Exhibit 10.1

[***] = CERTAIN CONFIDENTIAL INFORMATION CONTAINED IN THIS DOCUMENT, MARKED BY
BRACKETS, HAS BEEN OMITTED AND FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE
COMMISSION PURSUANT TO RULE 24B-2 OF THE SECURITIES EXCHANGE ACT OF 1934, AS
AMENDED.

EXCLUSIVE CHANNEL COLLABORATION AGREEMENT

THIS EXCLUSIVE CHANNEL COLLABORATION AGREEMENT (the “Agreement”) is made and
entered into effective as of September 28, 2015 (the “Effective Date”) by and
between INTREXON CORPORATION, a Virginia corporation with offices at 20358
Seneca Meadows Parkway, Germantown, MD 20876 (“Intrexon”), and ZIOPHARM
ONCOLOGY, INC., a Delaware corporation having its principal place of business at
1 First Avenue, Parris Building #34, Navy Yard Plaza, Boston, MA 02129
(“ZIOPHARM”). Intrexon and ZIOPHARM may be referred to herein individually as a
“Party”, and collectively as the “Parties.”

RECITALS

WHEREAS, Intrexon has expertise in and owns or controls proprietary technology
relating to the design and production of DNA vectors or their in vivo
expression; and

WHEREAS, ZIOPHARM now desires to become Intrexon’s exclusive channel
collaborator with respect to such technology for the purpose of developing the
GvHD Program (as defined herein), and Intrexon is willing to appoint ZIOPHARM as
an exclusive channel collaborator in the Field (as defined herein and subject to
amendments to the definition as permitted) under the terms and conditions of
this Agreement.

NOW, THEREFORE, in consideration of the foregoing and the covenants and promises
contained herein, the Parties agree as follows:

ARTICLE 1

DEFINITIONS

As used in this Agreement, the following capitalized terms shall have the
following meanings:

1.1 “Affiliate” means, with respect to a particular Party, any other person or
entity that directly or indirectly controls, is controlled by, or is in common
control with such Party. As used in this Section 1.1, the term “controls” (with
correlative meanings for the terms “controlled by” and “under common control
with”) means the ownership, directly or indirectly, of fifty percent (50%) or
more of the voting securities or other ownership interest of an entity, or the
possession, directly or indirectly, of the power to direct the management or
policies of an entity, whether through the ownership of voting securities, by
contract, or otherwise. Notwithstanding the foregoing, (i) Third Security shall
be deemed not to be an Affiliate of Intrexon, (ii) neither Party shall be deemed
to be an Affiliate of one another, and (iii) any other person, corporation,
partnership, or other entity that would be an Affiliate of Intrexon solely
because it and Intrexon are under common control by Randal J. Kirk or by
investment funds managed by Third Security or an affiliate of Third Security
shall also be deemed not to be an Affiliate of Intrexon.

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[***] = CERTAIN CONFIDENTIAL INFORMATION CONTAINED IN THIS DOCUMENT, MARKED BY
BRACKETS, HAS BEEN OMITTED AND FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE
COMMISSION PURSUANT TO RULE 24B-2 OF THE SECURITIES EXCHANGE ACT OF 1934, AS
AMENDED.

 

1.2 “Allowable Expenses” means any of the following expenses incurred by
ZIOPHARM or an Affiliate of ZIOPHARM after the Commercial Sale in the Territory
of a Product, in each case to the extent specifically attributable to such
Product and specifically attributable to the Commercialization of such Product:
(a) Cost of Goods Sold, (b) Marketing Expenses, (c) Distribution Expenses,
(d) Post-Launch Product R&D Expenses, and (e) Additional Commercialization
Expenses, in each case as such terms are defined and calculated in this Article
1 and in Exhibit A.

1.3 “Applicable Laws” has the meaning set forth in Section 8.2(d)(xiii).

1.4 “Authorizations” has the meaning set forth in Section 8.2(d)(xiii).

1.5 “CC” has the meaning set forth in Section 2.2(b).

1.6 “Channel-Related Program IP” has the meaning set forth in Section 6.1(c).

1.7 “Claims” has the meaning set forth in Section 9.1.

1.8 “CMCC” has the meaning set forth in Section 2.2(b).

1.9 “Committees” has the meaning set forth in Section 2.2(a).

1.10 “Commercialize” or “Commercialization” (including derivative forms of such
term, such as “Commercializing”) means any activities directed to the marketing
(including detailing to medical professionals in efforts to increase the
prescribing preferences), manufacturing, promoting, distributing, importing for
sale, offering to sell and/or selling of Products.

1.11 “Commercial Sale” means for a given Product and country in the Territory,
the sale for value of that product by ZIOPHARM (or, as the case may be, by an
Affiliate or permitted sublicensee of ZIOPHARM), to a Third Party after
regulatory approval (if necessary) has been obtained for such product in such
country.

1.12 “[***]” has the meaning set forth in Section [***]([***]).

1.13 “Confidential Information” means each Party’s confidential Information,
disclosed by such Party pursuant to this Agreement or any other confidentiality
agreement between the Parties, regardless of whether in oral, written, graphic
or electronic form.

1.14 “Control” means, with respect to a Patent or other intellectual property
right, that a Party owns or has a license to such right and has the ability to
grant a license or sublicense as provided for in this Agreement under such right
without violating the terms of any agreement or other arrangement with any Third
Party.

1.15 “CRC” has the meaning set forth in Section 2.2(b).

 

2

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[***] = CERTAIN CONFIDENTIAL INFORMATION CONTAINED IN THIS DOCUMENT, MARKED BY
BRACKETS, HAS BEEN OMITTED AND FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE
COMMISSION PURSUANT TO RULE 24B-2 OF THE SECURITIES EXCHANGE ACT OF 1934, AS
AMENDED.

 

1.16 “Diligent Efforts” means, with respect to a Party’s obligation under this
Agreement, the level of efforts and resources reasonably required to diligently
develop, manufacture, and/or Commercialize (as applicable) a Product in a
sustained manner, consistent with the efforts and resources a similarly situated
company working in the Field would typically devote to a product of similar
market potential, profit potential, strategic value and/or proprietary
protection, based on market conditions then prevailing. With respect to a
particular task or obligation, Diligent Efforts requires that the applicable
Party promptly assign responsibility for such task and consistently make and
implement decisions and allocate resources designed to advance progress with
respect to such task or obligation.

1.17 “Excess Product Liability Costs” has the meaning set forth in Section 9.3.

1.18 “Executive Officer” means: (a) the Chief Executive Officer of the
applicable Party, or (b) another senior executive officer of such Party who has
been duly appointed by the Chief Executive Officer to act as the representative
of the Party to resolve, as the case may be, ((i) a Committee dispute, provided
that such appointed officer is not a member of the applicable Committee and
occupies a position senior to the positions occupied by the applicable Party’s
members of the applicable Committee, or (ii) a dispute described in
Section 11.1.

1.19 “FDA” has the meaning set forth in Section 8.2(d)(xiii).

1.20 “[***]” has the meaning set forth in Section [***]([***])

1.21 “Field” means the treatment or prevention of Graft vs Host Disease in
humans by administering (i) regulatory T cells expressing membrane-bound and/or
soluble interleukin-2, (ii) orally delivered genetically modified L. lactis that
express interleukin-2 in humans, and (iii) a combination therapy utilizing
(i) and (ii).

1.22 “Fully Loaded Cost” means the direct cost of the applicable good, product
or service plus indirect charges and overheads reasonably allocable to the
provision of such good, product or service in accordance with US GAAP.

1.23 “Graft vs Host Disease” means a donor cell mediated inflammatory and
immuno-regulatory disorder occurring after allogeneic hematopoetic cell
transplantation.

1.24 “GvHD Program” has the meaning set forth in Section 2.1.

1.25 “Information” means information, results and data of any type whatsoever,
in any tangible or intangible form whatsoever, including without limitation,
databases, inventions, practices, methods, techniques, specifications,
formulations, formulae, knowledge, know-how, skill, experience, test data
including pharmacological, biological, chemical, biochemical, toxicological,
proof of concept and regulatory test data, manufacturing information, analytical
and quality control data, stability data, studies and procedures, patent and
other legal information or descriptions, and marketing, financial, personnel and
other business information and plans.

1.26 “Infringement” has the meaning set forth in Section 6.3(a).

 

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1.27 “Intrexon Channel Technology” means Intrexon’s technology directed towards
in vivo expression of effectors, including, without limitation, the technology
embodied in the Intrexon Materials and the Intrexon IP.

1.28 “Intrexon Indemnitees” has the meaning set forth in Section 9.2.

1.29 “Intrexon IP” means the Intrexon Patents and Intrexon Know-How.

1.30 “Intrexon Know-How” means all Information (other than Intrexon Patents)
that (a) is Controlled by Intrexon as of the Effective Date or during the Term
and (b) is reasonably required or useful for ZIOPHARM to conduct the GvHD
Program. For the avoidance of doubt, Intrexon Know-How shall include any
Information (other than Intrexon Patents) that constitutes Channel-Related
Program IP.

1.31 “Intrexon Materials” means the genetic code and associated gene constructs
used alone or in combination and such other proprietary reagents including but
not limited to plasmid vectors, virus stocks, and cells and cell lines, in each
case that are reasonably required or provided to ZIOPHARM to conduct the GvHD
Program.

1.32 “Intrexon Patents” means all Patents that (a) are Controlled by Intrexon as
of the Effective Date or developed during the Term; and (b) are reasonably
required or useful for ZIOPHARM to conduct the GvHD Program. For the avoidance
of doubt, the Intrexon Patents shall include any Patent in the Channel-Related
Program IP.

1.33 “Inventions” has the meaning set forth in Section 6.1(b).

1.34 “IPC” has the meaning set forth in Section 2.2(b).

1.35 “JSC” has the meaning set forth in Section 2.2(b).

1.36 “Losses” has the meaning set forth in Section 9.1.

1.37 “Net Sales” means, with respect to any Product, the net sales of such
Product by ZIOPHARM or an Affiliate of ZIOPHARM (including, without limitation,
net sales of Product to a non-Affiliate sublicensee but not including net sales
by such non-Affiliate sublicensee), as determined in accordance with US GAAP.

1.38 “Patents” means (a) all patents and patent applications (including
provisional applications), (b) any substitutions, divisions, continuations,
continuations-in-part, reissues, renewals, registrations, requests for continued
examination, confirmations, re-examinations, extensions, supplementary
protection certificates and the like of the foregoing, and (c) any foreign or
international equivalents of any of the foregoing.

1.39 “Product” means any product in the Field that is created, produced,
developed, or identified in whole or in part, directly or indirectly, by or on
behalf of ZIOPHARM during the Term whether through use or practice of Intrexon
Channel Technology, Intrexon IP, or the Intrexon Materials.

 

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[***] = CERTAIN CONFIDENTIAL INFORMATION CONTAINED IN THIS DOCUMENT, MARKED BY
BRACKETS, HAS BEEN OMITTED AND FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE
COMMISSION PURSUANT TO RULE 24B-2 OF THE SECURITIES EXCHANGE ACT OF 1934, AS
AMENDED.

 

1.40 “Product Profit” means Net Sales less Allowable Expenses.

1.41 “Product-Specific Program Patent” means any issued Intrexon Patent where
all the claims are directed to Inventions that relate solely and specifically to
Products. [***]. [***].

1.42 “Proposed Terms” has the meaning set forth in Section 11.2.

1.43 “Prosecuting Party” has the meaning set forth in Section 6.2(c).

1.44 “[***]” has the meaning set forth in Section [***]([***]).

1.45 “Retained Product” has the meaning set forth in Section 10.4(a).

1.46 “Reverted Product” has the meaning set forth in Section 10.4(c).

1.47 “SEC” means the United States Securities and Exchange Commission.

1.48 “Sublicensing Revenue” means any cash consideration (including upfront
payments, milestone payments, and royalties), and the cash equivalent of all
other consideration, actually received by ZIOPHARM or its Affiliate from a Third
Party in consideration for a grant of a sublicense under the Intrexon IP or any
rights to develop or commercialize Products, but excluding: (a) any amounts paid
as bona fide reimbursement for research and development costs to the extent
incurred following such grant; (b) bona fide loans or any payments in
consideration for a grant of equity of ZIOPHARM to the extent that such
consideration is equal to or less than fair market value (i.e. any amounts in
excess of fair market value shall be Sublicensing Revenue); or (c) amounts
received from sublicensees in respect of any Product sales that are included in
Net Sales.

1.49 “Superior Therapy” means a therapy in the Field for a given indication
that, based on the data then available, (a) demonstrably appears to offer
superior efficacy, safety or significantly lower cost of therapy, as compared
with both (i) those therapies that are marketed (either by ZIOPHARM or others)
at such time for the same indication and (ii) those therapies that are being
actively developed by ZIOPHARM for such indication; (b) demonstrably appears to
represent a substantial improvement over such existing therapies; and (c) has
intellectual property protection and a regulatory approval pathway that, in each
case, would not present a significant barrier to commercial development.

1.50 “[***]” has the meaning set forth in Section [***]([***]).

1.51 “Support Memorandum” has the meaning set forth in Section 11.2.

1.52 “Term” has the meaning set forth in Section 10.1.

1.53 “Territory” means the world.

1.54 “Third Party” means any individual or entity other than the Parties or
their respective Affiliates.

 

5

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1.55 “Third Security” means Third Security, LLC.

1.56 “US GAAP” means generally accepted accounting principles in the United
States.

1.57 “Working Group” has the meaning set forth in Section 2.3(d).

1.58 “ZIOPHARM Indemnitees” has the meaning set forth in Section 9.1.

1.59 “ZIOPHARM Program Patent” has the meaning set forth in Section 6.2(b).

1.60 “ZIOPHARM Termination IP” means all Patents or other intellectual property
that ZIOPHARM or any of its Affiliates Controls as of the Effective Date or
during the Term that Cover, or is otherwise necessary or useful for, the
development, manufacture or commercialization of a Reverted Product or necessary
or useful for Intrexon to operate in the Field.

