Exhibit 10.4

 

[ * ] = 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.

 

 

NOVATED AND RESTATED

 

TECHNOLOGY LICENSE AGREEMENT

 

 

dated as of June 9, 2005

 

 

among

 

 

EXELIXIS, INC.,

 

 

SYMPHONY EVOLUTION, INC.

 

 

and

 

 

SYMPHONY EVOLUTION HOLDINGS LLC

 

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Table of Contents

 

         Page

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Article  1

  Definitions    1

Article  2

  Grant Of Rights    1

             2.1.

    Assignment    1

             2.2.

    License Grant    2

             2.3.

    Sublicense to Licensor    2

             2.4.

    Right to Sublicense    2

             2.5.

    Partial Reversion of License upon Licensor’s Exercise of Program Option or
Discontinuation Option    3

             2.6.

    Reservation of Rights    3

             2.7.

    Regulatory Files    4

             2.8.

    Delivery of Materials    4

             2.9.

    License Opportunities    4

             2.10.

    Separate Third Party License for Discontinued Program    5

Article  3

  Sublicense To Certain Third Party Intellectual Property    6

             3.1.

    General    6

             3.2.

    Option to Acquire Sublicense    6

             3.3.

    Prosecution Fees    6

             3.4.

    Termination or Amendment of University Agreements    6

             3.5.

    No Conflicts    7

Article  4

  Intellectual Property    7

             4.1.

    Ownership    7

             4.2.

    Marking    7

             4.3.

    Prosecution and Maintenance    7

             4.4.

    Abandonment    8

             4.5.

    Infringement    8

             4.6.

    First Enforcement Right During Term    9

             4.7.

    Post-Term Enforcement    9

             4.8.

    Withdrawal of Enforcement    10

             4.9.

    Recoveries    10

             4.10.

    Third Party Rights    10

Article  5

  Representations And Warranties    10

             5.1.

    Representations and Warranties of Licensor    10

             5.2.

    Disclaimer and Acknowledgement    11

Article  6

  Indemnification And Limitation Of Liability    11

             6.1.

    Indemnity    11

             6.2.

    Notice of Claims    12

             6.3.

    Defense of Proceedings    13

             6.4.

    Settlement    14

 

i

 

[ * ] = 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.

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             6.5.

    Limitation of Liability    14

             6.6.

    Insurance    14

Article  7

  Term And Termination    15

             7.1.

    Term    15

             7.2.

    Termination    15

             7.3.

    Survival    15

             7.4.

    Bankruptcy    15

Article  8

  Miscellaneous    15

             8.1.

    Notices    15

             8.2.

    Entire Agreement    16

             8.3.

    Assignment    16

             8.4.

    Headings    17

             8.5.

    Independent Contractor    17

             8.6.

    Severability    17

             8.7.

    No Third-Party Beneficiaries    17

             8.8.

    Compliance with Laws    17

             8.9.

    Amendment    17

             8.10.

    Governing Law; Consent to Jurisdiction and Service of Process    17

             8.11.

    Waiver Of Jury TriaL    18

             8.12.

    Counterparts    18

             8.13.

    No Waiver    18

 

ii

 

[ * ] = 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.

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NOVATED AND RESTATED

TECHNOLOGY LICENSE AGREEMENT

 

This NOVATED AND RESTATED TECHNOLOGY LICENSE AGREEMENT (this “Agreement”) is
made and effective as of June 9, 2005 (the “Effective Date”) by and among,
Exelixis Inc., a Delaware corporation (the “Licensor”), Symphony Evolution,
Inc., a Delaware corporation (“Symphony Evolution”) (each of Licensor and
Symphony Evolution being a “Party,” and collectively, the “Parties”), and
Symphony Evolution Holdings LLC, a Delaware limited liability company
(“Holdings”).

 

WHEREAS, Licensor and Holdings have entered into that certain Technology License
Agreement, dated June 9, 2005 (the “Original Agreement”);

 

WHEREAS, Holdings desires to assign its right, title and interest in, and
delegate and novate its obligations under the Original Agreement to Symphony
Evolution, and Licensor and Symphony Evolution desire to novate and restate the
terms and conditions of the Original Agreement to effect such novation;

 

WHEREAS, Licensor owns or has rights in certain technology, know-how, patents
and other intellectual property rights related to the design, development,
manufacture and/or use of XL647, XL784, and XL999 and/or the Products;

 

WHEREAS, Licensor desires to grant to Symphony Evolution, and Symphony Evolution
desires to acquire, the exclusive right to use such technology, know-how,
patents and other intellectual property rights to develop and commercialize
Products on the terms and conditions of this Agreement; and

 

WHEREAS, Licensor desires to receive, and Symphony Evolution desires to grant to
Licensor, the exclusive right to use such technology, know-how, patents and
other intellectual property rights to develop Products on behalf of Symphony
Evolution on the terms and conditions of this Agreement.

 

NOW THEREFORE, in consideration of the mutual promises and agreements set forth
herein, and for other good and valuable consideration, the receipt and
sufficiency of which are hereby acknowledged, the Parties agree as follows:

 

ARTICLE 1

DEFINITIONS

 

Capitalized terms used herein and not defined shall have the meanings assigned
to such terms in Annex A attached hereto.

 

ARTICLE 2

GRANT OF RIGHTS

 

2.1. Assignment. Holdings hereby assigns to Symphony Evolution all of its right,
title and interest in and to the Original Agreement. The Parties agree that from
and after the Effective Date, all of the right, title, interest and obligations
of Holdings under the Original Agreement will be assigned, novated and
transferred to, and assumed by, Symphony Evolution, as amended and restated by
this Agreement.

 

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.

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2.2. License Grant. Subject to Sections 2.3, 2.4 and 2.6 below, Licensor hereby
grants to Symphony Evolution, subject to the terms and conditions of this
Agreement, a fully paid, worldwide, exclusive (even as to Licensor) license
under the Licensed Intellectual Property, to develop, make, have made, use,
offer for sale, sell, and import XL647, XL784, XL999 and Products.

 

2.3. Sublicense to Licensor. Symphony Evolution hereby grants to Licensor a
fully paid, worldwide, exclusive (even as to Symphony Evolution) sublicense
under the Licensed Intellectual Property, with the right to grant further
sublicense(s), to develop, make, have made, use and import XL647, XL784, XL999
and Products, or otherwise as necessary or useful to carry out Licensor’s
obligations or exercise Licensor’s rights under the Operative Documents.
Notwithstanding the foregoing, Licensor shall only exercise its sublicense
rights in connection with and for the purpose of carrying out Licensor’s
obligations or exercising Licensor’s rights under the Operative Documents. In
the event of the expiration of a Discontinuation Option without exercise by
Licensor, the sublicense set forth in this Section 2.3 shall expire with respect
to the compounds and Products relating to the Program to which such
Discontinuation Option pertained. Upon expiration of the Term without Licensor’s
exercise of the Purchase Option, the sublicense set forth in this Section 2.3
shall expire with respect to all compounds and Products relating to the
Program(s) for which Licensor has not exercised the Program Option or
Discontinuation Option.

 

2.4. Right to Sublicense. The license granted hereunder includes the right of
Symphony Evolution to grant sublicenses under the Licensed Intellectual
Property, provided, that,

 

(a) subject to Sections 2.3 and 2.4(b), Symphony Evolution shall not sublicense
any of the rights granted pursuant to Section 2.2 to any third party (including
without limitation any Affiliates) during the Term;

 

(b) notwithstanding (a), in the event of the expiration of a Discontinuation
Option without exercise by Licensor, Symphony Evolution may grant sublicense(s)
to third parties (including without limitation Affiliates) of the rights granted
pursuant to Section 2.2 with respect to the compounds and Products relating to
the Program to which such Discontinuation Option pertained, provided that
Symphony Evolution acts in accordance with Section 11.2(b) of the Amended and
Restated Research and Development Agreement;

 

(c) each sublicense granted is (i) pursuant to a written contract, (ii)
consistent with the terms of this Agreement, (iii) does not grant any rights
beyond the scope of the license rights granted herein, and (iv) is as protective
of Licensor’s rights as set forth in this Agreement; and

 

(d) upon Licensor’s written request, Symphony Evolution shall provide to
Licensor copies of any sublicense agreements, provided that (i) Symphony
Evolution may redact any financial or other proprietary information contained
therein which does not affect Licensor’s

 

2

 

[ * ] = 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.

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rights and (ii) Licensor shall treat its copy of the sublicense agreements as
Confidential Information of Symphony Evolution, provided that, if Symphony
Evolution exercises its option in Section 3.2, Licensor may disclose such
sublicense agreement or the material terms thereof as necessary to fulfill its
obligations under the Yale Agreement or Regents Agreement, as applicable.

 

2.5. Partial Reversion of License upon Licensor’s Exercise of Program Option or
Discontinuation Option. Licensor and Symphony Evolution acknowledge that
Licensor may exercise its Program Option pursuant to Section 11.1 of the Amended
and Restated Research and Development Agreement, or its Discontinuation Option
pursuant to Section 11.2 of the Amended and Restated Research and Development
Agreement. Upon the Program Option Closing Date or the Discontinuation Option
Closing Date, as applicable, (i) the license set forth in Section 2.2 (and the
corresponding sublicense under Section 2.3) shall expire with respect to the
compounds and Products relating to the Program for which Licensor exercised its
Program Option or Discontinuation Option, as applicable, (ii) those patents,
know-how and enhancements that were previously part of the Licensed Intellectual
Property and relate to such Program (including its compounds and Products) but
not to the other Programs, shall be deleted from the relevant intellectual
property definitions, and accordingly, Symphony Evolution shall no longer be
responsible for any obligations or costs (including royalties or fees to third
parties, prosecution costs, maintenance costs and enforcement costs) with
respect to such patents, know-how and enhancements; and (iii) Symphony Evolution
shall (a) at Licensor’s request and option, promptly return to Licensor or
destroy all Tangible Materials relating solely to such Program; and (b) upon
Licensor’s request, provide Licensor a copy of any Tangible Materials which
relate to such Program (but not solely to such Program). The Parties shall, as
necessary, promptly amend this Agreement, in connection with the exercise and
consummation of the Program Option pursuant to Section 11.1 or the
Discontinuation Option pursuant to Section 11.2 of the Amended and Restated
Research and Development Agreement, to give Licensor all rights it needs to
pursue the Program for which such option was exercised without any obligation to
or dependency on Symphony Evolution and to limit this Agreement to the other
Programs.

 

2.6. Reservation of Rights. All rights not expressly granted to a Party
hereunder shall remain the exclusive property of the other Party.
Notwithstanding the exclusivity of the license granted to Symphony Evolution in
Section 2.2, Licensor retains the right to make and use XL647, XL784, XL999 and
Structurally Related Compounds solely for Licensor’s research purposes. Symphony
Evolution covenants and agrees not to use or exploit the Licensed Intellectual
Property outside of the scope of the licenses granted herein. Licensor covenants
and agrees not to use or exploit the Licensed Intellectual Property in
connection with the development, manufacture, use, sale, or importation of
XL647, XL784, XL999 or Products after the expiration of all sublicenses granted
pursuant to Section 2.3; provided, however, that such covenant by Licensor shall
not (a) apply to any Program for which Licensor exercises a Program Option or
Discontinuation Option or to any compounds or Products relating to such Program
or (b) restrict Licensor’s ability to practice the retained rights specified in
this Section 2.6.

 

3

 

[ * ] = 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.

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2.7. Regulatory Files.

