confidential Information of
CuraGen.

 

1.21 “CuraGen Licensed Antigens” shall mean all CuraGen Optioned Antigens for
which CuraGen has exercised an option to obtain a commercial license pursuant to
Article 7 below, and “CuraGen Licensed Antigen” shall mean any one of the
CuraGen Licensed Antigens.

 

1.22 “CuraGen Optioned Antigens” shall mean all antigens which are selected from
the Eligible Antigens by CuraGen pursuant to Article 5 below (or otherwise
pursuant to the Extended Research Program), for which ABX has the right to grant
CuraGen the commercial license under Article 7 below, and which are not Licensed
Antigens, and “CuraGen Optioned Antigen” shall mean any one of the CuraGen
Optioned Antigens.

 

1.23 “CuraGen Patent Claim” shall mean a Patent Claim within the Licensed
CuraGen Intellectual Property Rights, other than Patent Claims that are
(i) directed to a method of use of the Research Antigen or antibodies to such
antigen that is initially identified solely

 

Portions of this Exhibit were omitted and have been filed separately with the
Secretary of the Commission pursuant to the Company’s application requesting
confidential Investment under Rule 24b-2 under the Securities Exchange Act of
1934.

 

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through the use of Antigen Specific Materials and Information or (ii) enabled
solely by data relating to or supporting a specific indication that was
initially identified solely through the use of the Antigen Specific Materials
and Information.

 

1.24 “CuraGen Patent Rights” shall mean, collectively, (a) all patent
applications heretofore or hereafter filed in any country which claim (and only
to the extent they claim) CuraGen Technology and Information or the use thereof;
(b) all patents that have issued or in the future issue from any of the
foregoing patent applications, including without limitation utility models,
design patents and certificates of invention; and (c) all divisionals,
continuations, continuations-in-part, reissues, renewals, supplemental
protection certificates, extensions or additions to any such patents and patent
applications.

 

1.25 “CuraGen Product” shall mean, with respect to any CuraGen Licensed Antigen,
any product comprising (a) an Antibody or Antibody Equivalent which binds to
such CuraGen Licensed Antigen, or (b) Genetic Material that encodes such an
Antibody or Antibody Equivalent wherein, in respect of each CuraGen Product,
said Genetic Material does not encode multiple antibodies.

 

1.26 “CuraGen Technology and Information” shall mean, collectively,
(a) [*******************************]; (b) [*********************************];
(c) [*******************************]; and (d) [******************************].
[*************************************************************************].

 

1.27 “Derived” or “derived” shall mean obtained, developed, created,
synthesized, designed, derived or resulting from, based upon or otherwise
generated (whether directly or indirectly, or in whole or in part).

 

1.28 “Diagnostic Field” shall mean the use of Products for the following human
medical purposes: the detection, diagnosis and monitoring of [*************],
predisposition, state or condition in humans or the selection of a particular
patient(s) to receive a particular therapeutic treatment(s).

 

1.29 “Effective Date” shall mean December 8, 1999.

 

1.30 “Eligible Antigen” shall mean a Research Antigen which satisfies the
criteria of Exhibit B as determined by the JMC pursuant to Section 3.2 below or
the arbitrator pursuant to Section 3.5 below, and which is not an Optioned
Antigen.

 

1.31 “Excluded ABX Technology” shall mean, collectively,
[***********************************] (a) [*********************************];
(b) [********************************]; (c) [***************************];
(d) [***************************]; (e) [***************************]; and
(f) [***************************].

 

Portions of this Exhibit were omitted and have been filed separately with the
Secretary of the Commission pursuant to the Company’s application requesting
confidential Investment under Rule 24b-2 under the Securities Exchange Act of
1934.

 

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1.32 “Excluded CuraGen Technology” shall mean, collectively,
[*******************************************]
(a) [*******************************************];
(b) [***********************************]; and
(c) [*******************************************].

 

1.33 “FDA” shall mean the United States Food and Drug Administration or its
successor agency.

 

1.34 “First Commercial Sale” shall mean, with respect to each Product in each
country, the date of first commercial sale (other than for purposes of obtaining
regulatory approval) of such Product by a party hereto, its Sublicensee or their
respective Affiliates to an unaffiliated Third Party in such country.

 

1.35 “Gene Therapy” shall mean the treatment or prevention of a disease by means
of Ex Vivo or In Vivo delivery (via viral or nonviral gene transfer systems) of
compositions comprising either (a) Genetic Material that encodes an Antibody,
wherein such Antibody serves a material function in the treatment or prevention
of such disease; (b) Genetic Material that encodes a moiety other than an
Antibody, wherein the moiety serves a material function in the treatment or
prevention of such disease and wherein such composition incorporates an Antibody
(or Genetic Material that encodes such Antibody), which Antibody is used as a
targeting vehicle for the composition; or (c) Genetic Material that encodes an
Antibody that serves a material function in the treatment or prevention of such
disease, wherein such composition also incorporates an Antibody (or Genetic
Material that encodes such Antibody) which Antibody is used as a targeting
vehicle for the composition. “Ex Vivo” delivery shall mean the introduction,
outside of the body of a human, of such compositions into a cell, tissue,
organoid, or organ, followed by the administration of the cell, tissue,
organoid, or organ which contains such introduced compositions into the body of
the same (autologous) or different (allogeneic) human, without limitation as to
the formulation, anatomic site, or route of administration or the use of
encapsulation or other devices for such administration. “In Vivo” delivery shall
mean the introduction of such compositions into an individual, without
limitation as to the formulation, anatomic site, or route of administration or
the use of encapsulation or other devices for such administration.

 

1.36 “Genetic Material” shall mean a nucleic acid, including DNA, RNA, and
nucleic acid complementary and reverse complementary to such nucleotide
sequences or nucleic acid, whether coding or noncoding and whether intact or a
fragment.

 

1.37 “GenPharm Cross License Agreement” shall mean that certain Cross License
Agreement entered into by and between ABX, JTI, XT, Cell Genesys, Inc., and
GenPharm International, Inc., effective as of March 26, 1997, as the same may be
amended from time to time.

 

1.38 “Human Antibody Equivalent” shall mean (i) [*********************], or
(ii) [**********************************].

 

Portions of this Exhibit were omitted and have been filed separately with the
Secretary of the Commission pursuant to the Company’s application requesting
confidential Investment under Rule 24b-2 under the Securities Exchange Act of
1934.

 

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1.39 “IND” shall mean an Investigational New Drug application filed with the
FDA, or any similar filing with any foreign regulatory authority, to commence
human clinical testing of any Product in any country.

 

1.40 “JMC” shall mean the joint management committee comprising representatives
of ABX and CuraGen described in Section 3.1 below.

 

1.41 “JTI” shall mean Japan Tobacco Inc., a Japanese corporation.

 

1.42 “Licensed Antigens” shall mean, collectively, the ABX Licensed Antigens and
CuraGen Licensed Antigens, and “Licensed Antigen” shall mean any one of the
Licensed Antigens.

 

1.43 “Licensed ABX Intellectual Property” shall mean ABX’s rights in the ABX
Patent Rights, ABX Know-How, Research Program Patent Rights and Research Program
Know-How; provided, however, that the Licensed ABX Intellectual Property (a) is
all to the extent and only to the extent that ABX has the right to grant
(sub)licenses thereunder (including without limitation to the extent permitted
under the applicable ABX In-Licenses); (b) is expressly subject to the ABX
In-Licenses; and (c) shall exclude the Excluded ABX Technology.

 

1.44 “Licensed CuraGen Intellectual Property” shall mean CuraGen’s rights in the
CuraGen Patent Rights, CuraGen Know-How, Research Program Patent Rights and
Research Program Know-How; provided, however, that the Licensed CuraGen
Intellectual Property (a) is all to the extent and only to the extent that
CuraGen has the right to grant (sub)licenses thereunder; and (b) shall exclude
the Excluded CuraGen Technology.

 

1.45 “Licensed Intellectual Property” shall mean, collectively, the Licensed ABX
Intellectual Property and the Licensed CuraGen Intellectual Property.

 

1.46 “Net Sales” shall mean, with respect to a Product, the gross sales price
charged by a party, its Sublicensees and their respective Affiliates for sales
of such Product to non-Affiliate customers, less
(a) [***************************]; (b) [*****************]; and
(c) [**********************************************************************].
[****************************************************************************].

 

1.47 “Optioned Antigens” shall mean, collectively, the ABX Optioned Antigens and
CuraGen Optioned Antigens, and “Optioned Antigen” shall mean any one of the
Optioned Antigens.

 

1.48 “Patent Claim” shall mean a claim of a pending patent application (pending
for no longer than five (5) years) or issued and unexpired patent included
within the Licensed Intellectual Property which has not been held unenforceable
or invalid by a court or other governmental agency of competent jurisdiction,
unappealable or unappealed within the time allowed for appeal and which has not
been admitted to be invalid or unenforceable through reissue, disclaimer or
otherwise.

 

Portions of this Exhibit were omitted and have been filed separately with the
Secretary of the Commission pursuant to the Company’s application requesting
confidential Investment under Rule 24b-2 under the Securities Exchange Act of
1934.

 

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1.49 “Person” shall mean an individual, corporation, partnership, limited
liability company, trust, business trust, association, joint stock company,
joint venture, pool, syndicate, sole proprietorship, unincorporated
organization, governmental authority or any other form of entity not
specifically listed herein.

 

1.50 “Phase I Clinical Trial” shall mean a human clinical trial in any country
that is intended to initially evaluate the safety and/or pharmacological effect
of a Product in subjects, or that would otherwise satisfy requirements of 21 CFR
312.21(a), or its foreign equivalent.

 

1.51 “Phase II Clinical Trial” shall mean a human clinical trial in any country
that is intended to initially evaluate the effectiveness of a Product for a
particular indication or indications in patients with the disease or indication
under study, or that would otherwise satisfy requirements of 21 CFR 312.21(b),
or its foreign equivalent.

 

1.52 “Phase III Clinical Trial” shall mean a pivotal human clinical trial in any
country the results of which could be used to establish safety and efficacy of a
Product as a basis for a marketing approval application submitted to the FDA, or
that would otherwise satisfy requirements of 21 CFR 312.21(c), or its foreign
equivalent.

 

1.53 “PMA” shall mean a Pre-Market Approval Application, 510(k) notice or
similar application for marketing approval of a product for use in the
Diagnostic Field submitted to the FDA, or its foreign equivalent.

 

1.54 “Products” shall mean, collectively, the ABX Products and the CuraGen
Products, and “Product” shall mean any one of the Products.

 

1.55 “Program Year” shall mean any period commencing on the Effective Date or
any anniversary thereof, and continuing through the first anniversary thereof,
during the term of the Research Program.

 

1.56 “Research Antigens” shall mean, collectively, the antigens which are
selected by the JMC, ABX or CuraGen pursuant to Section 4.1 below for use in the
Research Program, for which ABX and CuraGen have the right to grant the other
party the commercial license under Article 7 below, and which are not Optioned
Antigens or Licensed Antigens, and “Research Antigen” shall mean any one of the
Research Antigens.

 

1.57 “Research Field” shall mean the use of materials derived from XenoMouse
Animals that are immunized with Research Antigens solely for the creation,
identification, analysis, research, characterization and preclinical development
of potential Products for use in the Commercial Field.

 

1.58 “Research Program” shall mean the collaborative research program described
in Section 4.4 below

 

Portions of this Exhibit were omitted and have been filed separately with the
Secretary of the Commission pursuant to the Company’s application requesting
confidential Investment under Rule 24b-2 under the Securities Exchange Act of
1934.

 

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1.59 “Research Program Know-How” shall mean, collectively, all inventions,
discoveries, data, information, methods, techniques, technology and other
results, whether or not patentable but which are not generally known, regarding
Research Program Technology and Information or the use thereof.

 

1.60 “Research Program Technology and Information” shall mean, with respect to
an Antigen, collectively, (a) [*******************************************]; and
(b) [*******************************************].

 

1.61 “Research Program Patent Rights” shall mean, collectively, (a) all patent
applications hereafter filed in any country which claim Research Program
Technology and Information or the use thereof; (b) all patents that have issued
or in the future issue from any of the foregoing patent applications, including
without limitation utility models, design patents and certificates of invention;
and (c) all divisionals, continuations, continuations-in-part, reissues,
renewals, supplemental protection certificates, extensions or additions to any
such patents and patent applications.

 

1.62 “Royalty Commencement Date” shall mean, with respect to each Product in
each country, the date of the First Commercial Sale of such Product in such
country.

 

1.63 “Sublicense” shall mean, with respect to a Product, an agreement or
arrangement pursuant to which a (sub)license or distribution right regarding
such Product has been granted to a Sublicensee.

 

1.64 “Sublicense Income” shall mean, with respect to a Product, the aggregate
cash consideration, and the fair market value of the non-cash consideration,
received by a party or its Affiliate in connection with the Sublicense of such
Product, excluding consideration received (a) in reimbursement of such party’s
or its Affiliate’s cost to perform research, development or similar services
conducted for such Product after the grant of such Sublicense, (b) in
reimbursement of patent or other out-of-pocket expenses on such Product, or
(c) in consideration for the purchase of any securities of such party or its
Affiliates at a price equal to no more than 120% of the then fair market value
of such securities).

 

1.65 “Sublicensee” shall mean a Third Party that is granted (a) a (sub)license
under the Licensed Intellectual Property to develop, make, use, offer for sale,
sell or import a Product in the Commercial Field; or (b) a right to distribute a
Product in the Commercial Field, provided that such Third Party is responsible
for marketing and promotion of such Product within the applicable territory.

 

1.66 “Technology and Information” shall mean, collectively, the ABX Technology
and Information, CuraGen Technology and Information and Research Program
Technology and Information.

 

1.67 “Therapeutic Field” shall mean the use of Products for the following human
medical purposes: the prevention or treatment of [***************************].

 

Portions of this Exhibit were omitted and have been filed separately with the
Secretary of the Commission pursuant to the Company’s application requesting
confidential Investment under Rule 24b-2 under the Securities Exchange Act of
1934.

 

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1.68 “Third Party” shall mean any Person other than ABX, CuraGen and their
respective Affiliates.

 

1.69 “XenoMouse Animals” shall mean the transgenic mice capable of producing
human antibodies when immunized by ABX with an antigen.

 

1.70 “XT” shall mean Xenotech, L.P., a California limited partnership.

 

1.71 “XT Master Research License and Option Agreement” shall mean that certain
Master Research License and Option Agreement entered into by and among XT, JTI
and Cell Genesys, Inc. effective as of June 28, 1996, and subsequently assigned
to ABX by Cell Genesys, Inc., as the same may be amended from time to time.

 

1.72 “XT/ABX Product License Agreement” shall mean a license agreement between
XT and ABX entered into pursuant to the XT Master Research and License Agreement
granting to ABX a license (with the right to grant sublicenses) to commercialize
Products in one or more territories.

 

1.73 “Conjugate” shall mean a specific composition, as mutually agreed upon by
the parties in writing, which ABX owns or to which ABX otherwise has rights
(including the right to grant sublicenses to CuraGen hereunder) to be conjugated
to one or more Antibodies hereunder. “DM1”, as defined under the ImmunoGen
Agreement, is the initial Conjugate.

 

1.74 “Imaging Peptide” shall mean a peptide that (a) is less than fifty (50)
amino acids in length, and (b) is not derived from an Antibody Equivalent.

 

1.75 “Lambda Antibodies” shall mean Antibodies derived from the Lambda XenoMouse
Animals hereunder comprising a human lambda light chain.

 

1.76 “Lambda Licensed Antigen” shall mean an Optioned Antigen that is designated
as a Lambda Licensed Antigen at the time CuraGen exercises an option to take a
commercial license to such Optioned Antigen under Article 7.

 

1.77 “Lambda Optioned Antigen” shall mean an Optioned Antigen for which Lambda
XenoMouse Animals will or may be immunized under the Research Program and
designated as such pursuant to Section 5.

 

1.78 “Lambda XenoMouse Animals” shall mean XenoMouse Animals that are transgenic
for a portion of the human lambda light chain immunoglobulin locus and produce
human lambda light chain-containing immunoglobulin molecules.

 

1.79 “Specifically Binds” refers to those antibodies that have a minimum
affinity (KD value) of [******] (as measured by standard techniques such as the
BIAcore) toward a specified antigen and do not bind to related isozymes,
proteins or antigens with an affinity of better than 1 uM.

 

Portions of this Exhibit were omitted and have been filed separately with the
Secretary of the Commission pursuant to the Company’s application requesting
confidential Investment under Rule 24b-2 under the Securities Exchange Act of
1934.

 

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2. REPRESENTATIONS AND WARRANTIES

 

Each party hereby represents and warrants to the other party as follows:

 

2.1 Existence. Such party is duly organized, validly existing and in good
standing under the laws of the state in which it is organized.

 

2.2 Authorization and Enforcement of Obligations. Such party: (a) has the
requisite power and authority and the legal right to enter into this Agreement
and to perform its obligations hereunder; and (b) has taken all requisite action
on its part to authorize the execution and delivery of this Agreement and the
performance of its obligations hereunder. This Agreement has been duly executed
and delivered on behalf of such party, and constitutes a legal, valid, binding
obligation enforceable against such party in accordance with its terms except as
enforcement may be limited by equitable remedies or defenses and applicable
bankruptcy laws.

 

2.3 No Consents. All necessary consents, approvals and authorizations of all
governmental authorities and other persons required to be obtained by such party
in connection with this Agreement have been obtained.

 

2.4 No Conflict. The execution and delivery of this Agreement and the
performance of such party’s obligations hereunder (a) do not conflict with or
violate any requirement of applicable laws or regulations; and (b) do not
conflict with, or constitute a default under, any contractual obligation of it.

 

2.5 ABX In-Licenses. ABX has made available to counsel to CuraGen correct copies
of ABX In-Licenses, as in effect on the Effective Date.

 

2.6 Disclaimer. EXCEPT AS OTHERWISE EXPRESSLY SET FORTH IN THIS AGREEMENT,
NEITHER PARTY MAKES ANY REPRESENTATIONS OR EXTENDS ANY WARRANTIES OF ANY KIND
REGARDING TECHNOLOGY AND INFORMATION, PRODUCTS OR LICENSED INTELLECTUAL PROPERTY
EITHER EXPRESS OR IMPLIED, INCLUDING, BUT NOT LIMITED TO, WARRANTIES OF
MERCHANTABILITY, FITNESS FOR A PARTICULAR PURPOSE, NONINFRINGEMENT OR VALIDITY.
ALL TECHNOLOGY AND INFORMATION IS PROVIDED “AS IS.”

 

3. JOINT MANAGEMENT COMMITTEE

 

3.1 Composition. The JMC shall comprise three (3) named representatives of
CuraGen and three (3) named representatives of ABX. Each party shall notify the
other party in writing of its initial representatives to the JMC within ten
(10) days after the Effective Date, and may substitute one or more
representatives from time to time effective upon written notice to the other
party.

 

Portions of this Exhibit were omitted and have been filed separately with the
Secretary of the Commission pursuant to the Company’s application requesting
confidential Investment under Rule 24b-2 under the Securities Exchange Act of
1934.

 

11

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3.2 Responsibilities. The JMC shall be responsible for (a) selecting antigens
from the CuraGen Databases as Research Antigens; (b) monitoring and reporting
the progress of the Research Program; (c) recommending to the parties any
modifications to the Research Program with respect to any or all of the Research
Antigens; (d) facilitating open and frequent exchange of information between the
parties regarding the Research Program; (e) reviewing the data and information
regarding Research Antigens and determining whether a Research Antigen satisfies
the criteria set forth in Exhibit B; and (f) making selections of Eligible
Antigens under Article 5 below. The JMC shall also be responsible for discussing
potential Conjugates that are to be utilized in the Research Program; provided,
however, that no Conjugate shall be utilized in the Research Program until the
parties have mutually agreed in writing (i) that such Conjugate shall be used in
the Research Program, and (ii) those specific one or more Antibodies with which
such Conjugate will be utilized.