ARTICLE 2

SCOPE OF CHANNEL COLLABORATION; MANAGEMENT

2.1 General. The general purpose of the channel collaboration described in this
Agreement will be to use the Intrexon Channel Technology, Intrexon IP, and/or
the Intrexon Materials to research, develop and Commercialize products for use
in the Field (collectively, the “GvHD Program”). As provided below, the JSC
shall establish projects for the GvHD Program. Either Party may propose
potential projects in the Field for review and consideration by the JSC.

2.2 Committees.

(a) Generally. The Parties desire to establish several committees (collectively,
“Committees”) to oversee the GvHD Program and to facilitate communications
between the Parties with respect thereto. Each of such Committees shall have the
responsibilities and authority allocated to it in this Article 2. Each of the
Committees shall have the obligation to exercise its authority consistent with
the respective purpose for such Committee as stated herein and any decisions of
the Committees shall be made in good faith.

 

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(b) Formation and Purpose. Promptly following the Effective Date, the Parties
shall create the Committees listed in the chart below, each of which shall have
the purpose indicated in the chart.

 

Committee

  

Purpose

Joint Steering Committee (“JSC”)    Establish projects for the GvHD Program and
establish the priorities for such projects. Chemistry, Manufacturing and
Controls Committee (“CMCC”)    Establish project plans and review and approve
activities and budgets for chemistry, manufacturing, and controls under the GvHD
Program. Clinical/Regulatory Committee (“CRC”)    Review and approve all
research and development plans, clinical projects and publications, and
regulatory filings and correspondence under the GvHD Program; review and approve
itemized budgets with respect to the foregoing. Commercialization Committee
(“CC”)    Establish project plans and review and approve activities and budgets
for commercialization activities under the GvHD Program. Intellectual Property
Committee (“IPC”)    Evaluate intellectual property issues in connection with
the GvHD Program; review and approve itemized budgets with respect to the
foregoing.

2.3 General Committee Membership and Procedure.

(a) Membership. For each Committee, each Party shall designate an equal number
of representatives who are employees of such Party or an Affiliate of such Party
(not to exceed three (3) for each Party) with appropriate expertise to serve as
members of such Committee (and Third Security shall be deemed to be an Affiliate
of Intrexon solely for purposes of this Section 2.3). Each representative may
serve on more than one Committee as appropriate in view of the individual’s
expertise. Each Party may replace its Committee representatives at any time upon
written notice to the other Party. Each Committee shall have a chairperson; the
chairperson of each committee shall serve for a two-year term and the right to
designate which representative to the Committee will act as chairperson shall
alternate between the Parties, with ZIOPHARM selecting the chairperson first for
the JSC, CRC and CC, and Intrexon selecting the chairperson first for the CMCC
and IPC. The chairperson of each Committee shall be responsible for calling
meetings, preparing and circulating an agenda in advance of each meeting of such
Committee, and preparing and issuing minutes of each meeting within thirty
(30) days thereafter.

(b) Meetings. Each Committee shall hold meetings at such times as it elects to
do so, but in no event shall such meetings be held less frequently than once
every six (6) months. Meetings of any Committee may be held in person or by
means of telecommunication (telephone, video, or web conferences). To the extent
that a Committee holds any meetings in person, the Parties will alternate in
designating the location for such in-person meetings, with

 

7

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ZIOPHARM selecting the first meeting location for each Committee. A reasonable
number of additional representatives of a Party may attend meetings of a
Committee in a non-voting capacity. Each Party shall be responsible for all of
its own expenses of participating in any Committee (including without limitation
in any Working Group).

(c) Meeting Agendas. Each Party will disclose to the other proposed agenda items
along with appropriate information at least seven (7) business days in advance
of each meeting of the applicable Committee; provided, that a Party may provide
its agenda items to the other Party within a lesser period of time in advance of
the meeting, or may propose that there not be a specific agenda for a particular
meeting, so long as such other Party consents to such later addition of such
agenda items or the absence of a specific agenda for such Committee meeting.

(d) Working Groups. From time to time, each Committee may establish and delegate
duties to other committees, sub-committees or directed teams (each, a “Working
Group”) on an “as-needed” basis to oversee particular projects or activities.
Each such Working Group shall be constituted and shall operate as the applicable
Committee determines; provided, that each Working Group shall have equal
representation from each Party. Each Working Group and its activities shall be
subject to the oversight, review and approval of, and shall report to, the
Committee that established such Working Group. In no event shall the authority
of the Working Group exceed that specified for the relevant Committee in this
Article 2.

(e) Limitations of Committee Powers. Each Committee shall have only such powers
as are specifically delegated to it hereunder or from time to time as agreed to
by the mutual consent of the Parties and shall not be a substitute for the
rights of the Parties. Without limiting the generality of the foregoing, no
Committee shall have any power to amend this Agreement. Any amendment to the
terms and conditions of this Agreement shall be implemented pursuant to
Section 12.7 below.

2.4 Committee Decision-Making. If a Committee is unable to reach unanimous
consent on a particular matter within thirty (30) days of its initial
consideration of such matter, then either Party may provide written notice of
such dispute to the Executive Officer of the other Party. The Executive Officers
of each of the Parties will meet at least once in person or by means of
telecommunication (telephone, video, or web conferences) to discuss the dispute
and use their good faith efforts to resolve the dispute within thirty (30) days
after submission of such dispute to the Executive Officers. If any such dispute
is not resolved by the Executive Officers within thirty (30) days after
submission of such dispute to such officers, then the Executive Officer of the
Party specified in the applicable subsection below shall have the authority to
finally resolve such dispute acting in good faith.

(a) Casting Vote at JSC. If a dispute at the JSC is not resolved pursuant to
Section 2.4 above, then the Executive Officer of ZIOPHARM shall have the
authority to finally resolve such dispute

(b) Casting Vote at CMCC. If a dispute at the CMCC is not resolved pursuant to
Section 2.4 above, then (i) in the case of any disputes relating to the Intrexon

 

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[***] = CERTAIN CONFIDENTIAL INFORMATION CONTAINED IN THIS DOCUMENT, MARKED BY
BRACKETS, HAS BEEN OMITTED AND FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE
COMMISSION PURSUANT TO RULE 24B-2 OF THE SECURITIES EXCHANGE ACT OF 1934, AS
AMENDED.

 

Materials, the manufacture of a Product active pharmaceutical ingredient, or the
manufacturing of other components of Products contracted for or manufactured by
Intrexon, the Executive Officer of Intrexon shall have the authority to finally
resolve such dispute; and (ii) in the case of any other disputes, the Executive
Officer of ZIOPHARM shall have the authority to finally resolve such dispute.

(c) Casting Vote at CRC. If a dispute at the CRC is not resolved pursuant to
Section 2.4 above, then the Executive Officer of ZIOPHARM shall have the
authority to finally resolve such dispute.

(d) Casting Vote at CC. If a dispute at the CC is not resolved pursuant to
Section 2.4 above, then the Executive Officer of ZIOPHARM shall have the
authority to finally resolve such dispute.

(e) Casting Vote at IPC. If a dispute at the IPC is not resolved pursuant to
Section 2.4 above, then the Executive Officer of Intrexon shall have the
authority to finally resolve such dispute, provided that [***]([***]).

(f) Other Committees. If any additional Committee is formed, then the Parties
shall, at the time of such formation, agree on which Party shall have the
authority to finally resolve a dispute that is not resolved pursuant to
Section 2.4 above.

(g) Restrictions. Neither Party shall exercise its right to finally resolve a
dispute at a Committee in accordance with this Section 2.4 in a manner that
(i) excuses such Party from any of its obligations specifically enumerated under
this Agreement; (ii) expands the obligations of the other Party under this
Agreement; (iii) negates any consent rights or other rights specifically
allocated to the other Party under this Agreement; (iv) purports to resolve any
dispute involving the breach or alleged breach of this Agreement; (v) resolves a
matter if the provisions of this Agreement specify that mutual agreement is
required for such matter; or (vi) would require the other Party to perform any
act that is inconsistent with applicable law.

ARTICLE 3

LICENSE GRANTS

3.1 Licenses to ZIOPHARM. Subject to the terms and conditions of this Agreement,
Intrexon hereby grants to ZIOPHARM a license under the Intrexon IP, Intrexon
Channel Technology, and Intrexon Materials, including the right to grant
sublicenses as set forth in Section 3.2, to research, develop, use, import,
make, have made, sell, and offer for sale Products in the Field in the
Territory. Such license shall be exclusive (even as to Intrexon) with respect to
any clinical development, selling, offering for sale or other Commercialization
of Products in the Field, and shall be otherwise non-exclusive.

3.2 Sublicensing. Except as provided in this Section 3.2, ZIOPHARM shall not
sublicense the rights granted under Section 3.1 to any Third Party, or transfer
the Intrexon Materials to any Third Party, or otherwise grant any Third Party
the right to research, develop, use, or commercialize Products, in each case
except with Intrexon’s written consent, which

 

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[***] = CERTAIN CONFIDENTIAL INFORMATION CONTAINED IN THIS DOCUMENT, MARKED BY
BRACKETS, HAS BEEN OMITTED AND FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE
COMMISSION PURSUANT TO RULE 24B-2 OF THE SECURITIES EXCHANGE ACT OF 1934, AS
AMENDED.

 

written consent may be withheld in Intrexon’s sole discretion. Notwithstanding
the foregoing, ZIOPHARM may transfer, to the extent reasonably necessary,
Intrexon Materials to a Third Party contractor performing post-API fill/finish
responsibilities for Products, and may grant any sublicenses necessary to enable
such Third Party to perform such activities. In addition, ZIOPHARM shall not
sublicense the rights granted under Section 3.1 to an Affiliate, or transfer the
Intrexon Materials to any Affiliate, or otherwise grant any Affiliate the right
to research, develop, use, or commercialize Products, in each case except with
Intrexon’s written consent, which written consent shall not be unreasonably
withheld or delayed. In the event that Intrexon consents to any such grant or
transfer to an Affiliate, ZIOPHARM shall remain responsible for, and be
guarantor of, the performance by any such Affiliate and shall cause such
Affiliate to comply with the provisions of this Agreement in connection with
such performance (as though such Affiliate were ZIOPHARM), including any payment
obligations owed to Intrexon hereunder. None of the enforcement rights under the
Intrexon Patents that are granted to ZIOPHARM pursuant to Section 6.3 shall be
transferred to, or exercised by, a sublicensee except with Intrexon’s prior
written consent, which may be withheld in Intrexon’s sole discretion.

3.3 No Non-Permitted Use. ZIOPHARM hereby covenants that it shall not, nor shall
it permit any Affiliate or, if applicable, (sub)licensee, to use or practice,
directly or indirectly, any Intrexon IP, Intrexon Channel Technology, or
Intrexon Materials for any purposes other than those expressly permitted by this
Agreement.

3.4 Exclusivity. Intrexon and ZIOPHARM mutually agree that, under the channel
collaboration established by this Agreement, it is intended that the Parties
will be exclusive to each other in the Field. To this end, neither Intrexon nor
its Affiliates shall make the Intrexon Channel Technology or Intrexon Materials
available to any Third Party for the purpose of developing or commercializing
products in the Field, and neither Intrexon nor any Affiliate shall pursue
(either by itself or with a Third Party or Affiliate) the research, development
or commercialization of any product for purpose of sale in the Field, outside of
the GvHD Program. Further, neither ZIOPHARM nor its Affiliates shall pursue
(either by itself or with a Third Party or Affiliate) the research, development
or commercialization of any product for purpose of sale in the Field, outside of
the GvHD Program. Notwithstanding the foregoing and for clarity, Intrexon and
its Affiliates shall not be prohibited by this Agreement from selling,
distributing, or otherwise using itself or allowing others to use research
tools, including animal models (such as genetically modified pigs), it may
Control.

3.5 [***].[***].

3.6 No Prohibition on Intrexon. Except as explicitly set forth in Sections 3.1
and 3.4, nothing in this Agreement shall prevent Intrexon from practicing or
using the Intrexon Materials, Intrexon Channel Technology, and Intrexon IP for
any purpose, and to grant to Third Parties the right to do the same. Without
limiting the generality of the foregoing, ZIOPHARM acknowledges that Intrexon
has all rights, in Intrexon’s sole discretion, to make the Intrexon Materials,
Intrexon Channel Technology (including any active pharmaceutical ingredient or,
biologic or genetic materials, used in a Product), and Intrexon IP available to
Third Party channel collaborators for use in fields outside the Field.

 

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[***] = CERTAIN CONFIDENTIAL INFORMATION CONTAINED IN THIS DOCUMENT, MARKED BY
BRACKETS, HAS BEEN OMITTED AND FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE
COMMISSION PURSUANT TO RULE 24B-2 OF THE SECURITIES EXCHANGE ACT OF 1934, AS
AMENDED.

 

3.7 Third Party Licenses.

(a) [***].

(b) [***].

(c) [***].

(d) For any Third Party license under which ZIOPHARM or its Affiliates obtain a
license under Patents claiming inventions or know-how specific to or used or
incorporated into the development, manufacture, and/or commercialization of
Products, ZIOPHARM shall use commercially reasonable efforts to ensure that
ZIOPHARM will have the ability, pursuant to Section 10.4(h), to assign such
agreement to Intrexon or grant a sublicense to Intrexon thereunder (having the
scope set forth in Section 10.4(h)).

(e) The licenses granted to ZIOPHARM under Section 3.1 may include sublicenses
under Intrexon IP that has been licensed to Intrexon by one or more Third
Parties. Any such sublicenses are subject to the terms and conditions set forth
in the applicable upstream license agreement, subject to the cost allocation set
forth in Section 3.7(c), provided that Intrexon shall either provide unredacted
copies of such upstream license agreements to ZIOPHARM or shall disclose in
writing to ZIOPHARM all of such terms and conditions that are applicable to
ZIOPHARM. ZIOPHARM shall not be responsible for complying with any provisions of
such upstream license agreements unless, and to the extent that, such provisions
have been disclosed to ZIOPHARM as provided in the preceding sentence.

3.8 Licenses to Intrexon. Subject to the terms and conditions of this Agreement,
ZIOPHARM hereby grants to Intrexon a non-exclusive, worldwide, fully-paid,
royalty-free license, under any applicable Patents or other intellectual
property Controlled by ZIOPHARM or its Affiliates, solely to the extent
necessary for Intrexon to conduct those responsibilities assigned to it under
this Agreement, which license shall be sublicensable solely to Intrexon’s
Affiliates or to any of Intrexon’s subcontractors.