 

(a) Within a reasonable time after the expiration or termination of the Purchase
Option without exercise by Licensor and as of a date to be agreed upon by
Licensor and Symphony Evolution, Licensor and Symphony Evolution shall, at
Symphony Evolution’s expense, take all actions necessary to effect the
assignment to Symphony Evolution or its designee of the sponsorship to the
Regulatory Files with respect to the Programs for which Licensor has not
exercised its Program Option or Discontinuation Option. After such Regulatory
Files are assigned to Symphony Evolution, Licensor shall have no further rights
therein or obligations thereunder. Licensor shall, at the reasonable request of
Symphony Evolution and at Symphony Evolution’s expense, perform any acts that
Symphony Evolution may reasonably deem necessary or desirable to evidence or
confirm Symphony Evolution’s ownership interest in such Regulatory Files,
including, but not limited to, making further written assignments in a form
determined by Symphony Evolution. Without limiting the license rights granted
under this ARTICLE 2, the Parties understand and agree that the assignment of
such Regulatory Files does not include an assignment of any Licensed
Intellectual Property.

 

(b) In the event of the expiration of a Discontinuation Option without exercise
by Licensor, the provisions of Section 2.7(a) shall apply solely with respect to
the Regulatory Files for the Program to which the Discontinuation Option
pertained.

 

2.8. Delivery of Materials.

 

(a) Upon the expiration or termination of the Purchase Option without exercise
by Licensor, Licensor shall, at Symphony Evolution’s expense, promptly deliver
to Symphony Evolution all copies of Tangible Materials existing as of the date
of such expiration or termination that relate to the Programs for which Licensor
has not exercised its Program Option or Discontinuation Option; provided,
however that Licensor may also retain copies of (and the right to use) those
Tangible Materials that are required to be delivered to Symphony Evolution
hereunder but which also relate to (i) any Program for which Licensor has
exercised its Program Option or Discontinuation Option or (ii) any other product
of Licensor.

 

(b) In the event of the expiration of a Discontinuation Option without exercise
by Licensor, Licensor shall, at Symphony Evolution’s expense, promptly deliver
to Symphony Evolution all copies of Tangible Materials existing as of the date
of such expiration that relate to the Program to which the Discontinuation
Option pertained; provided, however that Licensor may also retain copies of (and
the right to use) those Tangible Materials that are required to be delivered to
Symphony Evolution hereunder but which also relate to any other Program or any
other product of Licensor.

 

2.9. License Opportunities. In the event that, during the Term, Licensor
reasonably determines that it is necessary to license from any third party any
intellectual property relating to the composition of matter, use, manufacture,
formulation or exploitation of XL647, XL784, or XL999 or the Products (“Third
Party IP”) and Licensor desires to license such Third Party IP during the Term,
then (i) if Licensor desires Symphony Evolution to pay any or all of the
financial obligations under such license, Licensor shall obtain Symphony
Evolution’s written consent, which shall not be unreasonably withheld or delayed

 

4

 

[ * ] = 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.

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before acquiring such license; and (ii) if Symphony Evolution provides such
consent, then unless otherwise agreed to by the Parties in writing, Licensor
shall use commercially reasonable efforts to obtain, at the time such license is
granted, the right to sublicense such Third Party IP to Symphony Evolution
consistent with the terms of this Agreement as if such Third Party IP were
Licensed Intellectual Property. Unless otherwise agreed to by the Parties in
writing, the financial obligations under any licenses to Third Party IP obtained
by Licensor with Symphony Evolution’s consent shall (1) be borne fully by
Symphony Evolution if such Third Party IP relates solely to the composition of
matter, use, manufacture, formulation or exploitation of XL647, XL784, or XL999
or the Products and, at the time of entering into such third party license,
Licensor has not exercised its Program Option or Discontinuation Option with
respect to the Program to which such Third Party IP relates; or (2) be shared by
the Parties in amounts and/or percentages to be agreed upon by the Parties prior
to Licensor entering into such third party license, if such Third Party IP
relates (but does not relate solely) to the composition of matter, use,
manufacture, formulation or exploitation of Products within Program(s) for which
Licensor has not exercised its Program Option and/or Discontinuation Option and
also relates to either (x) the composition of matter, use, manufacture,
formulation or exploitation of Products within Program(s) for which Licensor has
exercised its Program Option and/or Discontinuation Option or (y) the
composition of matter, use, manufacture, formulation or exploitation of other
products of Licensor; or (3) be borne fully by Licensor if such Third Party IP
relates solely to the composition of matter, use, manufacture, formulation or
exploitation of a Product(s) within a Program(s) for which Licensor has
exercised its Program Option and/or Discontinuation Option. Notwithstanding the
foregoing, Licensor shall have no obligation to obtain any such third party
licenses under this Agreement or, in the event that Symphony Evolution does not
give such consent, to grant any sublicenses to Symphony Evolution. Upon
obtaining a license to such Third Party IP and the right to sublicense to
Symphony Evolution, the Parties will, as necessary, promptly amend this
Agreement to include such sublicensed intellectual property within the license
granted hereunder, incorporate any other limitations, royalties or other
provisions required by such third party with respect to such sublicense, and
address Symphony Evolution’s rights (if any) with respect to patent prosecution,
maintenance and enforcement of patents and patent applications within such Third
Party IP.

 

2.10. Separate Third Party License for Discontinued Program. In the event of the
expiration of a Discontinuation Option without exercise by Licensor, Symphony
Evolution has the right to transfer to a third party, in accordance with Section
11.2(b) of the Amended and Restated Research and Development Agreement, Symphony
Evolution’s rights to the compounds and Products relating to the Program to
which such Discontinuation Option pertained (the “Discontinued Program”). If
Symphony Evolution identifies a third party that wishes to obtain such rights,
then upon Symphony Evolution’s request, (i) Licensor and Symphony shall amend
this Agreement to terminate all of Symphony Evolution’s rights and obligations
to the extent applicable to the Discontinued Program and (ii) Licensor shall
enter into a separate license agreement with such third party in which all of
such terminated rights and obligations shall be conferred upon and undertaken by
such third party. The terms and conditions of such license agreement shall be
identical to those contained herein, to the extent that such terms are
applicable to the Discontinued Program and not dependent on any Operative
Document other than this Agreement. Such terms shall include but not be limited
to (1) provisions allowing for termination of such license agreement upon a
material, uncured breach of such license agreement by the third party on similar
terms as provided herein with respect to

 

5

 

[ * ] = 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.

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Symphony Evolution and (2) a confidentiality provision that is not dependent on
any of the Operative Documents. Termination of this Agreement shall not effect
such license agreement and Licensor’s obligation to enter into such a license
agreement shall survive termination of this Agreement.

 

ARTICLE 3

SUBLICENSE TO CERTAIN THIRD PARTY INTELLECTUAL PROPERTY

 

3.1. General. The Parties acknowledge and agree that the license set forth in
Section 2.2 does not include certain Intellectual Property (the “University IP”)
which has been in-licensed by Licensor from Yale University (“Yale”) pursuant to
the Yale Exclusive License Agreement between Licensor and Yale effective January
9, 2002 (the “Yale Agreement”) and the Regents of the University of California
(“Regents”) pursuant to the Exclusive License and Bailment Agreement between
Licensor and Regents effective July 25, 2001 (the “Regents Agreement” and
together with the Yale Agreement, the “University Agreements”).

 

3.2. Option to Acquire Sublicense. In the event of (i) an expiration of a
Discontinuation Option in respect of the Program relating to XL784 without
exercise by Licensor or (ii) an expiration of the Purchase Option without
exercise by Licensor (and Licensor has not exercised a Discontinuation Option or
Program Option in respect of the Program relating to XL784), then, upon Symphony
Evolution’s written request, the Parties shall amend this Agreement to provide
that, effective upon such expiration of the Discontinuation Option or Purchase
Option (as applicable), Symphony Evolution is granted a sublicense in and to
such University IP to develop, make, have made, use, offer for sale, sell, and
import XL784 and related Products; provided, however, that, with respect to the
Intellectual Property licensed under the Yale Agreement, Symphony Evolution’s
sublicense shall be limited to Licensed Products as defined in the Yale
Agreement, and, with respect to the Intellectual Property licensed under the
Regents Agreement, Symphony Evolution’s sublicense shall be limited to Licensed
Products as defined in the Regents Agreement. The terms and conditions of the
sublicense shall be consistent with and no broader than the terms and conditions
contained herein with respect to Licensed Intellectual Property; provided,
however, such sublicense shall contain such additional terms and obligations as
are required under the University Agreements, including all terms set forth in
Annex C. Without limiting Licensor’s obligations under Section 3.4, the option
set forth in this Section 3.2 shall expire with respect to the Yale Agreement
and the Regents Agreement upon the expiration or termination of the Yale
Agreement and the Regents Agreement, respectively.

 

3.3. Prosecution Fees. Symphony Evolution shall reimburse Licensor, within [ * ]
after receipt of Licensor’s invoice, for [ * ] of the costs incurred by Licensor
with respect to the filing, prosecution and maintenance of all patent
applications and patents included within the University IP. The foregoing
obligation of Symphony Evolution shall terminate upon any exercise by Licensor
of a Program Option or Discontinuation Option in respect of the Program related
to XL784.

 

3.4. Termination or Amendment of University Agreements. Licensor may not (a)
terminate any University Agreements or (b) amend any University Agreements in a

 

6

 

[ * ] = 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.

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manner that would conflict with or otherwise limit Licensor’s obligations to
Symphony Evolution under Section 3.2 without (i) giving Symphony Evolution
reasonable advance written notice of such intention and (ii) in the event that
Yale or Regents agree to (1) permit the Yale Agreement or the Regents Agreement,
respectively, to be assigned to Symphony Evolution or to (2) grant a substitute
license to the relevant University IP to Symphony Evolution, executing any
document necessary to effect such assignment or permit such substitute license
and, in the event that Licensor terminates both the Yale Agreement and the
Regents Agreement, transferring to Symphony Evolution any applicable patent
files in respect of the University IP (provided that the foregoing shall not be
construed to require Licensor to pay any amounts or to undertake any additional
obligations).

 

3.5. No Conflicts. Licensor shall not enter into any agreements with third
parties that would conflict with or otherwise limit Licensor’s obligations to
Symphony Evolution under Section 3.2.

 

ARTICLE 4

INTELLECTUAL PROPERTY

 

4.1. Ownership. The Parties acknowledge and agree that, as between Licensor and
Symphony Evolution, Licensor or its licensors are the owner of all right, title
and interest in and to the Licensed Intellectual Property, including without
limitation Symphony Evolution Enhancements. Symphony hereby assigns to Licensor
all of Symphony Evolution’s rights and interests in any Symphony Evolution
Enhancements. Symphony Evolution shall promptly disclose any Symphony Evolution
Enhancement to Licensor, and shall use reasonable efforts, at Licensor’s request
and at no cost to Licensor, to cooperate fully with Licensor to transfer such
Symphony Evolution Enhancements to Licensor.

 

4.2. Marking. Symphony Evolution shall mark, and shall cause all of its
sublicensees to mark, all Products, or the packaging thereof or materials
related thereto, with the number of the applicable patents licensed hereunder in
accordance with applicable U.S. patent law.

 

4.3. Prosecution and Maintenance.

 

(a) Unless otherwise set forth in this Section 4.3, (i) Licensor shall prepare,
file, prosecute and maintain, in the name of Licensor, those patents and patent
applications in Licensed Patent Rights for which, as between Licensor and Third
Party Licensors, Licensor has patent prosecution and maintenance rights at such
time; and (ii) Licensor shall provide Symphony Evolution with (1) quarterly
reports regarding the status of the prosecution and maintenance of such patents
and patent applications, (2) copies of any patent documents provided to
GlaxoSmithKline with respect to such patents and patent applications, and (3)
timely answers to Symphony Evolution’s questions regarding the status of patents
and patent applications in Licensed Patent Rights.