 

3.3 Meetings. The JMC shall meet in person (unless otherwise agreed on a
meeting-by-meeting basis) not less than once each calendar quarter during the
term of the Research Program, on such dates and at such times and places as
agreed to by CuraGen and ABX, alternating between Fremont, California and New
Haven, Connecticut, or such other locations as the parties mutually agree. For
all other meetings, the JMC may meet by telephonic or video conference or in
person, as the parties mutually agree. Each party shall have the right to have
one (or such greater number as the parties mutually agree) employee or agent who
is not a member of the JMC attend each meeting of the JMC as a non-voting
observer. Each party shall be responsible for all its own personnel, travel and
related expenses relating to JMC meetings. The first meeting of the JMC shall
take place at the offices of ABX as soon as practicable after the Effective
Date, but in no event later than thirty (30) days after the Effective Date.

 

3.3.1 Within thirty (30) days following each JMC meeting, the party hosting the
meeting (or entitled to host the meeting, if held by telephonic or video
conference or at a location other than Fremont, California or New Haven,
Connecticut) shall prepare and provide to the other party mutually acceptable,
reasonably detailed written minutes describing (a) all matters reviewed or
considered by the JMC; (b) all discussions regarding potential and actual
Antigens; and (c) all determinations and actions of the JMC and the reasons
therefor. Such minutes shall be the Confidential Information of both ABX and
CuraGen; provided, however, that to the extent that such minutes relate to the
Optioned Antigens and Licensed Antigens of a party they shall be the
Confidential Information solely of such party.

 

3.3.2 Not less than ten (10) days prior to each regularly scheduled quarterly
meeting of the JMC, each party shall provide the other party with all data and
information, not previously disclosed to the other party, regarding the
activities of such party under the Research Program.

 

3.3.3 Not less than five (5) days prior to each regularly scheduled meeting of
the JMC, each party shall provide the other party with a list of the antigens
that such party desires to discuss at such JMC meeting for potential use in the
Research Program.

 

Portions of this Exhibit were omitted and have been filed separately with the
Secretary of the Commission pursuant to the Company’s application requesting
confidential Investment under Rule 24b-2 under the Securities Exchange Act of
1934.

 

12

--------------------------------------------------------------------------------

 

3.4 Actions. ABX and CuraGen each shall be entitled to cast one vote on matters
before the JMC. Decisions of the JMC shall be made by unanimous approval.

 

3.5 Disagreements. All disagreements within the JMC shall be resolved in the
following manner:

 

3.5.1 Promptly upon receipt of written notice (a “Dispute Notice”) from one
party to the other of a disagreement to be resolved under this Paragraph 3.5,
the JMC representatives of each party promptly shall present the disagreement to
the chief executive officer of such party.

 

3.5.2 The chief executive officers of each party thereafter shall meet to
discuss each party’s view and to explain the basis for their respective
positions of such disagreement, and in good faith shall attempt to resolve such
disagreement among themselves.

 

3.5.3 If, within thirty (30) days after receipt of a Dispute Notice as to
whether a Research Antigen satisfies the criteria of Exhibit B, the chief
executive officers of each party cannot resolve such disagreement, then upon
written notice from one party to the other party, such disagreement shall be
settled as follows. Within forty five (45) days after receipt of such Dispute
Notice, the parties shall attempt to mutually agree upon a single independent
Third Party arbitrator, who shall be a scientific professional in the antibody
field, to resolve such disagreement. If the parties are unable to mutually agree
upon one such person, then each party shall appoint one independent Third Party
scientific professional in the antibody field prior to the expiration of such
forty five (45) day period, and within sixty (60) days after receipt of such
Dispute Notice, such person(s) shall select a single independent Third Party
arbitrator, who shall be a scientific professional in the antibody field, to
resolve such disagreement. Each party shall present all information presented to
the JMC and all other information as such party reasonably desires regarding
such disagreement. Within ninety (90) days after receipt of such Dispute Notice,
such arbitrator shall determine whether such Research Antigen satisfies the
criteria of Exhibit B and provide written notice to the parties regarding such
determination.

 

4. RESEARCH ANTIGEN IDENTIFICATION AND RESEARCH

 

4.1.1 Searches for Research Antigens. During the term of the Research Program,
CuraGen shall have primary responsibility for the screening of the CuraGen
Databases and shall conduct searches thereof to identify and recommend to the
JMC potential antigens of interest hereunder. CuraGen shall recommend to the JMC
all antigens of interest (whether or not the genes encoding such antigens are
contained in the CuraGen Databases) that, based on the data and information in
the CuraGen Databases and such other data and information as CuraGen may have
acquired or developed, (i) CuraGen reasonably believes is not the subject of any
Third Party intellectual property rights (or the parties mutually believe, as
evidenced by written agreement, that a license to all applicable Third Party
intellectual property rights can be

 

Portions of this Exhibit were omitted and have been filed separately with the
Secretary of the Commission pursuant to the Company’s application requesting
confidential Investment under Rule 24b-2 under the Securities Exchange Act of
1934.

 

13

--------------------------------------------------------------------------------

 

reasonably obtained), (ii) CuraGen reasonably believes could be subject (or the
parties mutually believe, as evidenced by written agreement, that the antibodies
to which could be subject) to a proprietary position of CuraGen, (iii) CuraGen
reasonably believes would be available hereunder as a Research Antigen, and
(iv) CuraGen reasonably believes is reasonably likely to have potential as a
target for antibody-based therapeutics. In addition, CuraGen will use its best
efforts to recommend to the JMC antigens that would have an IP Score (as defined
below) of 1, 2, or 3 and not 4 or 5 in a sufficient number to allow selection of
at least [*****] Priority Research Antigens per year from the CuraGen Databases.
ABX shall have the right, but not the obligation, to recommend to the JMC
antigens of interest from the CuraGen Databases or from other sources that ABX
reasonably believes are not the subject of Third Party intellectual property
rights and would be available hereunder as Research Antigens and are reasonably
likely to have potential as targets for antibody-based therapeutics.

 

4.1.2 Research Antigen Selection.

 

During the term of the Research Program, based upon the data and information
provided by the parties regarding potential antigens of interest, the JMC shall
select at any JMC meeting, from those antigens proposed by the parties under
Section 3.3.3 and 4.1, potential antigens of interest for use in the Research
Program. With respect to each potential antigen which is selected, by the action
of the JMC, for use under the Research Program, within thirty (30) days after
the date of such JMC meeting, each party shall notify the other party in writing
if such party does not have the right to grant the other party a commercial
license under Article 7 below for such antigen. Unless a party timely notifies
the other party in writing that it does not have the right to grant the other
party a commercial license under Article 7 below for such antigen, such antigen
thereafter shall be a Research Antigen.

 

4.1.3 Notwithstanding anything to the contrary in this Agreement, if a party
gives written notice to the other party at any time stating that such party does
not have the right to grant the other party a commercial license under Article 7
below for a Research Antigen, then effective thirty (30) days after the receipt
by the other party of such notice, such antigen shall cease to be a Research
Antigen and both parties shall destroy all Antigen Specific Materials and
Information pertaining to such antigen. A party shall give such written notice
to the other party promptly upon the occurrence of the event giving rise to such
party’s not having the right to grant the other party a commercial license under
Article 7, to the extent such party has the right to do so.

 

4.2 Research Program.

 

4.2.1 Research Responsibilities. During the term of the Research Program, each
party shall use its commercially reasonable efforts to perform its obligations
set forth in the Work Plan within the time schedules contemplated therein. The
JMC may recommend changes to the allocation of responsibilities set forth in
Exhibit C, from time to time; provided, however, that such changes shall only be
effective if in a written amendment duly executed by both parties. Other than
the activities specified in Exhibit C as being the

 

Portions of this Exhibit were omitted and have been filed separately with the
Secretary of the Commission pursuant to the Company’s application requesting
confidential Investment under Rule 24b-2 under the Securities Exchange Act of
1934.

 

14

--------------------------------------------------------------------------------

 

responsibility of one party or another, the JMC shall allocate the
responsibility for each such activity between the parties, taking into account
the skills of each party, in an effort to divide the resources and internal
costs reasonably required to be dedicated by each party to the conduct of such
activities [*******************]. In the event that any activities with respect
to Research Antigens (other than CuraGen Exclusive Antigens), other than those
specified in Exhibit C as being the responsibility of one party or another,
require any payments to a Third Party for goods or services (e.g., specific
animal models), such payments shall be [*******************], provided that all
such goods and services and payments therefor are approved by the JMC prior to
incurring any such expense. Notwithstanding anything to the contrary in this
Agreement, all activities with respect to Research Antigens that are CuraGen
Exclusive Antigens, other than the generation and biochemical characterization
of Antibodies as described and allocated to ABX in Exhibit C, shall be the sole
and exclusive responsibility of CuraGen, at its sole cost and expense. With
respect to each Research Antigen, during the term of the Research Program, each
party may conduct, in its sole discretion, such additional preclinical research
in the Research Field as such party reasonably desires to evaluate its interest
in such Research Antigen, provided that, the preceding right shall not apply to
ABX in the case of Research Antigens that are CuraGen Exclusive Antigens, and
provided further that prior to commencing such additional preclinical research
with respect to Research Antigens that are not CuraGen Exclusive Antigens, such
party shall give prior written notice to the other party of the nature and scope
of such additional preclinical research regarding such Research Antigen and
shall provide the other party with all results of such research, which research
shall be deemed to have been part of the Research Program. Each party shall
provide the personnel, materials, equipment and other resources required to
conduct its obligations hereunder; provided, however, that CuraGen shall
transfer to ABX all information and materials available to CuraGen that are
useful in the conduct of all assays conducted by or on behalf of CuraGen in
connection with the Research Program. ABX shall reimburse CuraGen for all
reasonable out-of-pocket expenses incurred in effecting such transfer. CuraGen
grants to ABX the nonexclusive, worldwide license (without the right to grant
sublicenses) to practice and use all such assays both (a) for use in the
Research Program, and (b) for research purposes (unrelated to the Research
Program or CuraGen) related to the research and development of antigens and/or
antibodies. Each party shall perform its obligations hereunder in accordance
with high scientific and professional standards, and in compliance in all
material respects with the requirements of applicable laws and regulations. Each
party shall provide reasonable assistance required by the other party in
connection with the performance of the Research Program. Each party shall have
the right, at reasonable times during normal business hours and upon reasonable
notice, to visit the facilities of the other party where the other party is
conducting its obligations under the Research Program to observe such
activities.

 

4.2.2 Research Antigen Work Plans.

 

(a) Each year, the JMC will prioritize up to [****] Research Antigens for
immunization based on IP Score (as defined below) and biology (“Priority
Research Antigens”). The Parties agree that for purposes of this Agreement, an
“IP Score” for a Research Antigen shall be determined as follows: (i) if CuraGen
has priority for the composition of matter for a full length Research Antigen
(that is not a variant) such Research Antigen will be accorded a IP

 

Portions of this Exhibit were omitted and have been filed separately with the
Secretary of the Commission pursuant to the Company’s application requesting
confidential Investment under Rule 24b-2 under the Securities Exchange Act of
1934.

 

15

--------------------------------------------------------------------------------

 

Score of 1, (ii) if CuraGen has priority for the composition of matter of a
Research Antigen that is a variant and has priority for data demonstrating a
novel method of use for such variant or antibodies thereto such Research Antigen
shall be accorded an IP Score of 2, (iii) if the composition of matter of a
Research Antigen has been publicly disclosed in the literature (other than the
patent literature, unless such disclosure does not include a disclosure of
antibodies) before CuraGen’s priority date and CuraGen has priority for data
demonstrating a novel method of use for such variant or antibodies thereto, such
Research Antigen shall be accorded an IP Score of 3, (iv), if the composition of
matter of a Research Antigen (or antibodies thereto) has been disclosed in
patent literature together with a disclosure of antibodies before CuraGen’s
priority date such Research Antigen shall be accorded an IP Score of 4, and
(v) if the composition of matter of a Research Antigen (or antibodies thereto)
has been claimed in an issued or granted patent in the patent literature
together with a disclosure of antibodies before CuraGen’s priority date such
Research Antigen shall be accorded an IP Score of 5. Unless agreed as provided
herein, neither Party shall have any obligation to undertake any work or
continue any work with respect to a Research Antigen accorded an IP Score of 4
or 5 and no Research Antigen accorded an IP Score of 4 or 5 shall be a Priority
Research Antigen unless ABX agrees in writing. In the event that CuraGen
reasonably believes that, notwithstanding a Research Antigen having an IP Score
of 4 or 5, CuraGen has priority for a substantive method of use for the Research
Antigen not previously disclosed in the literature, CuraGen shall have the right
to propose such Research Antigen for reconsideration by ABX and if ABX agrees to
such reconsideration, present information demonstrating such method of use and
CuraGen’s priority information. Upon a determination by ABX that such a Research
Antigen would be acceptable, such Research Antigen shall be accorded an IP Score
of “4-MOU” or “5-MOU”, as the case may be, and may be designated a Priority
Research Antigen. From the pool of Priority Research Antigens, ABX will attempt
to raise Antibodies by immunization of Xenomouse Animals and the Parties will
attempt to generate and characterize such Antibodies to such Priority Research
Antigens. The Parties will use reasonable efforts to analyze or reanalyze, as
the case may be, the IP Score of each proposed Priority Research Antigen within
ten (10) business days of its becoming a proposed Priority Research Antigen. If
the JMC determines to reimmunize a Xenomouse Animal with a Research Antigen, it
will be counted as one of the Priority Research Antigens.

 

(b) For each Priority Research Antigen a Work Plan will be created, including
design of the immunogen(s) and specification of all assays required for Eligible
Antigen designation pursuant to Exhibit B. For each Research Antigen for which
research activities have already begun as of the Revision Date, a Work Plan will
be created that summarizes the work already completed and the work that remains
for Eligible Antigen designation pursuant to Exhibit B. In each case, the Work
Plan will detail the work to be done or remaining to be done and define the
responsibility of each party in conducting the work under the Work Plan
consistent with Section 4.2.2. It is understood and agreed by the Parties that
Exhibit C shall serve as a guide for the creation of the Work Plans of each
Research Antigen, however, the Work Plan once created and agreed to by the
Parties shall take precedence over Exhibit C with respect to the particular
Research Antigen to which the Work Plan applies.

 

Portions of this Exhibit were omitted and have been filed separately with the
Secretary of the Commission pursuant to the Company’s application requesting
confidential Investment under Rule 24b-2 under the Securities Exchange Act of
1934.

 

16

--------------------------------------------------------------------------------

 

(c) Failure by ABX to immunize a Xenomouse Animal within thirty (30) days of
delivery of an immunogen by CuraGen for a Priority Research Antigen meeting the
Work Plan criteria for such Priority Research Antigen will result in that
Priority Research Antigen being no longer designated as a Research Antigen. ABX
will return all CuraGen Technology and Information to CuraGen related to such
Research Antigen and CuraGen will no longer be subject to exclusivity provisions
of Section 4.4 with respect to such Research Antigen.

 

4.2.3 Neither Party is obligated to perform any further research on a Research
Antigen outside the scope of the agreed upon Work Plan once such Work Plan is
completed unless a new Work Plan is agreed to by the JMC. If either Party
unreasonably fails to perform an assigned task under a Work Plan after written
request for more than 90 days from the date of the request, unless such delay is
due to the failure of the other Party to perform, the other Party can perform it
instead and be reimbursed by the originally assigned Party.

 

4.2.4 The parties shall [**********] all costs incurred by ABX for the provision
of the Conjugates prior to the selection of an Eligible Antigen by one of the
parties including without limitation (a) fees paid by ABX in consideration for
the Conjugate in-licensed technology to the extent such fees are directly
related to the use of the Conjugates hereunder and are payable prior to such
selection, and (b) costs of scale-up manufacturing of Conjugates incurred by ABX
prior to such selection.

 

4.2.5 Access. Without limiting the generality of Section 4.1, each party shall
permit up to three (3) employees of the other party access to such party’s
facilities, upon reasonable advance notice, at all times during normal business
hours during the term of the Research Program Term to work with the employees of
such party in the development and use of assays pursuant to the Research
Program. Each party shall provide such employees of the other party in person
access to one or more employees of such party skilled in the development and use
of such assays to enable such employees of such other party to utilize such
assays and develop similar assays for use in the Research Program and, in the
case of ABX, as contemplated under Section 4.2.2; provided, however, except as
otherwise provided in Section 4.2.2, that no license (or sublicense, as the case
may be) to any intellectual property relating to such assays is granted hereby,
whether expressly or by implication.

 

4.2.6 Term of the Research Program. Unless this Agreement is earlier terminated,
the term of the Research Program shall commence on the Effective Date and shall
continue through completion of all Work Plans for Research Antigens for which
CuraGen has delivered to ABX for immunization on or prior to June 30, 2005 an
immunogen meeting the Work Plan criteria for such Research Antigen (the “Last
Immunization Date”). Without limiting the generality of the foregoing, CuraGen
will have no obligation to deliver Research Antigens after June 30, 2005 and ABX
will have no obligation to immunize Xenomouse Animals with Research Antigens
delivered after June 30, 2005 or conduct any further work with respect to such
unimmunized antigens.

 

Portions of this Exhibit were omitted and have been filed separately with the
Secretary of the Commission pursuant to the Company’s application requesting
confidential Investment under Rule 24b-2 under the Securities Exchange Act of
1934.

 

17

--------------------------------------------------------------------------------

 

4.2.7 Extended Research. Subject to Sections 6.1.4, 6.1.5, 6.1.6, both parties
may use Antibody Specific Materials and Information and Research Program
Technology and Information relating to Research Antigens (i) for which Xenomouse
Immunizations were conducted but that failed to become Eligible Antigens, as
listed on Exhibit E and as updated by agreement of the JMC, or (ii) which became
Unpicked Eligible Antigens under Section 5.2.12 (“Extended Research Antigens”).
At any time during the term of the Extended Research License under Section 6.1.6
(the “Extended Research License Term”), either party can designate such a
Research Antigen as an Optioned Antigen by notice to the other and payment of
the Section 8.2.1 fee, provided that a commercial license is available from the
other party. If a commercial license is not available, the Extended Research
License shall terminate for such Antigen and each party shall destroy all
Antigen Specific Materials and Information related to such antigen. Further, at
any time during the Extended Research License Term, should an antigen subject to
the Extended Research License cease to be available for commercial license, the
party no longer having the right to grant the exclusive license shall notify the
other party and the Extended Research License shall immediately terminate and
each party shall destroy all Antigen Specific Materials and Information related
to such antigen.

 

4.3 Research Records and Reports.

 

4.3.1 Research Records. Each party shall maintain records, in sufficient detail
and in good scientific manner appropriate for patent purposes, which shall be
complete and accurate and shall fully and properly reflect all work done and
results achieved in the performance of the activities under the Research
Program. Each party shall have the right, during normal business hours and upon
reasonable notice, to inspect and copy all such records of the other party to
the extent reasonably required for the performance of its obligations under this
Agreement. Each party shall maintain such records and the information of the
other party contained therein in confidence in accordance with Article 11 below.

 

4.3.2 Research Reports and Information. Each party shall keep the other informed
of the progress of its own activities under the Research Program. At a minimum,
within thirty (30) days following the last day of each calendar quarter during
the term of the Research Program, each party shall prepare, and provide to the
other party, a reasonably detailed written summary report which shall describe
the work performed by such party to date under the Research Program.

 

4.4 Exclusivity.

 

4.4.1 Except as otherwise expressly permitted under this Agreement, during the
term of the Research Program, CuraGen shall not,
[**************************************************************************].
[***********************************************], (i) [*******************]or
(ii) [****************************************************************************].
[***********************************************] (i) [********************] and
(ii) [*************************************************************************].
[****************************************************************************].