3.9 Restrictions Relating to Intrexon Materials. ZIOPHARM shall use the Intrexon
Materials solely for purposes of the GvHD Program and not for any other purpose
without the prior written consent of Intrexon. With respect to the Intrexon
Materials comprising Intrexon’s vector assembly technology, ZIOPHARM shall not,
and shall ensure that ZIOPHARM personnel do not (a) distribute, sell, lend or
otherwise transfer such Intrexon Materials to any Third Party; (b) co-mingle
such Intrexon Materials with any other proprietary biological or chemical
materials without Intrexon’s written consent; or (c) analyze such Intrexon
Materials or in any way attempt to reverse engineer or sequence such Intrexon
Materials.

ARTICLE 4

OTHER RIGHTS AND OBLIGATIONS

4.1 Development and Commercialization. Subject to Sections 4.6 and 4.7, ZIOPHARM
shall be solely responsible for the performance of the GvHD Program and the

 

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[***] = CERTAIN CONFIDENTIAL INFORMATION CONTAINED IN THIS DOCUMENT, MARKED BY
BRACKETS, HAS BEEN OMITTED AND FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE
COMMISSION PURSUANT TO RULE 24B-2 OF THE SECURITIES EXCHANGE ACT OF 1934, AS
AMENDED.

 

development and commercialization of Products in the Field. ZIOPHARM shall be
responsible for all costs incurred in connection with the GvHD Program except
that Intrexon shall be responsible for the following: (a) costs of establishing
manufacturing capabilities and facilities in connection with Intrexon’s
manufacturing obligation under Section 4.6 (provided, however, that Intrexon may
include an allocable portion of such costs, through depreciation and
amortization, when calculating the Fully Loaded Cost of manufacturing Product,
to the extent such allocation, depreciation, and amortization is permitted by
US GAAP, it being recognized that the majority of non-facilities scale-up costs
cannot be capitalized and amortized under US GAAP); (b) costs of discovery-stage
research with respect to the Intrexon Channel Technology and Intrexon Materials
(i.e., platform improvements) (but, for clarity, excluding research described in
Section 4.7); (c) [***]; and (d) costs of filing, prosecution and maintenance of
Intrexon Patents. The costs encompassed within subsection (a) above shall
include the scale-up of Intrexon Materials and API for clinical trials and
commercialization of Products undertaken pursuant to Section 4.6, which shall be
at Intrexon’s cost whether it elects to conduct such efforts internally or
through Third Party contractors retained by either Intrexon or ZIOPHARM (with
Intrexon’s consent).

4.2 Reserved.

4.3 Information and Reporting. ZIOPHARM will keep Intrexon informed about
ZIOPHARM’s efforts to develop and commercialize Products, including reasonable
and accurate summaries of ZIOPHARM’s (and its Affiliates’ and, if applicable,
(sub)licensees’) global development plans (as updated), global marketing plans
(as updated), progress towards meeting the goals and milestones in such plans
and explanations of any material deviations, and significant developments in the
development and/or commercialization of the Products, including initiation or
completion of a clinical trial, submission of a United States or international
regulatory filing, receipt of a response to such United States or international
regulatory filing, clinical safety event, receipt of Regulatory Approval, or
commercial launch. Intrexon will keep ZIOPHARM informed about Intrexon’s efforts
(a) to establish manufacturing capabilities and facilities for Products (and
Intrexon Materials relevant thereto) and otherwise perform its manufacturing
responsibilities under Section 4.6 and (b) to undertake discovery-stage research
for the GvHD Program with respect to the Intrexon Channel Technology and
Intrexon Materials. Such disclosures by ZIOPHARM and Intrexon will be made in
the course of JSC meetings at least once every six (6) months while Products are
being developed or commercialized anywhere in the world, and shall be reflected
in the minutes of such meetings.

4.4 Regulatory Matters. At all times after the Effective Date, ZIOPHARM shall
own and maintain, at its own cost, all regulatory filings and Regulatory
Approvals for Products that ZIOPHARM is developing or Commercializing pursuant
to this Agreement. As such, ZIOPHARM shall be responsible for reporting all
adverse events related to such Products to the appropriate regulatory
authorities in the relevant countries, in accordance with the applicable laws
and regulations of such countries. The decision to list or not list Patents in
any regulatory filing for a Product (for example, as required by 21 C.F.R. §
314.53(b)), or add or delete a Patent from a regulatory filing shall be
determined by Intrexon, after consultation with ZIOPHARM, except with respect to
Product Specific Program Patents, which will be mutually determined by the
Parties.

 

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4.5 Diligence.

(a) ZIOPHARM shall use Diligent Efforts to develop and commercialize Products.

(b) Without limiting the generality of the foregoing, Intrexon may, from time to
time, notify ZIOPHARM that it believes it has identified a Superior Therapy, and
in such case shall provide to ZIOPHARM its then-available information about such
therapy. ZIOPHARM shall have the following obligations with respect to such
proposed Superior Therapy: (i) within sixty (60) days after such notification,
ZIOPHARM shall prepare and deliver to the JSC for review and approval a
development plan detailing how ZIOPHARM will pursue the Superior Therapy
(including a proposed budget); (ii) ZIOPHARM shall revise the development plan
as directed by the JSC; and (iii) following approval of the development plan by
the JSC, ZIOPHARM shall use Diligent Efforts to pursue the development of the
Superior Therapy under the GvHD Program in accordance with such development
plan. If ZIOPHARM fails to comply with the foregoing obligations, or if ZIOPHARM
exercises its casting vote at the JSC to either (x) prevent the approval of a
development plan for a Superior Therapy; (y) delay such approval more than sixty
(60) days after delivery of the development plan to the JSC; or (z) approve a
development plan that is insufficient in view of the nature and magnitude of the
opportunity presented by the Superior Therapy, then Intrexon shall have the
termination right set forth in Section 10.2(b) (subject to the limitation set
forth therein). For clarity, any dispute arising under this 4.5, including any
dispute as to whether a proposed project constitutes a Superior Therapy (as with
any other dispute under this Agreement) shall be subject to dispute resolution
in accordance with Article 11.

(c) The activities of ZIOPHARM’s Affiliates and any permitted sublicensees shall
be attributed to ZIOPHARM for the purposes of evaluating ZIOPHARM’s fulfillment
of the obligations set forth in this Section 4.5.

4.6 Manufacturing. Intrexon shall use Diligent Efforts to perform any
manufacturing activities in connection with the GvHD Program that relate to the
Intrexon Materials, the manufacture of bulk drug product, the manufacturing of
bulk quantities of other components of Products, or any earlier steps in the
manufacturing process for Products. Except as provided in Section 4.1, any
manufacturing undertaken by Intrexon pursuant to the preceding sentence shall be
performed in exchange for cash payments equal to Intrexon’s Fully Loaded Cost in
connection with such manufacturing, on terms to be negotiated by the Parties in
good faith. In the event that Intrexon does not manufacture Intrexon Materials,
bulk drug product or bulk qualities of other components of Products, then
Intrexon shall provide to ZIOPHARM or a contract manufacturer selected by
ZIOPHARM and approved by Intrexon all Information Controlled by Intrexon that is
related to the manufacturing of such Intrexon Materials, bulk drug product or
bulk qualities of other components of Products, for use in the Field and is
reasonably necessary to enable ZIOPHARM or such contract manufacturer (as
appropriate) for the sole purpose of manufacturing such Intrexon Materials, bulk
drug product or bulk quantities of other components of Products, in each case as
manufactured by Intrexon. The costs and expenses incurred by Intrexon in
carrying out such transfer shall be borne by Intrexon. Any manufacturing
Information transferred hereunder to ZIOPHARM or its contract manufacturer

 

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shall not be further transferred to any Third Party or ZIOPHARM Affiliate
without the prior written consent of Intrexon; provided, however, that Intrexon
shall not unreasonably withhold such consent if necessary to permit ZIOPHARM to
switch manufacturers.

4.7 Support Services. From time to time, on an ongoing basis, ZIOPHARM shall
request, or Intrexon may propose, that Intrexon perform certain support services
with respect to the GvHD Program, such services including but not limited to,
pre-clinical or clinical activities relating to transition of the GvHD Program
to ZIOPHARM. To the extent that the Parties mutually agree that Intrexon should
perform such services, the Parties shall negotiate in good faith the terms under
which services would be performed, it being understood that Intrexon would be
compensated for such services by cash payments equal to Intrexon’s Fully Loaded
Cost in connection with such services.

4.8 Compliance with Law. Each Party shall comply, and shall ensure that its
Affiliates, (sub)licensees and Third Party contractors comply, with all
applicable laws, regulations, and guidelines applicable to the GvHD Program,
including without limitation those relating to the transport, storage, and
handling of Intrexon Materials and Products.

4.9 Patent Marking. Consistent with the U.S. patent laws, ZIOPHARM shall ensure
that Products, or their respective packaging or accompanying literature as
appropriate, bear applicable and appropriate patent markings for Intrexon Patent
numbers. ZIOPHARM shall provide Intrexon with copies of any materials containing
such patent markings prior to using or disseminating such materials, in order to
obtain Intrexon’s approval thereof. ZIOPHARM’s use of the patent markings shall
be subject to prior review and approval of the IPC. From time to time during the
Term, Intrexon shall have the right to obtain from ZIOPHARM samples of the
Product sold by ZIOPHARM or its Affiliates or sublicensees, or other items which
reflect public uses of the patent markings, for the purpose of inspecting the
accuracy of the patent markings. In the event that Intrexon inspects under this
Section 4.9, Intrexon shall notify the result of such inspection to ZIOPHARM in
writing thereafter.

ARTICLE 5

COMPENSATION

5.1 Technology Access Fee. In partial consideration for ZIOPHARM’s appointment
as an exclusive channel collaborator and the other rights granted to ZIOPHARM
hereunder, ZIOPHARM shall pay to Intrexon within ten (10) days following the
execution of this Agreement a non-refundable technology access fee of ten
million dollars ($10,000,000).

5.2 Profit-Share.

(a) No later than thirty (30) days after each calendar quarter in which there is
positive Product Profit arising from the sale of Product in the Field in the
Territory, ZIOPHARM shall pay to Intrexon fifty percent (50%) of such Product
Profit, on a Product-by-Product basis. In the event of negative Product Profit
for a particular Product in any calendar quarter, neither ZIOPHARM nor Intrexon
shall owe any payments hereunder with respect to such Product.

 

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[***] = CERTAIN CONFIDENTIAL INFORMATION CONTAINED IN THIS DOCUMENT, MARKED BY
BRACKETS, HAS BEEN OMITTED AND FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE
COMMISSION PURSUANT TO RULE 24B-2 OF THE SECURITIES EXCHANGE ACT OF 1934, AS
AMENDED.

 

[***]. Except as set forth in the preceding sentence, ZIOPHARM shall not be
permitted to carry forward any negative Product Profits to subsequent quarters.

(b) No later than thirty (30) days after each calendar quarter in which ZIOPHARM
or any ZIOPHARM Affiliate receives Sublicensing Revenue, ZIOPHARM shall pay to
Intrexon fifty percent (50%) of such Sublicensing Revenue. As set forth in
Section 3.2, sublicensing shall require Intrexon’s prior written consent.
Nevertheless, this Section 5.2(b) shall apply to Sublicensing Revenue received
by ZIOPHARM or any ZIOPHARM Affiliate, even if rights were granted to the
applicable sublicensee in violation of this Agreement. For purposes of clarity,
sales of Products by approved sublicensees shall not constitute Net Sales.

5.3 Method of Payment. All payments due to Intrexon under this Agreement shall
be paid in United States dollars by wire transfer to a bank in the United States
designated in writing by Intrexon. All references to “dollars” or “$” herein
shall refer to United States dollars.

5.4 Payment Reports and Records Retention. Within thirty (30) days after the end
of each calendar quarter during which Net Sales have been generated or Allowable
Expenses been incurred, ZIOPHARM shall deliver to Intrexon a written report that
shall contain at a minimum for the applicable calendar quarter:

(a) gross sales of each Product (on a country-by-country basis);

(b) itemized calculation of Net Sales, showing all applicable deductions;

(c) itemized calculation of Allowable Expenses and Sublicensing Revenue;

(d) the amount of the payment (if any) due pursuant to Section 5.2(a) and/or
5.2(b);

(e) the amount of taxes, if any, withheld to comply with any applicable law; and

(f) the exchange rates used in any of the foregoing calculations.

For three (3) years after each sale of Product or the incurring of an item
included in Net Sales or Allowable Expenses, ZIOPHARM shall keep (and shall
ensure that its Affiliates and, if applicable, (sub)licensees shall keep)
complete and accurate records of such sales or Allowable Expenses (as the case
may be) in sufficient detail to confirm the accuracy of the payment calculations
hereunder.

5.5 Audits.

(a) Upon the written request of Intrexon, ZIOPHARM shall permit an independent
certified public accounting firm of internationally recognized standing selected
by Intrexon, and reasonably acceptable to ZIOPHARM, to have access to and to
review, during normal business hours and upon no less than thirty (30) days
prior written notice, the applicable records of ZIOPHARM and its Affiliates to
verify the accuracy and timeliness of the reports and

 

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[***] = CERTAIN CONFIDENTIAL INFORMATION CONTAINED IN THIS DOCUMENT, MARKED BY
BRACKETS, HAS BEEN OMITTED AND FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE
COMMISSION PURSUANT TO RULE 24B-2 OF THE SECURITIES EXCHANGE ACT OF 1934, AS
AMENDED.

 

payments made by ZIOPHARM under this Agreement. Such review may cover the
records for sales made in any calendar year ending not more than three (3) years
prior to the date of such request. The accounting firm shall disclose to both
Parties whether the royalty reports and/or know-how reports conform to the
provisions of this Agreement and/or US GAAP, as applicable, and the specific
details concerning any discrepancies. Such audit may not be conducted more than
once in any calendar year.