 

(b) Licensor will use commercially reasonable efforts to seek the allowance of
broad generic claims, consistent with Licensor’s determination of
enforceability, business considerations and other factors.

 

7

 

[ * ] = 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.

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(c) Subject to any such costs paid by Third Party Licensors, the cost of such
prosecution and maintenance of Licensed Patent Rights shall be paid by Symphony
Evolution. Upon the scope of any Licensed Patent Rights being amended so that
the patent or patent application’s claims no longer relate to XL647, XL784,
XL999 or any Products, such patent or patent application shall cease to be a
Licensed Patent Right and all rights and obligations with respect to such patent
or patent application (including costs, fees, prosecution, maintenance and
enforcement) shall revert to Licensor.

 

(d) Symphony Evolution shall not be responsible for the costs of any
interference or reexamination initiated by Licensor with respect to the Licensed
Patent Rights (except to the extent allocated in the Development Budget), unless
the Parties mutually agree in writing that it is reasonably necessary or useful
to file and prosecute such interference or re-examination in connection with
such Licensed Patent Rights to protect their interests in such Licensed Patent
Rights, which agreement will not be unreasonably withheld or delayed. In the
event of such agreement, unless otherwise agreed in writing by the Parties,
Symphony Evolution shall pay all costs of such interference or reexamination.

 

(e) Each Party shall provide the prosecuting Party with reasonable cooperation
under this Section 4.3.

 

(f) Symphony Evolution acknowledges that Licensor has certain obligations to
GlaxoSmithKline with respect to the prosecution and maintenance of certain
patents and patent applications within the Licensed Patent Rights, including
without limitation certain obligations to [ * ]. Nothing in this Agreement shall
be interpreted as requiring Licensor to breach such obligations to
GlaxoSmithKline. Notwithstanding the foregoing, Licensor shall use commercially
reasonable efforts to make, no later than upon any expiration of the Term
without Licensor’s exercise of the Purchase Option, any amendment to the GSK
Agreement (as defined in Section 4.10) that may be necessary to provide that,
upon any such expiration of the Term, GlaxoSmithKline shall no longer have any
rights with respect to [ * ].

 

4.4. Abandonment. The Parties acknowledge that in the event Licensor desires to
abandon any patent or patent application covering Licensed Patent Rights
(whether during or after the Term), Licensor shall provide prompt, timely
written notice thereof to Symphony Evolution. If Symphony Evolution informs
Licensor in writing at least [ * ] before the relevant deadline that Symphony
Evolution desires to avoid such abandonment or lapse, then Licensor shall
continue to prosecute or maintain such patent or patent application at Symphony
Evolution’s request and sole expense. Symphony Evolution understands and
acknowledges that Licensor cannot allow certain patents or patent applications
in the Licensed Patent Rights to lapse or become abandoned without [ * ].
Nothing in this Section 4.4 shall be interpreted as giving Symphony Evolution
rights that conflict with such Licensor obligations.

 

4.5. Infringement. Each Party agrees to immediately notify the other Party upon
becoming aware of any infringement, misappropriation, illegal use or misuse of
the Licensed Intellectual Property and provide to the other party all available
evidence of such infringement.

 

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4.6. First Enforcement Right During Term. During the Term, as between the
Parties, Licensor has the first right, but not the obligation, to take action
against others in the courts, administrative agencies or otherwise, at Symphony
Evolution’s cost and expense, to prevent or terminate infringement,
misappropriation, illegal use or misuse of the Licensed Patent Rights or other
Licensed Intellectual Property due to the manufacture, use or sale of a product
or compound that might be competitive with a Product. Symphony Evolution shall,
at its expense, cooperate with and reasonably assist Licensor in any such action
if so requested by Licensor, and, upon Licensor’s request, execute, file and
deliver all documents and proof necessary for such purpose, including being
named as a party to such litigation if requested by Licensor or if required by
law. Subject to Section 4.10, Symphony Evolution shall have the right to
participate and be represented by its own counsel at its own expense in any such
action, suit or proceeding with respect to Licensed Patent Rights solely
relating to Products for which Licensor has not exercised its Program Option or
Discontinuation Option. Subject to Section 4.10, Licensor shall not enter into
any settlement or compromise of such action, suit or proceeding that affects or
concerns the validity, enforceability, or ownership of any Licensed Patent
Rights or other Licensed Intellectual Property without the prior written consent
of Symphony Evolution, which consent shall not be unreasonably withheld or
delayed.

 

4.7. Post-Term Enforcement.

 

(a) Following the expiration of the Term without Licensor’s exercise of the
Purchase Option, as between the Parties, Symphony Evolution shall have the first
right, but not the obligation, to take action against others in the courts,
administrative agencies or otherwise, under Symphony Evolution’s direction and
control and at Symphony Evolution’s cost and expense, to prevent or terminate
infringement, misappropriation, illegal use or misuse of any Licensed Patent
Rights or other Licensed Intellectual Property that solely relate to a Product
for which Licensor has not exercised its Program Option or Discontinuation
Option, due to the manufacture, use or sale of a product or compound that might
be competitive with such Product. Licensor shall, at Symphony Evolution’s
expense, cooperate and reasonably assist Symphony Evolution in such action if so
requested, and upon Symphony Evolution’s request, execute, file and deliver all
documents and proof necessary for such purpose, including being named as a party
to such litigation if requested by Symphony Evolution or if required by law.
Licensor shall have the right to participate and be represented in any such
action, suit or proceeding by its own counsel at its own expense. Symphony
Evolution shall not enter into any settlement or compromise of such action, suit
or proceeding that affects or concerns the validity, enforceability, or
ownership of any Licensed Patent Rights or other Licensed Intellectual Property
without the prior written consent of Licensor, which consent shall not be
unreasonably withheld or delayed.

 

(b) Following the expiration of the Term without Licensor’s exercise of the
Purchase Option, if Symphony Evolution does not take action under Section 4.7(a)
within [ * ] of Licensor’s written request that Symphony Evolution take such
action, then Licensor shall have the option to commence any such action under
its own direction and control, and at Licensor’s cost and expense. Symphony
Evolution shall, at Licensor’s expense, cooperate and reasonably assist Licensor
in such action if so requested, and upon Licensor’s request, execute, file and
deliver all documents and proof necessary for such purpose, including being
named as a party to such litigation if requested by Licensor or if required by
law. Symphony Evolution shall have

 

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the right to participate and be represented in any such action, suit or
proceeding by its own counsel at its own expense. Licensor shall not enter into
any settlement or compromise of such action, suit or proceeding that affects or
concerns the validity, enforceability, or ownership of any Licensed Patent
Rights or other Licensed Intellectual Property without the prior written consent
of Symphony Evolution, which consent shall not be unreasonably withheld or
delayed.

 

4.8. Withdrawal of Enforcement. If either Party brings an action under this
ARTICLE 4 and subsequently ceases to pursue or withdraws from such action, it
shall promptly notify the other Party and the other Party may substitute itself
for the withdrawing party under the terms of this ARTICLE 4, provided that such
substitution would not constitute a breach of Licensor’s obligations to any
Third Party Licensor.

 

4.9. Recoveries. All damages or other compensation of any kind recovered in such
action, suit, or proceeding or from any settlement or compromise brought under
this ARTICLE 4 shall first be used to reimburse each Party for its expenses in
connection with such action, suit or proceeding, (in proportion to the expenses
of each Party if recovery is insufficient to cover all such expenses) and the
remainder of such recovery, after Licensor makes any other payments it is
obligated to make to Third Party Licensors on account of such recovery, shall be
allocated [ * ].

 

4.10. Third Party Rights. Symphony Evolution acknowledges that Licensor has
certain obligations to GlaxoSmithKline with respect to the enforcement of
certain patents and patent applications within the Licensed Patent Rights,
including without limitation [ * ]. Nothing in this Agreement shall be
interpreted as requiring Licensor to breach such obligations to GlaxoSmithKline.
Notwithstanding the foregoing, (i) in the event that GlaxoSmithKline exercises
its option to [ * ] the Product Development and Commercialization Agreement
between Licensor and GlaxoSmithKline dated October 28, 2002 (the “GSK
Agreement”), Licensor shall use commercially reasonable efforts to amend the GSK
Agreement as soon as reasonably practical after such exercise but in no event
later than any expiration of the Term without Licensor’s exercise of the
Purchase Option, to provide that upon any expiration of the Term without
Licensor’s exercise of the Purchase Option, GlaxoSmithKline shall no longer have
any right to [ * ]; and (ii) in the event GlaxoSmithKline does not exercise its
option to [ * ], Licensor hereby represents and warrants to Symphony Evolution
that upon expiration of the Term pursuant to Section 1(c)(iii)(x) of the
Purchase Option Agreement, GlaxoSmithKline shall no longer have any right to [ *
].

 

ARTICLE 5

REPRESENTATIONS AND WARRANTIES

 

5.1. Representations and Warranties of Licensor. Licensor hereby represents and
warrants to Symphony Evolution, that, as of the Effective Date:

 

(a) Licensor is the owner of all right, title, and interest in and to (i) all
Licensed Patent Rights listed in Annex B and not identified as jointly owned or
licensed from a third party and (ii) the Regulatory Files;

 

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(b) Licensor has sufficient rights to grant the licenses granted hereunder and
the grant of such licenses does not and will not conflict with any agreement to
which Licensor is a party or otherwise governing the Licensed Intellectual
Property;

 

(c) To the Knowledge of Licensor, no third party is engaging in any activity
that infringes or misappropriates the Licensed Intellectual Property;

 

(d) No element of the Licensed Intellectual Property has been adjudged invalid
or unenforceable in whole or part, and to the Knowledge of Licensor, the issued
patents within the Licensed Intellectual Property are valid and enforceable;

 

(e) To the Knowledge of Licensor, no actions or claims have been asserted, are
pending or have been threatened, against Licensor in writing alleging that the
manufacture, use or sale of XL647, XL784 or XL999 misappropriates or infringes
the intellectual property rights of any third party; and

 

(f) To the Knowledge of Licensor, the manufacture, use or sale of XL647, XL784
or XL999 by Symphony Evolution (or its sublicensees) in strict accordance with
the licenses herein and other terms of this Agreement will not misappropriate or
infringe the intellectual property rights of any third party.

 

5.2. Disclaimer and Acknowledgement. EXCEPT AS EXPRESSLY SET FORTH IN THIS
ARTICLE 5, THE LICENSED INTELLECTUAL PROPERTY, PRODUCTS (AND THE COMPOUNDS
THEREIN), TANGIBLE MATERIALS AND REGULATORY FILES ARE PROVIDED “AS IS” WITH NO
REPRESENTATIONS OR WARRANTIES OF ANY KIND, AND LICENSOR EXPRESSLY DISCLAIMS ALL
OTHER WARRANTIES, EXPRESS OR IMPLIED, INCLUDING BUT NOT LIMITED TO ANY
WARRANTIES OF MERCHANTABILITY, FITNESS FOR PARTICULAR PURPOSE, OR
NON-INFRINGEMENT. LICENSOR DOES NOT WARRANT THE PERFORMANCE OF ANY PRODUCT (OR
THE COMPOUND(S) THEREIN), INCLUDING THEIR SAFETY, EFFECTIVENESS OR COMMERCIAL
VIABILITY. ANY SYMPHONY EVOLUTION ENHANCEMENTS PROVIDED TO LICENSOR HEREUNDER
ARE PROVIDED “AS IS” WITH NO REPRESENTATIONS OR WARRANTIES OF ANY KIND AND
SYMPHONY EVOLUTION EXPRESSLY DISCLAIMS ALL WARRANTIES, EXPRESS OR IMPLIED,
INCLUDING BUT NOT LIMITED TO ANY WARRANTIES OF MERCHANTABILITY, FITNESS FOR
PARTICULAR PURPOSE, OR NON-INFRINGEMENT.

