Exhibit 10.1

MASTER SECURITY AGREEMENT

dated as of October 3, 2014 (“Agreement”)

THIS AGREEMENT is between WEBSTER BANK, NATIONAL ASSOCIATION (together with its
successors and assigns, if any, “Secured Party”) and ACHILLION PHARMACEUTICALS,
INC. (“Debtor”). Secured Party has an office at 80 Elm Street, New Haven, CT
06510. Debtor is a corporation organized and existing under the laws of the
state of Delaware. Debtor’s mailing address and chief place of business is 300
George Street, New Haven, CT 06511.

1. EQUIPMENT LOAN ADVANCES; NOTES, CONDITIONS PRECEDENT TO EQUIPMENT LOAN
ADVANCE; CONTINGENCY; CREATION OF SECURITY INTEREST.

(a) Equipment Loan Advances. Subject to the terms and conditions set forth in
this Agreement, Secured Party agrees to make advances for the purchase of
Eligible Equipment (defined below) (each an “Equipment Loan Advance” and
collectively, the “Equipment Loan Advances”) to Debtor from time to time on any
business day during the period from October 3, 2014 up to and including
October 3, 2015 (the “Drawdown Period”); provided, however, that at no time
shall the aggregate amount of all Equipment Loan Advances exceed the lesser of
(i) one hundred percent (100%) of the documented cost of the Eligible Equipment
and (ii) ONE MILLION and 00/100 DOLLARS ($1,000,000) (the “Committed Amount”).
“Eligible Equipment” for the purposes of this Agreement includes new laboratory
equipment excluding shipping costs, taxes, installation costs and other soft
costs. Notwithstanding anything to the contrary contained in this Agreement,
(i) any and all Equipment Loan Advances must be made no later than ninety
(90) days after Debtor’s purchase of Eligible Equipment, (ii) each Equipment
Loan Advance must be equal to or greater than $50,000 and (iii) the Equipment
Loan Advances are limited to two (2) in total. Any amounts repaid with respect
to any Equipment Loan Advance may not be reborrowed.

(b) Equipment Loan Notes. Equipment Loan Advances shall be evidenced by, and
repaid with interest in accordance with, promissory notes of Debtor in the form
of Exhibit A hereto, duly completed, executed and delivered to Secured Party,
the aggregate of which shall not exceed the Committed Amount, payable to Secured
Party in accordance with its terms (each such promissory note a “Note” and
collectively, the “Notes”). Debtor hereby authorizes Secured Party to record on
each Note or in its internal computerized records the amount of each Equipment
Loan Advance and of each payment of principal received by Secured Party on
account of the advances evidenced by the Notes (individually, an “Equipment
Loan” and collectively, the “Equipment Loans”), which recordation shall, in the
absence of manifest error, be conclusive as to the outstanding principal balance
of the Equipment Loans and shall be considered correct and binding on Debtor;
provided, however, that the failure to make such recordation with respect to any
Equipment Loan Advance or payment shall not limit or otherwise affect the
obligations of Debtor under this Agreement or the Equipment Loan Notes.

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(c) Conditions Precedent to Equipment Loan Advances.

(i) As a condition precedent to each closing of an Equipment Loan Advance,
Debtor shall have (A) delivered duly executed and completed copies of each Note
and any other documents evidencing, or given in connection with, any of the
Indebtedness (defined below) (all of the foregoing are referred to herein as the
“Debt Documents”); (B) certified that all representations and warranties
contained in the debt documents are true, complete and correct as of the closing
date of each Equipment Loan Advance; and (C) certified that each covenant
required to be performed or completed as of each Equipment Loan Advance closing
date has been duly performed or completed.

(ii) As a condition precedent to each closing of an Equipment Loan Advance,
there shall have been no material adverse change in the general affairs, results
of operations, condition (financial or otherwise) of Debtor, whether or not
arising from transactions in the ordinary course of business nor shall there
have been any material adverse deviation by Borrower from the business plan of
Borrower, presented and accepted by Secured Party prior to the date hereof.