(b) If such accounting firm concludes that additional amounts were owed during
such period, ZIOPHARM shall pay additional amounts, with interest from the date
originally due as set forth in Section 5.7, within thirty (30) days of receipt
of the accounting firm’s written report. If the amount of the underpayment is
greater than five percent (5%) of the total amount actually owed for the period
audited, then ZIOPHARM shall in addition reimburse Intrexon for all costs
related to such audit; otherwise, Intrexon shall pay all costs of the audit. In
the event of overpayment, any amount of such overpayment shall be fully
creditable against amounts payable for the immediately succeeding calendar
quarter(s); provided, however, that such credit cannot be applied to reduce the
amounts payable by ZIOPHARM to Intrexon for any particular calendar quarter by
more than [***] percent ([***]%) of the amount otherwise due to Intrexon.

(c) Intrexon shall (i) treat all information that it receives under this
Section 5.5 in accordance with the confidentiality provisions of Article 7 and
(ii) cause its accounting firm to enter into an acceptable confidentiality
agreement with ZIOPHARM obligating such firm to retain all such financial
information in confidence pursuant to such confidentiality agreement, in each
case except to the extent necessary for Intrexon to enforce its rights under
this Agreement.

5.6 Taxes. The Parties will cooperate in good faith to obtain the benefit of any
relevant tax treaties to minimize as far as reasonably possible any taxes which
may be levied on any amounts payable hereunder. ZIOPHARM shall deduct or
withhold from any payments any taxes that it is required by applicable law to
deduct or withhold. Notwithstanding the foregoing, if Intrexon is entitled under
any applicable tax treaty to a reduction of the rate of, or the elimination of,
applicable withholding tax, it may deliver to ZIOPHARM or the appropriate
governmental authority (with the assistance of ZIOPHARM to the extent that this
is reasonably required and is expressly requested in writing) the prescribed
forms necessary to reduce the applicable rate of withholding or to relieve
ZIOPHARM of its obligation to withhold tax, and ZIOPHARM shall apply the reduced
rate of withholding tax, or dispense with withholding tax, as the case may be,
provided that ZIOPHARM has received evidence of Intrexon’s delivery of all
applicable forms (and, if necessary, its receipt of appropriate governmental
authorization) at least fifteen (15) days prior to the time that the payment is
due. If, in accordance with the foregoing, ZIOPHARM withholds any amount, it
shall make timely payment to the proper taxing authority of the withheld amount,
and send to Intrexon proof of such payment within forty-five (45) days following
that latter payment.

5.7 Late Payments. Any amount owed by ZIOPHARM to Intrexon under this Agreement
that is not paid within the applicable time period set forth herein shall accrue
interest at the lower of (a) two percent (2%) per month, compounded, or (b) the
highest rate permitted under applicable law.

 

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ARTICLE 6

INTELLECTUAL PROPERTY

6.1 Ownership.

(a) Subject to the license granted under Section 3.1, all rights in the Intrexon
IP and Intrexon Materials shall remain with Intrexon.

(b) ZIOPHARM and/or Intrexon may solely or jointly conceive, reduce to practice
or develop discoveries, inventions, processes, techniques, and other technology,
whether or not patentable, in the course of performing the GvHD Program
(collectively “Inventions”). Each Party shall promptly provide the other Party
with a detailed written description of any such Inventions that relate to the
Field. Inventorship shall be determined in accordance with United States patent
laws.

(c) Intrexon shall solely own all right, title and interest in all Inventions
related to Intrexon Channel Technology, together with all Patent rights and
other intellectual property rights therein (the “Channel-Related Program IP”).
ZIOPHARM hereby assigns all of its right, title and interest in and to the
Channel-Related Program IP to Intrexon. ZIOPHARM agrees to execute such
documents and perform such other acts as Intrexon may reasonably request to
obtain, perfect and enforce its rights to the Channel-Related Program IP and the
assignment thereof.

(d) Notwithstanding anything to the contrary in this Agreement, any discovery,
invention, process, technique, or other technology, whether or not patentable,
that is conceived, reduced to practice or developed by ZIOPHARM solely or
jointly through the use of the Intrexon Channel Technology, Intrexon IP, or
Intrexon Materials in breach of the terms and conditions of this Agreement,
together with all patent rights and other intellectual property rights therein,
shall be solely owned by Intrexon and shall be included in the Channel-Related
Program IP.

(e) All Information regarding Channel-Related Program IP shall be Confidential
Information of Intrexon. ZIOPHARM shall be under appropriate written agreements
with each of its employees, contractors or agents working on the GvHD Program,
pursuant to which such person shall grant all rights in the Inventions to
ZIOPHARM (so that ZIOPHARM may convey certain of such rights to Intrexon, as
provided herein) and shall be obligated to protect all Confidential Information
related to the GvHD Program.

6.2 Patent Prosecution.

(a) Intrexon shall have the sole right, but not the obligation, to conduct and
control the filing, prosecution and maintenance of the Intrexon Patents. At the
reasonable request of Intrexon, ZIOPHARM shall cooperate with Intrexon in
connection with such filing,

 

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prosecution, and maintenance, at Intrexon’s expense. Under no circumstances
shall ZIOPHARM (a) file, attempt to file, or assist anyone else in filing, or
attempting to file, any Patent application, either in the United States or
elsewhere, that claims or uses or purports to claim or use or relies for support
upon an Invention owned by Intrexon or use, attempt to use, or assist anyone
else in using or attempting to use, the Intrexon Know-How, Intrexon Materials,
or any Confidential Information of Intrexon to support the filing of a Patent
application, either in the United States or elsewhere, that contains claims
directed to the Intrexon IP, Intrexon Materials, or the Intrexon Channel
Technology.

(b) ZIOPHARM shall have the sole right, but not the obligation, to conduct and
control the filing, prosecution and maintenance of any Patents claiming
Inventions that are owned by ZIOPHARM or its Affiliates and not assigned to
Intrexon under Section 6.1(c) ( “ZIOPHARM Program Patents”). At the reasonable
request of ZIOPHARM, Intrexon shall cooperate with ZIOPHARM in connection with
such filing, prosecution, and maintenance, at ZIOPHARM’s expense.

(c) The Prosecuting Party shall be entitled to use patent counsel selected by it
and reasonably acceptable to the non-Prosecuting Party (including in-house
patent counsel as well as outside patent counsel) for the prosecution of the
Intrexon Patents and ZIOPHARM Program Patents, as applicable. The Prosecuting
Party shall:

(i) regularly provide the other Party in advance with reasonable information
relating to the Prosecuting Party’s prosecution of Patents hereunder, including
by providing copies of substantive communications, notices and actions submitted
to or received from the relevant patent authorities and copies of drafts of
filings and correspondence that the Prosecuting Party proposes to submit to such
patent authorities (it being understood that, to the extent that any such
information is readily accessible to the public, the Prosecuting Party may, in
lieu of directly providing copies of such information to such other Party,
provide such other Party with sufficient information that will permit such other
Party to access such information itself directly);

(ii) consider in good faith and consult with the non-Prosecuting Party regarding
its timely comments with respect to the same; provided, however, that if, within
fifteen (15) days after providing any documents to the non-Prosecuting Party for
comment, the Prosecuting Party does not receive any written communication from
the non-Prosecuting Party indicating that it has or may have comments on such
document, the Prosecuting Party shall be entitled to assume that the
non-Prosecuting Party has no comments thereon;

(iii) consult with the non-Prosecuting Party before taking any action that would
reasonably be expected to have a material adverse impact on the scope of claims
within the Intrexon Patents and ZIOPHARM Program Patents, as applicable.

As used above “Prosecuting Party” means Intrexon in the case of Intrexon Patents
and ZIOPHARM in the case of ZIOPHARM Program Patents.

 

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[***] = CERTAIN CONFIDENTIAL INFORMATION CONTAINED IN THIS DOCUMENT, MARKED BY
BRACKETS, HAS BEEN OMITTED AND FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE
COMMISSION PURSUANT TO RULE 24B-2 OF THE SECURITIES EXCHANGE ACT OF 1934, AS
AMENDED.

 

6.3 Infringement of Patents by Third Parties.

(a) Except as expressly provided in the remainder of this Section 6.3, Intrexon
shall have the sole right to take appropriate action against any person or
entity directly or indirectly infringing any Intrexon Patent (or asserting that
a Intrexon Patent is invalid or unenforceable) (collectively, “Infringement”),
either by settlement or lawsuit or other appropriate action.

(b) Notwithstanding the foregoing, [***] shall have the [***] right, but not the
obligation, to take appropriate action to enforce [***] against any Infringement
that involves a [***] of allegedly infringing activities in the Field (“[***]”),
either by settlement or lawsuit or other appropriate action. If [***] fails to
take the appropriate steps to enforce [***] against any [***] within [***]
([***]) days of the date one Party has provided notice to the other Party
pursuant to Section 6.3(g) of such [***], then [***] shall have the right (but
not the obligation), at its own expense, to enforce [***] against such [***],
either by settlement or lawsuit or other appropriate action.

(c) With respect to any [***] that cannot reasonably be abated through the
enforcement of [***] pursuant to Section 6.3(b) but can reasonably be abated
through the enforcement of [***] (other than the [***]), [***] shall be
obligated to choose one of the following courses of action: [***]. [***]. The
determination of which [***] to assert shall be made by [***] in its sole
discretion; provided, however, that [***] shall consult in good faith with [***]
on such determination. For the avoidance of doubt, [***] has no obligations
under this Agreement to enforce any [***] against, or otherwise abate, any
Infringement that is not a [***].

(d) In the event a Party pursues an action under this Section 6.3, the other
Party shall reasonably cooperate with the enforcing Party with respect to the
investigation and prosecution of any alleged, threatened, or actual
Infringement, at the enforcing Party’s expense (except with respect to an action
under Section 6.3(c), where all costs and expenses will be shared equally in
accordance with terms thereof).

(e) [***] shall not settle or otherwise compromise any action under this
Section 6.3 in a way that diminishes the rights or interests of [***] the [***]
or adversely affects any [***] without [***]’s prior written consent, which
consent shall not be unreasonably withheld. [***] shall not settle or otherwise
compromise any action under this Section 6.3 in a way that diminishes the rights
or interests of [***] in the [***] or adversely affects any [***] with respect
to the [***] without [***]’s prior written consent, which consent shall not be
unreasonably withheld.

(f) Except as otherwise agreed to by the Parties in writing, any settlements,
damages or other monetary awards recovered pursuant to a suit, proceeding, or
action brought pursuant to Section 6.3 will be allocated first to the costs and
expenses of the Party controlling such action, and second, to the costs and
expenses (if any) of the other Party (to the extent not otherwise reimbursed),
and any remaining amounts (the “[***]”) will be shared by the Parties as
follows: In any action initiated by [***], [***]. In any action initiated by
[***], [***]. In any action initiated by [***], the Parties shall share the
[***] equally, and such [***] shall not be deemed to constitute [***].

 

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[***] = CERTAIN CONFIDENTIAL INFORMATION CONTAINED IN THIS DOCUMENT, MARKED BY
BRACKETS, HAS BEEN OMITTED AND FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE
COMMISSION PURSUANT TO RULE 24B-2 OF THE SECURITIES EXCHANGE ACT OF 1934, AS
AMENDED.

 

(g) ZIOPHARM shall promptly notify Intrexon of any suspected, alleged,
threatened, or actual Infringement of which it becomes aware, and Intrexon shall
promptly notify ZIOPHARM in writing of any suspected, alleged, threatened, or
actual [***] of which it becomes aware.

ARTICLE 7

CONFIDENTIALITY

7.1 Confidentiality. Except to the extent expressly authorized by this Agreement
or otherwise agreed in writing by the Parties, each Party agrees that it shall
keep confidential and shall not publish or otherwise disclose and shall not use
for any purpose other than as provided for in this Agreement any Confidential
Information disclosed to it by the other Party pursuant to this Agreement,
except to the extent that the receiving Party can demonstrate by competent
evidence that specific Confidential Information:

(a) was already known to the receiving Party, other than under an obligation of
confidentiality, at the time of disclosure by the other Party;

(b) was generally available to the public or otherwise part of the public domain
at the time of its disclosure to the receiving Party;

(c) became generally available to the public or otherwise part of the public
domain after its disclosure and other than through any act or omission of the
receiving Party in breach of this Agreement;

(d) was disclosed to the receiving Party, other than under an obligation of
confidentiality to a Third Party, by a Third Party who had no obligation to the
disclosing Party not to disclose such information to others; or

(e) was independently discovered or developed by the receiving Party without the
use of Confidential Information belonging to the disclosing Party, as documented
by the receiving Party’s written records.

The foregoing non-use and non-disclosure obligation shall continue
(i) indefinitely, for all Confidential Information that qualifies as a trade
secret under applicable law; or (ii) for the Term of this Agreement and for
[***] ([***]) years thereafter, in all other cases.

7.2 Authorized Disclosure. Notwithstanding the limitations in this Article 7,
either Party may disclose the Confidential Information belonging to the other
Party to the extent such disclosure is reasonably necessary in the following
instances:

(a) complying with applicable laws or regulations or valid court orders,
provided that the Party making such disclosure provides the other Party with
reasonable prior written notice of such disclosure and makes a reasonable effort
to obtain, or to assist the other Party in obtaining, a protective order
preventing or limiting the disclosure and/or requiring that the terms and
conditions of this Agreement be used only for the purposes for which the law or
regulation required, or for which the order was issued;

 

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(b) to regulatory authorities in order to seek or obtain approval to conduct
clinical trials, or to gain regulatory approval, of Products or any products
being developed by Intrexon or its other licensees and/or channel partners and
collaborators, provided that the Party making such disclosure (i) provides the
other Party with reasonable opportunity to review any such disclosure in advance
and to suggest redactions or other means of limiting the disclosure of such
other Party’s Confidential Information and (ii) does not unreasonably reject any
such suggestions;

(c) disclosure to investors and potential investors, acquirers, or merger
candidates who agree to maintain the confidentiality of such information,
provided that such disclosure is used solely for the purpose of evaluating such
investment, acquisition, or merger (as the case may be);

(d) disclosure on a need-to-know basis to Affiliates, licensees, sublicensees,
employees, consultants or agents (such as CROs and clinical investigators) who
agree to be bound by obligations of confidentiality and non-use at least
equivalent in scope to those set forth in this Article 7; and

(e) disclosure of the terms of this Agreement by Intrexon to collaborators and
other channel partners and collaborators who agree to be bound by obligations of
confidentiality and non-use at least equivalent in scope to those set forth in
this Article 7.