 

Portions of this Exhibit were omitted and have been filed separately with the
Secretary of the Commission pursuant to the Company’s application requesting
confidential Investment under Rule 24b-2 under the Securities Exchange Act of
1934.

 

18

--------------------------------------------------------------------------------

 

4.4.2 For a period commencing on November 27, 2000, and ending on the earlier of
(i) the Last Immunization Date, and (ii) the effective date of a termination of
the Research Program and the options, licenses and rights of ABX under this
Agreement by CuraGen pursuant to Section 14.2.3 upon an uncured material breach
of a material obligation by ABX, CuraGen shall not enter into any agreement
(other than permitted license and sublicense agreements hereunder) with any
other Person under which:

 

(a) [*******************************************************].

 

(b) [*******************************************************].

 

(c) [*******************************************************].

 

(d) [*******************************************************].

 

(e) [*******************************************************]

 

4.4.3 Except as otherwise expressly permitted under this Agreement, for a period
ending on the earlier of (a) the Last Immunization Date, and (b) the effective
date of a termination of the Research Program and the options, licenses and
rights of ABX under this Agreement by CuraGen pursuant to Section 14.2.3 upon an
uncured material breach of a material obligation by ABX, CuraGen shall not, and
shall not grant any license (or sublicense, as the case may be), immunity or
other right to any Person to, research, develop, make, have made, use, import,
offer to sell or sell any Antibody Equivalent to an [**********************].
for use in the Commercial Field from and after the date on which a XenoMouse
Animal was first immunized with such Antigen; provided, however, that the
foregoing limitation shall not apply to antigens as to which ABX has notified
CuraGen that it does not have the right to grant CuraGen a commercial license
under Article 7 unless ABX has agreed to pay CuraGen the amounts provided
hereunder upon the development and commercialization of an antibody product
targeting such antigen as if it were an ABX Product hereunder in return for the
licenses from CuraGen for such product as if it were an ABX Product hereunder.
For the avoidance of doubt, nothing in this Agreement shall preclude CuraGen
from granting any license (or sublicense, as the case may be), immunity or other
right to any Person to research, develop, make, have made, use, import, offer to
sell or sell any Antibody Equivalent to an antigen contained in the CuraGen
Databases [**********************] for any purpose other than for use in the
prevention, treatment, detection, diagnosis or monitoring of, or the
determination of a predisposition for, or the selection of a particular
patient(s) to receive a particular therapeutic treatment(s) for,
[**********************], unless and until a XenoMouse Animal has been immunized
with such Antigen under this Agreement.

 

Portions of this Exhibit were omitted and have been filed separately with the
Secretary of the Commission pursuant to the Company’s application requesting
confidential Investment under Rule 24b-2 under the Securities Exchange Act of
1934.

 

19

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4.4.4 Except as otherwise expressly permitted under this Agreement, for a period
ending on the earlier of (a) the Last Immunization Date, and (b) the effective
date of a termination of the Research Program and the options, licenses and
rights of CuraGen under this Agreement by ABX pursuant to Section 14.2.3 upon an
uncured material breach of a material obligation by CuraGen, ABX shall not, and
shall not grant any license (or sublicense, as the case may be), immunity or
other right to any Person to, research, develop, make, have made, use, import,
offer to sell or sell any Antibody Equivalent to an
[***************************] for use in the Commercial Field from and after the
date on which a XenoMouse Animal was first immunized with such Antigen. For the
avoidance of doubt, nothing in this Agreement shall preclude ABX from granting
any license (or sublicense, as the case may be), immunity or other right to any
Person to research, develop, make, have made, use, import, offer to sell or sell
any Antibody Equivalent to an [****************************] for any purpose,
unless and until a XenoMouse Animal has been immunized with such Antigen under
this Agreement.

 

4.4.5 Except as otherwise expressly permitted under this Agreement, during the
term of this Agreement, ABX shall not, and shall not grant any license (or
sublicense, as the case may be), immunity or other right to any Person to,
research, develop, make, have made, use, import, offer to sell or sell any
Antibody Equivalent to a CuraGen Optioned Antigen [***************************],
for so long as such antigen remains a CuraGen Exclusive Antigen, CuraGen
Optioned Antigen, or a CuraGen Licensed Antigen [***************************]
for use in the Commercial Field.

 

4.4.6 Except as otherwise expressly permitted under this Agreement, during the
term of this Agreement, CuraGen shall not, and shall not grant any license (or
sublicense, as the case may be), immunity or other right to any Person to,
research, develop, make, have made, use, import, offer to sell or sell any
Antibody Equivalent to an ABX Optioned Antigen [***************************],
for so long as such antigen remains an ABX Optioned Antigen, or an ABX Licensed
Antigen [***************************] for use in the Commercial Field.

 

4.5 Research Program Licenses.

 

4.5.1 Subject to the terms and conditions of this Agreement, ABX hereby grants
to CuraGen a nonexclusive license (or sublicense, as the case may be) under the
Licensed ABX Intellectual Property, without right to grant Sublicenses, in the
Research Field solely to conduct its obligations under the Research Program and
to conduct additional preclinical research as permitted under Sections 4.2 and
4.6. Except as expressly set forth in this Agreement or otherwise expressly
agreed in writing by the parties, CuraGen shall not use the Licensed ABX
Intellectual Property or any ABX Technology and Information or any Research
Program Technology and Information for any use other than those uses expressly
licensed under this Section 4.5.1.

 

4.5.2 Subject to the terms and conditions of this Agreement, CuraGen hereby
grants to ABX a nonexclusive license (or sublicense, as the case may be) under
the

 

Portions of this Exhibit were omitted and have been filed separately with the
Secretary of the Commission pursuant to the Company’s application requesting
confidential Investment under Rule 24b-2 under the Securities Exchange Act of
1934.

 

20

--------------------------------------------------------------------------------

 

Licensed CuraGen Intellectual Property, without right to grant Sublicenses, in
the Research Field solely to conduct its obligations under the Research Program
and to conduct additional preclinical research as permitted under Section 4.2.
Except as expressly set forth in this Agreement or otherwise expressly agreed in
writing by the parties, ABX shall not use the Licensed CuraGen Intellectual
Property or any CuraGen Technology and Information or any Research Program
Technology and Information for any use other than those uses expressly licensed
under this Section 4.5.2.

 

4.6 CuraGen Exclusive Antigens.

 

4.6.1 Designation of CuraGen Exclusive Antigens.

 

(a) As of the Revision Date, Exhibit E lists the antigens designated as CuraGen
Exclusive Antigens. Subject to Section 4.6.3, CuraGen shall have no right to
designate any additional CuraGen Exclusive Antigens pursuant to this Agreement.

 

(b) Each CuraGen Exclusive Antigen shall be a Research Antigen, but shall not be
a part of the Pool (as defined in Section 5.2), (i) CuraGen shall have the
exclusive right to select such Research Antigen as an Optioned Antigen or
Licensed Antigen regardless of whether such Research Antigen is an Eligible
Antigen; and (ii) ABX shall have no right to select such Research Antigen as an
Optioned Antigen or Licensed Antigen.

 

4.6.2 Selection of CuraGen Exclusive Antigens as Optioned Antigens. CuraGen
shall have the right to select any Research Antigen that is a CuraGen Exclusive
Antigen as an Optioned Antigen regardless of whether such CuraGen Exclusive
Antigen is an Eligible Antigen. CuraGen shall make any such selection by giving
express written notice to ABX at any time during the first eight (8) years after
the Effective Date. CuraGen’s right to make such selections under this
Section 4.6.2 shall be outside, and in addition to, the selection process for
Optioned Antigens under Section 5.2.

 

4.6.3 If ABX notifies CuraGen in writing that ABX does not have the right to
grant CuraGen a commercial license under Article 7 below for an antigen that
CuraGen has designated as a CuraGen Exclusive Antigen, then CuraGen shall be
allowed to replace such antigen with another antigen by amending Exhibit E.

 

4.7 Material Transfer.

 

4.7.1 Subject to the reimbursement of costs, each party will use commercially
reasonable efforts to support the research activities of the other party under
this Section 4.

 

Portions of this Exhibit were omitted and have been filed separately with the
Secretary of the Commission pursuant to the Company’s application requesting
confidential Investment under Rule 24b-2 under the Securities Exchange Act of
1934.

 

21

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4.7.2 ABX will supply CuraGen with Control Antibody Material at commercial
prices and subject to the Control Antibody Material Transfer Agreement dated
April 4, 2003, (the “Control Antibody MTA”).

 

4.7.3 With respect to Antibody Specific Materials and Information and Research
Program Technology and Information regarding any Research Antigen, other than a
CuraGen Exclusive Antigen or an Optioned Antigen or Licensed Antigen of a Party,
transfer to a Third Party shall be done under the terms of an MTA under which
both ABX and CuraGen are parties. The Parties agree they will execute any such
MTA if it is in the form of Exhibit F (the “Three-way MTA”). Any change will
require the approval of both Parties, not to be unreasonably withheld. The
Parties will dedicate sufficient resources to review and comment on Three-way
MTAs within ten business days and to execute such Three-way MTAs within one week
of receipt of the execution version. A Party will be free to execute a Two-way
MTA with respect to Antibody Specific Materials and Information and Research
Program Technology and Information regarding any Research Antigen should the
other Party fail to reasonably adhere to these timelines with respect to such
Research Antigen.

 

4.7.4 With respect to Optioned Antigens and Licensed Antigens, this Second
Restated Collaboration Agreement supercedes Transferred Cell Line Material
Transfer Agreement dated April 4, 2003 (the “Transferred Cell Line MTA”).

 

4.7.5 Notwithstanding the provisions of Section 12.6 or any other provisions
hereof, CuraGen may transfer to any Third Party (a) CuraGen Optioned Antigens,
and Antibody Specific Materials and Information and Research Program Technology
and Information regarding any CuraGen Optioned Antigen, (b) any Antibodies to
any such CuraGen Optioned Antigens and (c) any Control Antibody Material,
provided, that, in each such instance, (a) CuraGen shall use a materials
transfer and services agreement substantially in the form attached hereto as
Exhibit G (the “Two-way MTA”), (b) such Third Party shall have first executed
the Two-way MTA, (c) CuraGen shall diligently enforce, and shall provide prompt
written notice to ABX of any breach of, any such Two-way MTA by such Third Party
and (d) CuraGen shall have made commercially reasonable efforts to include ABX
as a third party beneficiary of any such Two-way MTA as described more fully in
Section 15 of the form of Two-way MTA. CuraGen shall provide to ABX copies of
any reports provided to CuraGen by a Third Party utilizing the materials covered
by a Two-way MTA, shall timely notify ABX of the proposed publication or
required disclosure of Confidential Information by any Third Party and shall
disclose to ABX any inventions arising under a Two-way MTA. CuraGen agrees to
indemnify ABX and hold it harmless from any and all claims, liabilities, and/or
losses which arise as a result of any Third Party’s use of the materials
transferred, and shall not permit a Third Party to undertake an assignment of
its rights without the prior consent of ABX. In addition, transfer to a third
party of any Control Antibody Materials shall be made only pursuant and subject
to the Control Antibody MTA.

 

4.7.6 Notwithstanding the provisions of Section 12.6 or any other provisions
hereof, ABX may transfer to any Third Party (a) ABX Optioned Antigens and

 

Portions of this Exhibit were omitted and have been filed separately with the
Secretary of the Commission pursuant to the Company’s application requesting
confidential Investment under Rule 24b-2 under the Securities Exchange Act of
1934.

 

22

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Antibody Specific Materials and Information and Research Program Technology and
Information regarding any ABX Optioned Antigen, and (b) any Antibodies to any
such ABX Optioned Antigens, provided, that, in each such instance, (a) ABX shall
use a materials transfer and services agreement substantially in the form of the
Two-way MTA, (b) such Third Party shall have first executed a Two-way MTA,
(c) ABX shall diligently enforce, and shall provide prompt written notice to
CuraGen of any breach of, any such Two-way MTA by such Third Party and (d) ABX
shall have made commercially reasonable efforts to include CuraGen as a third
party beneficiary of any such Two-way MTA as described more fully in Section 15
of the form of MTA. ABX shall provide to CuraGen copies of any reports provided
to ABX by a Third Party utilizing the materials covered by a Two-way MTA, shall
timely notify CuraGen of the proposed publication or required disclosure of
Confidential Information by any Third Party and shall disclose to CuraGen any
inventions arising under a Two-way MTA. ABX agrees to indemnify CuraGen and hold
it harmless from any and all claims, liabilities, and/or losses which arise as a
result of any Third Party’s use of the materials transferred, and shall not
permit a Third Party to undertake an assignment of its rights without the prior
consent of CuraGen.

 

4.7.7 A Party will be considered to have made commercially reasonable efforts to
have the other party included as a third party beneficiary if such language is
included in the initial draft Two-way MTA sent to a Third Party.

 

4.7.8 CuraGen may use and transfer to any Third Party (a) CuraGen Exclusive
Antigens and CuraGen Licensed Antigens and Antibody Specific Materials and
Information and Research Program Technology and Information regarding any
CuraGen Exclusive Antigen or CuraGen Licensed Antigen, and (b) Antibodies (and
Antibody Cells thereto) to CuraGen Exclusive Antigens and CuraGen Licensed
Antigens, all without the approval of ABX, provided, that, in each such
instance, (a) CuraGen shall use a materials transfer and services agreement
substantially in the form of the Two-way MTA, (b) such Third Party shall have
first executed the Two-way MTA, and (c) CuraGen shall diligently enforce, and
shall provide prompt written notice to ABX of any breach of, any such Two-way
MTA by such Third Party.

 

4.7.9 ABX may use and transfer to any Third Party (a) ABX Licensed Antigens and
Antibody Specific Materials and Information and Research Program Technology and
Information regarding any ABX Licensed Antigen, and (b) Antibodies (and Antibody
Cells thereto) to ABX Licensed Antigens, all without the approval of CuraGen,
provided, that, in each such instance, (a) ABX shall use a materials transfer
and services agreement substantially in the form of the Two-way MTA, (b) such
Third Party shall have first executed the Two-way MTA, (c) ABX shall diligently
enforce, and shall provide prompt written notice to CuraGen of any breach of,
any such Two-way MTA by such Third Party.

 

Portions of this Exhibit were omitted and have been filed separately with the
Secretary of the Commission pursuant to the Company’s application requesting
confidential Investment under Rule 24b-2 under the Securities Exchange Act of
1934.

 

23

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5. SELECTION OF OPTIONED ANTIGENS

 

5.1 Eligible Antigens. Not less than ten (10) days prior to each regularly
scheduled meeting of the JMC, each party shall provide the other party with a
dossier for each Research Antigen that it proposes to be considered as a
potential Eligible Antigen. Such dossier shall contain all information
reasonably available to such party demonstrating whether such Research Antigen
satisfies the criteria set forth in Exhibit B. At such regularly scheduled
meeting of the JMC, the JMC shall consider whether such Research Antigen
satisfies the criteria set forth in Exhibit B. A Research Antigen shall be an
Eligible Antigen at such time as it is determined to satisfy the criteria set
forth in Exhibit B, as determined by the JMC under Section 3.2 above or the
arbitrator under Section 3.5 above. Notwithstanding anything to the contrary in
this Agreement, if a party gives written notice to the other party at any time
stating that such party does not have the right to grant the other party a
commercial license under Article 7 below for an Eligible Antigen, then effective
thirty (30) days after the receipt by the other party of such notice, such
antigen shall cease to be an Eligible Antigen and both parties shall destroy all
Antigen Specific Materials and Information pertaining to such Eligible Antigen.

 

5.2 Selection of Optioned Antigens. During the first eight (8) years after the
Effective Date, each party shall have the right, in its sole discretion, to
select Optioned Antigens from the list of Eligible Antigens at the time in
question (the “Pool”) as follows:

 

5.2.1 [*************************************************].

 

5.2.2 [*************************************************].

 

5.2.3 [*************************************************].

 

5.2.4 [*************************************************].

 

5.2.5 [*************************************************].

 

5.2.6 [*************************************************].

 

5.2.7 [*************************************************].

 

5.2.8 [*************************************************].

 

5.2.9 With respect to each Eligible Antigen which is selected by CuraGen as a
CuraGen Optioned Antigen pursuant to this Section 5.2, ABX shall notify CuraGen
in writing, within thirty (30) days of receipt of the notice of selection from
CuraGen, if ABX does not have the right to grant CuraGen a commercial license
under Article 7 below for such Eligible Antigen. Unless ABX timely notifies
CuraGen in writing that ABX does not have the right to grant CuraGen a
commercial license under Article 7 below for such antigen, ABX shall use its
good faith efforts to nominate such Eligible Antigen under the XT/ABX Master
Research and License Agreement and to obtain the right thereunder to obtain an
XT/ABX

 

Portions of this Exhibit were omitted and have been filed separately with the
Secretary of the Commission pursuant to the Company’s application requesting
confidential Investment under Rule 24b-2 under the Securities Exchange Act of
1934.

 

24

--------------------------------------------------------------------------------

 

Product License Agreement with respect to CuraGen Products to such Eligible
Antigen. If ABX is successful in nominating such Eligible Antigen and in
obtaining the right to obtain an XT/ABX Product License Agreement for CuraGen
Products to such Eligible Antigen, the ABX shall give prompt written notice to
CuraGen. Effective upon such notice, such Eligible Antigen shall be a CuraGen
Optioned Antigen. If CuraGen desires that an Eligible Antigen selected by
CuraGen as a CuraGen Optioned Antigen is also designated as a Lambda Optioned
Antigen, then CuraGen shall so notify ABX in writing at the time CuraGen selects
such Eligible Antigen, and subject to this Section 5.2.9, if such an Eligible
Antigen becomes a CuraGen Optioned Antigen it shall also be a Lambda Optioned
Antigen hereunder.

 

5.2.10 With respect to each Eligible Antigen which is selected by ABX as an ABX
Optioned Antigen pursuant to this Section 5.2, CuraGen shall notify ABX in
writing, within thirty (30) days of receipt of the notice of selection from ABX,
if CuraGen does not have the right to grant ABX a commercial license under
Article 7 below for such Eligible Antigen. Unless CuraGen timely notifies ABX in
writing that CuraGen does not have the right to grant ABX a commercial license
under Article 7 below for such antigen, such Eligible Antigen thereafter shall
be an ABX Optioned Antigen upon the expiration of such thirty (30) day period.

 

5.2.11 At such time as an Eligible Antigen becomes an Optioned Antigen of one of
the parties (the “Optioning Party”), the other party shall deliver to the
Optioning Party all Antigen Specific Materials and Information in its possession
pertaining to such Optioned Antigen and all related Confidential Information of
such other party, and such Antigen Specific Materials and Information and
Confidential Information shall thereafter be the Confidential Information of the
Optioning Party.

 

5.2.12 Within sixty (60) days after completion of the Research Program Term, the
Parties will meet to select any remaining Eligible Antigens in the Pool, with
the Party possessing the next pick selecting first, and then alternating, until
all Eligible Antigens are selected or both parties have passed on any remaining
Eligible Antigens (“Unpicked Eligible Antigens”). Within thirty (30) days after
completion of the Research Program Term, each Party will advise the other as to
whether it has the right to grant the other Party a commercial license under
Article 7 for each such remaining Eligible Antigen.

 

6. RESEARCH FIELD LICENSES FOR OPTIONED ANTIBODIES

 

6.1 Research Field Licenses.

 

6.1.1 Subject to the terms and conditions of this Agreement, ABX hereby grants
to CuraGen a nonexclusive license (or sublicense, as the case may be) under the
Licensed ABX Intellectual Property, without right to grant Sublicenses, (a) to
research, develop, make and use (but not to transfer, sell, lease, offer to sell
or lease, or otherwise transfer title to or an interest in) Antibody Cells that
contain, express or secrete Antibodies to the CuraGen Optioned Antigens solely
for use in the Research Field, (b) to research, develop, make and use (but not
to transfer, sell, lease, offer to sell or lease, or otherwise transfer title to
or an interest in) Antibodies that bind to the CuraGen Optioned Antigens and
Genetic Material that encodes such

 

Portions of this Exhibit were omitted and have been filed separately with the
Secretary of the Commission pursuant to the Company’s application requesting
confidential Investment under Rule 24b-2 under the Securities Exchange Act of
1934.