 

ARTICLE 6

INDEMNIFICATION AND LIMITATION OF LIABILITY

 

6.1. Indemnity. To the greatest extent permitted by applicable law, Licensor
shall indemnify and hold harmless Symphony Evolution, its Affiliates, and each
of their respective officers, directors, employees, agents, members, managers,
successors and assigns (each, a “Symphony Evolution Indemnified Party”) and
Symphony Evolution shall indemnify and hold harmless Licensor, its Affiliates
and each of their respective officers, directors, employees, agents, members,
successors and assigns (each, an “Exelixis Indemnified Party” and together with
Symphony Evolution Indemnified Party, the “Indemnified Parties”), from and

 

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against any and all claims, losses, diminution in value, costs, interest,
awards, judgments, penalties, fees (including reasonable fees for attorneys and
other professionals), court costs, liabilities, damages and expenses incurred by
any Symphony Evolution Indemnified Party or Exelixis Indemnified Party
(irrespective of whether any such Symphony Evolution Indemnified Party or
Exelixis Indemnified Party, as applicable, is a party to the action for which
indemnification hereunder is sought), (collectively, a “Loss”) as a result of,
arising out of, or relating to any and all third party suits, claims, actions,
proceedings, investigations, litigation or demands based upon:

 

(i) in the case of Licensor being the Indemnifying Party, (A) any breach of any
representation or warranty made by Licensor herein or in any certificate,
instrument or document delivered hereunder, (B) any breach of any covenant,
agreement or obligation of Licensor contained herein, or in any certificate,
instrument or document delivered hereunder, or (C) any act of gross negligence
or willful misconduct by Licensor in performing its obligations under this
Agreement; in each case, except (1) with respect to Losses for which Licensor is
entitled to indemnification under this ARTICLE 6 or (2) to the extent such Loss
arises from the gross negligence or willful misconduct of a Symphony Evolution
Indemnified Party, and

 

(ii) in the case of Symphony Evolution being the Indemnifying Party, (A) any
breach of any representation or warranty made by Symphony Evolution herein or in
any certificate, instrument or document delivered hereunder, (B) any breach of
any covenant, agreement or obligation of Symphony Evolution contained herein, or
in any certificate, instrument or document delivered hereunder, (C) any act of
gross negligence or willful misconduct by Symphony Evolution in performing its
obligations under this Agreement, or (D) the development, manufacture, use,
handling, storage, sale or other disposition of the Product (other than those
Products arising from a Program for which Licensor exercised a Program Option or
Discontinuation Option) after end of the Term; in each case, except (1) with
respect to Losses for which Symphony Evolution is entitled to indemnification
under this ARTICLE 6 or (2) to the extent such Loss arises from the gross
negligence or willful misconduct of an Exelixis Indemnified Party.

 

To the extent that the foregoing undertakings by Licensor and/or Symphony
Evolution may be unenforceable for any reason, such Party shall make the maximum
contribution to the payment and satisfaction of any Loss that is permissible
under applicable Law.

 

6.2. Notice of Claims. Any Indemnified Party that proposes to assert a right to
be indemnified under this ARTICLE 6 shall notify Licensor or Symphony Evolution,
as applicable (the “Indemnifying Party”), promptly after receipt of notice of
commencement of any action, suit or proceeding against such Indemnified Party
(an “Indemnified Proceeding”) in respect of which a claim is to be made under
this ARTICLE 6, or the incurrence or realization of any Loss in respect of which
a claim is to be made under this ARTICLE 6, of the commencement of such
Indemnified Proceeding or of such incurrence or realization, enclosing a copy of
all relevant documents, including all papers served and claims made, but the
omission so to notify the applicable Indemnifying Party promptly of any such
Indemnified Proceeding or incurrence or realization shall not relieve (a) such
Indemnifying Party from any liability that it may have to such Indemnified Party
under this ARTICLE 6 or otherwise, except, as to such

 

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COMMISSION PURSUANT TO RULE 24B-2 OF THE SECURITIES EXCHANGE ACT OF 1934, AS
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Indemnifying Party’s liability under this ARTICLE 6, to the extent, but only to
the extent, that such Indemnifying Party shall have been prejudiced by such
omission, or (b) any other indemnitor from liability that it may have to any
Indemnified Party under the Operative Documents.

 

6.3. Defense of Proceedings. In case any Indemnified Proceeding shall be brought
against any Indemnified Party, it shall notify the applicable Indemnifying Party
of the commencement thereof and such Indemnifying Party shall be entitled to
participate in, and provided such Indemnified Proceeding involves a claim solely
for money damages and does not seek an injunction or other equitable relief
against the Indemnified Party and is not a criminal or regulatory action, to
assume the defense of, such Indemnified Proceeding with counsel reasonably
satisfactory to such Indemnified Party, and after notice from such Indemnifying
Party to such Indemnified Party of such Indemnifying Party’s election so to
assume the defense thereof and the failure by such Indemnified Party to object
to such counsel within [ * ] following its receipt of such notice, such
Indemnifying Party shall not be liable to such Indemnified Party for legal or
other expenses related to such Indemnified Proceedings incurred after such
notice of election to assume such defense except as provided below and except
for the reasonable costs of investigating, monitoring or cooperating in such
defense subsequently incurred by such Indemnified Party reasonably necessary in
connection with the defense thereof. Such Indemnified Party shall have the right
to employ its counsel in any such Indemnified Proceeding, but the fees and
expenses of such counsel shall be at the expense of such Indemnified Party
unless:

 

(a) the employment of counsel by such Indemnified Party at the expense of the
applicable Indemnifying Party has been authorized in writing by such
Indemnifying Party;

 

(b) such Indemnified Party shall have reasonably concluded in its good faith
(which conclusion shall be determinative unless a court determines that such
conclusion was not reached reasonably and in good faith) that there is or may be
a conflict of interest between the applicable Indemnifying Party and such
Indemnified Party in the conduct of the defense of such Indemnified Proceeding
or that there are or may be one or more different or additional defenses,
claims, counterclaims, or causes of action available to such Indemnified Party
(it being agreed that in any case referred to in this clause (b) such
Indemnifying Party shall not have the right to direct the defense of such
Indemnified Proceeding on behalf of the Indemnified Party);

 

(c) the applicable Indemnifying Party shall not have employed counsel reasonably
acceptable to the Indemnified Party, to assume the defense of such Indemnified
Proceeding within a reasonable time after notice of the commencement thereof
(provided, however, that this clause shall not be deemed to constitute a waiver
of any conflict of interest that may arise with respect to any such counsel); or

 

(d) any counsel employed by the applicable Indemnifying Party shall fail to
timely commence or diligently conduct the defense of such Indemnified
Proceeding;

 

in each of which cases the fees and expenses of counsel for such Indemnified
Party shall be at the expense of such Indemnifying Party. Only one counsel shall
be retained by all Indemnified Parties with respect to any Indemnified
Proceeding, unless counsel for any

 

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Indemnified Party reasonably concludes in good faith (which conclusion shall be
determinative unless a court determines that such conclusion was not reached
reasonably and in good faith) that there is or may be a conflict of interest
between such Indemnified Party and one or more other Indemnified Parties in the
conduct of the defense of such Indemnified Proceeding or that there are or may
be one or more different or additional defenses, claims, counterclaims, or
causes or action available to such Indemnified Party.

 

6.4. Settlement. Without the prior written consent of such Indemnified Party,
such Indemnifying Party shall not settle or compromise, or consent to the entry
of any judgment in, any pending or threatened Indemnified Proceeding, unless
such settlement, compromise, consent or related judgment (i) includes an
unconditional release of such Indemnified Party from all liability for Losses
arising out of such claim, action, investigation, suit or other legal
proceeding, (ii) provides for the payment of money damages as the sole relief
for the claimant (whether at law or in equity), (iii) involves no finding or
admission of any violation of law or the rights of any Person by the Indemnified
Party, and (iv) is not in the nature of a criminal or regulatory action. No
Indemnified Party shall settle or compromise, or consent to the entry of any
judgment in, any pending or threatened Indemnified Proceeding in respect of
which any payment would result hereunder or under the Operative Documents
without the prior written consent of the Indemnifying Party, such consent not to
be unreasonably conditioned, withheld or delayed.

 

6.5. Limitation of Liability. TO THE GREATEST EXTENT PERMITTED BY APPLICABLE
LAW, NEITHER PARTY NOR ANY OF THEIR RESPECTIVE DIRECTORS, OFFICERS, MEMBERS,
MANAGERS, EMPLOYEES, INDEPENDENT CONTRACTORS OR AGENTS SHALL HAVE ANY LIABILITY
OF ANY TYPE (INCLUDING, BUT NOT LIMITED TO, CLAIMS IN CONTRACT, NEGLIGENCE AND
TORT LIABILITY) FOR ANY SPECIAL, INCIDENTAL, INDIRECT, PUNITIVE OR CONSEQUENTIAL
DAMAGES, INCLUDING, BUT NOT LIMITED TO, THE LOSS OF OPPORTUNITY, LOSS OF USE OR
LOSS OF REVENUE OR PROFIT IN CONNECTION WITH OR ARISING OUT OF THIS AGREEMENT OR
THE SERVICES PERFORMED HEREUNDER, EVEN IF SUCH DAMAGES MAY HAVE BEEN
FORESEEABLE. THE FOREGOING SHALL NOT LIMIT EITHER PARTY’S INDEMNIFICATION
OBLIGATIONS PURSUANT TO SECTION 6.1.

 

6.6. Insurance. Each Party shall maintain insurance, including on the part of
Symphony Evolution, product liability insurance, with respect to its activities
under this Agreement. Such insurance shall be in such amounts and subject to
such deductibles as are prevailing in the industry from time to time. Symphony
Evolution shall maintain a minimum of an aggregate of $10,000,000 in directors
and officers insurance and an aggregate of $10,000,000 in product liability
insurance. Notwithstanding anything to the contrary herein, this Section 6.6
shall survive only for a period of two (2) years following termination or
expiration of this Agreement.

 

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COMMISSION PURSUANT TO RULE 24B-2 OF THE SECURITIES EXCHANGE ACT OF 1934, AS
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ARTICLE 7

TERM AND TERMINATION

 

7.1. Term. This Agreement shall commence on the Effective Date and shall remain
in force until terminated as provided herein.

 

7.2. Termination.

 

(a) Either Party may terminate this Agreement at any time if the other Party is
in material default or breach of this Agreement that has resulted in, or would
reasonably be expected to result in, a material adverse effect on the Programs
or the non-breaching Party’s rights under the Operative Documents, and such
material default or breach continues unremedied for a period of [ * ] after
written notice thereof is delivered to the defaulting or breaching party.