(d) Creation of Security Interest. Debtor grants to Secured Party, its
successors and assigns, a security interest in and against all property listed
on any collateral schedule now or in the future annexed to or made a part of
this Agreement (“Collateral Schedule”), and in and against all additions,
attachments, accessories and accessions to such property, all substitutions,
replacements or exchanges therefor, and all insurance and/or other proceeds
thereof (all such property is individually and collectively called the
“Collateral”). This security interest is given to secure the payment and
performance of all debts, obligations and liabilities of any kind whatsoever
(other than with respect to any preferred stock of Debtor) of Debtor to Secured
Party now existing or arising in the future, including but not limited to the
payment and performance of the Notes identified on any Collateral Schedule, and
any renewals, extensions and modifications of such debts, obligations and
liabilities (such Notes, debts, obligations and liabilities are called the
“Indebtedness”). Unless otherwise provided by applicable law, notwithstanding
anything to the contrary contained in this Agreement, to the extent that Secured
Party asserts a purchase money security interest in any items of Collateral
(“PMSI Collateral”): (i) the PMSI Collateral shall secure only that portion of
the Indebtedness which has been advanced by Secured Party to enable Debtor to
purchase, or acquire rights in or the use of such PMSI Collateral (the “PMSI
Indebtedness”), and (ii) no other Collateral shall secure the PMSI Indebtedness.

(e) Stipulated Loss Value. If a unit of equipment is lost, stolen, destroyed or
seized by a government authority, Debtor will pay to Secured Party the
applicable Stipulated Loss Value (a percentage) times Secured Party’s advance on
the unit. A table of Stipulated Loss Value, substantially in the form of Exhibit
B, will be included in each advance schedule.

 

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2. CONDITIONS TO CLOSE.

The obligation of Secured Party to advance the Committed Amount to the Debtor
pursuant to the terms of this Agreement is subject to the fulfillment, to
Secured Party’s satisfaction, of the following conditions:

(a) Debtor shall have executed and delivered the following Debt Documents, in
form and substance satisfactory to the Secured Party in its sole discretion:
(i) this Agreement; (ii) Landlord Waiver; and (iii) Debtor’s Secretary
Certificate.

(b) Debtor shall have paid to Secured Party the following fees and expenses:
(i) An origination fee equal to $10,000 and (ii) all reasonable fees and
expenses of Secured Party, including fees of Shipman & Goodwin LLP.

3. REPRESENTATIONS, WARRANTIES AND COVENANTS OF DEBTOR.

Debtor represents, warrants and covenants as of the date of this Agreement and
as of the date of each Collateral Schedule, unless specifically otherwise
disclosed in writing, that:

(a) Debtor’s exact legal name is as set forth in the preamble of this Agreement
and Debtor is, and will remain, duly organized, existing and in good standing
under the laws of the State set forth in the preamble of this Agreement, has its
chief executive offices at the location specified in the preamble, and is, and
will remain, duly qualified and licensed in every jurisdiction wherever
necessary to carry on its business and operations;

(b) Debtor has adequate power and capacity to enter into, and to perform its
obligations under the Debt Documents;

(c) This Agreement and the other Debt Documents have been duly authorized,
executed and delivered by Debtor and constitute legal, valid and binding
agreements enforceable in accordance with their terms, except to the extent that
the enforcement of remedies may be limited under applicable bankruptcy and
insolvency laws and equitable remedies;

(d) No approval, consent or withholding of objections is required from any
governmental authority or instrumentality with respect to the entry into, or
performance by Debtor of any of the Debt Documents, except any already obtained;

(e) The entry into, and performance by, Debtor of the Debt Documents will not
(i) violate any of the organizational documents of Debtor or any judgment,
order, law or regulation applicable to Debtor, or (ii) result in any breach of
or constitute a default under any contract to which Debtor is a party, or result
in the creation of any lien, claim or encumbrance on any of Debtor’s property
(except for liens in favor of Secured Party) pursuant to any indenture,
mortgage, deed of trust, bank loan, credit agreement, or other agreement or
instrument to which Debtor is a party;

(f) There are no suits or proceedings pending in court or before any commission,
board or other administrative agency against or affecting Debtor which could, in
the aggregate, have a material adverse effect on Debtor, its business or
operations, or its ability to perform its obligations under the Debt Documents,
nor does Debtor have reason to believe that any such suits or proceedings are
threatened;