 

25

--------------------------------------------------------------------------------

 

Antibodies, solely for use in the Research Field for the research and
development of potential CuraGen Products and (c) with respect to one or more
Antibodies that bind to a CuraGen Optioned Antigen, if the parties have mutually
agreed in writing to a Conjugate to be conjugated to such one or more Antibodies
that bind to such CuraGen Optioned Antigen, to research, develop, make and use
(but not to transfer, sell, lease, offer to sell or lease, or otherwise transfer
title to or interest in) such Conjugates conjugated to such Antibodies that bind
to such CuraGen Optioned Antigens, solely for use in the Research Field for the
research and development of potential CuraGen Products. Except as expressly
agreed in this Agreement or otherwise expressly agreed in writing by the
parties, CuraGen shall not use the Licensed ABX Intellectual Property, the ABX
Technology and Information or the Research Program Technology and Information
for any use other than those uses expressly licensed under this Section 6.1.1.

 

6.1.2 Subject to the terms and conditions of this Agreement, CuraGen hereby
grants to ABX a nonexclusive license (or sublicense, as the case may be) under
the Licensed CuraGen Intellectual Property, without right to grant Sublicenses,
(a) to research, develop, make and use (but not to transfer, sell, lease, offer
to sell or lease, or otherwise transfer title to or an interest in) Antibody
Cells that contain, express or secrete Antibodies to the ABX Optioned Antigens
solely for use in the Research Field, and (b) to research, develop, make and use
(but not to transfer, sell, lease, offer to sell or lease, or otherwise transfer
title to or an interest in) Antibodies that bind to the ABX Optioned Antigens
and Genetic Material that encodes such Antibodies, solely for use in the
Research Field for the research and development of potential ABX Products.
Except as expressly agreed in this Agreement or otherwise expressly agreed in
writing by the parties, ABX shall not use the Licensed CuraGen Intellectual
Property, the CuraGen Technology and Information or the Research Program
Technology and Information for any use other than those uses expressly licensed
under this Section 6.1.2.

 

6.1.3 The licenses (or sublicenses, as the case may be) granted under this
Section 6.1 shall terminate with respect to each Optioned Antigen on the second
anniversary of the date on which such antigen became an Optioned Antigen;
provided, however, if a party has timely exercised its option under Article 7
below to obtain a license (or sublicense, as the case may be) for Products to
such Optioned Antigen, such license (or sublicense, as the case may be) shall
remain in effect for Products to such Optioned Antigen for the term of the
applicable license (or sublicense, as the case may be) under Article 7 below. If
a party does not timely exercise its option under Article 7 below to obtain a
license (or sublicense, as the case may be) for Products to an Optioned Antigen
and the other party does not timely exercise its standby option under
Section 7.1.2 or 7.2.2, as the case may be, for Products to such Optioned
Antigen, such Antigen shall cease to be an Optioned Antigen but shall be
restored as an Eligible Antigen.

 

Extended Research License

 

6.1.4 Subject to the terms and conditions of this Agreement, ABX hereby grants
to CuraGen a nonexclusive license (or sublicense, as the case may be) under the
Licensed ABX Intellectual Property and ABX’s interest in Antibody Specific
Materials and Information and Research Program Technology and Information
relating to Research Antigens,

 

Portions of this Exhibit were omitted and have been filed separately with the
Secretary of the Commission pursuant to the Company’s application requesting
confidential Investment under Rule 24b-2 under the Securities Exchange Act of
1934.

 

26

--------------------------------------------------------------------------------

 

without right to grant Sublicenses, (a) to research, develop, make and use (but
not to transfer, sell, lease, offer to sell or lease, or otherwise transfer
title to or an interest in) Antibody Cells that contain, express or secrete
Antibodies to the Extended Research Antigens solely for use in the Research
Field, (b) to research, develop, make and use (but not to transfer, sell, lease,
offer to sell or lease, or otherwise transfer title to or an interest in)
Antibodies that bind to the Extended Research Antigen and Genetic Material that
encodes such Antibodies, solely for use in the Research Field for the research
and development of potential CuraGen Products and (c) with respect to one or
more Antibodies that bind to an Extended Research Antigen, if the parties have
mutually agreed in writing to a Conjugate to be conjugated to such one or more
Antibodies that bind to such Extended Research Antigen, to research, develop,
make and use (but not to transfer, sell, lease, offer to sell or lease, or
otherwise transfer title to or interest in) such Conjugates conjugated to such
Antibodies that bind to such Extended Research Antigens, solely for use in the
Research Field for the research and development of potential CuraGen Products.
Except as expressly agreed in this Agreement or otherwise expressly agreed in
writing by the parties, CuraGen shall not use the Licensed ABX Intellectual
Property, the ABX Technology and Information or the Research Program Technology
and Information for any use other than those uses expressly licensed under this
Section 6.1.4.

 

6.1.5 Subject to the terms and conditions of this Agreement, CuraGen hereby
grants to ABX a nonexclusive license (or sublicense, as the case may be) under
the Licensed CuraGen Intellectual Property and CuraGen’s interest in Antibody
Specific Materials and Information and Research Program Technology and
Information relating to Research Antigens, without right to grant Sublicenses,
(a) to research, develop, make and use (but not to transfer, sell, lease, offer
to sell or lease, or otherwise transfer title to or an interest in) Antibody
Cells that contain, express or secrete Antibodies to the Extended Research
Antigens solely for use in the Research Field, and (b) to research, develop,
make and use (but not to transfer, sell, lease, offer to sell or lease, or
otherwise transfer title to or an interest in) Antibodies that bind to the
Extended Research Antigens and Genetic Material that encodes such Antibodies,
solely for use in the Research Field for the research and development of
potential ABX Products. Except as expressly agreed in this Agreement or
otherwise expressly agreed in writing by the parties, ABX shall not use the
Licensed CuraGen Intellectual Property, the CuraGen Technology and Information
or the Research Program Technology and Information for any use other than those
uses expressly licensed under this Section 6.1.5.

 

6.1.6 The licenses (or sublicenses, as the case may be) granted under Sections
6.1.4 and 6.1.5 shall terminate with respect to each Extended Research Antigen
on the [********] anniversary of the date on which such antigen became an
Extended Research Antigen; provided, however, if a party has timely exercised
its option under Article 7 below to obtain a license (or sublicense, as the case
may be) for Products to such Extended Research Antigen, such license (or
sublicense, as the case may be) shall remain in effect for Products to such
Extended Research Antigen for the term of the applicable license (or sublicense,
as the case may be) under Article 7 below. If neither Party timely exercise its
option under Article 7 below to obtain a license (or sublicense, as the case may
be) for Products to an Extended Research Antigen, such Extended Research Antigen
shall cease to be an Antigen and all Antigen Specific Materials and Information
shall be destroyed by both Parties.

 

Portions of this Exhibit were omitted and have been filed separately with the
Secretary of the Commission pursuant to the Company’s application requesting
confidential Investment under Rule 24b-2 under the Securities Exchange Act of
1934.

 

27

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6.2 Research and Preclinical Development.

 

6.2.1 As between ABX and CuraGen, ABX shall have the sole right and
responsibility, at its sole expense, to conduct research and preclinical
development of Antibodies that bind to the ABX Optioned Antigens and Genetic
Material that encodes such Antibodies for use in the research and development of
potential ABX Products in the Research Field.

 

6.2.2 As between ABX and CuraGen, CuraGen shall have the sole right and
responsibility, at its sole expense, to conduct research and preclinical
development of Antibodies that bind to the CuraGen Optioned Antigens and Genetic
Material that encodes such Antibodies for use in the research and development of
potential CuraGen Products in the Research Field.

 

6.2.3 Each party shall conduct such research and preclinical development in
accordance with high scientific and professional standards, and in compliance in
all material respects with the requirements of applicable laws and regulations.

 

7. COMMERCIAL FIELD LICENSES FOR LICENSED ANTIGENS

 

7.1 CuraGen Products.

 

7.1.1 Options for CuraGen Optioned Antigens. Subject to the terms and conditions
of this Agreement, ABX hereby grants to CuraGen exclusive, non-transferable
options to obtain a license (or sublicense, as the case may be) under
Section 7.1.3 below for CuraGen Products to each CuraGen Optioned Antigen, with
each such option being exercisable in accordance with the provisions of this
Section 7.1.1 until the earliest of (a) the second anniversary of the date on
which such antigen became a CuraGen Optioned Antigen; (b) such time as ABX no
longer would be obligated to grant a license (or sublicense, as the case may be)
under Section 7.1.3 below for such CuraGen Products, and (c) the twelfth
anniversary of the Effective Date.

 

(a) If CuraGen desires to exercise its option for CuraGen Products to such
CuraGen Optioned Antigen, CuraGen shall so notify ABX in writing. At the time
CuraGen exercises its option to obtain a license (or sublicense, as the case may
be) under Section 7.1.3 for any CuraGen Optioned Antigen that is a Lambda
Optioned Antigen, if CuraGen wishes such license to include rights for CuraGen
Products for use in the Therapeutic Field directed to a CuraGen Licensed Antigen
and comprising a Lambda Antibody or Genetic Material that encodes such Lambda
Antibody, then CuraGen shall designate such CuraGen Licensed Antigen as a Lambda
Licensed Antigen.

 

(b) Effective upon such notice, such CuraGen Optioned Antigen shall be a CuraGen
Licensed Antigen, and the exclusive license (or sublicense, as the case may be)
grant under Section 7.1.3 below for CuraGen Products to such CuraGen Licensed
Antigen shall then be effective.

 

Portions of this Exhibit were omitted and have been filed separately with the
Secretary of the Commission pursuant to the Company’s application requesting
confidential Investment under Rule 24b-2 under the Securities Exchange Act of
1934.

 

28

--------------------------------------------------------------------------------

 

7.1.2 Standby Options for ABX Optioned Antigens. If ABX fails to timely exercise
its option under Section 7.2.1 below for any ABX Optioned Antigen, within ten
(10) days after the written request by CuraGen, ABX shall provide CuraGen with
copies of, or access to, all data and information of ABX regarding such ABX
Optioned Antigen and Antibodies thereto. Except as otherwise expressly provided
in this Agreement or the parties otherwise expressly agree in writing, CuraGen
shall have the right to use such data and information for the sole purpose of
evaluating its interest in exercising its option under this Section 7.1.2 for
such ABX Optioned Antigen. Subject to the terms and conditions of this
Agreement, ABX hereby grants to CuraGen exclusive, non-transferable options to
obtain a license (or sublicense, as the case may be) under Section 7.1.3 below
for CuraGen Products to each ABX Optioned Antigen for which ABX fails to timely
exercise its option under Section 7.2.1 below, with each such option being
exercisable in accordance with the provisions of this Section 7.1.2 commencing
on the expiration of ABX’s option under Section 7.2.1 below until the earliest
of (a) the date six (6) months thereafter, (b) such time as ABX no longer would
be obligated to grant a license (or sublicense, as the case may be) under
Section 7.1.3 below for such CuraGen Products, and (c) the twelfth anniversary
of the Effective Date.

 

(a) If CuraGen desires to exercise its option for CuraGen products to such ABX
Optioned Antigen, CuraGen shall so notify ABX in writing. At the time CuraGen
exercises its option to obtain a license (or sublicense, as the case may be)
under Section 7.1.3 for any ABX Optioned Antigen that is a Lambda Optioned
Antigen, if CuraGen wishes such license to include the rights for CuraGen
Products for use in the Therapeutic Field directed to a CuraGen Licensed Antigen
and comprising a Lambda Antibody or Genetic Material that encodes such Lambda
Antibody, then CuraGen shall designate such CuraGen Licensed Antigen as a Lambda
Licensed Antigen.

 

(b) Within thirty (30) days after receipt of such notice, ABX shall notify
CuraGen in writing if ABX does not have the right to grant CuraGen the license
(or sublicense, as the case may be) under Section 7.1.3 below for CuraGen
products to such ABX Optioned Antigen. If ABX does not have such a right, ABX
shall have no obligation to grant CuraGen the license (or sublicense, as the
case may be) under Section 7.1.3 below for CuraGen Products to such ABX Optioned
Antigen.

 

(c) Unless ABX timely notifies CuraGen in writing that it does not have such a
right, effective upon the expiration of such thirty (30) day period, such
antigen shall be a CuraGen Licensed Antigen, and the exclusive license (or
sublicense, as the case may be) grant under Section 7.1.3 below for CuraGen
Products to such CuraGen Licensed Antigen shall be effective upon the expiration
of such thirty (30) day period.

 

7.1.3 Commercial Field License. Subject to the terms and conditions of this
Agreement, ABX hereby grants to CuraGen an exclusive worldwide license (or
sublicense,

 

Portions of this Exhibit were omitted and have been filed separately with the
Secretary of the Commission pursuant to the Company’s application requesting
confidential Investment under Rule 24b-2 under the Securities Exchange Act of
1934.

 

29

--------------------------------------------------------------------------------

 

as the case may be) (with the right to grant Sublicenses) under Licensed ABX
Intellectual Property to research, develop, make, have made, use, import, offer
to sell and sell CuraGen Products in the Commercial Field. CuraGen shall provide
ABX with a copy of each Sublicense promptly after executing the same; provided,
however, that CuraGen shall have the right to redact any confidential financial
terms or confidential research, development or commercialization plans from the
copy provided to ABX. Any Sublicense shall be subject and subordinate to the
terms and conditions of this Agreement, and CuraGen shall remain responsible for
all payments due to ABX hereunder.

 

7.2 ABX Products.

 

7.2.1 Options for ABX Optioned Antigens. Subject to the terms and conditions of
this Agreement, CuraGen hereby grants to ABX exclusive, non-transferable options
to obtain a license (or sublicense, as the case may be) under Section 7.2.3
below for ABX Products to each ABX Optioned Antigen, with each such option being
exercisable in accordance with the provisions of this Section until the earliest
of (a) the second anniversary of the date on which such antigen became a ABX
Optioned Antigen, (b) such time as CuraGen no longer would be obligated to grant
a license (or sublicense, as the case may be) under Section 7.2.3 below for such
ABX Products, and (c) the twelfth anniversary of the Effective Date.

 

(a) If ABX desires to exercise its option for ABX Products to such ABX Optioned
Antigen, ABX shall so notify CuraGen in writing.

 

(b) Effective upon such notice, such antigen shall be an ABX Licensed Antigen,
and the exclusive license (or sublicense, as the case may be) grant under
Section 7.2.3 below for ABX Products to such ABX Licensed Antigen shall be
effective.

 

7.2.2 Standby Options for CuraGen Optioned Antigens. If CuraGen fails to timely
exercise its option under Section 7.1.1 above for any CuraGen Optioned Antigen
that is not a CuraGen Exclusive Antigen, within ten (10) days after the written
request by ABX, CuraGen shall provide ABX with copies of, or access to, all data
and information of CuraGen regarding such CuraGen Optioned Antigen and
Antibodies thereto. Except as otherwise expressly provided in this Agreement or
the parties otherwise expressly agree in writing, ABX shall have the right to
use such data and information for the sole purpose of evaluating its interest in
exercising its option under this Section 7.2.2 for such CuraGen Optioned
Antigen. Subject to the terms and conditions of this Agreement, CuraGen hereby
grants to ABX non-exclusive, non-transferable options to obtain a license (or
sublicense, as the case may be) under Section 7.2.3 below for ABX Products to
each CuraGen Optioned Antigen that is not a CuraGen Exclusive Antigen for which
CuraGen fails to timely exercise its option under Section 7.1.1 above, with each
such option being exercisable in accordance with the provisions of this
Section 7.2.2 commencing on the expiration of CuraGen’s option under
Section 7.1.1 above until the earliest of (a) the date six (6) months
thereafter, (b) such time as CuraGen no longer would be obligated to grant a
license (or sublicense, as the case may be) under Section 7.2.3 below for such
ABX Products, and (c) the twelfth anniversary of the Effective Date.

 

Portions of this Exhibit were omitted and have been filed separately with the
Secretary of the Commission pursuant to the Company’s application requesting
confidential Investment under Rule 24b-2 under the Securities Exchange Act of
1934.

 

30

--------------------------------------------------------------------------------

 

(a) If ABX desires to exercise its option for ABX products to such CuraGen
Optioned Antigen, ABX shall so notify CuraGen in writing.

 

(b) Within thirty (30) days after receipt of such notice, CuraGen shall notify
ABX in writing if CuraGen does not have the right to grant ABX the license (or
sublicense, as the case may be) under Section 7.2.3 below for ABX products to
such CuraGen Optioned Antigen. If CuraGen does not have such a right, CuraGen
shall have no obligation to grant ABX the license (or sublicense, as the case
may be) under Section 7.2.3 below for ABX Products to such CuraGen Optioned
Antigen.

 

(c) Unless CuraGen timely notifies ABX in writing that it does not have such a
right, effective upon the expiration of such thirty (30) day period, such
antigen shall be an ABX Licensed Antigen, and the exclusive license (or
sublicense, as the case may be) grant under Section 7.2.3 below for ABX Products
to such ABX Licensed Antigen shall be effective upon the expiration of such
thirty (30) day period.

 

7.2.3 Commercial Field License. Subject to the terms and conditions of this
Agreement, CuraGen hereby grants to ABX an exclusive worldwide license (or
sublicense, as the case may be) (with the right to grant Sublicenses) under
Licensed CuraGen Intellectual Property to research, develop, make, have made,
use, import, offer to sell and sell ABX Products in the Commercial Field. ABX
shall provide CuraGen with a copy of each Sublicense promptly after executing
the same; provided, however, that ABX shall have the right to redact any
confidential financial terms or confidential research, development or
commercialization plans from the copy provided to CuraGen. Any Sublicense shall
be subject and subordinate to the terms and conditions of this Agreement, and
ABX shall remain responsible for all payments due to CuraGen hereunder.

 

7.3 No Other Rights. No rights other than those expressly set forth in this
Agreement are granted to either party hereunder, and no additional rights shall
be granted to either party by implication, estoppel or otherwise.

 

7.4 Further Restrictions.

 

7.4.1 Notwithstanding anything to the contrary in this Agreement, neither a
party, nor its Sublicensees hereunder nor their respective Affiliates shall
submit an IND for, or otherwise commence human clinical testing of, any Product
to any Antigen unless and until such party has obtained a commercial license
under this Article 7 for Products to such Antigen.

 

7.4.2 For purposes of this Agreement, if (a) ABX has otherwise granted exclusive
rights to antibodies to an antigen to a Third Party without breach of
the-exclusivity provisions of Section 4.4, or (b) ABX has an active research and
development program ongoing

 

Portions of this Exhibit were omitted and have been filed separately with the
Secretary of the Commission pursuant to the Company’s application requesting
confidential Investment under Rule 24b-2 under the Securities Exchange Act of
1934.

 

31

--------------------------------------------------------------------------------

 

for antibodies to an antigen (that was not provided by CuraGen hereunder) that
is independent of its efforts hereunder and does not and did not involve access
to, or otherwise make use of, the CuraGen Databases, then ABX shall not have the
right to grant CuraGen a license (or sublicense, as the case may be) hereunder
to use such antigen in the Research Field or a license (or sublicense, as the
case may be) regarding the related CuraGen Products in the Commercial Field.

 

7.4.3 For purposes of this Agreement, if CuraGen has granted exclusive rights to
antibodies to an antigen to a Third Party without breach of the exclusivity
provisions of Section 4.4, then CuraGen shall not have the right to grant ABX a
license (or sublicense, as the case may be) hereunder to use such antigen in the
Research Field or a license (or sublicense, as the case may be) regarding the
related ABX Products in the Commercial Field.