 

(b) Licensor may terminate this Agreement at any time upon written notice to
Symphony Evolution if (i) Investors materially breaches Sections 2 or 3 of the
Funding Agreement, (ii) Holdings breaches Section 2 of the Subscription
Agreement or (iii) Holdings or Symphony Evolution is in material default or
breach the Purchase Option Agreement that has resulted in, or would reasonably
be expected to result in, a material adverse effect on the Licensor’s rights
under the Operative Documents and such default or breach is not cured within [ *
] after written notice of such default or breach under the Purchase Option
Agreement is delivered to the defaulting or breaching party.

 

(c) Licensor may terminate this Agreement in the event that the Amended and
Restated Research and Development Agreement is terminated by Licensor in
accordance with the terms thereof due to a material breach or default by
Symphony Evolution or Holdings (without limiting any rights to notice or cure
that Symphony Evolution or Holdings may have under such agreements).

 

(d) Upon any termination of this Agreement, all license rights granted herein
(except for those rights granted in or pursuant to Section 2.5) shall
immediately terminate.

 

7.3. Survival. The following Sections and Articles shall survive any expiration
or termination of this Agreement: Sections 2.10, 4.1, 5.2 and 7.3, and Articles
6 and 8.

 

7.4. Bankruptcy. All rights and licenses granted under this Agreement are, and
shall otherwise be deemed to be, for purposes of Section 365(n) of the United
States Bankruptcy Code (the “Code”), licenses to “Intellectual Property” as
defined in the Code. The Parties agree that each Party shall retain and may
fully exercise all of its rights and elections under the Code.

 

ARTICLE 8

MISCELLANEOUS

 

8.1. Notices. Any notice, request, demand, waiver, consent, approval or other
communication which is required or permitted to be given to any Party shall be
in writing and shall be deemed given only if delivered to the Party personally
or sent to the Party by

 

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facsimile transmission (promptly followed by a hard-copy delivered in accordance
with this Section 8.1), by next Business Day delivery by a nationally recognized
courier service, or by registered or certified mail (return receipt requested),
with postage and registration or certification fees thereon prepaid, addressed
to the Party at its address set forth below:

 

Licensor:

 

Exelixis, Inc.

170 Harbor Way

South San Francisco, CA 94083

Attention: Corporate Secretary

Facsimile: (650) 837-7951

 

Symphony Evolution:

 

Symphony Evolution, Inc.

7361 Calhoun Place, Suite 325

Rockville, MD 20850

Attn: Charles Finn

Facsimile: (301) 762-6154

 

with a copy to:

 

Symphony Capital Partners, L.P.

875 Third Avenue

18th Floor

New York, NY 10022

Attn: Mark Kessel

Facsimile: (212) 632-5401

 

or to such other address as such Party may from time to time specify by notice
given in the manner provided herein to each other Party entitled to receive
notice hereunder.

 

8.2. Entire Agreement. This Agreement (including any Annexes, Schedules,
Exhibits or other attachments hereto) and the agreements referred to herein
(including the Operative Documents) constitute the entire agreement between the
Parties with respect to the subject matter hereof, and no oral or written
statement may be used to interpret or vary the meaning of the terms and
conditions hereof. This Agreement supersedes any prior or contemporaneous
agreements and understandings, whether written or oral, between the Parties with
respect to the subject matter hereof, including the Original Agreement but
excluding the Operative Documents.

 

8.3. Assignment. Neither Party may assign or otherwise transfer this Agreement
without the prior written consent of the other Party; provided, however, that
(i) Licensor may assign this Agreement or any of its rights and obligations
hereunder without the consent of Symphony Evolution (A) to an Affiliate or in
connection with a merger or the sale of all or substantially all of the assets
of the Licensor to which this Agreement relates, or (B) to the

 

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Surviving Entity in the event Licensor undergoes a Change of Control in
compliance with Article 14 of the Amended and Restated Research and Development
Agreement, provided, however, the Licensed Patent Rights and Licensed Know-How
shall not be construed, as a result of such assignment, to include any patent
rights, know-how, trade secret, and other intellectual property that, prior to
such Change of Control, were owned or Controlled by the Person (other than
Licensor) involved in such Change of Control; and (ii) after expiration of the
Term without Licensor’s exercise of the Purchase Option, Symphony Evolution may
assign this Agreement to any Person without the prior, written consent of
Licensor. Assignment of this Agreement by either Party shall not relieve the
assignor of its obligations hereunder. This Agreement shall be binding upon and
inure to the benefit of the Parties and their respective successors and
permitted assigns.

 

8.4. Headings. The descriptive headings contained in this Agreement are for
convenience of reference only and shall not affect in any way the meaning or
interpretation of the Agreement.

 

8.5. Independent Contractor. Each Party shall be acting as an independent
contractor in performing under this Agreement and shall not be considered or
deemed to be an agent, employee, joint venturer or partner of the other Party.

 

8.6. Severability. If any term or other provision of this Agreement is invalid,
illegal or incapable of being enforced by any law or public policy, all other
terms and provisions of this Agreement shall nevertheless remain in full force
and effect so long as the economic or legal substance of the transactions
contemplated hereby is not affected in any manner materially adverse to any
Party.

 

8.7. No Third-Party Beneficiaries. Except with respect to certain
indemnification obligations and liability limitations pursuant to ARTICLE 6,
nothing in this Agreement, either express or implied, is intended to or shall
confer upon any third party any legal or equitable right, benefit or remedy of
any nature whatsoever under or by reason of this Agreement.

 

8.8. Compliance with Laws. In performing under this Agreement, each Party shall
comply with all applicable laws rules and regulations, including without
limitation, the United States Food and Drug Administration and the United States
Export Administration Regulations.

 

8.9. Amendment. This Agreement may not be amended or modified except by an
instrument in writing signed by authorized representatives of Licensor and
Symphony Evolution.

 

8.10. Governing Law; Consent to Jurisdiction and Service of Process.

 

(a) This Agreement shall be governed by, and construed in accordance with, the
laws of the State of New York.

 

(b) Each of the Parties hereby irrevocably and unconditionally submits, for
itself and its property, to the nonexclusive jurisdiction of any New York State
court or federal

 

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court of the United States of America sitting in The City of New York, Borough
of Manhattan, and any appellate court from any jurisdiction thereof, in any
action or proceeding arising out of or relating to this Agreement, or for
recognition or enforcement of any judgment, and each of the Parties hereby
irrevocably and unconditionally agrees that all claims in respect of any such
action or proceeding may be heard and determined in any such New York State
court or, to the fullest extent permitted by law, in such federal court. Each of
the Parties agrees that a final judgment in any such action or proceeding shall
be conclusive and may be enforced in other jurisdictions by suit on the judgment
or in any other manner provided by law. Nothing in this Agreement shall affect
any right that any Party may otherwise have to bring any action or proceeding
relating to this Agreement.

 

(c) Each of the Parties irrevocably and unconditionally waives, to the fullest
extent it may legally and effectively do so, any objection that it may now or
hereafter have to the laying of venue of any suit, action or proceeding arising
out of or relating to this Agreement in any New York State or federal court.
Each of the Parties hereby irrevocably waives, to the fullest extent permitted
by law, the defense of an inconvenient forum to the maintenance of such action
or proceeding in any such court.

 

8.11. WAIVER OF JURY TRIAL. EACH OF THE PARTIES HERETO IRREVOCABLY WAIVES ALL
RIGHT TO TRIAL BY JURY IN ANY ACTION, PROCEEDING OR COUNTERCLAIM (WHETHER BASED
ON CONTRACT, TORT OR OTHERWISE) ARISING OUT OF OR RELATING TO THIS AGREEMENT.

 

8.12. Counterparts. This Agreement may be executed in one or more counterparts,
and by the respective Parties in separate counterparts, each of which when
executed shall be deemed to be an original but all of which taken together shall
constitute one and the same Agreement.

 

8.13. No Waiver. The failure of either Party to enforce at any time for any
period the provisions of or any rights deriving from this Agreement shall not be
construed to be a waiver of such provisions or rights or the right of such Party
thereafter to enforce such provisions.

 

SIGNATURES FOLLOW ON NEXT PAGE

 

18

 

[ * ] = 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.

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

 

 

SYMPHONY EVOLUTION, INC.

/s/ Harri V. Taranto

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Name: Harri V. Taranto

Title:   Chairman of the Board

 

 

SYMPHONY EVOLUTION HOLDINGS LLC

 

By:

 

Symphony Capital Partners, L.P.,

   

its Manager

By:

 

Symphony Capital GP, L.P.,

   

its general partner

By:

 

Symphony GP, LLC,

   

its general partner

 

/s/ Mark Kessel

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Name: Mark Kessel

Title:   Managing Member

 

 

EXELIXIS, INC.

            /s/ Christoph Pereira

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            Name: Christoph Pereira

            Title:   Vice President, Legal Affairs and Secretary

 

19

 

[ * ] = 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.

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ANNEX A

 

DEFINITIONS

 

“$” means United States dollars.

 

“Accredited Investor” has the meaning set forth in Rule 501(a) of Regulation D
promulgated under the Securities Act of 1933, as amended.

 

“Act” means the Delaware Limited Liability Company Act, 6 Del. C. § 18-101 et
seq.

 

“Additional Funds” has the meaning set forth in Section 2(b) of the Funding
Agreement.

 

“Additional Funding Date” has the meaning set forth in Section 3 of the Funding
Agreement.

 

“Additional Party” has the meaning set forth in Section 12 of the
Confidentiality Agreement.

 

“Additional Regulatory Filings” means such Governmental Approvals as required to
be made under any law applicable to the purchase of the Symphony Evolution
Equity Securities under the Agreement.

 

“Ad Hoc Meeting” has the meaning set forth in Paragraph 6 of Annex B to the
Amended and Restated Research and Development Agreement.

 

“Adjusted Capital Account Deficit” has the meaning set forth in Section 1.01 of
the Holdings LLC Agreement.

 

“Affected Member” has the meaning set forth in Section 27 of the Investors LLC
Agreement.

 

“Affiliate” means, with respect to any Person (i) any Person directly or
indirectly controlling, controlled by or under common control with such Person,
(ii) any officer, director, general partner, member or trustee of such Person,
or (iii) any Person who is an officer, director, general partner, member or
trustee of any Person described in clauses (i) or (ii) of this sentence. For
purposes of this definition, the terms “controlling,” “controlled by” or “under
common control with” shall mean the possession, direct or indirect, of the power
to direct or cause the direction of the management and policies of a Person or
entity, whether through the ownership of voting securities, by contract or
otherwise, or the power to elect at least 50% of the directors, managers,
general partners, or persons exercising similar authority with respect to such
Person or entities.

 

“Amended and Restated Research and Development Agreement” means the Amended and
Restated Research and Development Agreement dated as of June 9, 2005, among
Exelixis, Holdings and Symphony Evolution.

 

A-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.

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“Asset Value” has the meaning set forth in Section 1.01 of the Holdings LLC
Agreement.

 

“Auditors” means an independent certified public accounting firm of recognized
national standing.

 

“A Warrant Date” has the meaning set forth in Section 2.04 of the Warrant
Purchase Agreement.

 

“A Warrants” has the meaning set forth in Section 2.01 of the Warrant Purchase
Agreement.

 

“A Warrant Shares” has the meaning set forth in Section 2.01 of the Warrant
Purchase Agreement.

 

“Bankruptcy Code” means the United States Bankruptcy Code.

 

“Bloomberg” means Bloomberg L.P., a multimedia based distributor of information
services, including data and analysis for financial markets and businesses.

 

“Bloomberg Screen” means the display page designated on the Bloomberg service
(or such other page as may replace that page on that service) for the purpose of
displaying prices or bids of Exelixis Common Stock.