(g) All financial statements as filed with the Securities and Exchange
Commission (the “SEC”) and utilized by the Secured Party in connection with the
Indebtedness have been prepared in accordance with generally accepted accounting
principles consistently applied (“GAAP”), and since the date of the most recent
financial statement, there has been no material adverse change in Debtor’s
financial condition;

 

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(h) The Collateral is not, and will not be, used by Debtor for personal, family
or household purposes;

(i) The Collateral is, and will remain, in good condition and repair and Debtor
will not be negligent in its care and use;

(j) Debtor is, and will remain, the sole and lawful owner, and in possession of,
the Collateral, and has the sole right and lawful authority to grant the
security interest described in this Agreement;

(k) The Collateral is, and will remain, free and clear of all liens, claims and
encumbrances of any kind whatsoever, except for (i) liens in favor of Secured
Party, (ii) purchase money security liens, (iii) liens for taxes not yet due or
for taxes being contested in good faith and which do not involve, in the
judgment of Secured Party, any risk of the sale, forfeiture or loss of any of
the Collateral, and (iv) inchoate materialmen’s, mechanic’s, repairmen’s and
similar liens arising by operation of law in the normal course of business for
amounts which are not delinquent (all of such liens are called “Permitted
Liens”); and

(l) Debtor shall not sell, lease, license or dispose of any of the Collateral,
without the prior written consent of the Secured Party.

4. COLLATERAL.

(a) Until the occurrence and during the continuance of any default under
Section 8, Debtor shall remain in possession of the Collateral; except that
Secured Party shall have the right to possess (i) any chattel paper or
instrument that constitutes a part of the Collateral, and (ii) any other
Collateral in which Secured Party’s security interest may be perfected only by
possession. Secured Party may inspect any of the Collateral during normal
business hours after giving Debtor reasonable prior notice. If Secured Party
asks, Debtor will promptly notify Secured Party in writing of the location of
any Collateral.

(b) Debtor shall (i) use the Collateral only in its trade or business,
(ii) maintain all of the Collateral in good operating order and repair, normal
wear and tear excepted, (iii) use and maintain the Collateral only in compliance
with manufacturers recommendations and all applicable laws, and (iv) keep all of
the Collateral free and clear of all liens, claims and encumbrances (except for
Permitted Liens).

(c) Secured Party does not authorize and Debtor agrees it shall not (i) part
with possession of any of the Collateral (except to Secured Party or for
maintenance and repair), (ii) move any of the Collateral to a new location
without the express, prior written consent of Secured Party, or (iii) sell,
rent, lease, mortgage, license, grant a security interest in or otherwise
transfer or encumber (except for Permitted Liens) any of the Collateral.

(d) Debtor shall pay promptly when due all taxes, license fees, assessments and
public and private charges levied or assessed on any of the Collateral, on its
use, or on this Agreement or any of the other Debt Documents. At its option,
Secured Party may discharge taxes, liens, security interests or other
encumbrances at any time levied or placed on the Collateral and may pay for the
maintenance, insurance

 

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and preservation of the Collateral and effect compliance with the terms of this
Agreement or any of the other Debt Documents. Debtor agrees to reimburse Secured
Party, on demand, all reasonable costs and expenses incurred by Secured Party in
connection with such payment or performance and agrees that such reimbursement
obligation shall constitute Indebtedness.

(e) Debtor shall, at all times, keep accurate and complete records of the
Collateral, and Secured Party shall have the right to inspect and make copies of
all of Debtor’s books and records relating to the Collateral during normal
business hours, after giving Debtor reasonable prior notice.

(f) Debtor agrees and acknowledges that any third person who may at any time
possess all or any portion of the Collateral shall be deemed to hold, and shall
hold, the Collateral as the agent of, and as pledge holder for, Secured Party.
Secured Party may at any time give notice to any third person described in the
preceding sentence that such third person is holding the Collateral as the agent
of, and as pledge holder for, the Secured Party.

5. INSURANCE.

(a) Debtor shall at all times bear the entire risk of any loss, theft, damage
to, or destruction of, any of the Collateral from any cause whatsoever.