 

8. PAYMENTS

 

8.1 Research Funding.

 

8.1.1 CuraGen has paid to ABX aggregate research funding of
[***************************(**********)] to date. CuraGen shall pay to ABX
additional research funding of [*******************************************].

 

8.1.2 CuraGen shall pay ABX [******************(**********)] for each of the
first five immunizations of Xenomouse Animals with Research Antigens after the
Revision Date, payable [**************************************].

 

8.2 Certain Fees.

 

8.2.1 Each party shall pay to the other party a non-refundable, non-creditable
technology access fee of [*********************(**********)] for each Eligible
Antigen it selects under Article 5 above that becomes an Optioned Antigen within
ten (10) days after such Eligible Antigen becomes an Optioned Antigen. CuraGen
additionally shall pay to ABX a non-refundable, non-creditable technology access
fee of [*************(**********)] for each Eligible Antigen that becomes a
Lambda Optioned Antigen hereunder, within ten (10) days after such Eligible
Antigen becomes a Lambda Optioned Antigen.

 

8.2.2 Each party shall pay to the other party a non-refundable, non-creditable
exercise fee of [*************(**********)] for each Optioned Antigen for which
it exercised an option to obtain a commercial license under Article 7 above
within ten (10) days after such Optioned Antigen becomes a Licensed Antigen.
CuraGen additionally shall pay to ABX a non-refundable, non-creditable exercise
fee of [*************(**********)] for each Lambda Optioned Antigen for which
CuraGen exercised an option to obtain a commercial license under Article 7 above
within ten (10) days after such Lambda Optioned Antigen becomes a Lambda
Licensed Antigen.

 

8.2.3 With respect to each Licensed Antigen for which a party exercised an
option to obtain a commercial license under Article 7 above, but for which it
was not required

 

Portions of this Exhibit were omitted and have been filed separately with the
Secretary of the Commission pursuant to the Company’s application requesting
confidential Investment under Rule 24b-2 under the Securities Exchange Act of
1934.

 

32

--------------------------------------------------------------------------------

 

to pay an option fee under Section 8.2.1 above because it was not selected as an
Optioned Antigen by such party under Article 5 above, such party shall pay to
the other party, in lieu of the amounts set forth in Sections 8.2.1 and 8.2.2, a
non-refundable, non-creditable exercise fee of [*************(**********)] for
such Licensed Antigen within ten (10) days after such antigen becomes a Licensed
Antigen. CuraGen additionally shall pay to ABX a non-refundable, non-creditable
exercise fee of [*************(**********)] for each CuraGen Licensed Antigen
for which CuraGen exercised an option to obtain a commercial license and
designated such CuraGen Licensed Antigen as a Lambda Licensed Antigen under
Article 7 above, but for which it was not required to pay an option fee under
Section 8.2.1 above because it was not selected as an Optioned Antigen by
CuraGen under Article 5 above, and within ten (10) days after such antigen
becomes a Lambda Licensed Antigen.

 

8.3 Milestone Payments.

 

8.3.1 In the Therapeutic Field.

 

(a) Subject to Section 8.3.1(d), and, in the case of Sublicenses, to
Section 8.4.3(c) below, within thirty (30) days following the achievement of
each of the following milestones with respect to each CuraGen Product for use in
the Therapeutic Field (other than a CuraGen Product directed to a CuraGen
Licensed Antigen and comprising a Lambda Antibody or Genetic Material that
encodes such Lambda Antibody), on a CuraGen Product-by-CuraGen Product basis,
CuraGen shall give written notice to ABX thereof and shall (i) pay to ABX the
corresponding milestone payments described below and (ii) pay to ABX the
milestone payments due any Third Party under an ABX In-License arising from use
of a Conjugate as part of such CuraGen Product (as permitted under this
Agreement), as applicable. Subject, in the case of Sublicenses, to
Section 8.4.3(a) below, within thirty (30) days following the achievement of
each of the following milestones with respect to each ABX Product for use in the
Therapeutic Field, on an ABX Product-by-ABX Product basis, ABX shall give
written notice to CuraGen thereof and shall pay to CuraGen the corresponding
milestone payments described below.

 

[*******]    [***************************************************]

 

[*******]    [***************************************************]

 

[*******]    [***************************************************]

 

[*******]    [***************************************************]

 

[*******]    [***************************************************]

 

(b) Subject to Section 8.3.1(d), and, in the case of Sublicenses, to
Section 8.4.3(c) below, within thirty (30) days following the achievement of
each of the following milestones with respect to each CuraGen Product for use in
the Therapeutic Field directed to a CuraGen Licensed Antigen and comprising a
Lambda Antibody or Genetic Material that encodes such Lambda Antibody, on a
CuraGen Product-by-CuraGen Product basis, CuraGen shall give

 

Portions of this Exhibit were omitted and have been filed separately with the
Secretary of the Commission pursuant to the Company’s application requesting
confidential Investment under Rule 24b-2 under the Securities Exchange Act of
1934.

 

33

--------------------------------------------------------------------------------

 

written notice to ABX thereof and shall (i) pay to ABX the corresponding
milestone payments described below, and (ii) pay to ABX the milestone payments
due any Third Party under an ABX In-License arising from use of a Conjugate as
part of such CuraGen Product (as permitted under this Agreement), as applicable.

 

[*******]    [***************************************************]

 

[*******]    [***************************************************]

 

[*******]    [***************************************************]

 

[*******]    [***************************************************]

 

[*******]    [***************************************************]

 

(c) If, at the time when any milestone payment listed in this Section 8.3.1,
with respect to a Product for use in the Therapeutic Field, is due from a party,
such party has not paid all other milestone payments (if any) previously listed
in this Section 8.3.1 with respect to such Product, then at such time such party
shall pay all such unpaid milestone payments (if any) previously listed in this
Section 8.3.1 with respect to such Product. If, at the time of the First
Commercial Sale by a party, its Affiliate or their respective Sublicensee of a
Product for use in the Therapeutic Field, such party has not paid all milestone
payments (if any) listed in this Section 8.3.1 with respect to such Product,
then at such time such party shall pay all such unpaid milestone payments (if
any) listed in this Section 8.3.1 with respect to such Product. If at any time a
party abandons the development of a Product after the payment to the other party
of one or more milestone payments under this Section 8.3.1 and subsequently
commences or continues the development of another Product directed to the same
Licensed Antigen as the abandoned Product, then such party shall have no
obligation to pay to the other party a milestone payment upon the occurrence of
a milestone event for the subsequent Product for which such party previously has
paid to the other party a milestone payment under this Section 8.3.1 for the
abandoned Product.

 

(d) Notwithstanding Sections 8.3.1(a) and (b), CuraGen shall only be required to
make the higher payments set forth in Section 8.3.1(b) with respect to a CuraGen
Product comprising a Lambda Antibody or Genetic Material that encodes a Lambda
Antibody if and to the extent that the additional amounts are owed or paid by
ABX to the licensors under the licenses specified in Section 1.2 of Amendment
No. 2. If such payments to such licensors are not owed or paid by ABX, CuraGen
shall only be required to make the payments set forth in Section 8.1.3(a).

 

8.3.2 In the Diagnostic Field.

 

(a) Subject to Section 8.3.2(d), and, in the case of Sublicenses, to
Section 8.4.3(d) below, within thirty (30) days following the achievement of
each of the following milestones with respect to each CuraGen Product for use in
the Diagnostic Field (other than a

 

Portions of this Exhibit were omitted and have been filed separately with the
Secretary of the Commission pursuant to the Company’s application requesting
confidential Investment under Rule 24b-2 under the Securities Exchange Act of
1934.

 

34

--------------------------------------------------------------------------------

 

CuraGen Product directed to a CuraGen Licensed Antigen and comprising a Lambda
Antibody or Genetic Material that encodes such Lambda Antibody), on a CuraGen
Product-by-CuraGen Product basis, CuraGen shall give written notice to ABX
thereof and shall (i) pay to ABX the corresponding milestone payments described
below, and (ii) pay to ABX the milestone payments due any Third Party under an
ABX In-License arising from use of a Conjugate as part of such CuraGen Product
(as permitted under this Agreement), as applicable. Subject, in the case of
Sublicenses, to Section 8.4.3(b) below, within thirty (30) days following the
achievement of each of the following milestones with respect to each ABX Product
for use in the Diagnostic Field, on an ABX Product-by-ABX Product basis, ABX
shall give written notice to CuraGen thereof and shall pay to CuraGen the
corresponding milestone payments described below.

 

[*******]    [***************************************************]

 

[*******]    [***************************************************]

 

[*******]    [***************************************************]

 

(b) Subject to Section 8.3.2(d), and, in the case of Sublicenses, to
Section 8.4.3(d) below, within thirty (30) days following the achievement of
each of the following milestones with respect to each CuraGen Product for use in
the Diagnostic Field directed to a CuraGen Licensed Antigen and comprising a
Lambda Antibody or Genetic Material that encodes such Lambda Antibody, on a
CuraGen Product-by-CuraGen Product basis, CuraGen shall give written notice to
ABX thereof and shall (i) pay to ABX the corresponding milestone payments
described below, and (ii) pay to ABX the milestone payments due any Third Party
under an ABX In-License arising from use of a Conjugate as part of such CuraGen
Product (as permitted under this Agreement), as applicable.

 

[*******]    [***************************************************]

 

[*******]    [***************************************************]

 

[*******]    [***************************************************]

 

(c) If, at the time when any milestone payment listed in this Section 8.3.2,
with respect to a Product for use in the Diagnostic Field, is due from a party,
such party has not paid all other milestone payments (if any) previously listed
in this Section 8.3.2 with respect to such Product, then at such time such party
shall pay all such unpaid milestone payments (if any) previously listed in this
Section 8.3.2 with respect to such Product. If, at the time of the First
Commercial Sale by a party, its Affiliate or permitted (sub)licensee of a
Product for use in the Diagnostic Field, such party has not paid all milestone
payments (if any) listed in this Section 8.3.2 with respect to such Product,
then at such time such party shall pay all such unpaid milestone payments (if
any) listed in this Section 8.3.2 with respect to such Product. If at any time a
party abandons the development of a Product after the payment to the other party
of one or more milestone payments under this Section 8.3.2 and subsequently
commences or continues the development of another Product directed to the same
Licensed Antigen as the abandoned

 

Portions of this Exhibit were omitted and have been filed separately with the
Secretary of the Commission pursuant to the Company’s application requesting
confidential Investment under Rule 24b-2 under the Securities Exchange Act of
1934.

 

35

--------------------------------------------------------------------------------

 

Product, then such party shall have no obligation to pay to the other party a
milestone payment upon the occurrence of a milestone event for the subsequent
Product for which such party previously has paid to the other party a milestone
payment under this Section 8.3.2 for the abandoned Product.

 

(d) Notwithstanding Sections 8.3.2(a) and (b), CuraGen shall only be required to
make the higher payments set forth in Section 8.3.2(b) with respect to a CuraGen
Product comprising a Lambda Antibody or Genetic Material that encodes a Lambda
Antibody if and to the extent that the additional amounts are owed or paid by
ABX to the licensors under the licenses specified in Section 1.2 of Amendment
No. 2. If such payments to such licensors are not owed or paid by ABX, CuraGen
shall only be required to make the payments set forth in Section 8.1.3(a).

 

8.4 Royalties.

 

8.4.1 Notice of Royalty Commencement Date. Within thirty (30) days following the
Royalty Commencement Date for each CuraGen Product in each country, CuraGen
shall give written notice to ABX thereof. Within thirty (30) days following the
Royalty Commencement Date for each ABX Product in each country, ABX shall give
written notice to CuraGen thereof.

 

8.4.2 Royalties on Net Sales.

 

(a) Subject, in the case of Sublicenses, to Sections 8.4.3(a) and (b) below,
where a CuraGen Patent Claim covers an ABX Product, ABX shall pay to CuraGen
royalties equal to (a) [*******************************************], and
(b) [*******************************************].
[*******************************************].

 

(b) Subject, in the case of Sublicenses, to Sections 8.4.3(a) and (b) below,
where no CuraGen Patent Claim covers an ABX Product, ABX shall pay to CuraGen
royalties equal to [******************************]
(i) [**********************************] and
(ii) [*******************************************]; provided, however,
[*******************************************]
(a) [*******************************************] or
(b) [*******************************************].

 

(c) Subject, in the case of Sublicenses, to Sections 8.4.3(c) and (d) below,
where an ABX Patent Claim covers a CuraGen Product, CuraGen shall pay to ABX
royalties equal to (a) [*******************************************],
(b) [*******************************************] and
(c) [*******************************************].
[*******************************************].

 

Portions of this Exhibit were omitted and have been filed separately with the
Secretary of the Commission pursuant to the Company’s application requesting
confidential Investment under Rule 24b-2 under the Securities Exchange Act of
1934.

 

36

--------------------------------------------------------------------------------

 

(d) Subject, in the case of Sublicenses, to Sections 8.4.3(a) and (b) below,
where no ABX Patent Claim covers a CuraGen Product, CuraGen shall pay to ABX
royalties equal to (x) [*******************************************] or
(y) [*******************************************].

 

8.4.3 Royalties on Sublicense Income.

 

(a) In the event that ABX grants a Sublicense with respect to any ABX Product
for use in the Therapeutic Field, ABX shall notify CuraGen in writing, within
fifteen (15) days of the grant of such Sublicense, whether ABX elects to pay to
CuraGen (i) the milestone payments set forth in Section 8.3.1 upon the
occurrence with respect to such ABX Product of the milestone events set forth
therein and the royalties set forth in Section 8.4.2 based on Net Sales of such
ABX Product or (ii) the following payments and royalties equal to the following
percentage of Sublicense Income received by ABX and its Affiliates in connection
with such Sublicense for each ABX Product for use in the Therapeutic Field:

 

[*******]    [***************************************************]

 

[*******]    [***************************************************]

 

[*******]    [***************************************************]

 

Notwithstanding the foregoing, the royalties owing by ABX under this
Section 8.4.3(a) in any calendar quarter, with respect to Net Sales by such
Sublicensee and its Affiliates of any ABX Product for use in the Therapeutic
Field, shall not be less than [********(***)] of Net Sales by such Sublicensee
and its Affiliates of such ABX Product in such calendar quarter. Once made, the
election of the basis of payment hereunder may not be changed, and ABX shall pay
the amounts determined in accordance with its election.

 

(b) In the event that ABX grants a Sublicense with respect to any ABX Product
for use in the Diagnostic Field, ABX shall notify CuraGen in writing, within
fifteen (15) days of the grant of such Sublicense, whether ABX elects to pay to
CuraGen (i) the milestone payments set forth in Section 8.3.2 upon the
occurrence with respect to such ABX Product of the milestone events set forth
therein and the royalties set forth in Section 8.4.2 based on Net Sales of such
ABX Product or (ii) the following payments and royalties equal to the following
percentage of Sublicense Income received by ABX and its Affiliates in connection
with such Sublicense for each ABX Product for use in the Diagnostic Field:

 

[*******]    [***************************************************]

 

[*******]    [***************************************************]

 

[*******]    [***************************************************]

 

Portions of this Exhibit were omitted and have been filed separately with the
Secretary of the Commission pursuant to the Company’s application requesting
confidential Investment under Rule 24b-2 under the Securities Exchange Act of
1934.

 

37

--------------------------------------------------------------------------------

 

Notwithstanding the foregoing, the royalties owing by ABX under this
Section 8.4.3(b) in any calendar quarter, with respect to Net Sales by such
Sublicensee and its Affiliates of any ABX Product for use in the Diagnostic
Field, shall not be less than [********(***)] of Net Sales by such Sublicensee
and its Affiliates of such ABX Product in such calendar quarter. Once made, the
election of the basis of payment hereunder may not be changed, and ABX shall pay
the amounts determined in accordance with its election.

 

(c) In the event that CuraGen grants a Sublicense with respect to any CuraGen
Product for use in the Therapeutic Field, CuraGen shall notify ABX in writing,
within fifteen (15) days of the grant of such Sublicense, whether CuraGen elects
to pay to ABX (i) the milestone payments set forth in Section 8.3.1 upon the
occurrence with respect to such CuraGen Product of the milestone events set
forth therein and the royalties set forth in Section 8.4.2 based on Net Sales of
such CuraGen Product or (ii) the following payments and royalties equal to the
following percentage of Sublicense Income received by CuraGen and its Affiliates
in connection with the Sublicense for each CuraGen Product for use in the
Therapeutic Field:

 

[*******]    [***************************************************]

 

[*******]    [***************************************************]

 

[*******]    [***************************************************]

 

Notwithstanding the foregoing, the royalties owing by CuraGen under this
Section 8.4.3(c) in any calendar quarter, with respect to Net Sales by such
Sublicensee and its Affiliates of any CuraGen Product for use in the Therapeutic
Field, shall not be less than the aggregate of (i) [********(***)] of Net Sales
by such Sublicensee and its Affiliates of such CuraGen Product in such calendar
quarter, plus
(ii) [***************************************************************************************]
Once made, the election of the basis of payment hereunder may not be changed,
and CuraGen shall pay the amounts determined in accordance with its election.

 

(d) In the event that CuraGen grants a Sublicense with respect to any CuraGen
Product for use in the Diagnostic Field, CuraGen shall notify ABX in writing,
within fifteen (15) days of the grant of such Sublicense, whether CuraGen elects
to pay to ABX (i) the milestone payments set forth in Section 8.3.2 upon the
occurrence with respect to such CuraGen Product of the milestone events set
forth therein and the royalties set forth in Section 8.4.2 based on Net Sales of
such CuraGen Product or (ii) the following payments and royalties equal to the
following percentage of Sublicense Income received by CuraGen and its Affiliates
in connection with the Sublicense for such CuraGen Product for use in the
Diagnostic Field:

 

[*******]    [***************************************************]

 

[*******]    [***************************************************]

 

[*******]    [***************************************************]

 

Portions of this Exhibit were omitted and have been filed separately with the
Secretary of the Commission pursuant to the Company’s application requesting
confidential Investment under Rule 24b-2 under the Securities Exchange Act of
1934.

 

38

--------------------------------------------------------------------------------

 

Notwithstanding the foregoing, the royalties owing by CuraGen under this
Section 8.4.3(d) in any calendar quarter, with respect to Net Sales by such
Sublicensee and its Affiliates of any CuraGen Product for use in the Diagnostic
Field, shall not be less than the aggregate of (i) [********(***)] of Net Sales
by such Sublicensee and its Affiliates of such CuraGen Product in such calendar
quarter, plus
(ii) [*****************************************************************************************].
Once made, the election of the basis of payment hereunder may not be changed,
and CuraGen shall pay the amounts determined in accordance with its election.

 

(e) Length of Royalty Obligations. Each party’s obligations to pay royalties
(including without limitation percentages of Sublicense Income) with respect to
each Product in each country shall commence on the Royalty Commencement Date for
such Product in such country, and shall continue for such Product in such
country until (i) [**************************], or
(ii) [*************************************].

 

8.4.4 Discounting. If a party, its Sublicensees or their respective Affiliates
sells a Product to a Third Party who also purchases other products or services
from such party, its Sublicensees or their respective Affiliates, and such
party, its Sublicensees or their respective Affiliates discounts the purchase
price of such Product to a greater degree than it generally discounts the price
of its other products or services to such customer, then in such case the Net
Sales for the sale of such Product to such Third Party shall equal the arm’s
length price that Third Parties would generally pay for the Product alone when
not purchasing any other product or service from such party, its Sublicensee or
their respective Affiliates. For purposes of this provision “discounting”
includes establishing the list price at a lower-than-normal level.