7.3 Publicity. The Parties agree that the public announcement of the execution
of this Agreement shall be in the form of the press release attached as Exhibit
B.

7.4 Terms of the Agreement. Each Party shall treat the terms of this Agreement
as the Confidential Information of other Party, subject to the exceptions set
forth in Section 7.2. Notwithstanding the foregoing, each Party acknowledges
that the other Party may be obligated to file a copy of this Agreement with the
SEC, either as of the Effective Date or at some point during the Term. Each
Party shall be entitled to make such a required filing, provided that it
requests confidential treatment of certain commercial terms and sensitive
technical terms hereof to the extent such confidential treatment is reasonably
available to it. In the event of any such filing, the filing Party shall provide
the other Party with a copy of the Agreement marked to show provisions for which
the filing Party intends to seek confidential treatment and shall reasonably
consider and incorporate the other Party’s comments thereon to the extent
consistent with the legal requirements governing redaction of information from
material agreements that must be publicly filed. The other Party shall promptly
provide any such comments.

7.5 Proprietary Information Audits.

(a) For the purpose of confirming compliance with the Field-limited licenses
granted in Article 3 and the confidentiality obligations under Article 7,
ZIOPHARM acknowledges that Intrexon’s authorized representative(s), during
regular business hours may (i) examine and inspect ZIOPHARM’s facilities and
(ii) inspect all data and work products relating

 

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to this Agreement. Any examination or inspection hereunder shall require five
(5) business days written notice from Intrexon to ZIOPHARM. ZIOPHARM will make
itself and the pertinent employees and/or agents available, on a reasonable
basis, to Intrexon for the aforementioned compliance review.

(b) In view of the Intrexon Confidential Information, Intrexon Know-How, and
Intrexon Materials transferred to ZIOPHARM hereunder, Intrexon from
time-to-time, but no more than quarterly, may request that ZIOPHARM confirm the
status of the Intrexon Materials at Company (i.e. how much used, how much
shipped, to whom and any unused amounts destroyed (by whom, when) as well as any
amounts returned to Intrexon or destroyed). Within ten (10) business days of
ZIOPHARM’s receipt of any such written request, ZIOPHARM shall provide the
written report to Intrexon.

7.6 Intrexon Commitment. Intrexon shall use reasonable efforts to obtain an
agreement with its other licensees and channel partners and collaborators to
enable ZIOPHARM to disclose confidential information of such licensees and
channel partners and collaborators to regulatory authorities in order to seek or
obtain approval to conduct clinical trials, or to gain regulatory approval of,
Products, in a manner consistent with the provisions of Section 7.2(b).

ARTICLE 8

REPRESENTATIONS AND WARRANTIES

8.1 Representations and Warranties of ZIOPHARM. ZIOPHARM hereby represents and
warrants to Intrexon that, as of the Effective Date:

(a) Corporate Power. ZIOPHARM is duly organized and validly existing under the
laws of Delaware and has corporate full power and authority to enter into this
Agreement and to carry out the provisions hereof.

(b) Due Authorization. ZIOPHARM is duly authorized to execute and deliver this
Agreement and to perform its obligations hereunder, and the person executing
this Agreement on ZIOPHARM’s behalf has been duly authorized to do so by all
requisite corporate action.

(c) Binding Agreement. This Agreement is a legal and valid obligation binding
upon ZIOPHARM and enforceable in accordance with its terms, except as such
enforcement may be limited by applicable bankruptcy, insolvency, reorganization,
arrangement, moratorium or other similar laws affecting creditors’ rights, and
subject to general equity principles and to limitations on availability of
equitable relief, including specific performance. The execution, delivery and
performance of this Agreement by ZIOPHARM does not conflict with any agreement,
instrument or understanding, oral or written, to which it is a party or by which
it may be bound. ZIOPHARM is aware of no action, suit or inquiry or
investigation instituted by any governmental agency which questions or threatens
the validity of this Agreement.

 

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[***] = CERTAIN CONFIDENTIAL INFORMATION CONTAINED IN THIS DOCUMENT, MARKED BY
BRACKETS, HAS BEEN OMITTED AND FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE
COMMISSION PURSUANT TO RULE 24B-2 OF THE SECURITIES EXCHANGE ACT OF 1934, AS
AMENDED.

 

8.2 Representations and Warranties of Intrexon. Intrexon hereby represents and
warrants to ZIOPHARM that, as of the Effective Date:

(a) Corporate Power. Intrexon is duly organized and validly existing under the
laws of Virginia and has full corporate power and authority to enter into this
Agreement and to carry out the provisions hereof.

(b) Due Authorization. Intrexon is duly authorized to execute and deliver this
Agreement and to perform its obligations hereunder, and the person executing
this Agreement on Intrexon’s behalf has been duly authorized to do so by all
requisite corporate action.

(c) Binding Agreement. This Agreement is a legal and valid obligation binding
upon Intrexon and enforceable in accordance with its terms, except as such
enforcement may be limited by applicable bankruptcy, insolvency, reorganization,
arrangement, moratorium or other similar laws affecting creditors’ rights, and
subject to general equity principles and to limitations on availability of
equitable relief, including specific performance. The execution, delivery and
performance of this Agreement by Intrexon does not conflict with any agreement,
instrument or understanding, oral or written, to which it is a party or by which
it may be bound. Intrexon is aware of no action, suit or inquiry or
investigation instituted by any governmental agency which questions or threatens
the validity of this Agreement.

(d) Additional Intellectual Property Representations.

(i) Intrexon possesses sufficient rights to enable Intrexon to grant all rights
and licenses it purports to grant to ZIOPHARM with respect to the Intrexon
Patents under this Agreement;

(ii) The Intrexon Patents existing as of the Effective Date constitute all of
the Patents Controlled by Intrexon as of such date that are necessary for the
development, manufacture or Commercialization of Products;

(iii) Intrexon has not granted, and during the Term Intrexon will not grant, any
right or license, to any Third Party under the Intrexon IP that conflicts with
the rights or licenses granted or to be granted to ZIOPHARM hereunder;

(iv) There is no pending litigation, and Intrexon has not received any written
notice of any claims or litigation, seeking to invalidate or otherwise challenge
the Intrexon Patents or Intrexon’s rights therein;

(v) To Intrexon’s knowledge, [***], the use of the Intrexon Materials in
connection with the GvHD Program as of the Effective Date and the conduct of the
GvHD Program as contemplated as of the Effective Date, does not (A) infringe any
claims of any Patents of any Third Party, or (b) misappropriate any Information
of any Third Party;

 

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(vi) None of the Intrexon Patents is subject to any pending re-examination,
opposition, interference or litigation proceedings;

(vii) All of the Intrexon Patents have been filed and prosecuted in accordance
with all Applicable Laws and have been maintained, with all applicable fees with
respect thereto (to the extent such fees have come due) having been paid;

(viii) Intrexon has entered into agreements with each of its current and former
officers, employees and consultants involved in research and development work,
including development of the Intrexon’s products and technology providing
Intrexon, to the extent permitted by law, with title and ownership to patents,
patent applications, trade secrets and inventions conceived, developed, reduced
to practice by such person, solely or jointly with other of such persons, during
the period of employment or contract by Intrexon (except where the failure to
have entered into such an agreement would not have a material adverse effect on
the rights granted to ZIOPHARM herein), and Intrexon is not aware that any of
its employees or consultants is in material violation thereof;

(ix) To Intrexon’s knowledge, there is no infringement, misappropriation or
violation by third parties of any Intrexon Channel Technology or Intrexon IP in
the Field;

(x) There is no pending or, to Intrexon’s knowledge, threatened action, suit,
proceeding or claim by others against Intrexon that Intrexon infringes,
misappropriates or otherwise violates any intellectual property or other
proprietary rights of others in connection with the use of the Intrexon Channel
Technology or Intrexon IP, and Intrexon has not received any written notice of
such claim;

(xi) To Intrexon’s knowledge, no employee of Intrexon is the subject of any
claim or proceeding involving a violation of any term of any employment
contract, patent disclosure agreement, invention assignment agreement,
non-competition agreement, non-solicitation agreement, non-disclosure agreement
or any restrictive covenant to or with a former employer (A) where the basis of
such violation relates to such employee’s employment with Intrexon or actions
undertaken by the employee while employed with Intrexon and (B) where such
violation is relevant to the use of the Intrexon Channel Technology in the
Field;

(xii) None of the Intrexon Patents owned by Intrexon or its Affiliates, and, to
Intrexon’s knowledge, the Intrexon Patents licensed to Intrexon or its
Affiliates, have been adjudged invalid or unenforceable by a court of competent
jurisdiction or applicable government agency, in whole or in part, and there is
no pending or, to Intrexon’s knowledge, threatened action, suit, proceeding or
claim by others challenging the validity or scope of any such Intrexon Patents;
and

(xiii) Except as otherwise disclosed in writing to ZIOPHARM, Intrexon: (A) is in
material compliance with all statutes, rules or regulations applicable to the
ownership, testing, development, manufacture, packaging, processing, use,
distribution, marketing, labeling, promotion, sale, offer for sale, storage,
import, export or disposal of any product that is under

 

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development, manufactured or distributed by Intrexon in the Field (“Applicable
Laws”); (B) has not received any FDA Form 483, notice of adverse finding,
warning letter, untitled letter or other correspondence or notice from the
United States Food and Drug Administration (the “FDA”) or any other federal,
state, local or foreign governmental or regulatory authority alleging or
asserting material noncompliance with any Applicable Laws or any licenses,
certificates, approvals, clearances, authorizations, permits and supplements or
amendments thereto required by any such Applicable Laws (“Authorizations”),
which would not, individually or in the aggregate, result in a material adverse
effect; (C) possesses all material Authorizations necessary for the operation of
its business as described in the Field and such Authorizations are valid and in
full force and effect and Intrexon is not in material violation of any term of
any such Authorizations; and (D) since January 1, 2012, (1) has not received
notice of any claim, action, suit, proceeding, hearing, enforcement,
investigation, arbitration or other action from the FDA or any other federal,
state, local or foreign governmental or regulatory authority or third party
alleging that any product operation or activity is in material violation of any
Applicable Laws or Authorizations and has no knowledge that the FDA or any other
federal, state, local or foreign governmental or regulatory authority or third
party is considering any such claim, litigation, arbitration, action, suit
investigation or proceeding; (2) has not received notice that the FDA or any
other federal, state, local or foreign governmental or regulatory authority has
taken, is taking or intends to take action to limit, suspend, modify or revoke
any material Authorizations and has no knowledge that the FDA or any other
federal, state, local or foreign governmental or regulatory authority is
considering such action; (3) has filed, obtained, maintained or submitted all
material reports, documents, forms, notices, applications, records, claims,
submissions and supplements or amendments as required by any Applicable Laws or
Authorizations and that all such reports, documents, forms, notices,
applications, records, claims, submissions and supplements or amendments were
materially complete and correct on the date filed (or were corrected or
supplemented by a subsequent submission); and (4) has not, either voluntarily or
involuntarily, initiated, conducted, or issued or caused to be initiated,
conducted or issued, any recall, market withdrawal or replacement, safety alert,
post sale warning, “dear doctor” letter, or other notice or action relating to
the alleged lack of safety or efficacy of any product or any alleged product
defect or violation and, to Intrexon’s knowledge, no third party has initiated,
conducted or intends to initiate any such notice or action. Except to the extent
disclosed in writing to ZIOPHARM, since January 1, 2012, Intrexon has not
received any notices or correspondence from the FDA or any other federal, state,
local or foreign governmental or regulatory authority requiring the termination,
suspension or material modification of any studies, tests or preclinical or
clinical trials conducted by or on behalf of Intrexon.

except, in each of (iv), (vi), and (ix) through (xiii), for any instances which
would not, individually or in the aggregate, result in a material adverse effect
on the rights granted to ZIOPHARM hereunder or Intrexon’s ability to perform its
obligations hereunder.

8.3 Warranty Disclaimer. EXCEPT FOR THE EXPRESS WARRANTIES PROVIDED IN THIS
ARTICLE 8, EACH PARTY HEREBY DISCLAIMS ANY AND ALL OTHER WARRANTIES, EITHER
EXPRESS OR IMPLIED, INCLUDING WITHOUT LIMITATION ANY WARRANTIES OF TITLE,
MERCHANTABILITY, FITNESS FOR A PARTICULAR PURPOSE, OR NONINFRINGEMENT OF THE
INTELLECTUAL PROPERTY RIGHTS OF THIRD PARTIES.

 

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[***] = CERTAIN CONFIDENTIAL INFORMATION CONTAINED IN THIS DOCUMENT, MARKED BY
BRACKETS, HAS BEEN OMITTED AND FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE
COMMISSION PURSUANT TO RULE 24B-2 OF THE SECURITIES EXCHANGE ACT OF 1934, AS
AMENDED.

 

ARTICLE 9

INDEMNIFICATION

9.1 Indemnification by Intrexon. Intrexon agrees to indemnify, hold harmless,
and defend ZIOPHARM and its Affiliates and their respective directors, officers,
employees, and agents (collectively, the “ZIOPHARM Indemnitees”) from and
against any and all liabilities, damages, costs, expenses, or losses (including
reasonable legal expenses and attorneys’ fees) (collectively, “Losses”)
resulting from any claims, suits, actions, demands, or other proceedings brought
by a Third Party (collectively, “Claims”) to the extent arising from (a) the
gross negligence or willful misconduct of Intrexon or any of its Affiliates, or
their respective employees or agents, (b) the use, handling, storage or
transport of Intrexon Materials by or on behalf of Intrexon or its Affiliates,
licensees (other than ZIOPHARM) or sublicensees; or (c) breach by Intrexon of
any representation, warranty or covenant in this Agreement. Notwithstanding the
foregoing, Intrexon shall not have any obligation to indemnify the ZIOPHARM
Indemnitees to the extent that a Claim arises from (i) the gross negligence or
willful misconduct of ZIOPHARM or any of its Affiliates, licensees, or
sublicensees, or their respective employees or agents; or (ii) a breach by
ZIOPHARM of a representation, warranty, or covenant of this Agreement.