(b) Debtor agrees to keep the Collateral insured against loss or damage by fire
and extended coverage perils, theft, burglary, and for any or all Collateral
which are vehicles, for risk of loss by collision, and if requested by Secured
Party, against such other risks as Secured Party may reasonably require. The
insurance coverage shall be in an amount no less than the full replacement value
of the Collateral, and deductible amounts, insurers and policies shall be
acceptable to Secured Party. Debtor shall deliver to Secured Party policies or
certificates of insurance evidencing such coverage. Each policy covering the
Collateral shall name Secured Party as a loss payee, shall provide for coverage
to Secured Party regardless of the breach by Debtor of any warranty or
representation made therein, shall not be subject to co-insurance, and shall
provide that coverage may not be canceled or altered by the insurer except upon
thirty (30) days prior written notice to Secured Party. Debtor appoints Secured
Party as its attorney-in-fact to make proof of loss, claim for insurance and
adjustments with insurers, and to receive payment of and execute or endorse all
documents, checks or drafts in connection with insurance payments. Secured Party
shall not act as Debtor’s attorney-in-fact unless Debtor is in default. Proceeds
of insurance shall be applied, at the option of Secured Party, to repair or
replace the Collateral or to reduce any of the Indebtedness.

6. REPORTS.

(a) Debtor shall promptly notify Secured Party of (i) any change in the name of
Debtor, (ii) any change in the state of its incorporation or registration,
(iii) any relocation of its chief executive offices, (iv) any relocation of any
of the Collateral, (v) any of the Collateral being lost, stolen, missing,
destroyed, materially damaged or worn out, or (vi) any lien, claim or
encumbrance other than Permitted Liens attaching to or being made against any of
the Collateral.

 

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(b) Debtor will furnish or cause to be furnished to Secured Party via electronic
notification (i) copies of Debtor’s Form 10-Q within five (5) days of the filing
of same with the SEC, and (ii) copies of Debtor’s Form 10-K within five (5) days
of the filing of same with the SEC.

7. FURTHER ASSURANCES.

(a) Debtor shall, upon request of Secured Party, furnish to Secured Party such
further information, execute and deliver to Secured Party such documents and
instruments (including, without limitation, Uniform Commercial Code financing
statements) and shall do such other acts and things as Secured Party may at any
time reasonably request relating to the perfection or protection of the security
interest created by this Agreement or for the purpose of carrying out the intent
of this Agreement. Without limiting the foregoing, Debtor shall cooperate and do
all acts deemed necessary or advisable by Secured Party to continue in Secured
Party a perfected first security interest in the Collateral, and shall obtain
and furnish to Secured Party any subordinations, releases, landlord waivers,
lessor waivers, mortgagee waivers, and similar documents as may be from time to
time reasonably requested by, and in form and substance satisfactory to, Secured
Party.

(b) Debtor authorizes Secured Party to file a financing statement and amendments
thereto describing the Collateral and containing any other information required
by the applicable Uniform Commercial Code. Debtor irrevocably grants to Secured
Party the power to sign Debtor’s name and generally to act on behalf of Debtor
to execute and file applications for title, transfers of title, financing
statements, notices of lien and other documents pertaining to any or all of the
Collateral; this power is coupled with Secured Party’s interest in the
Collateral. Debtor shall, if any certificate of title be required or permitted
by law for any of the Collateral, obtain and promptly deliver to Secured Party
such certificate showing the lien of this Agreement with respect to the
Collateral. Debtor ratifies its prior authorization for Secured Party to file
financing statements and amendments thereto describing the Collateral and
containing any other information required by the Uniform Commercial Code if
filed prior to the date hereof.

(c) Debtor shall indemnify and defend the Secured Party, its successors and
assigns, and their respective directors, officers and employees, from and
against all claims, actions and suits (including, without limitation, related
attorneys’ fees) of any kind whatsoever arising, directly or indirectly, in
connection with any of the Collateral.