 

9. ACCOUNTING AND RECORDS

 

9.1 Royalty Reports and Payments. Commencing with the first calendar quarter in
which the Royalty Commencement Date for a Product occurs, CuraGen in the case of
CuraGen Products, and ABX in the case of ABX Products (the “Payor”) shall make
written reports to the other party (the “Payee”) within sixty (60) days after
the end of each calendar quarter, stating in each such report (a) the number,
description, and aggregate Net Sales of such Product sold during the calendar
quarter, (b) the calculation of the royalties and other amounts payable under
Article 8 above, and (c) otherwise satisfying the royalty reporting requirements
under each ABX In-License applicable to such Product (in the case of CuraGen
Products). Concurrently with the making of such reports, the Payor shall pay to
the Payee all royalties payable under Article 8 above. With respect to (1) each
CuraGen Product directed to a CuraGen Licensed Antigen and comprising a Lambda
Antibody or Genetic Material that encodes such Lambda Antibody, and (2) each
CuraGen Product comprising a Conjugate, prior to the date any Third Party
royalty is due for such CuraGen Products pursuant to Section 8.4, ABX shall
provide to CuraGen information from the applicable ABX In-License(s) sufficient
for CuraGen to calculate the royalty then owing and to satisfy the royalty
reporting obligations under such ABX In-License(s).

 

Portions of this Exhibit were omitted and have been filed separately with the
Secretary of the Commission pursuant to the Company’s application requesting
confidential Investment under Rule 24b-2 under the Securities Exchange Act of
1934.

 

39

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9.2 Records; Inspection. The Payor shall keep (and cause its Affiliates,
Sublicensees and Sublicensees’ Affiliates to keep) complete, true and accurate
books of account and records for the purpose of determining the royalties
payable to the Payee under this Agreement. Such books and records shall be kept
at the principal place of business of the Payor, its Sublicensee or their
respective Affiliates, as the case may be, for at least three years following
the end of the calendar quarter to which they pertain. Such records of the Payor
and its Affiliates shall be open for inspection during such three-year period by
independent accountants chosen by the Payee, and subject to the approval of the
Payor, which approval shall not be unreasonably withheld or delayed, (which
accountants, in the case of ABX, may also represent XT) for the purpose of
verifying the royalty statements. The Payor shall require each of its
Sublicensees to maintain similar books and records and to open such records for
inspection during the same three-year period by a representative of the Payor
reasonably satisfactory to the Payee on behalf of, and as required by, the Payee
for the purpose of verifying the royalty statements. All such inspections may be
made no more than once each calendar year at reasonable times mutually agreed by
the Payor and the Payee. The independent accountants chosen by the Payee will be
obliged to execute a reasonable confidentiality agreement prior to commencing
any such inspection. Inspections conducted under this Section 9.2 shall be at
the expense of the Payee, unless a variation or error producing an increase
exceeding five percent (5%) of the amount stated for any period is established
in the course of any such inspection, whereupon all costs relating to the audit
of such period will be paid by the Payor.

 

9.3 Payment Method. All payments by the Payor to the Payee hereunder shall be in
United States Dollars in immediately available funds and shall be made by wire
transfer from a United States bank located in the United States to such bank
account as designated by the Payee to the Payor.

 

9.4 Currency Conversion. If any currency conversion shall be required in
connection with the calculation of royalties hereunder, such conversion shall be
made using the selling exchange rate for conversion of the foreign currency into
United States Dollars, quoted for current transactions reported under the
heading “Currency Trading — Exchange Rates” in The Wall Street Journal in the
United States for the last business day of the calendar quarter to which such
payment pertains. If The Wall Street Journal ceases to be published, then the
rate of exchange to be used shall be that reported in such other business
publication of national circulation in the United States as the parties
reasonably agree.

 

9.5 Late Payments. Any payments due from the Payor that are not paid on the date
such payments are due under this Agreement shall bear interest at the lesser of
(i) the Prime Rate as reported under the heading “Money Rates” in The Wall
Street Journal in the United States on the date such payment is due, plus an
additional two percent (2%), or (ii) the maximum rate permitted by applicable
law, in each case calculated on the number of days such payment is delinquent.
This Section 9.5 shall in no way limit any other remedies available to any
party. If The Wall Street Journal ceases to be published, then the prime rate to
be used shall be that reported in such other business publication of national
circulation in the United States as the parties reasonably agree.

 

Portions of this Exhibit were omitted and have been filed separately with the
Secretary of the Commission pursuant to the Company’s application requesting
confidential Investment under Rule 24b-2 under the Securities Exchange Act of
1934.

 

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9.6 Withholding Taxes. Each party shall be entitled to deduct from the royalties
owing to the other party hereunder the amount of any withholding taxes,
value-added taxes or other taxes, levies or charges with respect to such
amounts, other than United States taxes, payable by such party, or any taxes
required to be withheld by such party, to the extent such party pays to the
appropriate governmental authority on behalf of the other party such taxes,
levies or charges. The withholding party shall use reasonable efforts to
minimize any such taxes, levies or charges required to be withheld on behalf of
the other party by such party. The withholding party promptly shall deliver to
the other party proof of payment of all such taxes, levies and other charges,
together with copies of all communications from or with such governmental
authority with respect thereto, and shall reasonably assist the other party in
obtaining a refund thereof (to the extent permitted under applicable law) or to
obtain a foreign tax credit therefor.

 

10. DILIGENCE

 

10.1 Diligence Obligation of CuraGen.

 

10.1.1 CuraGen shall use commercially reasonable efforts to actively research,
develop and obtain regulatory approvals as expeditiously as reasonably
practicable to market in major markets throughout the world at least one CuraGen
Product to each CuraGen Licensed Antigen, and following such approval to
maximize Net Sales of such CuraGen Product.

 

10.1.2 Without limiting Section 10.1.1, CuraGen, its Sublicensees or their
respective Affiliates shall file an IND with the FDA for at least one CuraGen
Product to each CuraGen Licensed Antigen within three (3) years after the
effective date of the applicable XT/ABX Product License Agreement. After the
filing of an IND for at least one CuraGen Product to a CuraGen Licensed Antigen,
CuraGen, its Sublicensees or their respective Affiliates, shall have an active
IND and actively and diligently conduct clinical trials in pursuit of regulatory
approval for at least one such CuraGen Product in the United States until at
least one such CuraGen Product may be sold commercially in the United States.

 

10.1.3 During the term of this Agreement and for a period of five (5) years
thereafter, CuraGen shall keep complete and accurate records of its activities
conducted under this Agreement regarding the commercialization of CuraGen
Products and the results thereof. Within thirty (30) days after the end of each
semi-annual period during the term of this Agreement, CuraGen shall prepare and
provide ABX with a reasonably detailed written report of such activities and
results, through such date.

 

10.2 Diligence Obligation of ABX.

 

10.2.1 ABX shall use commercially reasonable efforts to actively research,
develop and obtain regulatory approvals as expeditiously as reasonably
practicable to market in major markets throughout the world at least one ABX
Product to each ABX Licensed Antigen, and following such approval to maximize
Net Sales of such ABX Product.

 

Portions of this Exhibit were omitted and have been filed separately with the
Secretary of the Commission pursuant to the Company’s application requesting
confidential Investment under Rule 24b-2 under the Securities Exchange Act of
1934.

 

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10.2.2 Without limiting Section 10.2.1, ABX, its Sublicensees or their
respective Affiliates shall file an IND with the FDA for at least one ABX
Product to each ABX Licensed Antigen within three (3) years after the effective
date of the applicable XT/ABX Product License Agreement. After the filing of an
IND for at least one ABX Product to a ABX Licensed Antigen, ABX, its
Sublicensees or their respective Affiliates, shall have an active IND and
actively and diligently conduct clinical trials in pursuit of regulatory
approval for at least one such ABX Product in the United States until at least
one such ABX Product may be sold commercially in the United States.

 

10.2.3 During the term of this Agreement and for a period of five (5) years
thereafter, ABX shall keep complete and accurate records of its activities
conducted under this Agreement regarding the commercialization of ABX Products
and the results thereof. Within thirty (30) days after the end of each
semi-annual period during the term of this Agreement, ABX shall prepare and
provide CuraGen with a reasonably detailed written report of such activities and
results, through such date.

 

10.3 Standards of Performance. The development and commercialization of a
Product hereunder by a party, its Sublicensees and their respective Affiliates
shall be performed in accordance with high scientific and professional
standards, and in compliance in all material respects with the requirements of
applicable laws and regulations. ABX, its Sublicensees and their respective
Affiliates shall be solely responsible for providing the personnel, materials,
equipment, and other resources for the development and commercialization of ABX
Products hereunder. CuraGen, its Sublicensees and their respective Affiliates
shall be solely responsible for providing the personnel, materials, equipment,
and other resources for the development and commercialization of CuraGen
Products hereunder.

 

10.4 Gene Therapy Applications. Each party’s intention as of the Effective Date
is to commercialize a Product hereunder for an application other than Gene
Therapy before commercializing a Product hereunder for a Gene Therapy
application. It is understood, however, that either party may or may not also
intend to develop and sell Products for use in Gene Therapy, and that such Gene
Therapy application may ultimately be commercialized before a Product is
commercialized hereunder for a non-Gene Therapy application.

 

11. CONFIDENTIALITY

 

11.1 Confidential Information. During the term of this Agreement and for a
period of five (5) years following the expiration or earlier termination hereof,
each party shall maintain in confidence the Confidential Information of the
other party, and shall not disclose, use or grant the use of the Confidential
Information of the other party except on a need-to-know basis to such party’s
directors, officers employees, consultants and collaborators, and to the Third
Party licensors of the Licensed Intellectual Property, to the extent such
disclosure is reasonably necessary or required in connection with such party’s
activities as expressly authorized by this Agreement. To the extent that
disclosure by a party to any Person is authorized by this Agreement, prior to
disclosure, a party shall obtain written agreement of such

 

Portions of this Exhibit were omitted and have been filed separately with the
Secretary of the Commission pursuant to the Company’s application requesting
confidential Investment under Rule 24b-2 under the Securities Exchange Act of
1934.

 

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Person to hold in confidence and not disclose, use or grant the use of the
Confidential Information of the other party except as expressly permitted under
this Agreement. Each party shall notify the other promptly upon discovery of any
unauthorized use or disclosure of the other party’s Confidential Information.
Upon the expiration or earlier termination of this Agreement, each party shall
return to the other party all tangible items regarding the Confidential
Information of the other party and all copies thereof, except for Confidential
Information pertaining to any Licensed Antigen and related Products for which,
and for so long as, such party retains a license (or sublicense, as the case may
be) hereunder; provided, however, that each party shall have the right to retain
one (1) copy for its legal files for the sole purpose of determining its
obligations hereunder.

 

11.2 Terms of Agreement. Neither party shall disclose any terms or conditions of
this Agreement to any Third Party without the prior consent of the other party;
provided, however, that either party may disclose the terms or conditions of
this Agreement, (a) on a need-to-know basis to its legal and financial advisors
to the extent such disclosure is reasonably necessary in connection with such
party’s activities as expressly permitted by this Agreement or for the conduct
of its business; (b) to the Third Party licensors of the Licensed Intellectual
Property; (c) to a Third Party in connection with (i) an equity investment or
other form of financing in such party by a Third Party; (ii) a merger,
consolidation or similar transaction entered into by such party; or (iii) the
sale of all or substantially all of the assets of such party; and (d) as may, in
the reasonable opinion of such party’s counsel, be required by applicable law,
regulation or court order, including without limitation, a disclosure in
connection with such party’s filing of a registration statement or other filing
with the United States Securities and Exchange Commission (in which event such
party will first consult with the other party, to the extent reasonably
practicable, with respect to such disclosure). Notwithstanding the foregoing,
(i) the parties will jointly issue a press release in mutually agreed form
promptly after execution hereof and (ii) prior to execution of this Agreement
CuraGen and ABX shall agree upon the substance of information that can be used
to describe the terms of this transaction, and CuraGen and ABX may disclose such
information, as modified by mutual agreement from time to time, without the
other party’s consent.

 

12. TECHNOLOGY, INFORMATION AND INTELLECTUAL PROPERTY

 

12.1 Ownership.

 

12.1.1 ABX shall solely own all right, title and interest in the ABX Technology
and Information and in all patent rights and other intellectual property rights
therein. CuraGen shall not (and shall not attempt or purport to) file or
prosecute any patent application in any country which claims or purports to
claim the ABX Technology and Information, unless the parties otherwise expressly
agree in writing. ABX shall solely own all right, title and interest in the
Excluded ABX Technology and in all patent rights and other intellectual property
rights therein. CuraGen shall not (and shall not attempt or purport to) file or
prosecute any patent application in any country which claims or purports to
claim the Excluded ABX Technology.

 

Portions of this Exhibit were omitted and have been filed separately with the
Secretary of the Commission pursuant to the Company’s application requesting
confidential Investment under Rule 24b-2 under the Securities Exchange Act of
1934.

 

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12.1.2 CuraGen shall solely own all right, title and interest in the CuraGen
Technology and Information and in all patent rights and other intellectual
property rights therein. ABX shall not (and shall not attempt or purport to)
file or prosecute any patent application in any country which claims or purports
to claim the CuraGen Technology and Information, unless the parties otherwise
expressly agree in writing. CuraGen shall solely own all right, title and
interest in the Excluded CuraGen Technology and in all patent rights and other
intellectual property rights therein. ABX shall not (and shall not attempt or
purport to) file or prosecute any patent application in any country which claims
or purports to claim the Excluded CuraGen Technology.

 

12.1.3 ABX shall solely own all right, title and interest in Research Program
Technology and Information conceived, reduced to practice or otherwise derived
solely by Persons on behalf of ABX, together with all patent rights and other
intellectual property rights therein and, subject to the provisions of this
Agreement, shall have the right to freely exploit, transfer, license, or
encumber its rights thereto. CuraGen shall solely own all right, title and
interest in Research Program Technology and Information conceived, reduced to
practice or otherwise derived solely by Persons on behalf of CuraGen, together
with all patent rights and other intellectual property rights therein and,
subject to the provisions of this Agreement, shall have the right to freely
exploit, transfer, license, or encumber its rights thereto. The parties jointly
shall own all right, title and interest in Research Program Technology and
Information conceived, reduced to practice or otherwise derived jointly by
Persons on behalf of ABX and by Persons on behalf of CuraGen, together with all
patent rights and other intellectual property rights therein. Each party shall
have the right, subject to the provisions of this Agreement, to freely exploit,
transfer, license or encumber its rights in any jointly-owned Research Program
Technology and Information (and all patent rights and other intellectual
property rights therein) without the consent of, or payment or accounting to,
the other party.

 

12.1.4 The transfer of physical possession of any Technology and Information
owned by, and the physical possession and use of any Technology and Information
by, CuraGen or ABX, as the case may be, shall not be (nor be construed as) a
sale, lease, offer to sell or lease, or other transfer of title of such
Technology and Information to CuraGen or ABX, as the case may be.

 

12.1.5 During the term of this Agreement, neither party shall (and neither party
shall attempt or purport to) assign, sell, have sold, lease, offer to sell or
lease, otherwise transfer title to, or otherwise distribute or license,
sublicense or otherwise commercialize or exploit, any Research Program
Technology and Information, except as otherwise set forth herein or the parties
otherwise expressly agree in writing.

 

12.2 Assignment and Disclosure. Each party shall cause all employees and others
conducting work on its behalf under this Agreement to promptly disclose to the
other party all Technology and Information in which the other party has an
ownership interest, and to assign any and all right, title and interest in all
Technology and Information and all patent rights and other intellectual property
rights therein in accordance with this Agreement. Each party

 

Portions of this Exhibit were omitted and have been filed separately with the
Secretary of the Commission pursuant to the Company’s application requesting
confidential Investment under Rule 24b-2 under the Securities Exchange Act of
1934.

 

44

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shall maintain records in sufficient detail and in good scientific manner
appropriate for patent purposes to properly reflect all work done and results
achieved in conducting its work hereunder, and shall respond to reasonable
requests of the other party for information regarding Technology and Information
in which the other party has an ownership interest.

 

12.3 Research Program Patent Rights.

 

12.3.1 Prosecution and Maintenance.

 

(a) Subject to the provisions of Section 12.3.1(e) and Section 12.3.1(g) below,
ABX shall have the right (but not the obligation), at its sole expense, to
prepare, file, prosecute and maintain the ABX Patent Rights. ABX will use
reasonable efforts to file Antibody composition of matter claims (i) with
respect to any ABX Patent Rights arising before the Revision Date, within 6
months of the Revision Date and (ii) with respect to any ABX Patent Rights
arising after the Revision Date, within 6 months of characterization of Antibody
supernatants resulting from immunizations with Research Antigens. If ABX
unreasonably fails to file such claims in such time period, CuraGen may, by
written notice to ABX, assume control of the preparation, filing, prosecution
and maintenance of the ABX Patent Rights, to the extent and only to the extent,
that such ABX Patent Rights claim such Antibodies as a composition of matter,
and ABX shall reimburse CuraGen on demand for all expenses of the preparation,
filing, prosecution and maintenance of such ABX Patent Rights.

 

(b) CuraGen shall have the right (but not the obligation), at its sole expense,
to prepare, file, prosecute and maintain the CuraGen Patent Rights. CuraGen
shall have the right to use Antigen Specific Materials and Information and
Research Program Technology and Information in preparing, prosecuting,
maintaining and defending CuraGen Patent Rights; provided, however, that CuraGen
shall not claim any ABX Technology.

 

(c) Subject to the provisions of Section 12.3(a) above and Section 12.3.1(e) and
(f) below, (i) ABX shall have the right (but not the obligation), at its sole
expense, to prepare, file, prosecute and maintain the Research Program Patent
Rights owned solely by ABX; (ii) CuraGen shall have the right (but not the
obligation), at its sole expense, to prepare, file, prosecute and maintain the
Research Program Patent Rights owned solely by CuraGen; and (iii) CuraGen shall
have the right (but not the obligation) to prepare, file, prosecute and maintain
the Research Program Patent Rights owned jointly by the parties, and ABX shall
reimburse CuraGen on demand for one-half the reasonable expenses thereof.

 

(d) Any method of use data arising from the conduct of in-vitro assays or use of
in-vivo models in the Research Program will be filed by the responsible party
simultaneously in the patent applications claiming Antibodies and Research
Antigens, regardless of the category in which such patent applications fall. The
parties will coordinate such filings and will use reasonable efforts to file
such applications within three months of generating the data.

 

Portions of this Exhibit were omitted and have been filed separately with the
Secretary of the Commission pursuant to the Company’s application requesting
confidential Investment under Rule 24b-2 under the Securities Exchange Act of
1934.

 

45

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(e) Upon the effective date of a research license under Article 6 to a CuraGen
Optioned Antigen, and for so long as such license or a commercial license under
Article 7 for such Antigen remains in effect, (i) CuraGen shall have the right
(but not the obligation) to assume control of the preparation, filing,
prosecution and maintenance of the Research Program Patent Rights that
specifically and solely claim such CuraGen Licensed or Optioned Antigen or the
use thereof; (ii) CuraGen shall have the right (but not the obligation) to
assume control of the preparation, filing, prosecution and maintenance of the
ABX Patent Rights that specifically and solely claim the use of such CuraGen
Antigen or Antibodies to such CuraGen Licensed or Optioned Antigen or the use
thereof; (iii) CuraGen shall reimburse ABX on demand for all previously
unreimbursed expenses of the preparation, filing, prosecution and maintenance of
such ABX Patent Rights and Research Program Patent Rights; and (iv) CuraGen
shall be solely responsible for the expenses of the preparation, filing,
prosecution and maintenance of such ABX Patent Rights and Research Program
Patent Rights thereafter. In the event there are any Research Program Patent
Rights or ABX Patent Rights with such claims and other claims, ABX shall file
such divisional or other applications, to the extent legally permitted, as may
be necessary to separate such claims into a separate application, which CuraGen
shall then have the right to control as aforesaid. If the claims cannot be so
separated ABX will take no action with respect to any such claim that would
materially narrow the scope thereof without CuraGen’s express written consent,
which consent shall not be unreasonably withheld or delayed. If CuraGen assumes
control of any patent application pursuant to this Section and determines to
abandon such application, CuraGen shall give written notice of such intention to
ABX at least thirty (30) days before taking such action, and ABX shall have the
right, by written notice to CuraGen, to assume the prosecution and maintenance
thereof.