9.2 Indemnification by ZIOPHARM. ZIOPHARM agrees to indemnify, hold harmless,
and defend Intrexon, its Affiliates and Third Security, and their respective
directors, officers, employees, and agents (and any Third Parties which have
licensed to Intrexon intellectual property rights within Intrexon IP on or prior
to the Effective Date, to the extent required by the relevant upstream license
agreement) (collectively, the “Intrexon Indemnitees”) from and against any
Losses resulting from Claims, to the extent arising from any of the following:
(a) the gross negligence or willful misconduct of ZIOPHARM or any of its
Affiliates or their respective employees or agents; (b) the use, handling,
storage, or transport of Intrexon Materials by or on behalf of ZIOPHARM or its
Affiliates, licensees, or sublicensees; (c) breach by ZIOPHARM or any
representation, warranty or covenant in this Agreement; or (d) the design,
development, manufacture, regulatory approval, handling, storage, transport,
distribution, sale or other disposition of any Product by or on behalf of
ZIOPHARM or its Affiliates, licensees, or sublicensees. Notwithstanding the
foregoing, ZIOPHARM shall not have any obligation to indemnify the Intrexon
Indemnitees to the extent that a Claim arises from (i) the gross negligence or
willful misconduct of Intrexon or any of its Affiliates, or their respective
employees or agents; or (ii) a breach by Intrexon of a representation, warranty,
or covenant of this Agreement.

9.3 Product Liability Claims. Notwithstanding the provisions of Section 9.2, any
Losses arising out of any Third Party claim, suit, action, proceeding, liability
or obligation involving any actual or alleged death or bodily injury arising out
of or resulting from the development, manufacture or commercialization of any
Products for use or sale in the Field, to the extent that such Losses exceed the
amount (if any) covered by the applicable Party’s product liability insurance
(“Excess Product Liability Costs”), shall be paid by [***], except to the extent
such Losses arise out of any Third-Party Claim based on the gross negligence or
willful misconduct of a Party, its Affiliates, its or its Affiliates’
Sublicensees, or any of the respective officers, directors, employees and agents
of each of the foregoing entities, in the performance of obligations or exercise
of rights under this Agreement.

 

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9.4 Control of Defense. As a condition precedent to any indemnification
obligations hereunder, any entity entitled to indemnification under this Article
9 shall give written notice to the indemnifying Party of any Claims that may be
subject to indemnification, promptly after learning of such Claim. If such Claim
falls within the scope of the indemnification obligations of this Article 9,
then the indemnifying Party shall assume the defense of such Claim with counsel
reasonably satisfactory to the indemnified Party. The indemnified Party shall
cooperate with the indemnifying Party in such defense. The indemnified Party
may, at its option and expense, be represented by counsel of its choice in any
action or proceeding with respect to such Claim. The indemnifying Party shall
not be liable for any litigation costs or expenses incurred by the indemnified
Party without the indemnifying Party’s written consent, such consent not to be
unreasonably withheld. The indemnifying Party shall not settle any such Claim if
such settlement (a) does not fully and unconditionally release the indemnified
Party from all liability relating thereto or (b) adversely impacts the exercise
of the rights granted to the indemnified Party under this Agreement, unless the
indemnified Party otherwise agrees in writing.

9.5 Insurance. During the term of this Agreement, ZIOPHARM shall maintain in
effect and good standing a product liability insurance policy issued by a
reputable insurance company in amounts considered standard for the industry. At
Intrexon’s reasonable request, ZIOPHARM shall provide Intrexon with all details
regarding such policy, including without limitation copies of the applicable
liability insurance contracts. ZIOPHARM shall use reasonable efforts to include
Intrexon as an additional insured on any such policy.

ARTICLE 10

TERM; TERMINATION

10.1 Term. The term of this Agreement shall commence upon the Effective Date and
shall continue until terminated pursuant to Section 10.2 or 10.3 (the “Term”).

10.2 Termination for Material Breach; Termination Under Section 4.5(b)

(a) Either Party shall have the right to terminate this Agreement upon written
notice to the other Party if the other Party commits any material breach of this
Agreement that such breaching Party fails to cure within sixty (60) days
following written notice from the nonbreaching Party specifying such breach.

(b) Intrexon shall have the right to terminate this Agreement under the
circumstances set forth in Section 4.5(b) upon written notice to ZIOPHARM, such
termination to become effective sixty (60) days following such written notice
unless ZIOPHARM remedies the circumstances giving rise to such termination
within such sixty (60) day period.

 

27

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(c) Intrexon shall have the right to terminate this Agreement under the
circumstances set forth in Section 12.8 upon written notice to ZIOPHARM, such
termination to become effective immediately upon such written notice.

(d) Notwithstanding the foregoing, during the twenty-four (24) month period
commencing on the Effective Date, neither Party shall have the right to
terminate this Agreement under Section 10.2(a) based on the failure of the other
Party to use Diligent Efforts or to comply with any other diligence obligations
hereunder (including Section 4.5), nor shall Intrexon have the right to
terminate this Agreement under Section 4.5(b).

10.3 Termination by ZIOPHARM. ZIOPHARM shall have the right to voluntarily
terminate this Agreement in its entirety upon ninety (90) days written notice to
Intrexon at any time, provided that such notice may not be given during the
twenty four (24) month period commencing on the Effective Date.

10.4 Effect of Termination. In the event of termination of this Agreement
pursuant to Section 10.2 or Section 10.3, the following shall apply:

(a) Retained Products. ZIOPHARM shall be permitted to continue the development
and commercialization of any Product that, at the time of termination, satisfies
at least one of the following criteria (a “Retained Product”):

(i) is being Commercialized by ZIOPHARM,

(ii) has received regulatory approval,

(iii) is a subject of an application for regulatory approval in the Field that
is pending before the applicable regulatory authority, or

(iv) is the subject of at least

(A) an ongoing Phase 2 clinical trial in the Field (in the case of a termination
by Intrexon due to a ZIOPHARM uncured breach pursuant to Section 10.2(a) or a
termination by ZIOPHARM pursuant to Section 10.3), or

(B) an ongoing Phase 1 clinical trial in the Field (in the case of a termination
by ZIOPHARM due to an Intrexon uncured breach pursuant to Section 10.2(a) or a
termination by Intrexon pursuant to Section 10.2(b) or 10.2(c)).

Such right to continue development and commercialization shall be subject to
ZIOPHARM’s full compliance with the payment provisions in Article 5 and all
other provisions of this Agreement that survive termination.

(b) Termination of Licenses. Except as necessary for ZIOPHARM to continue to
develop and commercialize the Retained Products as permitted by Section 10.4(a),
all rights and licenses granted by Intrexon to ZIOPHARM under this Agreement
shall terminate and shall revert to Intrexon without further action by either
Intrexon or ZIOPHARM. ZIOPHARM’s license with respect to Retained Products shall
be exclusive or non-exclusive, as the case may be, on the same terms as set
forth in Section 3.1.

 

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(c) Reverted Products. All Products other than the Retained Products shall be
referred to herein as the “Reverted Products.” ZIOPHARM shall immediately cease,
and shall cause its Affiliates and, if applicable, (sub)licensees to immediately
cease, all development and commercialization of the Reverted Products, and
ZIOPHARM shall not use or practice, nor shall it cause or permit any of its
Affiliates or, if applicable, (sub)licensees to use or practice, directly or
indirectly, any Intrexon IP with respect to the Reverted Products. ZIOPHARM
shall immediately discontinue making any representation regarding its status as
a licensee or channel partner or collaborator of Intrexon with respect to the
Reverted Products.

(d) Intrexon Materials. ZIOPHARM shall promptly return, or at Intrexon’s
request, destroy, any Intrexon Materials in ZIOPHARM’s possession or control at
the time of termination, or other than any Intrexon Materials necessary for the
continued development and commercialization of the Retained Products.

(e) Licenses to Intrexon. ZIOPHARM is automatically deemed to grant to Intrexon
a worldwide, fully paid, royalty-free, exclusive (even as to ZIOPHARM and its
Affiliates), irrevocable, license (with full rights to sublicense) under the
ZIOPHARM Termination IP, to make, have made, import, use, offer for sale and
sell Reverted Products and to use the Intrexon Channel Technology, the Intrexon
Materials, and/or the Intrexon IP in the Field, subject to any exclusive rights
held by ZIOPHARM in Reverted Products pursuant to Section 10.4(c). ZIOPHARM
shall also take such actions and execute such other instruments and documents as
may be necessary to document such license to Intrexon.

(f) Regulatory Filings. ZIOPHARM shall promptly assign to Intrexon, and will
provide full copies of, all regulatory approvals and regulatory filings that
relate specifically and solely to Reverted Products. ZIOPHARM shall also take
such actions and execute such other instruments, assignments and documents as
may be necessary to effect the transfer of rights thereunder to Intrexon. To the
extent that there exist any regulatory approvals and regulatory filings that
relate both to Reverted Products and other products, ZIOPHARM shall provide
copies of the portions of such regulatory filings that relate to Reverted
Products and shall reasonably cooperate to assist Intrexon in obtaining the
benefits of such regulatory approvals with respect to the Reverted Products.

(g) Data Disclosure. ZIOPHARM shall provide to Intrexon copies of the relevant
portions of all material reports and data, including clinical and non-clinical
data and reports, obtained or generated by or on behalf of ZIOPHARM or its
Affiliates to the extent that they relate to Reverted Products, within sixty
(60) days of such termination unless otherwise agreed, and Intrexon shall have
the right to use any such Information in developing and commercializing Reverted
Products and to license any Third Parties to do so.

(h) Third-Party Licenses. At Intrexon’s request, ZIOPHARM shall promptly provide
to Intrexon copies of all Third Party agreements under which ZIOPHARM or its
Affiliates obtained a license under Patents claiming inventions or know-how
specific to or

 

29

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used or incorporated into the development, manufacture and/or commercialization
of the Reverted Products. At Intrexon’s request, ZIOPHARM shall use reasonable
commercial efforts to promptly: (x) with respect to such Third Party licenses
relating solely to the applicable Reverted Products, immediately assign (or
cause to be assigned), such agreements to Intrexon, and (y) with respect to all
other Third Party licenses, at ZIOPHARM’s option either assign the agreement or
grant (or cause to be granted) to Intrexon a sublicense thereunder of a scope
equivalent to that described in Section 10.4(e), provided ZIOPHARM has the
ability to assign such agreement to Intrexon or grant a sublicense to Intrexon
thereunder. In any case, thereafter Intrexon shall be fully responsible for all
obligations due for its actions under the Third Party agreements.
Notwithstanding the above, if Intrexon does not wish to assume any financial or
other obligations associated with a particular assignment or sublicense, then
Intrexon shall so notify ZIOPHARM and ZIOPHARM shall not make such assignment or
grant such sublicense (or cause it to be made or granted).

(i) Remaining Materials. At the request of Intrexon, ZIOPHARM shall transfer to
Intrexon, all quantities of Reverted Product (including API or work-in-process)
in the possession of ZIOPHARM or its Affiliates. ZIOPHARM shall transfer to
Intrexon all such quantities of Reverted Products without charge, except that
Intrexon shall pay the reasonable costs of shipping.

(j) Third Party Vendors. At Intrexon’s request, ZIOPHARM shall promptly provide
to Intrexon copies of all agreements between ZIOPHARM or its Affiliates and
Third Party suppliers, vendors, or distributors that relate to the supply, sale,
or distribution of Reverted Products in the Territory. At Intrexon’s request,
ZIOPHARM shall promptly: (x) with respect to such Third Party agreements
relating solely to the applicable Reverted Products, immediately assign (or
cause to be assigned), such agreements to Intrexon, and (y) with respect to all
other such Third Party agreements, ZIOPHARM shall reasonably cooperate to assist
Intrexon in obtaining the benefits of such agreements. ZIOPHARM shall be liable
for any costs associated with assigning a Third Party agreement to Intrexon or
otherwise obtaining the benefits of such agreement for Intrexon, to the extent
such costs are directly related to ZIOPHARM’s breach. For the avoidance of
doubt, Intrexon shall have no obligation to assume any of ZIOPHARM’s obligations
under any Third Party agreement.

(k) Commercialization. Intrexon shall have the right to develop and
commercialize the Reverted Products itself or with one or more Third Parties,
and shall have the right, without obligation to ZIOPHARM, to take any such
actions in connection with such activities as Intrexon (or its designee), at its
discretion, deems appropriate.

(l) Confidential Information. Each Party shall promptly return, or at the other
Party’s request destroy, any Confidential Information of the other Party in such
Party’s possession or control at the time of termination; provided, however,
that each Party shall be permitted to retain (i) a single copy of each item of
Confidential Information of the other Party in its confidential legal files for
the sole purpose of monitoring and enforcing its compliance with Article 7,
(ii) Confidential Information of the other Party that is maintained as archive
copies on the recipient Party’s disaster recovery and/or information technology
backup systems, or (iii) Confidential Information of the other Party necessary
to exercise such Party’s rights in Retained

 

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Products (in the case of ZIOPHARM) or Reverted Products (in the case of
Intrexon). The recipient of Confidential Information shall continue to be bound
by the terms and conditions of this Agreement with respect to any such
Confidential Information retained in accordance with this Section 10.4(l).

10.5 Surviving Obligations. Termination or expiration of this Agreement shall
not affect any rights of either Party arising out of any event or occurrence
prior to termination, including, without limitation, any obligation of ZIOPHARM
to pay any amount which became due and payable under the terms and conditions of
this Agreement prior to expiration or such termination. The following portions
of this Agreement shall survive termination or expiration of this Agreement:
Sections 3.1 (as applicable with respect to 10.4(b)), 5.2 through 5.7, 6.1, 6.2
(with subsection (c) surviving only to the extent relating to Intrexon Patents
that are relevant to Retained Products that, to Intrexon’s knowledge, are being
developed or commercialized at such time, if any), 10.4, and 10.5; Articles 7,
9, 11, and 12; and any relevant definitions in Article 1.