8. DEFAULT AND REMEDIES; RIGHT TO SET OFF.

(a) Debtor shall be in default under this Agreement and each of the other Debt
Documents if (and so long as is continuing):

(i) Debtor breaches its obligation to pay when due any installment or other
amount due or coming due under any of the Debt Documents unless such failure to
pay on the required due date is as a result of the error or malfunction of any
electronic payment system or other system established for the electronic
transfer of funds. If the error or malfunction of any electronic payment system
or other system persists for more than three (3) days, Debtor agrees to
immediately send payment to Secured Party via wire transfer or overnight mail;

 

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(ii) Debtor, without the prior written consent of Secured Party, attempts to or
does sell, rent, lease, license, mortgage, grant a security interest in, or
otherwise transfer or encumber (except for Permitted Liens) any of the
Collateral;

(iii) Debtor breaches any of its insurance obligations under Section 5;

(iv) Debtor breaches any of its other obligations under any of the Debt
Documents and fails to cure that breach within thirty (30) days after written
notice from Secured Party;

(v) Any warranty, representation or statement made by Debtor in any of the Debt
Documents or otherwise in connection with any of the Indebtedness shall be false
or misleading in any material respect when made;

(vi) Any of the Collateral is subjected to attachment, execution, levy, seizure
or confiscation in any legal proceeding or otherwise, or if any legal or
administrative proceeding is commenced against Debtor or any of the Collateral,
which in the good faith judgment of Secured Party subjects any of the Collateral
to a material risk of attachment, execution, levy, seizure or confiscation and
no bond is posted or protective order obtained to negate such risk;

(vii) Debtor shall (A) fail to pay any indebtedness for borrowed money,
including interest or premium thereon, when due (whether by scheduled maturity,
required prepayment, acceleration, demand, or otherwise), (B) fail to perform or
observe any term, covenant, or condition on its part to be performed or observed
under any agreement or instrument relating to any such indebtedness, when
required to be performed or observed (including any applicable grace periods) if
the effect of such failure to perform or observe is to accelerate, or to permit
the acceleration after the giving of notice or passage of time, or both, of the
maturity of such indebtedness, whether or not such failure to perform or observe
shall be waived by the holder of such indebtedness; or any such indebtedness
shall be declared to be due and payable, or required to be prepaid (other than
by a regularly scheduled required prepayment), prior to the stated maturity
thereof, or (C) be in default under any other indebtedness of Debtor to Secured
Party;

(viii) Debtor or any guarantor or other obligor for any of the Indebtedness
(collectively “Guarantor”) dissolves, terminates its existence, becomes
insolvent or ceases to do business as a going concern;

(ix) If Debtor or any Guarantor is a natural person, Debtor or any such
Guarantor dies or becomes incompetent;

(x) A receiver is appointed for all or of any part of the property of Debtor or
any Guarantor, or Debtor or any Guarantor makes any assignment for the benefit
of creditors;

(xi) Debtor or any Guarantor files a petition under any bankruptcy, insolvency
or similar law, or any such petition is filed against Debtor or any Guarantor
and is not dismissed within sixty (60) days; or

(xii) Debtor’s improper filing of an amendment or termination statement relating
to a filed financing statement describing the Collateral.

 

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(b) If Debtor is in default, the Secured Party, at its option, may declare any
or all of the Indebtedness to be immediately due and payable, without demand or
notice to Debtor or any Guarantor. The accelerated obligations and liabilities
shall bear interest (both before and after any judgment) until paid in full at
the lower of eighteen percent (18%) per annum or the maximum rate not prohibited
by applicable law.

(c) After default, Secured Party shall have all of the rights and remedies of a
Secured Party under the Uniform Commercial Code, and under any other applicable
law. Without limiting the foregoing, Secured Party shall have the right to
(i) notify any account debtor of Debtor or any obligor on any instrument which
constitutes part of the Collateral to make payment to the Secured Party,
(ii) with or without legal process, enter any premises where the Collateral may
be and take possession of and remove the Collateral from the premises or store
it on the premises, (iii) sell the Collateral at public or private sale, in
whole or in part, and have the right to bid and purchase at said sale, or
(iv) lease or otherwise dispose of all or part of the Collateral, applying
proceeds from such disposition to the obligations then in default. If requested
by Secured Party, Debtor shall promptly assemble the Collateral and make it
available to Secured Party at a place to be designated by Secured Party which is
reasonably convenient to both parties. Secured Party may also render any or all
of the Collateral unusable at the Debtor’s premises and may dispose of such
Collateral on such premises without liability for rent or costs. Any notice that
Secured Party is required to give to Debtor under the Uniform Commercial Code of
the time and place of any public sale or the time after which any private sale
or other intended disposition of the Collateral is to be made shall be deemed to
constitute reasonable notice if such notice is given to the last known address
of Debtor at least ten (10) days prior to such action.