 

(f) Upon the effective date of a research license under Article 6 to an ABX
Optioned Antigen, and for so long as such license or a commercial license under
Article 7 for such Antigen remains in effect, (i) ABX shall have the right (but
not the obligation) to assume control of the preparation, filing, prosecution
and maintenance of the Research Program Patent Rights that specifically and
solely claim such ABX Licensed or Optioned Antigen or the use thereof; (ii) ABX
shall have the right (but not the obligation) to assume control of the
preparation, filing, prosecution and maintenance of the CuraGen Patent Rights
that specifically and solely claim antibodies to such ABX Licensed or Optioned
Antigen or the use thereof; (iii) ABX shall reimburse CuraGen on demand for all
previously unreimbursed expenses of the preparation, filing, prosecution and
maintenance of such Research Program Patent Rights and CuraGen Patent Rights;
and (iv) ABX shall be solely responsible for the expenses of the preparation,
filing, prosecution and maintenance of such Research Program Patent Rights and
CuraGen Patent Rights thereafter. In the event there are any Research Program
Patent Rights or CuraGen Patent Rights with such claims and other claims,
CuraGen shall file such divisional or other applications, to the extent legally
permitted, as may be necessary to separate such claims into a separate
application, which ABX shall then have the right to control as aforesaid. If the
claims cannot be so separated CuraGen will take no action with respect to any
such claim that would materially narrow the scope thereof without ABX’s express
written consent, which consent shall not be unreasonably withheld or delayed. If
ABX assumes control of any patent application pursuant to this Section and
determines to abandon such application, ABX shall give

 

Portions of this Exhibit were omitted and have been filed separately with the
Secretary of the Commission pursuant to the Company’s application requesting
confidential Investment under Rule 24b-2 under the Securities Exchange Act of
1934.

 

46

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written notice of such intention to CuraGen at least thirty (30) days before
taking such action, and CuraGen shall have the right, by written notice to ABX,
to assume the prosecution and maintenance thereof.

 

(g) CuraGen shall have the right (but not the obligation) to control the
preparation, filing, prosecution and maintenance of any Research Program Patent
Rights and ABX Patent Rights that specifically and solely claim any CuraGen
Exclusive Antigen or the use thereof or Antibodies that Specifically Bind to
such CuraGen Exclusive Antigen or the use thereof. In the event there are any
Research Program Patent Rights or ABX Patent Rights with such claims and other
claims, ABX shall file such divisional or other applications, to the extent
legally permitted, as may be necessary to separate such claims into a separate
application, which CuraGen shall then have the right to control as aforesaid. If
the claims cannot be so separated ABX will take no action with respect to any
such claim that would materially narrow the scope thereof without CuraGen’s
express written consent, which consent shall not be unreasonably withheld or
delayed.

 

(h) With respect to each patent application and patent within the Licensed
Intellectual Property Rights or Research Program Patent Rights that specifically
and solely claims an Optioned Antigen, a Licensed Antigen, an Antibody that
Specifically Binds to an Optioned Antigen, an Antibody to a Licensed Antigen or
the use thereof and with respect to each other patent and patent application
within the Research Program Patent Rights owned jointly by the parties, the
controlling party shall (i) provide the non-controlling party with any patent
application filed by the controlling party prior to filing in order to provide
the non-controlling party with an opportunity to comment thereon, and consider
in good faith reasonable comments by the non-controlling party thereon;
(ii) provide the non-controlling party with any patent application filed by the
controlling party promptly after such filing; and (iii) provide the
non-controlling party promptly with copies of all substantive communications
received from or filed in patent office(s) with respect to such filings and
consider in good faith reasonable comments by the non-controlling party thereon;
and (iv) use commercially reasonable efforts to obtain the broadest reasonable
claims.

 

(i) The non-controlling party shall assist the controlling party, upon the
controlling party’s request, and to the extent commercially reasonable, in
preparing, filing or maintaining the patent applications and patents within the
Research Program Patent Rights and Licensed Intellectual Property Rights.

 

12.3.2 Enforcement.

 

(a) Subject to the provisions of Section 12.3.2(e) below, ABX shall have the
right (but not the obligation), at its sole expense, to control the enforcement
of the ABX Patent Rights; provided, however, that CuraGen shall have the right
(but not the obligation), at its sole expense, to control the enforcement of
those ABX Patent Rights (if any) for which CuraGen assumes control of the
preparation, filing, prosecution and maintenance under Section 12.3.1(e) and
(g) above.

 

Portions of this Exhibit were omitted and have been filed separately with the
Secretary of the Commission pursuant to the Company’s application requesting
confidential Investment under Rule 24b-2 under the Securities Exchange Act of
1934.

 

47

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(b) Subject to the provisions of Section 12.3.2(e) below, CuraGen shall have the
right (but not the obligation), at its sole expense, to control the enforcement
of the CuraGen Patent Rights; provided, however, that ABX shall have the right
(but not the obligation), at its sole expense, to control the enforcement of
those CuraGen Patent Rights (if any) for which ABX assumes control of the
preparation, filing, prosecution and maintenance under Section 12.3.1(f) above.

 

(c) Subject to the provisions of Section 12.3.2(e) below, the controlling party
identified under Section 12.3.1 above shall have the first right (but not the
obligation), at its sole expense, to enforce the Research Program Patent Rights.

 

(d) With respect to each patent within the Licensed Intellectual Property Rights
or Research Program Patent Rights that specifically and solely claims a Licensed
Antigen, an Antibody to a Licensed Antigen or the use thereof, the controlling
party shall keep the non-controlling party informed and consider in good faith
the reasonable comments of the non-controlling party, both prior to and during
any such enforcement. The non-controlling party shall assist the controlling
party, upon request and at the controlling party’s sole expense, and to the
extent commercially reasonable, in taking any action to enforce such Licensed
Intellectual Property Rights or Research Program Patent Rights to the extent the
non-controlling party has the right to do so.

 

(e) If the controlling party fails to abate an infringement of any patent within
the Licensed Intellectual Property Rights or Research Program Patent Rights that
specifically and solely claims a Licensed Antigen, an Antibody to a Licensed
Antigen or the use thereof, or to file an action to abate such infringement,
within ninety (90) days after a written request from the non-controlling party
to do so, or if the controlling party discontinues the prosecution of any such
action after filing patent, the non-controlling party at its expense may, in its
discretion, undertake such action as it determines appropriate to enforce the
Research Program Patent Rights. In such case, the controlling party shall assist
the non-controlling party, upon request and at the non-controlling party’s sole
expense, and to the extent commercially reasonable, in taking any action to
enforce such patent within the Licensed Intellectual Property Rights or Research
Program Patent Rights to the extent the controlling party has the right to do
so.

 

(f) All monies recovered upon the final judgment or settlement of any such
action regarding the Licensed Intellectual Property Rights or Research Program
Patent Rights that specifically and solely claims a Licensed Antigen, an
Antibody to a Licensed Antigen or the use thereof shall be used (i) first, to
reimburse the costs and expenses (including reasonable attorneys’ fees and
costs) of the controlling party and the non-controlling party, and (ii) the
remainder, [******************************].

 

Portions of this Exhibit were omitted and have been filed separately with the
Secretary of the Commission pursuant to the Company’s application requesting
confidential Investment under Rule 24b-2 under the Securities Exchange Act of
1934.

 

48

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12.4 Patent Marking. Each party shall mark, and shall cause its Sublicensees and
their respective Affiliates to mark all Products, sold pursuant to this
Agreement by such party, its Sublicensees and their respective Affiliates in
accordance with the requirements of applicable laws and regulations in the
country or countries of manufacture and sale thereof.

 

12.5 Limitation. Notwithstanding any other provision in this Article 12, (a) ABX
shall not be obligated to prepare, file, prosecute, and maintain patents and
patent applications, or to bring or pursue enforcement proceedings or defend
declaratory judgment actions regarding the Licensed ABX Intellectual Property
if, and to the extent that, ABX is not entitled to do so under one or more ABX
In-Licenses, and (b) any rights conveyed under this Article 12 permitting
CuraGen to prepare, file, prosecute and maintain certain patents and patent
applications, or to bring and pursue enforcement proceedings, or defend
declaratory judgment actions, regarding the Licensed ABX Intellectual Property,
shall be subject to all applicable ABX In-Licenses, and are conveyed only to the
extent permitted under such agreements.

 

12.6 Use and Transfer Restrictions. Each party shall use the Technology and
Information owned by the other party solely for purposes of conducting its
obligations or exercising its rights under this Agreement, at its facilities,
under commercially and scientifically reasonable containment conditions, and not
for any other commercial, business or other use or purpose, without the prior
express written consent of the other party. Except as otherwise provided in this
Agreement, (a) a party shall not transfer or provide access to the Technology
and Information owned by the other party to any Affiliate or Third Party; (b) a
party shall not transfer or transport the Technology and Information owned by
the other party from its facilities to any other location; (c) a party shall
limit access to the Technology and Information owned by the other party to those
of its employees working on its premises, to the extent such access is
reasonably necessary to conduct its obligations or exercise its rights under
this Agreement; and (d) a party shall not (and shall not attempt or purport to)
assign, sell, have sold, lease, offer to sell or lease, otherwise transfer title
to, or otherwise distribute or license, sublicense or otherwise commercialize or
exploit, any Technology and Information owned by the other party or any interest
therein.

 

12.7 Grant Backs.

 

12.7.1 It is the intent of the parties that this Agreement shall not restrict
ABX’s freedom to practice and commercialize the Licensed ABX Intellectual
Property, the XenoMouse Animals and the ABX Technology and Information, except
as expressly set forth herein. CuraGen hereby grants to ABX a royalty-free,
perpetual, irrevocable, exclusive, worldwide license (with the right to grant
sublicenses) under CuraGen’s rights in the Research Program Patent Rights and
Research Program Know-How to research, develop, make, have made, use, offer for
sale, sell and import Human Antibody Equivalents and products comprising Human
Antibody Equivalents (other than CuraGen Products) for all uses. CuraGen hereby
grants to ABX a royalty-free, perpetual, irrevocable, nonexclusive worldwide
license (with the right to grant sublicenses) under CuraGen’s rights in the
Research Program Patent Rights and Research Program Know-How to research,
develop, make and use Antibody Equivalents (other

 

Portions of this Exhibit were omitted and have been filed separately with the
Secretary of the Commission pursuant to the Company’s application requesting
confidential Investment under Rule 24b-2 under the Securities Exchange Act of
1934.

 

49

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than Human Antibody Equivalents) solely in connection with the research,
development, making, having made, using, offering for sale, selling and
importing of Human Antibody Equivalents and products comprising Human Antibody
Equivalents (other than CuraGen Products) for all uses. CuraGen hereby grants to
ABX a royalty-free, perpetual, irrevocable, nonexclusive, worldwide license
(with the right to grant sublicenses) under those certain one or more CuraGen
Patent Rights, which have a common claim of priority and relate to the same
antigen and in which the claims within such CuraGen Patent Rights are supported
by information or data derived from the use of the ABX Technology and
Information and/or Research Program Technology and Information, solely in
connection with the research, development, making, having made, using, offering
for sale, selling and importing of Human Antibody Equivalents and products
comprising Human Antibody Equivalents (other than CuraGen Products) for all
uses.

 

12.7.2 It is the intent of the parties that this Agreement shall not restrict
CuraGen’s freedom to practice and commercialize the Licensed CuraGen
Intellectual Property, the CuraGen Databases, and the CuraGen Technology and
Information, except as expressly set forth herein. ABX hereby grants to CuraGen
a royalty-free, perpetual, irrevocable, exclusive, worldwide license (with the
right to grant sublicenses) under ABX’s rights in the Research Program Patent
Rights and Research Program Know-How to research, develop, make, have made, use,
offer for sale, sell and import Antibody Equivalents (other than Human Antibody
Equivalents) and compositions other than Antibody Equivalents, and products
(other than ABX Products) comprising Antibody Equivalents (other than Human
Antibody Equivalents) and compositions other than Antibody Equivalents, for all
uses; provided, however, that ABX reserves, for itself and its sublicensees, the
right under ABX’s rights in the Research Program Patent Rights and Research
Program Know-How to exercise its license rights granted under Section 12.7.1
above. ABX hereby grants to CuraGen a royalty-free, perpetual, irrevocable,
nonexclusive, worldwide license (with the right to grant sublicenses) under
those certain one or more ABX Patent Rights, which have a common claim of
priority and relate to the same antigen and in which the claims within such ABX
Patent Rights are supported by information or data derived from the use of the
CuraGen Technology and Information and/or Research Program Technology and
Information, solely in connection with the research, development, making, having
made, using, offering for sale, selling and importing of Antibody Equivalents
(other than Human Antibody Equivalents) and compositions other than Antibody
Equivalents, and products (other than ABX Products) comprising Antibody
Equivalents (other than Human Antibody Equivalents) and compositions other than
Antibody Equivalents, for all uses.

 

12.8 Imaging Peptides. Nothing in this Agreement shall preclude CuraGen from
making, using, offering for sale, selling or importing Imaging Peptides for
purposes of in vivo diagnostic imaging use.

 

13. INDEMNIFICATION

 

13.1 ABX. ABX shall indemnify and hold harmless CuraGen, and its directors,
officers, employees and agents, from and against all losses, liabilities,
damages and expenses, including reasonable attorneys’ fees and costs
(collectively, “Liabilities”), resulting from any

 

Portions of this Exhibit were omitted and have been filed separately with the
Secretary of the Commission pursuant to the Company’s application requesting
confidential Investment under Rule 24b-2 under the Securities Exchange Act of
1934.

 

50

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claims, demands, actions or other proceedings by any Third Party arising from
(a) the material breach of any representation, warranty or covenant by ABX under
this Agreement, (b) any use, handling or storage by ABX, its Sublicensees (other
than CuraGen) and their respective Affiliates of the CuraGen Technology and
Information or the Research Program Technology and Information, (c) the
manufacture, use, sale, handling or storage by ABX, its Sublicensees (other than
CuraGen) and their respective Affiliates of ABX Products (without regard to
culpable conduct), or (d) any use by ABX, its Sublicensees (other than CuraGen)
and their respective Affiliates of the Confidential Information of CuraGen;
provided, however, that ABX shall not be obligated to indemnify or hold harmless
CuraGen for such Liabilities to the extent that such Liabilities arise from the
gross negligence or willful misconduct of CuraGen.

 

13.2 CuraGen. CuraGen shall indemnify and hold harmless ABX, and its directors,
officers, employees and agents, from and against all Liabilities resulting from
any claims, demands, actions or other proceedings by any Third Party arising
from (a) the material breach of any representation, warranty or covenant by
CuraGen under this Agreement, (b) any use, handling or storage by CuraGen, its
Sublicensees (other than ABX) and their respective Affiliates of the ABX
Technology and Information or the Research Program Technology and Information,
(c) the manufacture, use, sale, handling or storage by CuraGen, its Sublicensees
(other than ABX) and their respective Affiliates of CuraGen Products (without
regard to culpable conduct), or (d) any use by CuraGen, its Sublicensees (other
than ABX) and their respective Affiliates of the Confidential Information of
ABX; provided, however, that CuraGen shall not be obligated to indemnify or hold
harmless ABX for such Liabilities to the extent that such Liabilities arise from
the gross negligence or willful misconduct of ABX.

 

13.3 Procedure. If a party (an “Indemnitee”) intends to claim indemnification
under this Article 13, it shall promptly notify the indemnifying party (the
“Indemnitor”) in writing of any claim, demand, action or other proceeding for
which the Indemnitee intends to claim such indemnification, and the Indemnitor
shall have the right to participate in, and, to the extent the Indemnitor so
desires, to assume the defense thereof with counsel mutually satisfactory to the
parties; provided, however, that an Indemnitee shall have the right to retain
its own counsel, with the fees and expenses to be paid by the Indemnitor, if
representation of such Indemnitee by the counsel retained by the Indemnitor
would be inappropriate due to actual or potential differing interests between
such Indemnitee and any other party represented by such counsel in such
proceeding. The indemnity agreement in this Article 13 shall not apply to
amounts paid in settlement of any claim, demand, action or other proceeding if
such settlement is effected without the consent of the Indemnitor, which consent
shall not be withheld or delayed unreasonably. The failure to deliver written
notice to the Indemnitor within a reasonable time after the commencement of any
such action, if prejudicial to its ability to defend such action, shall relieve
such Indemnitor of any liability to the Indemnitee under this Article 13, but
the omission so to deliver written notice to the Indemnitor shall not relieve it
of any liability that it may have to any party claiming indemnification
otherwise than under this Article 13. The party claiming indemnification under
this Article 13, its employees and agents, shall reasonably cooperate with the
Indemnitor and its legal representatives in the investigation of any claim,
demand, action or other proceeding covered by this indemnification.

 

Portions of this Exhibit were omitted and have been filed separately with the
Secretary of the Commission pursuant to the Company’s application requesting
confidential Investment under Rule 24b-2 under the Securities Exchange Act of
1934.

 

51

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13.4 Insurance. Each party shall maintain insurance, including product liability
insurance, with respect to the research, development, manufacture and sale of
Products hereunder by such party, its Sublicensees and their respective
Affiliates in such amount as such party customarily maintains with respect to
the research, development, manufacture and sale of its other products. Each
party shall maintain such insurance for so long as such party, its Sublicensees
and their respective Affiliates continues to research, develop, manufacture or
sell any Products hereunder, and thereafter for so long as such party
customarily maintains insurance covering the research, development, manufacture
and sale of its other products.

 

14. TERM AND TERMINATION

 

14.1 Term. The term of this Agreement shall commence on the Effective Date and,
unless earlier terminated, shall continue in full force and effect until the
expiration of the parties’ respective royalty obligations pursuant to this
Agreement.

 

14.2 Termination.

 

14.2.1 If CuraGen breaches its obligations under Section 8.2, 8.3 or 8.4 above,
or materially breaches its obligations under Section 10.1 above, with respect to
any Antigen or to CuraGen Products to any CuraGen Licensed Antigen, and such
breach shall have continued for ten (10) days, in the case of breaches under
Section 8.2, 8.3, or 8.4, or for thirty (30) days, in the case of material
breaches under Section 10.1, after written notice of such breach was provided to
CuraGen by ABX, ABX shall have the right at its option to terminate the licenses
(or sublicenses, as the case may be) under this Agreement with respect to such
Antigen or to CuraGen Products to such CuraGen Licensed Antigen (as applicable)
effective at the end of such ten (10) day or thirty (30) day period, as the case
may be, without otherwise affecting the other licenses (or sublicenses, as the
case may be) granted under this Agreement or the other remaining provisions of
this Agreement. In the event of such termination by ABX, the Antigen which was
the subject of the termination shall be subject to ABX’s standby option under
Section 7.2.2, CuraGen’s obligation to provide data and information under
Section 7.2.2 shall apply to all data and information in existence at the time
of the termination, the six-month period in which to exercise such option shall
commence on the date of termination, and no payment shall be due under
Section 8.2.3 upon the exercise by ABX of such option.

 

14.2.2 If ABX breaches its obligations under Section 8.2, 8.3 or 8.4 above, or
materially breaches its obligations under Section 10.2 above, with respect to
any Antigen or to ABX Products to any ABX Licensed Antigen, and such breach
shall have continued for ten (10) days, in the case of breaches under
Section 8.2, 8.3, or 8.4, or for thirty (30) days, in the case of material
breaches under Section 10.2, after written notice of such breach was provided to
ABX by CuraGen, CuraGen shall have the right at its option to terminate the
licenses (or sublicenses, as the case may be) under this Agreement with respect
to such Antigen or to ABX Products to such ABX Licensed Antigen (as applicable)
effective at the end of such ten (10) day or thirty (30) day period, as the case
may be, without otherwise affecting the other licenses (or sublicenses, as the
case may be) granted under this Agreement or the other remaining

 

Portions of this Exhibit were omitted and have been filed separately with the
Secretary of the Commission pursuant to the Company’s application requesting
confidential Investment under Rule 24b-2 under the Securities Exchange Act of
1934.

