IN SECTIONS 1(C)(IV) AND (V), THE
PURCHASE OPTION MAY BE EXERCISED ONLY DURING THE PERIOD (THE "PURCHASE OPTION
PERIOD") COMMENCING ON AND INCLUDING APRIL 7, 2007 (THE "PURCHASE OPTION
COMMENCEMENT DATE") AND ENDING ON AND INCLUDING THE EARLIER OF (X) APRIL 7, 2010
(THE "FINAL TERMINATION DATE"), AND (Y) THE 90TH CALENDAR DAY (SUCH 90TH
CALENDAR DAY, THE "FUNDS TERMINATION DATE") IMMEDIATELY FOLLOWING THE FIRST DATE
(EACH, A "BALANCE SHEET DEFICIENCY DATE") ON WHICH A NOTICE OF AN IMPENDING
FUNDS TERMINATION DATE (A "FUNDS TERMINATION NOTICE") IS DELIVERED TO ISIS IN
ACCORDANCE WITH SECTION 13 HEREOF, ACCOMPANIED BY AN INTERNALLY PREPARED,
UNAUDITED, BALANCE SHEET OF SYMPHONY GENISIS (PREPARED IN ACCORDANCE WITH GAAP)
STATING THAT THE AGGREGATE AMOUNT OF CASH AND CASH
2
EQUIVALENTS HELD BY SYMPHONY GENISIS IS LESS THAN [***] NET OF ALL ACCRUED AND
UNPAID AMOUNTS OWING BY SYMPHONY GENISIS AT SUCH TIME;
(IV)
IN THE EVENT THAT ISIS HAS AGREED TO SHARE THE COSTS OF ADDITIONAL
RESEARCH PURSUANT TO THE RESEARCH COST SHARING AND EXTENSION AGREEMENT, THE
PURCHASE OPTION PERIOD SHALL BE DETERMINED IN ACCORDANCE WITH THE RESEARCH COST
SHARING AND EXTENSION AGREEMENT (FOR THE AVOIDANCE OF DOUBT, FUNDS ADVANCED BY
ISIS PURSUANT TO THE RESEARCH COST SHARING AND EXTENSION AGREEMENT SHALL NOT BE
INCLUDED IN ANY CALCULATION OF THE PURCHASE PRICE HEREUNDER); AND
(V)
IN THE EVENT THAT HOLDINGS TERMINATES THE AMENDED AND RESTATED
RESEARCH AND DEVELOPMENT AGREEMENT PURSUANT TO SECTION 17.2 THEREOF, ISIS SHALL
HAVE FIVE (5) BUSINESS DAYS TO NOTIFY HOLDINGS OF ITS EXERCISE OF THE PURCHASE
OPTION UNDER THE TERMS OF THIS AGREEMENT. SUCH EXERCISE OF THE PURCHASE OPTION
BY ISIS MAY OCCUR PRIOR TO THE PURCHASE OPTION COMMENCEMENT DATE (AN "EARLY
PURCHASE OPTION EXERCISE").
Section 2.
Exercise of Purchase Option.
(A)
EXERCISE NOTICE.
ISIS MAY EXERCISE THE PURCHASE OPTION ONLY BY DELIVERY
OF A NOTICE IN THE FORM ATTACHED HERETO AS EXHIBIT 1 (THE "PURCHASE OPTION
EXERCISE NOTICE") DURING THE PURCHASE OPTION PERIOD.
THE PURCHASE OPTION
EXERCISE NOTICE SHALL BE DELIVERED ON A BUSINESS DAY TO HOLDINGS AND SYMPHONY
GENISIS AND SHALL BE IRREVOCABLE ONCE DELIVERED.
THE DATE ON WHICH THE PURCHASE
OPTION EXERCISE NOTICE IS FIRST DELIVERED TO HOLDINGS AND SYMPHONY GENISIS IS
REFERRED TO AS THE "PURCHASE OPTION EXERCISE DATE."
THE PURCHASE OPTION
EXERCISE NOTICE SHALL CONTAIN (1) AN ESTIMATED DATE
FOR THE SETTLEMENT OF THE
PURCHASE OPTION (THE "PURCHASE OPTION CLOSING"), WHICH DATE SHALL BE ESTIMATED
IN ACCORDANCE WITH THIS SECTION 2(A), (2) THE
PURCHASE PRICE, DETERMINED IN
ACCORDANCE WITH SECTION 2(B) HEREOF, AND (3) IF ISIS INTENDS TO PAY PART OF THE
PURCHASE PRICE IN ISIS COMMON STOCK, NOTICE OF SUCH INTENT, THE NUMBER OF SHARES
TO BE TRANSFERRED AS SUCH PURCHASE PRICE, THE VALUATION THEREOF AND THE
PERCENTAGE SUCH PORTION BEARS TO (A) THE PURCHASE PRICE, AND (B) THE TOTAL
AMOUNT OF ISIS COMMON STOCK THEN ISSUED AND OUTSTANDING (WHICH SHALL BE NO
GREATER PERCENTAGES THAN ARE PERMITTED UNDER SECTION 2(C)).
SUCH NOTICE AND
ELECTION SHALL BE IRREVOCABLE ONCE GIVEN AND MADE.
IF, DURING THE PERIOD