(d) Proceeds from any sale or lease or other disposition shall be applied:
first, to all costs of repossession, storage, and disposition including without
limitation attorneys’, appraisers’, and auctioneers’ fees; second, to discharge
the obligations then in default; third, to discharge any other Indebtedness of
Debtor to Secured Party, whether as obligor, endorser, guarantor, surety or
indemnitor; fourth, to expenses incurred in paying or settling liens and claims
against the Collateral; and lastly, to Debtor, if there exists any surplus.
Debtor shall remain fully liable for any deficiency.

(e) Debtor agrees to pay all reasonable attorneys’ fees and other costs incurred
by Secured Party in connection with the enforcement, assertion, defense or
preservation of Secured Party’s rights and remedies under this Agreement, or if
prohibited by law, such lesser sum as may be permitted. Debtor further agrees
that such fees and costs shall constitute Indebtedness.

(f) Secured Party’s rights and remedies under this Agreement or otherwise
arising are cumulative and may be exercised singularly or concurrently. Neither
the failure nor any delay on the part of the Secured Party to exercise any
right, power or privilege under this Agreement shall operate as a waiver, nor
shall any single or partial exercise of any right, power or privilege preclude
any other or further exercise of that or any other right, power or privilege.
SECURED PARTY SHALL NOT BE DEEMED TO HAVE WAIVED ANY OF ITS RIGHTS UNDER THIS
AGREEMENT OR UNDER ANY OTHER AGREEMENT, INSTRUMENT OR PAPER SIGNED BY DEBTOR
UNLESS SUCH WAIVER IS EXPRESSED IN WRITING AND SIGNED BY SECURED PARTY. A waiver
on any one occasion shall not be construed as a bar to or waiver of any right or
remedy on any future occasion.

 

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(g) DEBTOR AND SECURED PARTY UNCONDITIONALLY WAIVE THEIR RIGHTS TO A JURY TRIAL
OF ANY CLAIM OR CAUSE OF ACTION BASED UPON OR ARISING OUT OF THIS AGREEMENT, ANY
OF THE OTHER DEBT DOCUMENTS, ANY OF THE INDEBTEDNESS SECURED HEREBY, ANY
DEALINGS BETWEEN DEBTOR AND SECURED PARTY RELATING TO THE SUBJECT MATTER OF THIS
TRANSACTION OR ANY RELATED TRANSACTIONS, AND/OR THE RELATIONSHIP THAT IS BEING
ESTABLISHED BETWEEN DEBTOR AND SECURED PARTY. THE SCOPE OF THIS WAIVER IS
INTENDED TO BE ALL ENCOMPASSING OF ANY AND ALL DISPUTES THAT MAY BE FILED IN ANY
COURT. THIS WAIVER IS IRREVOCABLE. THIS WAIVER MAY NOT BE MODIFIED EITHER ORALLY
OR IN WRITING. THE WAIVER ALSO SHALL APPLY TO ANY SUBSEQUENT AMENDMENTS,
RENEWALS, SUPPLEMENTS OR MODIFICATIONS TO THIS AGREEMENT, ANY OTHER DEBT
DOCUMENTS, OR TO ANY OTHER DOCUMENTS OR AGREEMENTS RELATING TO THIS TRANSACTION
OR ANY RELATED TRANSACTION. THIS AGREEMENT MAY BE FILED AS A WRITTEN CONSENT TO
A TRIAL BY THE COURT.

(h) Set Off. Debtor hereby grants to Secured Party an option to set off against,
any and all property, including deposits of Debtor, now or hereafter in the
possession or control of Secured Party (inclusive of such property as may be in
transit by mail or carrier to or from Secured Party), or that of any third party
acting on behalf of Debtor against any and all Indebtedness due under the Master
Security Agreement, although otherwise unmatured, without prior demand or notice
regardless of the adequacy of any collateral securing all or part of the
Indebtedness, and without resort to legal process or judicial proceeding or
other authorization.