 

“Business Day” means any day other than Saturday, Sunday or any other day on
which commercial banks in The City of New York or the City of San Francisco are
authorized or required by law to remain closed.

 

“B Warrants” has the meaning set forth in Section 2.02 of the Warrant Purchase
Agreement.

 

“B Warrant Date” has the meaning set forth in Section 2.02 of the Warrant
Purchase Agreement.

 

“B Warrant Shares” has the meaning set forth in Section 2.05 of the Warrant
Purchase Agreement.

 

“Capital Contributions” has the meaning set forth in Section 1.01 of the
Holdings LLC Agreement.

 

“Capitalized Leases” means all leases that have been or should be, in accordance
with GAAP, recorded as capitalized leases.

 

“Cash Available for Distribution” has the meaning set forth in Section 1.01 of
the Holdings LLC Agreement.

 

“Chair” has the meaning set forth in Paragraph 4 of Annex B to the Amended and
Restated Research and Development Agreement.

 

A-2

 

[ * ] = 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.

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“Change of Control” means and includes the occurrence of any of the following
events, but specifically excludes (i) acquisitions of capital stock directly
from Exelixis for cash, whether in a public or private offering, (ii) sales of
capital stock by stockholders of Exelixis, and (iii) acquisitions of capital
stock by or from any employee benefit plan or related trust:

 

(a) the merger, reorganization or consolidation of Exelixis into or with another
corporation or legal entity in which Exelixis’ stockholders holding the right to
vote with respect to matters generally immediately preceding such merger,
reorganization or consolidation, own less than fifty percent (50%) of the voting
securities of the surviving entity; or

 

(b) the sale of all or substantially all of Exelixis’ assets or business.

 

“Class A Member” means a holder of a Class A Membership Interest.

 

“Class A Membership Interest” means a Class A Membership Interest in Holdings.

 

“Class B Member” means a holder of a Class B Membership Interest.

 

“Class B Membership Interest” means a Class B Membership Interest in Holdings.

 

“Class C Member” means a holder of a Class C Membership Interest.

 

“Class C Membership Interest” means a Class C Membership Interest in Holdings.

 

“Class D Member” means a holder of a Class D Membership Interest.

 

“Class D Membership Interest” means a Class D Membership Interest in Holdings.

 

“Clinical Budget” has the meaning set forth in Section 4.1 of the Amended and
Restated Research and Development Agreement.

 

“Clinical Plan” has the meaning set forth in Section 4.1 of the Amended and
Restated Research and Development Agreement.

 

“Closing Date” means June 9, 2005.

 

“CMC” means the chemistry, manufacturing and controls documentation as required
for filings with Regulatory Authority relating to the manufacturing, production
and testing of drug products.

 

“Code” means the Internal Revenue Code of 1986, as amended from time to time.

 

“Committed Capital” means $80,000,000.00.

 

“Common Stock” means the common stock, par value $0.01 per share, of Symphony
Evolution.

 

A-3

 

[ * ] = 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.

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“Company Expenses” has the meaning set forth in Section 5.09 of the Holdings LLC
Agreement.

 

“Company Property” has the meaning set forth in Section 1.01 of the Holdings LLC
Agreement.

 

“Confidential Information” has the meaning set forth in Section 2 of the
Confidentiality Agreement.

 

“Confidentiality Agreement” means the Confidentiality Agreement, dated as of
June 9, 2005, among Symphony Evolution, Holdings, Exelixis, each Symphony Fund,
SCP, SSP, Investors, Symphony Capital, RRD and Daniel F. Hoth, M.D., Herbert J.
Conrad, and Alastair J.J. Wood, M.D.

 

“Conflict Transaction” has the meaning set forth in Article IX of the Symphony
Evolution Charter.

 

“Control” means, with respect to any material, information or intellectual
property right, that a Party owns or has a license to such item or right, and
has the ability to grant the other Party access, a license or a sublicense (as
applicable) in or to such item or right as provided in the Operative Documents
without violating the terms of any agreement or other arrangement with any third
party.

 

“C Warrants” has the meaning set forth in Section 2.03 of the Warrant Purchase
Agreement.

 

“C Warrant Date” has the meaning set forth in Section 2.06 of the Warrant
Purchase Agreement.

 

“C Warrant Shares” has the meaning set forth in Section 2.03 of the Warrant
Purchase Agreement.

 

“Debt” of any Person means, without duplication:

 

(a) all indebtedness of such Person for borrowed money,

 

(b) all obligations of such Person for the deferred purchase price of property
or services (other than any portion of any trade payable obligation that shall
not have remained unpaid for 91 days or more from the later of (A) the original
due date of such portion and (B) the customary payment date in the industry and
relevant market for such portion),

 

(c) all obligations of such Person evidenced by bonds, notes, debentures or
other similar instruments,

 

(d) all obligations of such Person created or arising under any conditional sale
or other title retention agreement with respect to property acquired by such
Person (whether or not the rights and remedies of the seller or lender under
such agreement in an event of default are limited to repossession or sale of
such property),

 

(e) all Capitalized Leases to which such Person is a party,

 

A-4

 

[ * ] = 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.

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(f) all obligations, contingent or otherwise, of such Person under acceptance,
letter of credit or similar facilities,

 

(g) all obligations of such Person to purchase, redeem, retire, defease or
otherwise acquire for value any Equity Securities of such Person,

 

(h) the net amount of all financial obligations of such Person in respect of
Hedge Agreements,

 

(i) the net amount of all other financial obligations of such Person under any
contract or other agreement to which such Person is a party,

 

(j) all Debt of other Persons of the type described in clauses (a) through (i)
above guaranteed, directly or indirectly, in any manner by such Person, or in
effect guaranteed, directly or indirectly, by such Person through an agreement
(A) to pay or purchase such Debt or to advance or supply funds for the payment
or purchase of such Debt, (B) to purchase, sell or lease (as lessee or lessor)
property, or to purchase or sell services, primarily for the purpose of enabling
the debtor to make payment of such Debt or to assure the holder of such Debt
against loss, (C) to supply funds to or in any other manner invest in the debtor
(including any agreement to pay for property or services irrespective of whether
such property is received or such services are rendered) or (D) otherwise to
assure a creditor against loss, and

 

(k) all Debt of the type described in clauses (a) through (i) above secured by
(or for which the holder of such Debt has an existing right, contingent or
otherwise, to be secured by) any Encumbrance on property (including accounts and
contract rights) owned or held or used under lease or license by such Person,
even though such Person has not assumed or become liable for payment of such
Debt.

 

“Development Budget” means the budget for the implementation of the Development
Plan that is agreed upon by Exelixis and Symphony Evolution as of the Effective
Date, as may be revised from time to time in accordance with the Development
Committee Charter and the Amended and Restated Research and Development
Agreement.

 

“Development Committee” has the meaning set forth in Article 3 of the Amended
and Restated Research and Development Agreement.

 

“Development Committee Charter” has the meaning set forth in Article 3 of the
Amended and Restated Research and Development Agreement.

 

“Development Committee Member” has the meaning set forth in Paragraph 1 of Annex
B to the Amended and Restated Research and Development Agreement.

 

“Development Plan” means the development plan, covering all the Programs, agreed
to by Exelixis and Symphony Evolution as of the Effective Date, as may be
revised from time to time in accordance with the Development Committee Charter
and the Amended and Restated Research and Development Agreement.

 

“Directors” has the meaning set forth in the Preliminary Statement of the
Indemnification Agreement.

 

A-5

 

[ * ] = 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.

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“Disclosing Party” has the meaning set forth in Section 3 of the Confidentiality
Agreement.

 

“Discontinuation Closing Date” means the date of Symphony’s receipt of the
Discontinuation Price.

 

“Discontinuation Option” has the meaning set forth in Section 11.2(a) of the
Amended and Restated Research and Development Agreement.

 

“Discontinuation Price” has the meaning set forth in Section 11.2(a) of the
Amended and Restated Research and Development Agreement.

 

“Discontinued Program” has the meaning set forth in Section 2.10 of the Novated
and Restated Technology License Agreement.

 

“Disinterested Directors” has the meaning set forth in Article IX of the
Symphony Evolution Charter.

 

“Distribution” has the meaning set forth in Section 1.01 of the Holdings LLC
Agreement.

 

“Effective Date” has the meaning set forth in the Novated and Restated
Technology License Agreement.

 

“Effective Registration Date” has the meaning set forth in the Registration
Rights Agreement

 

“Encumbrance” means (i) any security interest, pledge, mortgage, lien (statutory
or other), charge or option to purchase, lease or otherwise acquire any
interest, (ii) any adverse claim, restriction, covenant, title defect,
hypothecation, assignment, deposit arrangement or other encumbrance of any kind,
preference or priority, or (iii) any other security agreement or preferential
arrangement of any kind or nature whatsoever (including, without limitation, any
conditional sale or other title retention agreement).

 

“Enhancements” means findings, improvements, discoveries, inventions, additions,
modifications, enhancements, derivative works, clinical development data, or
changes to the Licensed Intellectual Property and Regulatory Files.

 

“Equity Securities” means, with respect to any Person, shares of capital stock
of (or other ownership or profit interests in) such Person, warrants, options or
other rights for the purchase or other acquisition from such Person of shares of
capital stock of (or other ownership or profit interests in) such Person,
securities convertible into or exchangeable for shares of capital stock of (or
other ownership or profit interests in) such Person or warrants, rights or
options for the purchase or other acquisition from such Person of such shares
(or such other interests), and other ownership or profit interests in such
Person (including, without limitation, partnership, member or trust interests
therein), whether voting or nonvoting, and whether or not such shares, warrants,
options, rights or other interests are authorized or otherwise existing on any
date of determination.

 

A-6

 

[ * ] = 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.

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“ERISA” means the United States Employee Retirement Income Security Act of 1974,
as amended.

 

“Exchange Act” means the Securities Exchange Act of 1934, as amended, and the
rules and regulations promulgated thereunder.

 

“Exelixis” means Exelixis, Inc., a Delaware corporation.

 

“Exelixis Common Stock” means the common stock, par value $0.001 per share, of
Exelixis.

 

“Exelixis Common Stock Valuation” has the meaning set forth in Section 2(e) of
the Purchase Option Agreement.

 

“Exelixis-GlaxoSmithKline Collaboration Committee” means the committee
established by Exelixis and GlaxoSmithKline pursuant to Section 2.2 of the GSK
Agreement.

 

“Exelixis Member” has the meaning set forth in Section 2(c) of the Management
Services Agreement.

 

“Exelixis Obligations” has the meaning set forth in Section 6.1 of the Amended
and Restated Research and Development Agreement.

 

“Exelixis Personnel” has the meaning set forth in Section 8.4 of the Amended and
Restated Research and Development Agreement.

 

“Existing NDA” has the meaning set forth in Section 2 of the Confidentiality
Agreement.

 

“Expert” has the meaning set forth in Section 11.2(c) of the Amended and
Restated Research and Development Agreement.

 

“Extension Funding” has the meaning set forth in Section 2 of the Research Cost
Sharing and Extension Agreement.

 

“External Directors” has the meaning set forth in the preamble of the
Confidentiality Agreement.

 

“FDA” means the United States Food and Drug Administration or its successor
agency in the United States.

 

“FDA Sponsor” has the meaning set forth in Section 5.1 of the Amended and
Restated Research and Development Agreement.

 

“Final Purchase Price” has the meaning set forth in Section 2(j)(ii) of the
Purchase Option Agreement.

 

“Financial Audits” has the meaning set forth in Section 6.7 of the Amended and
Restated Research and Development Agreement.