ARTICLE 11

DISPUTE RESOLUTION

11.1 Disputes. It is the objective of the Parties to establish procedures to
facilitate the resolution of disputes arising under this Agreement in an
expedient manner by mutual cooperation and without resort to litigation. In the
event of any disputes, controversies or differences which may arise between the
Parties out of or in relation to or in connection with this Agreement (other
than disputes arising from a Committee), including, without limitation, any
alleged failure to perform, or breach, of this Agreement, or any issue relating
to the interpretation or application of this Agreement, then upon the request of
either Party by written notice, the Parties agree to meet and discuss in good
faith a possible resolution thereof, which good faith efforts shall include at
least one in-person meeting between the Executive Officers of each Party. If the
matter is not resolved within thirty (30) days following the written request for
discussions, either Party may then invoke the provisions of Section 11.2. For
the avoidance of doubt, any disputes, controversies or differences arising from
a Committee pursuant to Article 2 shall be resolved solely in accordance with
Section 2.4.

11.2 Arbitration. Any dispute, controversy, difference or claim which may arise
between the Parties and not from a Committee, out of or in relation to or in
connection with this Agreement (including, without limitation, arising out of or
relating to the validity, construction, interpretation, enforceability, breach,
performance, application or termination of this Agreement) that is not resolved
pursuant to Section 11.1 shall, subject to Section 11.10, be settled by binding
“baseball arbitration” as follows. Either Party, following the end of the thirty
(30) day period referenced in Section 11.1, may refer such issue to arbitration
by submitting a written notice of such request to the other Party. Promptly
following receipt of such notice, the Parties shall meet and discuss in good
faith and seek to agree on an arbitrator to resolve the issue, which arbitrator
shall be neutral and independent of both Parties and all of their respective
Affiliates, shall have significant experience and expertise in licensing and
partnering agreements in the pharmaceutical and biotechnology industries, and
shall have some experience in mediating or arbitrating issues relating to such
agreements. If the Parties cannot agree on a single arbitrator within fifteen
(15) days

 

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of request by a Party for arbitration, then each Party shall select an
arbitrator meeting the foregoing criteria and the two (2) arbitrators so
selected shall select a third arbitrator meeting the foregoing criteria. Within
fifteen (15) days after an arbitrator(s) is selected (in the case of the
three-person panel, when the third arbitrator is selected), each Party will
deliver to both the arbitrator(s) and the other Party a detailed written
proposal setting forth its proposed terms for the resolution for the matter at
issue (the “Proposed Terms” of the Party) and a memorandum (the “Support
Memorandum”) in support thereof. The Parties will also provide the arbitrator(s)
a copy of this Agreement, as it may be amended at such time. Within fifteen
(15) days after receipt of the other Party’s Proposed Terms and Support
Memorandum, each Party may submit to the arbitrator(s) (with a copy to the other
Party) a response to the other Party’s Support Memorandum. Neither Party may
have any other communications (either written or oral) with the arbitrator(s)
other than for the sole purpose of engaging the arbitrator or as expressly
permitted in this Section 11.2; provided that, the arbitrator(s) may convene a
hearing if the arbitrator(s) so chooses to ask questions of the Parties and hear
oral argument and discussion regarding each Party’s Proposed Terms. Within sixty
(60) days after the arbitrator’s appointment, the arbitrator(s) will select one
of the two Proposed Terms (without modification) provided by the Parties that he
or she believes is most consistent with the intention underlying and agreed
principles set forth in this Agreement. The decision of the arbitrator(s) shall
be final, binding, and unappealable. For clarity, the arbitrator(s) must select
as the only method to resolve the matter at issue one of the two sets of
Proposed Terms, and may not combine elements of both Proposed Terms or award any
other relief or take any other action.

11.3 Governing Law. This Agreement shall be governed by and construed under the
substantive laws of the State of New York, excluding any conflicts or choice of
law rule or principle that might otherwise refer construction or interpretation
of this Agreement to the substantive law of another jurisdiction.

11.4 Award. Any award to be paid by one Party to the other Party as determined
by the arbitrator(s) as set forth above under Section 11.2 shall be promptly
paid in United States dollars free of any tax, deduction or offset; and any
costs, fees or taxes incident to enforcing the award shall, to the maximum
extent permitted by law, be charged against the losing Party. Each Party agrees
to abide by the award rendered in any arbitration conducted pursuant to this
Article 11, and agrees that, subject to the United States Federal Arbitration
Act, 9 U.S.C. §§ 1-16, judgment may be entered upon the final award in any
United States District Court located in New York and that other courts may award
full faith and credit to such judgment in order to enforce such award. The award
shall include interest from the date of any damages incurred for breach of the
Agreement, and from the date of the award until paid in full, at a rate fixed by
the arbitrator(s). With respect to money damages, nothing contained herein shall
be construed to permit the arbitrator(s) or any court or any other forum to
award consequential, incidental, special, punitive or exemplary damages. By
entering into this agreement to arbitrate, the Parties expressly waive any claim
for consequential, incidental, special, punitive or exemplary damages. The only
damages recoverable under this Agreement are direct compensatory damages.

11.5 Costs. Each Party shall bear its own legal fees. The arbitrator(s) shall
assess his or her costs, fees and expenses against the Party losing the
arbitration.

 

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11.6 Injunctive Relief. Nothing in this Article 11 will preclude either Party
from seeking equitable relief or interim or provisional relief from a court of
competent jurisdiction, including a temporary restraining order, preliminary
injunction or other interim equitable relief, concerning a dispute either prior
to or during any arbitration if necessary to protect the interests of such Party
or to preserve the status quo pending the arbitration proceeding. Specifically,
the Parties agree that a material breach by either Party of its obligations in
Section 3.4 of this Agreement may cause irreparable harm to the other Party, for
which damages may not be an adequate remedy. Therefore, in addition to its
rights and remedies otherwise available at law, including, without limitation,
the recovery of damages for breach of this Agreement, upon an adequate showing
of material breach of such Section 3.4, and without further proof of irreparable
harm other than this acknowledgement, such non-breaching Party shall be entitled
to seek (a) immediate equitable relief, specifically including, but not limited
to, both interim and permanent restraining orders and injunctions, and (b) such
other and further equitable relief as the court may deem proper under the
circumstances. For the avoidance of doubt, nothing in this Section 11.6 shall
otherwise limit a breaching Party’s opportunity to cure a material breach as
permitted in accordance with Section 10.2.

11.7 Confidentiality. The arbitration proceeding shall be confidential and the
arbitrator(s) shall issue appropriate protective orders to safeguard each
Party’s Confidential Information. Except as required by law, no Party shall make
(or instruct the arbitrator(s) to make) any public announcement with respect to
the proceedings or decision of the arbitrator(s) without prior written consent
of the other Party. The existence of any dispute submitted to arbitration, and
the award, shall be kept in confidence by the Parties and the arbitrator(s),
except as required in connection with the enforcement of such award or as
otherwise required by applicable law.

11.8 Survivability. Any duty to arbitrate under this Agreement shall remain in
effect and be enforceable after termination of this Agreement for any reason.

11.9 Jurisdiction. For the purposes of this Article 11, the Parties acknowledge
their diversity and agree to accept the jurisdiction of any United States
District Court located in New York for the purposes of enforcing or appealing
any awards entered pursuant to this Article 11 and for enforcing the agreements
reflected in this Article 11 and agree not to commence any action, suit or
proceeding related thereto except in such courts.

11.10 Patent Disputes. Notwithstanding any other provisions of this Article 11,
and subject to the provisions of Section 6.2, any dispute, controversy or claim
relating to the scope, validity, enforceability or infringement of any Intrexon
Patents shall be submitted to a court of competent jurisdiction in the country
in which such Patent was filed or granted.

ARTICLE 12

GENERAL PROVISIONS

12.1 Use of Name. No right, express or implied, is granted by this Agreement to
either Party to use in any manner the name of the other or any other trade name
or trademark of

 

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the other in connection with the performance of this Agreement except that
either Party may use the name of the other Party as required by law or
regulation and in press releases accompanying quarterly and annual earnings
reports approved by such Party’s Board of Directors.

12.2 LIMITATION OF LIABILITY. NEITHER PARTY SHALL BE LIABLE TO THE OTHER FOR ANY
SPECIAL, CONSEQUENTIAL, INCIDENTAL, PUNITIVE, OR INDIRECT DAMAGES ARISING FROM
OR RELATING TO ANY BREACH OF THIS AGREEMENT, REGARDLESS OF ANY NOTICE OF THE
POSSIBILITY OF SUCH DAMAGES. NOTWITHSTANDING THE FOREGOING, NOTHING IN THIS
PARAGRAPH IS INTENDED TO LIMIT OR RESTRICT THE INDEMNIFICATION RIGHTS OR
OBLIGATIONS OF ANY PARTY UNDER ARTICLE 9, OR DAMAGES AVAILABLE FOR BREACHES OF
THE OBLIGATIONS SET FORTH IN ARTICLE 7.

12.3 Independent Parties. The Parties are not employees or legal representatives
of the other Party for any purpose. Neither Party shall have the authority to
enter into any contracts in the name of or on behalf of the other Party. This
Agreement shall not constitute, create, or in any way be interpreted as a joint
venture, partnership, or business organization of any kind.

12.4 Notice. All notices, including notices of address change, required or
permitted to be given under this Agreement shall be in writing and deemed to
have been given when delivered if personally delivered or sent by facsimile
(provided that the party providing such notice promptly confirms receipt of such
transmission with the other party by telephone), on the business day after
dispatch if sent by a nationally-recognized overnight courier and on the third
business day following the date of mailing if sent by certified mail, postage
prepaid, return receipt requested. All such communications shall be sent to the
address or facsimile number set forth below (or any updated addresses or
facsimile number communicated to the other Party in writing):

 

If to Intrexon:      

Intrexon Corporation

20374 Seneca Meadows Parkway

Germantown, MD 20876

Attention: Legal Department

Fax: (301) 556-9902

If to ZIOPHARM:      

ZIOPHARM Oncology, Inc.

One First Avenue

Parris Building, #34

Navy Yard Plaza

Boston, MA 02129

Attention: Chief Executive Officer

Fax: (617) 241-2855

12.5 Severability. In the event any provision of this Agreement is held to be
invalid or unenforceable, the valid or enforceable portion thereof and the
remaining provisions of this Agreement will remain in full force and effect.

 

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12.6 Waiver. Any waiver (express or implied) by either Party of any breach of
this Agreement shall not constitute a waiver of any other or subsequent breach.

12.7 Entire Agreement; Amendment. This Agreement and the exhibits attached
hereto constitute the entire, final, complete and exclusive agreement between
the Parties and supersede all previous agreements or representations, written or
oral, with respect to the subject matter of this Agreement (including any prior
confidentiality agreement between the Parties). All information of Intrexon or
ZIOPHARM to be kept confidential by the other Party under any prior
confidentiality agreement, as of the Effective Date, shall be maintained as
Confidential Information by such other Party under the obligations set forth in
Article 7 of this Agreement. This Agreement may not be modified or amended
except in a writing signed by a duly authorized representative of each Party.

12.8 Nonassignability; Binding on Successors. Any attempted assignment of the
rights or delegation of the obligations under this Agreement shall be void
without the prior written consent of the nonassigning or nondelegating Party;
provided, however, that either Party may assign its rights or delegate its
obligations under this Agreement without such consent (a) to an Affiliate of
such Party or (b) to its successor in interest in connection with any merger,
acquisition, consolidation, corporate reorganization, or similar transaction, or
sale of all or substantially all of its assets, provided that such assignee
agrees in writing to assume and be bound by the assignor’s obligations under
this Agreement. This Agreement shall be binding upon, and inure to the benefit
of, the successors, executors, heirs, representatives, administrators and
permitted assigns of the Parties hereto. Notwithstanding the foregoing, in the
event that either Party assigns this Agreement to its successor in interest by
way of merger, acquisition, or sale of all or substantially all of its assets
(whether this Agreement is actually assigned or is assumed by such successor in
interest or its affiliate by operation of law (e.g., in the context of a reverse
triangular merger)), (a) the intellectual property rights of such successor in
interest or any of its affiliates shall be automatically excluded from the
rights licensed to the other Party under this Agreement, and (b) such successor
in interest may elect by written notice to have the restrictions set forth in
Section 3.4 not apply to the activities of such successor in interest (but, for
purposes of clarity, such restriction shall in any event continue to apply to
the applicable Party and all other Affiliates of such Party not related to such
successor in interest). In the event that a successor in interest to ZIOPHARM
elects to have the restrictions set forth in Section 3.4 not apply to the
activities of such successor in interest, Intrexon shall have the termination
right set forth in Section 10.2(c).

12.9 Force Majeure. Neither Party shall be liable to the other for its failure
to perform any of its obligations under this Agreement, except for payment
obligations, during any period in which such performance is delayed because
rendered impracticable or impossible due to circumstances beyond its reasonable
control, including without limitation earthquakes, governmental regulation,
fire, flood, labor difficulties, civil disorder, acts of terrorism and acts of
God, provided that the Party experiencing the delay promptly notifies the other
Party of the delay.

 

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12.10 No Other Licenses. Neither Party grants to the other Party any rights or
licenses in or to any intellectual property, whether by implication, estoppel,
or otherwise, except to the extent expressly provided for under this Agreement.

12.11 Legal Compliance. The Parties shall review in good faith and cooperate in
taking such actions to ensure compliance of this Agreement with all applicable
laws.

12.12 Counterparts. This Agreement may be executed in two or more counterparts,
each of which shall be deemed an original and all of which shall constitute
together the same instrument.

[Remainder of page intentionally left blank.]

 

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IN WITNESS WHEREOF, the Parties hereto have duly executed this Exclusive Channel
Collaborator Agreement.

 

INTREXON CORPORATION     ZIOPHARM ONCOLOGY, INC. By:  

/s/ Donald P. Lehr

    By:  

/s/ Caesar J. Belbel

Name:   Donald P. Lehr     Name:   Caesar J. Belbel Title:   Chief Legal Officer
    Title:   Executive Vice President, Chief Operating Officer and Chief Legal
Officer

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EXHIBIT A

Financial Terms for Calculating Allowable Expenses

As used herein, the term “operating unit” shall mean the smallest operating unit
in which an operating profit and loss statement is prepared for management
accounting purposes in the applicable Party’s normal accounting procedures,
consistently applied within and across its operating units. To the extent
certain cost or expense items below are incurred with respect to multiple
products and some of such products are not Products, then such cost or expense
items shall be allocated on a pro rata basis based upon net sales of each
respective product by the applicable operating unit during the most recent
quarter.