 

52

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provisions of this Agreement. In the event of such termination by CuraGen, the
Antigen which was the subject of the termination shall be subject to CuraGen’s
standby option under Section 7.1.2, ABX’s obligation to provide data and
information under Section 7.1.2 shall apply to all data and information in
existence at the time of the termination, the six-month period in which to
exercise such option shall commence on the date of termination, and no payment
shall be due under Section 8.2.3 upon the exercise by CuraGen of such option.

 

14.2.3 If a party shall have materially breached any of its material obligations
hereunder (other than under Sections 8.2, 8.3, 8.4, 10.1 and 10.2 above), and
such breach shall have continued for thirty (30) days after written notice of
such breach was provided to the breaching party by the nonbreaching party, the
nonbreaching party shall have the right (at its option), effective at the end of
such thirty (30) day period, to terminate the Research Program and all options,
licenses, and rights to obtain additional options and licenses granted to the
breaching party under this Agreement; provided, however, that any commercial
licenses previously granted to the breaching party under Article 7 above (and
any related continuing research licenses to the breaching party under
Section 6.1 above), all licenses granted to the breaching party under
Section 12.7 above, and all options, licenses, and rights to obtain additional
options and licenses granted to the nonbreaching party under this Agreement
shall survive any such termination by the nonbreaching party under this
Section 14.2.3.

 

14.3 Effect of Expiration or Termination.

 

14.3.1 Expiration or termination of this Agreement shall be without prejudice to
any rights which shall have accrued to the benefit of a party prior to such
expiration or termination. Without limiting the foregoing, the license rights
granted under Section 4.2.7, Section 4.2.2 and the provisions of Sections 4.4.4
and 8.1 and Articles 9, 11, 12, 13, 14 and 15 shall survive any expiration or
termination of this Agreement.

 

14.3.2 Following the expiration under Section 8.4.3(e) of CuraGen’s obligation
to pay royalties to ABX hereunder with respect to a CuraGen Product (provided
that CuraGen’s option, license or other rights with respect to such CuraGen
Product have not been previously terminated), CuraGen shall have a fully-paid
up, non-exclusive license (or sublicense, as the case may be) (with the right to
grant sublicenses) under the ABX Know-How and Research Program Know-How solely
to make, have made, use, offer for sale, sell and import such CuraGen Product
for use in the Commercial Field. Following the expiration under
Section 8.4.3(e) of ABX’s obligation to pay royalties to CuraGen hereunder with
respect to an ABX Product (provided that ABX’s option, license or other rights
with respect to such ABX Product have not been previously terminated), ABX shall
have a fully-paid up, non-exclusive license (or sublicense, as the case may be)
(with the right to grant sublicenses) under the CuraGen Know-How and Research
Program Know-How solely to make, have made, use, offer for sale, sell and import
such ABX Product for use in the Commercial Field.

 

14.3.3 Upon termination of this Agreement, or upon termination of the licenses
(or sublicenses, as the case may be) hereunder for any CuraGen Product, CuraGen,
its

 

Portions of this Exhibit were omitted and have been filed separately with the
Secretary of the Commission pursuant to the Company’s application requesting
confidential Investment under Rule 24b-2 under the Securities Exchange Act of
1934.

 

53

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Sublicensees and their respective Affiliates shall have the right to sell or
otherwise dispose (consistent with all applicable laws and regulations and
subject to Articles 8 and 9 above) of the stock of any CuraGen Product then on
hand. Upon termination of this Agreement, or upon termination of the licenses
(or sublicenses, as the case may be) hereunder for any ABX Product, ABX, its
Sublicensees and their respective Affiliates shall have the right to sell or
otherwise dispose (consistent with all applicable laws and regulations and
subject to Articles 8 and 9 above) of the stock of any ABX Product then on hand.

 

14.3.4 Upon termination of this Agreement by ABX, or upon termination by ABX of
the licenses (or sublicenses, as the case may be) hereunder for any CuraGen
Product, any Sublicense granted by CuraGen hereunder shall survive, provided
that upon request by ABX, such Sublicensee promptly agrees in writing that such
Sublicensee shall be bound by the terms of such Sublicense for the benefit of
ABX and ABX shall have all of the rights of CuraGen under such Sublicense, but
ABX shall not be bound by any obligation of CuraGen thereunder except to the
extent it is already bound to an equivalent obligation hereunder. Upon
termination of this Agreement by CuraGen, or upon termination by CuraGen of the
licenses (or sublicenses, as the case may be) hereunder for any ABX Product, any
Sublicense granted by ABX hereunder shall survive, provided that upon request by
CuraGen, such Sublicensee promptly agrees in writing that such Sublicensee shall
be bound by the terms of such Sublicense for the benefit of CuraGen and CuraGen
shall have all of the rights of ABX under such Sublicense, but CuraGen shall not
be bound by any obligation of ABX thereunder except to the extent it is already
bound to an equivalent obligation hereunder.

 

14.3.5 Except as otherwise expressly agreed in writing by the parties, promptly
upon the expiration of the Extended Research License Term, each party shall
destroy all remaining Research Program Technology and Information and Antigen
Specific Materials and Information; in each case except to the extent such party
retains an option or license (or sublicense, as the case may be) thereto
hereunder; that survives such expiration or termination.

 

14.3.6 Except as otherwise expressly agreed in writing by the parties, promptly
upon the expiration or earlier termination of this Agreement, (a) CuraGen shall
destroy or return to ABX (as ABX shall direct) all remaining ABX Technology and
Information; (b) ABX shall destroy or return to CuraGen (as CuraGen shall
direct) all remaining CuraGen Technology and Information; and (c) each party
shall destroy all remaining Research Program Technology and Information and
Antigen Specific Materials and Information; in each case except to the extent
such party retains a license (or sublicense, as the case may be) thereto
hereunder; that survives such expiration or termination.

 

14.3.7 Except as otherwise expressly agreed in writing by the parties, promptly
upon the termination of the license (or sublicense, as the case may be)s granted
to CuraGen hereunder regarding any Antigen, CuraGen shall destroy or return to
ABX (as ABX shall direct) all remaining ABX Technology and Information regarding
such Antigen, Antibodies to such Antigens and Products to such Antigen, and
shall destroy all remaining Research Program Technology and Information and
Antigen Specific Materials and Information regarding such Antigen, Antibodies to
such Antigens and Products to such Antigen.

 

Portions of this Exhibit were omitted and have been filed separately with the
Secretary of the Commission pursuant to the Company’s application requesting
confidential Investment under Rule 24b-2 under the Securities Exchange Act of
1934.

 

54

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14.3.8 Except as otherwise expressly agreed in writing by the parties, promptly
upon the termination of the license (or sublicense, as the case may be)s granted
to ABX hereunder regarding any Antigen, ABX shall destroy or return to CuraGen
(as CuraGen shall direct) all remaining CuraGen Technology and Information
regarding such Antigen, Antibodies to such Antigens and Products to such
Antigen, and shall destroy all remaining Research Program Technology and
Information and Antigen Specific Materials and Information regarding such
Antigen, Antibodies to such Antigens and Products to such Antigen.

 

15. MISCELLANEOUS

 

15.1 Governing Laws. This Agreement shall be governed by, interpreted and
construed in accordance with the laws of the State of Delaware, without regard
to conflicts of law principles.

 

15.2 Waiver. No waiver by any party hereto of any breach or default of any of
the covenants or agreements herein set forth shall be deemed a waiver as to any
subsequent and/or similar breach or default.

 

15.3 Assignments. Neither this Agreement nor any right or obligation hereunder
may be assigned or delegated, in whole or part, by either party without the
prior express written consent of the other; provided, however, that either party
may, without the written consent of the other, assign this Agreement and its
rights and delegate its obligations hereunder in connection with the transfer or
sale of all or substantially all of its business, or in the event of its merger,
consolidation, change in control or similar transaction. Any permitted assignee
shall assume all obligations of its assignor under this Agreement. Any purported
assignment in violation of this Section 15.3 shall be void.

 

15.4 Independent Contractors. The relationship of the parties hereto is that of
independent contractors. The parties hereto shall not be deemed to be agents,
partners or joint venturers of the others for any purpose as a result of this
Agreement or the transactions contemplated thereby.

 

15.5 Further Actions. Each party agrees to execute, acknowledge and deliver such
further instruments and to do all such other acts as may be necessary or
appropriate in order to carry out the purposes and intent of this Agreement.

 

15.6 Notices. All requests and notices required or permitted to be given to the
parties hereto shall be given in writing, shall expressly reference the
section(s) of this Agreement to which they pertain, and shall be delivered to
the other party, effective on receipt, at the appropriate address as set forth
below or to such other addresses as may be designated in writing by the parties
from time to time during the term of this Agreement.

 

Portions of this Exhibit were omitted and have been filed separately with the
Secretary of the Commission pursuant to the Company’s application requesting
confidential Investment under Rule 24b-2 under the Securities Exchange Act of
1934.

 

55

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If to ABX:

 

Abgenix, Inc.

7601 Dumbarton Circle

Fremont, California 94555

Attn: President

 

with a copy to:

 

Gray Cary Ware & Freidenrich LLP

4365 Executive Drive, Suite 1600

San Diego, California 92121-2189

Attn: Mark R. Wicker

 

If to CuraGen:

 

CuraGen Corporation

555 Long Wharf Drive

New Haven, Connecticut 06511

Attn: President

 

with a copy to:

 

Mintz, Levin, Cohn, Ferris, Glovsky & Popeo, P.C.

One Financial Center

Boston, Massachusetts 02111

Attn: Jeffrey M. Wiesen

 

15.7 No Implied Licenses. Only licenses (or sublicenses, as the case may be) and
rights granted expressly herein shall be of legal force and effect. No license
(or sublicense, as the case may be) or other right shall be created hereunder by
implication, estoppel or otherwise. By way of clarification and not limitation,
no license (or sublicense, as the case may be) is granted hereunder to CuraGen
to have in its possession any XenoMouse Animals or to conduct immunizations
thereof.

 

15.8 Compliance with Laws. Each party shall use the Technology and Information
of the other party and the Research Program Technology and Information in
compliance in all material respects with all applicable laws, guidelines and
regulations which are applicable to such Technology and Information or the use
thereof, including without limitation any biosafety procedures and all safety
precautions accompanying such Technology and Information. Except as otherwise
expressly agreed in this Agreement or otherwise expressly agreed in writing by
the parties, neither party shall administer the Technology and Information of
the other party or the Research Program Technology and Information to humans
under any circumstances.

 

Portions of this Exhibit were omitted and have been filed separately with the
Secretary of the Commission pursuant to the Company’s application requesting
confidential Investment under Rule 24b-2 under the Securities Exchange Act of
1934.

 

56

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15.9 Export Laws. Notwithstanding anything to the contrary contained herein, all
obligations of ABX and CuraGen are subject to prior compliance with United
States export regulations and such other United States laws and regulations as
may be applicable, and to obtaining all necessary approvals required by the
applicable agencies of the government of the United States. Each party shall be
responsible for obtaining such approvals as required of it, and shall use
efforts consistent with prudent business judgment to obtain such approvals. Each
party shall cooperate reasonably with the other party and provide reasonable
assistance to the other party as may be reasonably necessary to obtain any
required approvals.

 

15.10 Force Majeure. Nonperformance of a party (other than for the payment of
money) shall be excused to the extent that performance is rendered impossible by
strike, fire, earthquake, flood, governmental acts or orders or restrictions,
failure of suppliers, or any other reason where failure to perform, is beyond
the reasonable control and not caused by the negligence, intentional conduct or
misconduct of the nonperforming party.

 

15.11 No Consequential Damages. IN NO EVENT SHALL A PARTY HERETO BE LIABLE FOR
SPECIAL, INCIDENTAL OR CONSEQUENTIAL DAMAGES ARISING OUT OF THIS AGREEMENT OR
THE EXERCISE OF ITS RIGHTS HEREUNDER, INCLUDING WITHOUT LIMITATION LOST PROFITS
ARISING FROM OR RELATING TO ANY BREACH OF THIS AGREEMENT, REGARDLESS OF ANY
NOTICE OF SUCH DAMAGES. NOTHING IN THIS SECTION 15.11 IS INTENDED TO LIMIT OR
RESTRICT THE INDEMNIFICATION RIGHTS OR OBLIGATIONS OF EITHER PARTY.

 

15.12 Third Party Rights. Notwithstanding anything to the contrary in this
Agreement, the grant of rights by ABX under this Agreement shall be subject to
and limited in all respects by the terms of the applicable ABX
In-License(s) pursuant to which ABX acquired any Licensed ABX Intellectual
Property, and all rights or sublicenses granted under this Agreement shall be
limited to the extent that ABX may grant such rights and sublicenses under such
ABX In-Licenses. Additionally, and without limiting the foregoing, the rights
granted to CuraGen hereunder, including without limitation any grant of
“exclusive” rights, shall be subject to the rights granted to or retained by
GenPharm under the GenPharm Cross License Agreement.

 

15.13 Complete Agreement. This Agreement constitutes the entire agreement
between the parties regarding the subject matter hereof, and all prior
representations, understandings and agreements regarding the subject matter
hereof (including without limitation, the Original Agreement and the letter
dated July 5, 2000, from Christopher McLeod to Raymond Withy) either written or
oral, expressed or implied, are superseded and of no effect.

 

15.14 Counterparts. This Agreement may be executed in counterparts, each of
which shall be deemed to be an original and both together shall be deemed to be
one and the same agreement.

 

Portions of this Exhibit were omitted and have been filed separately with the
Secretary of the Commission pursuant to the Company’s application requesting
confidential Investment under Rule 24b-2 under the Securities Exchange Act of
1934.

 

57

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15.15 Headings. The captions to the several Articles and Sections hereof are not
a part of this Agreement, but are included merely for convenience of reference
only and shall not affect its meaning or interpretation.

 

IN WITNESS WHEREOF, the parties have caused this Agreement to be executed by
their respective duly authorized officers as of the day and year first above
written.

 

 

ABGENIX, INC.

 

 

 

 

By:

 

 

 

 

 

 

(Signature)

 

 

 

 

 

 

 

 

(Printed Name)

 

 

 

 

 

 

 

 

(Title)

 

 

 

 

CURAGEN CORPORATION

 

 

 

By:

 

 

 

 

 

 

(Signature)

 

 

 

 

 

Christopher K. McLeod

 

 

(Printed Name)

 

 

 

 

 

Executive Vice President

 

 

(Title)

 

Portions of this Exhibit were omitted and have been filed separately with the
Secretary of the Commission pursuant to the Company’s application requesting
confidential Investment under Rule 24b-2 under the Securities Exchange Act of
1934.

 

58

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EXHIBIT A

 

ABX PATENT RIGHTS

 

I.

Pursuant to the MRLOA

 

A. Any of the patent applications listed in the following Table:

 

[*******]

 

[*******]

 

[*******]

 

[*******]

 

[*******]

 

[**********]

 

[************]

 

[*************]

 

[***************]

 

[********************]

 

[**********]

 

[************]

 

[*************]

 

[***************]

 

[********************]

 

[**********]

 

[************]

 

[************]

 

[***************]

 

[********************]

 

[**********]

 

[************]

 

[*************]

 

[***************]

 

[********************]

 

[**********]

 

[************]

 

[*************]

 

[***************]

 

[********************]

 

[**********]

 

[************]

 

[*************]

 

[***************]

 

[********************]

 

[**********]

 

[************]

 

[*************]

 

[***************]

 

[********************]

 

[**********]

 

[************]

 

[*************]

 

[***************]

 

[********************]

 

[**********]

 

[************]

 

[*************]

 

[***************]

 

[********************]

 

[**********]

 

[************]

 

[*************]

 

[***************]

 

[********************]

 

[**********]

 

[************]

 

[*************]

 

[***************]

 

[********************]

 

[**********]

 

[************]

 

[*************]

 

[***************]

 

[********************]

 

[**********]

 

[************]

 

[*************]

 

[***************]

 

[********************]

 

[**********]

 

[************]

 

[*************]

 

[***************]

 

[********************]

 

[**********]

 

[************]

 

[*************]

 

[***************]

 

[********************]

 

[**********]

 

[************]

 

[*************]

 

[***************]

 

[********************]

 

[**********]

 

[************]

 

[*************]

 

[***************]

 

[********************]

 

[**********]

 

[************]

 

[*************]

 

[***************]

 

[********************]

 

 

 

B.

[****************************************************************]:

 

[**********************************************************************].

 

 

D.

[****************************************************************]:

 

[**********************************************************************].

 

 

E.

[****************************************************************]:

 

[**********************************************************************].

 

II.

[*********************************]

 

Portions of this Exhibit were omitted and have been filed separately with the
Secretary of the Commission pursuant to the Company’s application requesting
confidential Investment under Rule 24b-2 under the Securities Exchange Act of
1934.

 

59

--------------------------------------------------------------------------------

 

A.

[**********************************************************************].

 

B.

[**********************************************************************].

 

C.

[******************************************************************]:

 

[**********************************************************************].

 

Portions of this Exhibit were omitted and have been filed separately with the
Secretary of the Commission pursuant to the Company’s application requesting
confidential Investment under Rule 24b-2 under the Securities Exchange Act of
1934.

 

60

--------------------------------------------------------------------------------

 

EXHIBIT B

 

ELIGIBLE ANTIGEN CRITERIA

 

A Research Antigen shall become an Eligible Antigen if it meets the following
criteria:

 

1.

[*****************************************************************]

 

2.

[*****************************************************************]

 

Portions of this Exhibit were omitted and have been filed separately with the
Secretary of the Commission pursuant to the Company’s application requesting
confidential Investment under Rule 24b-2 under the Securities Exchange Act of
1934.

 

61

--------------------------------------------------------------------------------

 

EXHIBIT C

 

RESEARCH PLAN

 

CuraGen/ABX Research Plan

 

[ATTACHED]

 

Portions of this Exhibit were omitted and have been filed separately with the
Secretary of the Commission pursuant to the Company’s application requesting
confidential Investment under Rule 24b-2 under the Securities Exchange Act of
1934.

 

62

--------------------------------------------------------------------------------

 

EXHIBIT D

 

THIRD PARTY AGREEMENTS

 

Collaboration Agreements between CuraGen and

 

[***********************************]

 

[***********************************]

 

[***********************************]

 

[***********************************]

 

[***********************************]

 

[***********************************]

 

Portions of this Exhibit were omitted and have been filed separately with the
Secretary of the Commission pursuant to the Company’s application requesting
confidential Investment under Rule 24b-2 under the Securities Exchange Act of
1934.

 

63

--------------------------------------------------------------------------------

 

EXHIBIT E

 

RESEARCH ANTIGEN DESIGNATION

 

Portions of this Exhibit were omitted and have been filed separately with the
Secretary of the Commission pursuant to the Company’s application requesting
confidential Investment under Rule 24b-2 under the Securities Exchange Act of
1934.

 

64

--------------------------------------------------------------------------------

 

EXHIBIT F

 

FORM OF THREE-WAY MTA

 

Portions of this Exhibit were omitted and have been filed separately with the
Secretary of the Commission pursuant to the Company’s application requesting
confidential Investment under Rule 24b-2 under the Securities Exchange Act of
1934.

 

65

--------------------------------------------------------------------------------

 

EXHIBIT G

 

FORM OF TWO-WAY MTA

 

Portions of this Exhibit were omitted and have been filed separately with the
Secretary of the Commission pursuant to the Company’s application requesting
confidential Investment under Rule 24b-2 under the Securities Exchange Act of
1934.

 

66

--------------------------------------------------------------------------------