9. MISCELLANEOUS.

(a) This Agreement, any Note and/or any of the other Debt Documents may be
assigned, in whole or in part, by Secured Party without notice to Debtor, and
Debtor agrees not to assert against any such assignee, or assignee’s assigns,
any defense, set-off, recoupment claim or counterclaim which Debtor has or may
at any time have against Secured Party for any reason whatsoever. Debtor agrees
that if Debtor receives written notice of an assignment from Secured Party,
Debtor will pay all amounts payable under any assigned Debt Documents to such
assignee or as instructed by Secured Party. Debtor also agrees to confirm in
writing receipt of the notice of assignment as may be reasonably requested by
Secured Party or assignee.

(b) All notices to be given in connection with this Agreement shall be in
writing, shall be addressed to the parties at their respective addresses set
forth in this Agreement (unless and until a different address may be specified
in a written notice to the other party), and shall be deemed given (i) on the
date of receipt if delivered in hand or by facsimile transmission, (ii) on the
next business day after being sent by express mail, and (iii) on the fourth
business day after being sent by regular, registered or certified mail. As used
herein, the term “business day” shall mean and include any day other than
Saturdays, Sundays, or other days on which commercial banks in New Haven,
Connecticut are required or authorized to be closed.

(c) Secured Party may correct patent errors and fill in all blanks in this
Agreement or in any Collateral Schedule consistent with the agreement of the
parties.

 

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(d) Time is of the essence of this Agreement. This Agreement shall be binding,
jointly and severally, upon all parties described as the “Debtor” and their
respective heirs, executors, representatives, successors and assigns, and shall
inure to the benefit of Secured Party, its successors and assigns.

(e) This Agreement and its Collateral Schedules constitute the entire agreement
between the parties with respect to the subject matter of this Agreement and
supersede all prior understandings (whether written, verbal or implied) with
respect to such subject matter. THIS AGREEMENT AND ITS COLLATERAL SCHEDULES
SHALL NOT BE CHANGED OR TERMINATED ORALLY OR BY COURSE OF CONDUCT, BUT ONLY BY A
WRITING SIGNED BY BOTH PARTIES. Section headings contained in this Agreement
have been included for convenience only, and shall not affect the construction
or interpretation of this Agreement.

(f) This Agreement shall continue in full force and effect until all of the
Indebtedness has been indefeasibly paid in full to Secured Party or its
assignee. The surrender, upon payment or otherwise, of any Note or any of the
other documents evidencing any of the Indebtedness shall not affect the right of
Secured Party to retain the Collateral for such other Indebtedness as may then
exist or as it may be reasonably contemplated will exist in the future. This
Agreement shall automatically be reinstated if Secured Party is ever required to
return or restore the payment of all or any portion of the Indebtedness (all as
though such payment had never been made).

(g) THIS AGREEMENT AND THE RIGHTS AND OBLIGATIONS OF THE PARTIES HEREUNDER SHALL
IN ALL RESPECTS BE GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH, THE INTERNAL
LAWS OF THE STATE OF CONNECTICUT (WITHOUT REGARD TO THE CONFLICT OF LAWS
PRINCIPLES OF SUCH STATE), INCLUDING ALL MATTERS OF CONSTRUCTION, VALIDITY AND
PERFORMANCE, REGARDLESS OF THE LOCATION OF THE EQUIPMENT.

 

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IN WITNESS WHEREOF, Debtor and Secured Party, intending to be legally bound
hereby, have duly executed this Agreement in one or more counterparts, each of
which shall be deemed to be an original, as of the day and year first aforesaid.

 

SECURED PARTY:     DEBTOR: Webster Bank, National Association     Achillion
Pharmaceuticals, Inc. By:  

/s/ Peter Hicks

    By:  

/s/ Mary Kay Fenton

Name:  

Peter Hicks

    Name:  

Mary Kay Fenton

Title:  

Sr. Vice President

    Title:  

Executive Vice President & Chief Financial Officer