1. COST OF GOODS SOLD

1.1 “Cost of Goods Sold” means all Manufacturing Costs that are directly and
reasonably attributable to manufacturing of Product for commercial sale in the
countries where such Product has been launched.

1.2 “Manufacturing Costs” means, with respect to Products, the FTE costs (under
a reasonable accounting mechanism to be agreed upon by the Parties and
out-of-pocket costs of a Party or any of its Affiliates incurred in
manufacturing such Products, including costs and expenses incurred in connection
with (1) the development or validation of any manufacturing process,
formulations or delivery systems, or improvements to the foregoing;
(2) manufacturing scale-up; (3) in-process testing, stability testing and
release testing; (4) quality assurance/quality control development; (5) internal
and Third Party costs and expenses incurred in connection with qualification and
validation of Third Party contract manufacturers, including scale up, process
and equipment validation, and initial manufacturing licenses, approvals and
inspections; (6) packaging development and final packaging and labeling;
(7) shipping configurations and shipping studies; and (8) overseeing the conduct
of any of the foregoing. “Manufacturing Costs” shall further include:

(a) to the extent that any such Product is Manufactured by a Third Party
manufacturer, the out-of-pocket costs incurred by such Party or any of its
Affiliates to the Third Party for the manufacture and supply (including
packaging and labeling) thereof, and any reasonable out-of-pocket costs and
direct labor costs incurred by such Party or any of its Affiliates in managing
or overseeing the Third Party relationship determined in accordance with the
books and records of such Party or its Affiliates maintained in accordance with
US GAAP; and

(b) to the extent that any such Product is manufactured by such Party or any of
its Affiliates, direct material and direct labor costs attributable to such
Product, as well as reasonably allocable overhead expenses, determined in
accordance with the books and records of such Party or its Affiliates maintained
in accordance with US GAAP.

2. MARKETING EXPENSES.

2.1 “Marketing Expenses” means the sum of Selling Expenses, Marketing Management
Expenses, Market and Consumer Research Expenses, Advertising Expenses, Trade

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Promotion Expenses, and Consumer Promotion Expenses, each of which is specified
below, in each case to the extent directly and reasonably attributable to the
sale, promotion or marketing of the applicable Products in the countries where
such Product has been launched.

2.2 “Selling Expenses” shall mean all reasonable costs and expenses directly
associated with the efforts of field sales representatives with respect to
Products in the Territory. The costs of detailing sales calls shall be allocated
based on field force time at an accounting charge rate reasonably and
consistently applied within and across its operating units and which is no less
favorable to the Products than the internal charge rate used by ZIOPHARM for its
own internal cost accounting purposes for products other than Products
(excluding internal profit margins and markups).

2.3 “Marketing Management Expenses” means all reasonable product management and
sales promotion management compensation (including customary bonuses and
benefits but excluding stock-based compensation) and departmental expenses,
including product related public relations, relationships with opinion leaders
and professional societies, health care economics studies, contract pricing and
administration, market information systems, governmental affairs activities for
reimbursement, formulary acceptance and other activities directly related to the
Products in the Territory, management and administration of managed care and
national accounts and other activities associated with developing overall sales
and marketing strategies and planning for Products in the Territory.

2.4 “Market and Consumer Research Expenses” means all reasonable compensation
(including customary bonuses and benefits but excluding stock-based
compensation) and departmental expenses for market and consumer research
personnel and payments to Third Parties related to and to the extent use for
conducting and monitoring professional and consumer appraisals of existing, new
or proposed Products in the Territory such as market share services (e.g., IMS
data), special research testing and focus groups.

2.5 “Advertising Expenses” shall mean all reasonable costs reasonably incurred
for the advertising and promotion of Products in the Territory.

2.6 “Trade Promotion Expenses” means the actual and reasonable allowances given
to retailers, brokers, distributors, hospital buying groups, etc. for
purchasing, promoting, and distribution of Products in the Territory. This shall
include purchasing, advertising, new distribution, and display allowances as
well as free goods, wholesale allowances and reasonable field sales samples (at
the out of pocket cost).

2.7 “Consumer Promotion Expenses” means all reasonable expenses associated with
programs to promote Products directly to the end user in the Territory. This
category shall include expenses associated with promoting products directly to
the professional community such as professional samples, professional
literature, promotional material costs, patient aids and detailing aids.

3. DISTRIBUTION EXPENSES.

“Distribution Expenses” means the reasonable costs, excluding overhead, incurred
by ZIOPHARM that are directly and reasonably allocable to the distribution of a
Product with respect to a particular country where such Product has been
launched, excluding any costs included as a deduction in calculating Net Sales.

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[***] = CERTAIN CONFIDENTIAL INFORMATION CONTAINED IN THIS DOCUMENT, MARKED BY
BRACKETS, HAS BEEN OMITTED AND FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE
COMMISSION PURSUANT TO RULE 24B-2 OF THE SECURITIES EXCHANGE ACT OF 1934, AS
AMENDED.

 

4. ADDITIONAL COMMERCIALIZATION EXPENSES.

4.1 “Additional Commercialization Expenses” means the sum of Regulatory and
Related Costs, Third Party IP Costs, Patent and Trademark Costs, Product
Liability Costs, and Additional Approved Expenses, each of which is specified
below, in each case to the extent directly and reasonably attributable to the
commercialization of the applicable Products.

4.2 “Regulatory and Related Costs” means all reasonable costs and expenses
associated with the preparation and filing of marketing and pricing approval
applications, and the maintenance of marketing approvals, for Products,
including (i) fees paid to regulatory authorities directly related to NDAs and
Marketing Approvals in the Field, (ii) costs of any regulatory interactions with
respect to Products, (iii) costs incurred in securing reimbursement approvals
from public and private payers, and (iv) costs to establish and maintain a
global safety database.

4.3 “[***]” means [***].

4.4 “Patent and Trademark Costs” means all reasonable costs and expenses
incurred by ZIOPHARM or its Affiliates in connection with (i) the preparation,
filing, prosecution, maintenance and enforcement of ZIOPHARM Program Patents,
and (ii) establishing, maintaining and enforcing the Patents and trademarks for
Products in the Territory.

4.5 “Product Liability Costs” means the reasonable costs associated with (i) any
recall in the Territory, including the cost of any investigations or corrective
actions, (ii) any Excess Product Liability Costs, and (iii) product liability
insurance premiums for policies covering the development, manufacture or
Commercialization of Products (as described in Section 9.5).

4.6 “Additional Approved Expenses” means any additional costs and/or expenses
that are incurred in connection with the commercialization of Products and that
are approved in advance, in writing, by the Intrexon representatives on the CC.

5. POST-LAUNCH PRODUCT R&D EXPENSES.

“Post-Launch Product R&D Expenses” means the reasonable costs, excluding
administrative expenses and costs that are included within Costs of Goods Sold,
of Phase 4 clinical trials and ongoing product support (including manufacturing
and quality assurance technical support, and laboratory and clinical efforts
directed toward the further understanding of product safety and efficacy) and
medical affairs (including regulatory support necessary for product
maintenance), in each case that are (a) specifically attributable to a Product
in the countries of the Territory where such Product has been launched and
(b) approved by both Parties in writing.

6. NO DUPLICATION. No item of cost shall be duplicated in any of the categories
comprising Allowable Expenses or in the deductions permitted under Net Sales or
Sublicensing Revenue.

 

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EXHIBIT B

Press Release

[See Following Pages]

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LOGO [g77534g87j09.jpg]

Intrexon and ZIOPHARM to Develop Immunotherapies for

Treatment of Graft-Versus-Host Disease

Companies Form New Collaboration to Pursue Cellular Therapy Approaches to
Autoimmune Disorder

Companies to Host Conference Call and Webcast Slide Presentation Today at 5:00
PM ET

Germantown, MD, and Boston, MA September 28, 2015 – Intrexon Corporation (NYSE:
XON), a leader in synthetic biology, announced today it has formed a new
Exclusive Channel Collaboration (ECC) with ZIOPHARM Oncology, Inc. (Nasdaq:
ZIOP), a biopharmaceutical company focused on new cancer immunotherapies, for
the treatment and prevention of graft-versus-host disease (GvHD), a major
complication of allogeneic hematopoietic stem-cell transplantation (HSCT) which
significantly impairs the quality of life and survival of many recipients. The
collaboration will focus on addressing the underlying pathologies of GvHD
through engineered cell platforms to express and deliver interleukin-2 (IL-2), a
cytokine critical for modulation of the immune system.

“The combined expertise and the knowledge gained from our current research
programs with Intrexon in adoptive T-cell therapies and cytokine modulation for
treatment of cancer, position us well to develop and implement therapeutic
approaches addressing an area of high unmet medical need for patients with
GvHD,” said Laurence Cooper, M.D., Ph.D., Chief Executive Officer of ZIOPHARM.

Through the ECC, the companies plan to pursue engineered cell therapy
strategies, used either separately or in combination, for targeted treatment of
GvHD. The first approach is infusion of regulatory T cells (Tregs) conditionally
expressing IL-2 utilizing Intrexon’s proprietary gene control approaches such as
its RheoSwitch® platform. The second is deployment of orally-delivered
microbe-based ActoBiotics® therapeutics expressing IL-2 to modulate immune
function.

Allogeneic HSCT is used for the treatment of various diseases including
hematological malignancies, immunological deficiencies as well as non-malignant
conditions. Approximately 40 to 60% of HSCT recipients develop GvHD, either
acute or chronic, when immune (graft) cells in a transplant patient recognize
their engrafted host as foreign and attack the patient’s (host) cells.

Immunosuppressive agents and systemic steroids routinely used to treat GvHD have
limited efficacy and toxicity, defining the need for safer, more effective
therapies. Human studies have shown that administration of low dose subcutaneous
IL-2 in patients with steroid-refractory GvHD acts via Tregs to ameliorate its
manifestations.

The ECC intends to expand on the benefits of IL-2 immunotherapy under Intrexon’s
technologies to generate clinical-grade Tregs that can precisely deliver IL-2.
In addition, the ActoBiotics® platform will be harnessed for its ability to
target delivery of IL-2 to the digestive tract, a site which plays a significant
role in the body’s immune system. These new ways of treating and preventing GvHD
have the potential to broaden the number of patients eligible to receive
allogeneic HCST and also increase the number of effective donor/recipient
combinations.

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Samuel Broder, M.D., Senior Vice President and Head of Intrexon’s Health Sector
stated, “GvHD substantially impairs the quality of life and survival of
transplant patients. We believe adoptive therapy with gene-modified T cells may
offer an exciting alternative approach for restoring ‘immune homeostasis’ and
countering the destructive pro-inflammatory mediators of GvHD. This ECC also
includes access to the ActoBiotics® platform as an innovative approach to GvHD.”

Under the terms of the agreement, Intrexon will receive a technology access fee
of $10 million in cash and reimbursement for all research and development costs.
The agreement also provides for equal sharing of operating profits.

Conference Call and Webcast September 28, 2015, at 5:00 PM ET

ZIOPHARM and Intrexon will host a conference call and webcast slide presentation
today, September 28, 2015, at 5:00 PM ET to discuss their GVHD exclusive channel
collaboration. The call can be accessed by dialing (877) 751-7350 (U.S. and
Canada) or (918) 559-5237 (international). The passcode for the conference call
is 50985976. To access the slide and live audio webcast, or the subsequent
archived recording, visit the “Investors & Media” section of the ZIOPHARM
website at www.ziopharm.com. The webcast will be recorded and available for
replay on the Company’s website for two (2) weeks.

About Intrexon Corporation

Intrexon Corporation (NYSE:XON) is Powering the Bioindustrial Revolution with
Better DNA™ to create biologically-based products that improve the quality of
life and the health of the planet. The Company’s integrated technology suite
provides its partners across diverse markets with industrial-scale design and
development of complex biological systems delivering unprecedented control,
quality, function, and performance of living cells. We call our synthetic
biology approach Better DNA®, and we invite you to discover more at www.dna.com.

About ZIOPHARM Oncology, Inc.

ZIOPHARM Oncology is a Boston, Massachusetts-based biotechnology company
employing novel gene expression, control and cell technologies to deliver safe,
effective and scalable cell-based therapies for the treatment of cancer. The
Company’s synthetic immuno-oncology programs, in collaboration with Intrexon
Corporation (NYSE:XON) and the MD Anderson Cancer Center, include chimeric
antigen receptor T cell (CAR-T) and other adoptive cell based approaches that
use non-viral gene transfer methods for broad scalability. The Company is
advancing programs in multiple stages of development together with Intrexon
Corporation’s RheoSwitch Therapeutic System® technology, a switch to turn on and
off, and precisely modulate, gene expression in order to improve therapeutic
index. The Company’s pipeline includes a number of cell-based therapeutics in
both clinical and preclinical testing which are focused on hematologic and solid
tumor malignancies.

Trademarks

Intrexon, ActoBiotics, Powering the Bioindustrial Revolution with Better DNA,
and Better DNA are trademarks of Intrexon and/or its affiliates. Other names may
be trademarks of their respective owners.

Safe Harbor Statement

Some of the statements made in this press release are forward-looking
statements. These forward-looking statements are based upon our current
expectations and projections about future events and generally relate to our
plans, objectives and expectations for the development of our business. Although
management believes that the plans and objectives reflected in or suggested by
these forward-looking statements are reasonable, all forward-looking statements
involve risks and uncertainties and actual future results may be materially
different from the plans, objectives and expectations expressed in this press
release.

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For more information, contact:

Intrexon Corporation Contacts:

Investor Contact:

Christopher Basta

Vice President, Investor Relations

Tel: +1 (561) 410-7052

investors@intrexon.com

Corporate Contact:

Marie Rossi, Ph.D.

Senior Manager, Technical Communications

Tel: +1 (301) 556-9850

publicrelations@intrexon.com

ZIOPHARM Contacts:

Lori Ann Occhiogrosso

ZIOPHARM Oncology, Inc.

617-259-1987

locchiogrosso@ziopharm.com

David Pitts

Argot Partners

212-600-1902

david@argotpartners.com