 

A-7

 

[ * ] = 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.

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“Financing” has the meaning set forth in the Preliminary Statement of the
Purchase Option Agreement.

 

“Fiscal Year” has for each Operative Document in which it appears the meaning
set forth in such Operative Document.

 

“Form S-3” means the Registration Form S-3 as defined under the Securities Act.

 

“FTE” has the meaning set forth in Section 4.1 of the Amended and Restated
Research and Development Agreement.

 

“Funded Capital” has the meaning set forth in Section 2.02(b) of the Warrant
Purchase Agreement.

 

“Funding Agreement” means the Funding Agreement, dated June 9, 2005, among
Exelixis, SCP and Investors.

 

“Funding Notice” has the meaning set forth in Section 2(a) of the Funding
Agreement.

 

“Funds Price” has the meaning set forth in Section 2(b) of the Purchase Option
Agreement.

 

“GAAP” means generally accepted accounting principles in effect in the United
States of America from time to time.

 

“GlaxoSmithKline” means SmithKline Beecham Corporation, a Pennsylvania
corporation, doing business as GlaxoSmithKline.

 

“Governmental Approvals” means authorizations, consents, orders, declarations or
approvals of, or filings with, or terminations or expirations of waiting periods
imposed by any Governmental Authority.

 

“Governmental Authority” means any United States or non-United States federal,
national, supranational, state, provincial, local, or similar government,
governmental, regulatory or administrative authority, agency or commission or
any court, tribunal, or judicial or arbitral body.

 

“Governmental Order” means any order, writ, judgment, injunction, decree,
stipulation, determination or award entered by or with any Governmental
Authority.

 

“GSK Agreement” has the meaning set forth in Section 4.10 of the Novated and
Restated Technology License Agreement.

 

“Hedge Agreement” means any interest rate swap, cap or collar agreement,
interest rate future or option contract, currency swap agreement, currency
future or option contract or other similar hedging agreement.

 

A-8

 

[ * ] = 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.

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“HHMI” has the meaning set forth in Annex C of the Novated and Restated
Technology License Agreement.

 

“Holdings” means Symphony Evolution Holdings LLC, a Delaware limited liability
company.

 

“Holdings Claims” has the meaning set forth in Section 5.01 of the Warrant
Purchase Agreement.

 

“Holdings LLC Agreement” means the Second Amended and Restated Limited Liability
Company Agreement of Holdings dated June 9, 2005.

 

“HSR Act Filings” means the premerger notification and report forms required
under the Hart-Scott-Rodino Antitrust Improvements Act of 1976, as amended.

 

“IND” means an Investigational New Drug Application, as described in 21 U.S.C. §
355(i)(1) and 21 C.F.R. § 312 in the regulations promulgated by the United
States Food and Drug Administration, or any foreign equivalent thereof.

 

“Indemnification Agreement” means the Indemnification Agreement among Symphony
Evolution and the Directors named therein, dated June 9, 2005.

 

“Independent Accountant” has the meaning set forth in Section 2(i)(ii) of the
Purchase Option Agreement.

 

“Initial Funds” has the meaning set forth in Section 2(a) of the Funding
Agreement.

 

“Initial Holdings LLC Agreement” means the Agreement of Limited Liability
Company of Holdings, dated March 30, 2005.

 

“Initial Investors LLC Agreement” means the Agreement of Limited Liability
Company of Investors, dated May 20, 2005.

 

“Initial LLC Member” has the meaning set forth in Section 1.01 of the Holdings
LLC Agreement.

 

“Interest Certificate” has the meaning set forth in Section 1.01 of the Holdings
LLC Agreement.

 

“Interim Holdings LLC Agreement” means the Amended and Restated Agreement of
Limited Liability Company of Holdings, dated June 2, 2005.

 

“Investment Company Act” means the Investment Company Act of 1940, as amended.

 

“Investment Overview” means the investment overview describing the transactions
entered into pursuant to the Operative Documents.

 

A-9

 

[ * ] = 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.

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“Investment Policy” has the meaning set forth in Section 1(a)(viii) of the
Management Services Agreement.

 

“Investors” means Symphony Evolution Investors LLC.

 

“Investors LLC Agreement” means Amended and Restated Agreement of Limited
Liability Company of Investors dated June 9, 2005.

 

“IRS” means the U.S. Internal Revenue Service.

 

“Knowledge” means the actual (and not imputed) knowledge of the executive
officers of Exelixis, without the duty of inquiry or investigation.

 

“Law” means any law, statute, treaty, constitution, regulation, rule, ordinance,
order or Governmental Approval, or other governmental restriction, requirement
or determination, of or by any Governmental Authority.

 

“Ledger Fee” has the meaning set forth in Section 6(b) of the Management
Services Agreement.

 

“License” has the meaning set forth in the Preliminary Statement of the Purchase
Option Agreement.

 

“Licensed Intellectual Property” means the Licensed Patent Rights, Symphony
Evolution Enhancements, Licensor Enhancements and the Licensed Know-How.

 

“Licensed Know-How” means any and all proprietary technology (other than the
University IP) that is [ * ]

 

“Licensed Patent Rights” means:[ * ]

 

“Licensor” means Exelixis.

 

“Licensor Enhancements” means [ * ]

 

“Lien” has the meaning set forth in Section 1.01 of the Holdings LLC Agreement.

 

“Liquidating Event” has the meaning set forth in Section 8.01 of the Holdings
LLC Agreement.

 

“LLC Agreements” means the Initial Holdings LLC Agreement, the Interim Holdings
LLC Agreement, the Holdings LLC Agreement, the Initial Investors LLC Agreement
and the Investors LLC Agreement.

 

“Loss” has for each Operative Document in which it appears the meaning set forth
in such Operative Document.

 

A-10

 

[ * ] = 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.

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“Management Budget” has the meaning set forth in Section 4.1 of the Amended and
Restated Research and Development Agreement.

 

“Management Fee” has the meaning set forth in Section 6(a) of the Management
Services Agreement.

 

“Management Plan” has the meaning set forth in Section 4.1 of the Amended and
Restated Research and Development Agreement.

 

“Management Services” has the meaning set forth in Section 1(a) of the
Management Services Agreement.

 

“Management Services Agreement” means the Management Services Agreement between
Symphony Evolution and RRD, dated as of June 9, 2005.

 

“Manager” means (i) for each LLC Agreement in which it appears, the meaning set
forth in such LLC Agreement, and (ii) for each other Operative Document in which
it appears, RRD.

 

“Manager Event” has the meaning set forth in Section 3.01(f) of the Holdings LLC
Agreement.

 

“Material Adverse Effect” means, with respect to any Person, a material adverse
effect on (i) the business, assets, property or condition (financial or
otherwise) of such Person or, (ii) its ability to comply with and satisfy its
respective agreements and obligations under the Operative Documents or, (iii)
the enforceability of the obligations of such Person of any of the Operative
Documents to which it is a party.

 

“Material Change” has the meaning set forth in Paragraph 12 of Annex B of the
Amended and Restated Research and Development Agreement.

 

“Material Contract” has the meaning set forth in Section 3(j) of the Management
Services Agreement.

 

“Material Subsidiary” means, at any time, a Subsidiary of Exelixis having assets
in an amount equal to at least 5% of the amount of total consolidated assets of
Exelixis and its Subsidiaries (determined as of the last day of the most recent
fiscal quarter of Exelixis) or revenues or net income in an amount equal to at
least 5% of the amount of total consolidated revenues or net income of Exelixis
and its Subsidiaries for the 12-month period ending on the last day of the most
recent fiscal quarter of Exelixis.

 

“Maximum Committed Capital” has the meaning set forth in Section 2.02(b) of the
Warrant Purchase Agreement.

 

“Medical Discontinuation Event” means (a) as specified in each Protocol, those
data that, if collected in such Protocol, demonstrate that such Protocol should
not be continued or (b) a series of adverse events, side effects or other
undesirable outcomes that, when collected in a Protocol, would cause a
reasonable FDA Sponsor to discontinue such Protocol.

 

A-11

 

[ * ] = 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.

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“Membership Interest” means (i) for each LLC Agreement in which it appears, the
meaning set forth in such LLC Agreement, and (ii) for each other Operative
Document in which it appears, the meaning set forth in the Holdings LLC
Agreement.

 

“NASDAQ” means the National Association of Securities Dealers Automatic
Quotation System.

 

“NDA” means a New Drug Application, as defined in the regulations promulgated by
the United States Food and Drug Administration, or any foreign equivalent
thereof.

 

“Net Debt” has the meaning set forth in Section 2(b) of the Purchase Option
Agreement.

 

“Non-Exelixis Capital Transaction” means any (i) sale or other disposition of
all or part of the Symphony Evolution Shares or all or substantially all of the
operating assets of Symphony Evolution, to a Person other than Exelixis or an
Affiliate of Exelixis or (ii) distribution in kind of the Symphony Evolution
Shares following the expiration of the Purchase Option.

 

“Novated and Restated Technology License Agreement” means the Novated and
Restated Technology License Agreement, dated as of June 9, 2005, among Exelixis,
Symphony Evolution and Holdings.

 

“Operative Documents” means, collectively, the Indemnification Agreement, the
Holdings LLC Agreement, the Purchase Option Agreement, the Warrant Purchase
Agreement, the Registration Rights Agreement, the Subscription Agreement, the
Technology License Agreement, the Novated and Restated Technology License
Agreement, the Management Services Agreement, the Research and Development
Agreement, the Amended and Restated Research and Development Agreement, the
Research Cost Sharing and Extension Agreement, the Confidentiality Agreement,
the Funding Agreement and each other certificate and agreement executed in
connection with any of the foregoing documents.

 

“Organizational Documents” means any certificates or articles of incorporation
or formation, partnership agreements, trust instruments, bylaws or other
governing documents.

 

“Parties” means, for each Operative Document or other agreement in which it
appears, the parties to such Operative Document or other agreement, as set forth
therein (each a “Party”). With respect to any agreement in which a provision is
included therein by reference to a provision in another agreement, the term
“Party” shall be read to refer to the parties to the document at hand, not the
agreement that is referenced.

 

“Payment Terms” has the meaning set forth in Section 8.2 of the Amended and
Restated Research and Development Agreement.

 

“Percentage” has the meaning set forth in Section 1.01 of the Holdings LLC
Agreement.

 

“Permitted Investments” has the meaning set forth in Section 1.01 of the
Holdings LLC Agreement.

 

A-12

 

[ * ] = 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.

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“Permitted Investments Letter” means the Permitted Investments Letter dated as
of June 9, 2005, from Symphony Evolution to RRD, as set forth in Exhibit B to
the Management Services Agreement.

 

“Permitted Lien” has the meaning set forth in Section 1.01 of the Holdings LLC
Agreement.

 

“Person” means any individual, partnership (whether general or limited), limited
liability company, corporation, trust, estate, association, nominee or other
entity.

 

“Personnel” of a Party means such Party, its employees, subcontractors,
consultants, representatives and agents.

 

“Prime Rate” means the quoted “Prime Rate” at JPMorgan Chase Bank or, if such
bank ceases to exist or is not quoting a base rate, prime rate reference rate or
similar rate for United States dollar loans, such other major money center
commercial bank in New York City selected by the Manager.

 

“Product” means any product that contains or comprises XL647, XL784 or XL999 or
any Structurally Related Compound thereof.

 

“Profit” has the meaning set forth in Section 1.01 of the Holdings LLC
Agreement.

 

“Program Option” has the meaning set forth in Section 11.1(a) of the Amended and
Restated Research and Development Agreement.

 

“Program Option Closing Date” has the meaning set forth in Section 11.1(d) of
the Amended and Restated Research and Development Agreement.

 

“Program Option Exercise Date” has the meaning set forth in Section 11.1(b) of
the Amended and Restated Research and Development Agreement.

 

“Program Option Exercise Notice” has the meaning set forth in Section 11.1(b) of
the Amended and Restated Research and Development Agreement.

 

“Program Option Exercise Price” has the meaning set forth in Section 11.1(c) of
the Amended and Restated Research and Development Agreement.

 

“Program Option Period” has the meaning set forth in Section 11.1(a) of the
Amended and Restated Research and Development Agreement.

 

“Programs” means those certain clinical programs pursuing indications for XL647,
XL784, and XL999 in accordance with the Development Plan (each a “Program”).

 

“Protocol” means a written protocol that meets the substantive requirements of
Section 6 of the ICH Guideline for Good Clinical Practice as adopted by the FDA,
effective May 9, 1997 and is included within the Clinical Plan or later modified
or added to the Clinical Plan pursuant to Section 4.2 of the Amended and
Restated Research and Development Agreement.

 

A-13

 

[ * ] = 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.

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“Public Companies” has the meaning set forth in Section 5(e) of the Purchase
Option Agreement.

 

“Purchase Option” has the meaning set forth in Section 1(a) of the Purchase
Option Agreement.

 

“Purchase Option Agreement” means this Purchase Option Agreement dated as of
June 9, 2005, among Exelixis, Holdings and Symphony Evolution.

 

“Purchase Option Closing Date” has the meaning set forth in Section 2(a) of the
Purchase Option Agreement.

 

“Purchase Option Dispute Notice” has the meaning set forth in Section 2(b) of
the Purchase Option Agreement.

 

“Purchase Option Exercise Date” has the meaning set forth in Section 2(a) of the
Purchase Option Agreement.

 

“Purchase Option Exercise Notice” has the meaning set forth in Section 2(a) of
the Purchase Option Agreement.

 

“Purchase Option Period” has the meaning set forth in Section 1(c)(iii) of the
Purchase Option Agreement.

 

“Purchase Price” has the meaning set forth in Section 2(b) of the Purchase
Option Agreement.

 

“QA Audits” has the meaning set forth in Section 6.6 of the Amended and Restated
Research and Development Agreement.

 

“Quarterly Meeting” has the meaning set forth in Paragraph 6 of Annex B of the
Amended and Restated Research and Development Agreement.

 

“Regents” has the meaning set forth in Section 3.1 of the Novated and Restated
Technology License Agreement.

 

“Regents Agreement” has the meaning set forth in Section 3.1 of the Novated and
Restated Technology License Agreement.

 

“Regents Claims” has the meaning set forth in Annex C of the Novated and
Restated Technology License Agreement.

 

“Regents Indemnitees” has the meaning set forth in Annex C of the Novated and
Restated Technology License Agreement.

 

“Regents Technology” has the meaning set forth in Annex C of the Novated and
Restated Technology License Agreement.

 

A-14

 

[ * ] = 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.

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“Registration Rights Agreement” means the Registration Rights Agreement dated as
of the Closing Date, between Exelixis and Holdings.

 

“Registration Statement” has the meaning set forth in Section 1(b) of the
Registration Rights Agreement.

 

“Regulatory Authority” means the United States Food and Drug Administration, or
any successor agency in the United States, or any health regulatory
authority(ies) in any other country that is a counterpart to the FDA and has
responsibility for granting registrations or other regulatory approval for the
marketing, manufacture, storage, sale or use of drugs in such other country.

 

“Regulatory Allocation” has the meaning set forth in Section 3.06 of the
Holdings LLC Agreement.

 

“Regulatory Files” means any IND, NDA or any other filings filed with any
Regulatory Authority with respect to XL647, XL784, XL999 or the Programs.

 

“Removed Director” has the meaning set forth in Section 3.01(h)(i) of the
Holdings LLC Agreement.

 

“Representative” of any Person means such Person’s shareholders, principals,
directors, officers, employees, members, managers and/or partners.

 

“Research and Development Agreement” means the Research and Development
Agreement dated as of June 9, 2005, between Exelixis and Holdings.

 

“Research Cost Sharing and Extension Agreement” means the Research Cost Sharing
and Extension Agreement dated as of June 9, 2005, between Exelixis, Holdings,
and Symphony Evolution.

 

“RRD” means RRD International, LLC, a Delaware limited liability company.

 

“RRD Indemnified Party” has the meaning set forth in Section 10(a)(i) of the
Management Services Agreement.

 

“RRD Loss” has the meaning set forth in Section 10(a)(i) of the Management
Services Agreement.

 

“Schedule K-1” has the meaning set forth in Section 9.02(a) of the Holdings LLC
Agreement.

 

“Scientific Discontinuation Event” has the meaning set forth in Section 4.2(f)
of the Amended and Restated Research and Development Agreement.

 

“SCP” means Symphony Capital Partners, L.P., a Delaware limited partnership.

 

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

 

A-15

 

[ * ] = 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.

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“Securities Act” means the Securities Act of 1933, as amended.

 

“Shareholder” means any Person who owns any Symphony Evolution Shares.

 

“Solvent” has the meaning set forth in Section 1.01 of the Holdings LLC
Agreement.

 

“SSP” means Symphony Strategic Partners, LLC, a Delaware limited liability
company.

 

“Stock Payment Date” has the meaning set forth in Section 2 of the Subscription
Agreement.

 

“Stock Purchase Price” has the meaning set forth in Section 2 of the
Subscription Agreement.

 

“Structurally Related Compound” means:

 

(a) with respect to XL647, any compound that is [ * ]

 

(b) with respect to XL784, any compound that is [ * ]

 

(c) with respect to XL999, any compound that is [ * ]

 

“Subcontracting Agreement” has the meaning set forth in Section 6.3 of the
Amended and Restated Research and Development Agreement.

 

“Subcontractor” has the meaning set forth in Section 6.3 of the Amended and
Restated Research and Development Agreement.

 

“Subscription Agreement” means the Subscription Agreement between Symphony
Evolution and Holdings, dated as of June 9, 2005.

 

“Subsidiary” of any Person means any corporation, partnership, joint venture,
limited liability company, trust or estate of which (or in which) more than 50%
of (a) the issued and outstanding capital stock having ordinary voting power to
elect a majority of the board of directors of such corporation (irrespective of
whether at the time capital stock of any other class or classes of such
corporation shall or might have voting power upon the occurrence of any
contingency); (b) the interest in the capital or profits of such partnership,
joint venture or limited liability company; or (c) the beneficial interest in
such trust or estate is at the time directly or indirectly owned or controlled
by such Person, by such Person and one or more of its other Subsidiaries or by
one or more of such Person’s other Subsidiaries.

 

“Surviving Entity” means the surviving legal entity which is surviving entity to
Exelixis after giving effect to a Change of Control.

 

“Symphony Capital” means Symphony Capital LLC, a Delaware limited liability
company.

 

“Symphony Evolution” means Symphony Evolution, Inc., a Delaware corporation.

 

A-16

 

[ * ] = 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.

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“Symphony Evolution Board” means the Symphony Evolution board of directors.

 

“Symphony Evolution By-laws” means the By-laws of Symphony Evolution, as adopted
by resolution of the Symphony Evolution Board on June 9, 2005.

 

“Symphony Evolution Charter” means the Amended and Restated Certificate of
Incorporation of Symphony Evolution, dated as of June 9, 2005.

 

“Symphony Evolution Director Event” has the meaning set forth in Section
3.01(h)(i) of the Holdings LLC Agreement.

 

“Symphony Evolution Enhancements” means [ * ]

 

“Symphony Evolution Equity Securities” means the Common Stock and any other
stock or shares issued by Symphony Evolution.

 

“Symphony Evolution Loss” has the meaning set forth in Section 10(b) of the
Management Services Agreement.

 

“Symphony Evolution Securities Encumbrance” has the meaning set forth in Section
4(b)(ii) of the Purchase Option Agreement.

 

“Symphony Evolution Shares” has the meaning set forth in Section 2.02 of the
Holdings LLC Agreement.

 

“Symphony Funds” means Symphony Capital Partners, L.P., a Delaware limited
partnership, and Symphony Strategic Partners, LLC, a Delaware limited liability
company (each a “Symphony Fund”).

 

“Symphony Member” has the meaning set forth in Section 4.2(d) of the Amended and
Restated Research and Development Agreement.

 

“Tangible Materials” means [ * ].

 

“Tax Amount” has the meaning set forth in Section 4.02 of the Holdings LLC
Agreement.

 

“Technology License Agreement” means the Technology License Agreement, dated as
of June 9, 2005, between Exelixis and Holdings.

 

“Term” means the period starting on the Closing Date and ending upon the
termination or expiration of the Purchase Option Period.

 

“Territory” means the world.

 

“Third Party IP” has the meaning set forth in Section 2.9 of the Novated and
Restated Technology License Agreement.

 

A-17

 

[ * ] = 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.

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“Third Party Licensor” means (a) a third party from which Exelixis has received
a license or sublicense to Licensed Intellectual Property or (b) a third party
to which Exelixis has granted a license or sublicense to the Licensed
Intellectual Property. As of the Closing Date, GlaxoSmithKline is the only Third
Party Licensor.

 

“Transfer” has for each Operative Document in which it appears the meaning set
forth in such Operative Document.

 

“Transferee” has, for each Operative Document in which it appears, the meaning
set forth in such Operative Document.

 

“University Agreements” has the meaning set forth in Section 3.1 of the Novated
and Restated Technology License Agreement.

 

“University IP” has the meaning set forth in Section 3.1 of the Novated and
Restated Technology License Agreement.

 

“Voluntary Bankruptcy” has the meaning set forth in Section 1.01 of the Holdings
LLC Agreement.

 

“Warrant Closing” has the meaning set forth in Section 2.07 of the Warrant
Purchase Agreement.

 

“Warrant Date” has the meaning set forth in Section 2.06 of the Warrant Purchase
Agreement.

 

“Warrant Purchase Agreement” means the Warrant Purchase Agreement dated as of
the Closing Date, between Exelixis and Holdings.

 

“Warrants” has the meaning set forth in Section 2.03 of the Warrant Purchase
Agreement.

 

“Warrant Share Legend” has the meaning set forth in Section 6.02 of the Warrant
Purchase Agreement.

 

“Warrant Shares” has the meaning set forth in Section 2.03 of the Warrant
Purchase Agreement.

 

“XL647” means: [ * ]

 

“XL784” means: [ * ]

 

“XL999” means: [ * ]

 

“Yale” has the meaning set forth in Section 3.1 of the Novated and Restated
Technology License Agreement.

 

A-18

 

[ * ] = 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.

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“Yale Agreement” has the meaning set forth in Section 3.1 of the Novated and
Restated Technology License Agreement.

 

“Yale Claims” has the meaning set forth in Annex C of the Novated and Restated
Technology License Agreement.

 

“Yale Indemnitees” has the meaning set forth in Annex C of the Novated and
Restated Technology License Agreement.

 

“Yale Technology” has the meaning set forth in Annex C of the Novated and
Restated Technology License Agreement.

 

A-19

 

[ * ] = 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.

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

ANNEX B

 

PATENTS INCLUDED IN LICENSED PATENT RIGHTS

 

[ * ]

 

B-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.

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

ANNEX C

 

SUBLICENSE TERMS

 

[ * ]

 

C-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.