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Exhibit 4.17    
    

 
 

LICENSE AGREEMENT    
    

        Effective this    day of September, 2004 ("EFFECTIVE DATE"), GENETIC TECHNOLOGIES LIMITED, having an
office at 60 Hanover Street, Fitzroy, Victoria 3065, Australia ("LICENSEE") and METAMORPHIX, INC., a Delaware corporation, having an office at
8510A Corridor Road, Savage, Maryland 20763, and MMI GENOMICS, INC., a Delaware corporation, having an office at 1756 Picasso Avenue, Davis,
California, 95616, USA (collectively, "LICENSOR"), agree as follows: 

ARTICLE I
 BACKGROUND  

        1.1   LICENSOR
has certain intellectual property rights, including patent rights and associated know-how, relating to cattle and canine genotyping services for
identity and parentage verification. 

        1.2   LICENSEE
wishes to acquire a license under, and to obtain access to LICENSOR's patents and associated know-how in order to perform internal
DNA-based diagnostic assays for use in its cattle and canine identity and parentage verification services (the "PURPOSE") within only the EXCLUSIVE TERRITORY and the NON EXCLUSIVE
TERRITORY. 

        1.3   LICENSOR
is prepared to grant a non-exclusive, field-restricted license to LICENSEE under its patents and associated know-how, subject to the
terms and conditions of this AGREEMENT. 

ARTICLE II
 GENERAL DEFINITIONS AND RELATIONSHIPS AMONG DEFINITIONS  

        2.1   "AGREEMENT"
means this document, its attachments, all addenda, schedules, exhibits, appendices, and any amendments to the foregoing. 

        2.2   "APPLERA-LICENSED
PRODUCTS" means any product or products covered by at least one valid claim of the LICENSED PATENTS, including, but not limited to, kits for use by
LICENSEE'S customers. 

        2.3   "CONFIDENTIAL
INFORMATION" means any and all information which is disclosed by either party to the other verbally, electronically, visually, or in a written or other
tangible form which is either identified at the time of disclosure as confidential or should be reasonably understood to be confidential or proprietary. CONFIDENTIAL INFORMATION includes, but is not
limited to, the specific terms and/or conditions of this AGREEMENT, TECHNOLOGY, trade secrets, ideas, processes, know-how, formulas, programs, software, source of supply, technology,
discoveries, developments, inventions, techniques, marketing plans, strategies, forecasts, unpublished financial statements, prices, costs, and customer lists. 

        2.4   "EXCLUSIVE
TERRITORY" means Australia and New Zealand. 

        2.5   "FIELD
OF USE" means identity and parentage services performed only at a LICENSEE-controlled facility or facilities (and expressly excluding, as further set forth in
Section 4.5 and by way of example, the sale of diagnostic kits or other APPLERA-LICENSED PRODUCTS to LICENSEE'S customers and other third parties). 

        2.6   LICENSOR
and LICENSEE may hereunder be commonly referred to as "parties" (in singular and plural usage, as required by the context). 

        2.7   "LICENSED
PATENT(S)" means individually or collectively (i) the United States patent of LICENSOR listed in the attached Appendix "A"; (ii) all reissues,
reexaminations, divisionals, continuations, continuations-in-part, substitutions, additions, improvements, or other applications 

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claiming
priority from such patents and any patents which may issue on such other applications, or extensions of such patents; and (iii) foreign counterparts of any of the foregoing (including,
but not limited to, the Australian patent of LICENSOR listed in the attached Appendix "A"). 

        2.8   "LICENSED
SERVICE(S)" means microsatellite-based cattle and/or canine identity and/or parentage verification genotyping services developed, performed, or provided by
LICENSEE or a SUBSIDIARY of LICENSEE that, but for the license granted herein, would infringe or contribute to the infringement of one or more claims of a LICENSED PATENT and which, in no respect,
includes any making, having made, importing, or selling for internal use by customers of any APPLERA-LICENSED PRODUCTS. 

        2.9   "NONEXCLUSIVE
TERRITORY" means all territories falling within the continent of Asia. 

        2.10 "SUBSIDIARY"
means any corporation, company or other legal entity, in which more than fifty percent (50%) of the shares entitled to vote for the election of directors
or persons performing similar functions are, now or hereafter, owned or controlled, directly or indirectly by a party hereto, or jointly by the parties hereto; provided, however, that any corporation,
company or other legal entity shall be a SUBSIDIARY only for as long as such ownership or control exists. 

        2.11 "TECHNOLOGY"
means any technology, know-how, trade secrets, or the like, in any form whatsoever, owned, controlled or licensable by LICENSOR as of the
EFFECTIVE DATE and related to or associated with: (i) the LICENSED PATENTS; (ii) microsatellite-based cattle and/or canine identity and/or parentage verification genotyping services;
and/or (iii) any methods, techniques, processes, procedures, protocols, databases, or interpretive aids utilized by LICENSOR in the exploitation of the LICENSED PATENTS or in connection with
microsatellite-based canine and cattle identity and/or parentage testing services. 

        2.12 "TERM"
means, unless sooner terminated as hereinafter provided, ten (10) years from the EFFECTIVE DATE with automatic five (5) year renewals thereafter
(but not beyond the expiration of the last to expire of the LICENSED PATENTS), provided LICENSEE is not in breach of any terms or conditions of this AGREEMENT on the date of renewal. 

ARTICLE III
 RELEASE  

        3.1   Upon
payment in full of the amount to be paid to LICENSOR pursuant to Section 5.1 below, LICENSOR hereby releases, acquits and forever discharges LICENSEE and
SUBSIDIARIES of LICENSEE from all claims, demands, and rights of action which LICENSOR may now have on account of any infringement of any LICENSED PATENT, by performance or acts, prior to the
EFFECTIVE DATE by LICENSEE or SUBSIDIARIES of LICENSEE. Notwithstanding anything in the foregoing to the contrary, however, LICENSOR makes no release, acquittal, or discharge in respect to making,
having made, importing, or selling for internal use by its customers any APPLERA-LICENSED PRODUCTS, although LICENSOR acknowledges that it is not aware of any infringement of LICENSEE in respect to
any APPLERA-LICENSED PRODUCT. 

ARTICLE IV
 GRANT TO LICENSEE  

        4.1   Subject
to the terms and conditions of this AGREEMENT, LICENSOR hereby grants LICENSEE and SUBSIDIARIES of LICENSEE, during the TERM of this AGREEMENT: 

        4.1.1 a
nonexclusive, non-assignable (except as provided in Section 4.2), non-transferable (except as provided in Section 4.2), fully
paid-up, irrevocable (except as provided in Article 8), license under the LICENSED PATENTS and TECHNOLOGY (without the right to sublicense) to 

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make,
have made, use, sell, offer for sale, import and perform LICENSED SERVICES in the FIELD OF USE throughout the NONEXCLUSIVE TERRITORY solely for the PURPOSE; and 

        4.1.2 an
exclusive, non-assignable (except as provided in Section 4.2), non-transferable (except as provided in Section 4.2), fully
paid-up, irrevocable (except as provided in Article 8), license under the LICENSED PATENTS and TECHNOLOGY (without the right to sublicense) to make, have made, use, sell, offer for
sale, import and perform LICENSED SERVICES in the FIELD OF USE throughout the EXCLUSIVE TERRITORY solely for the PURPOSE. 

        4.2   The
rights and licenses granted by LICENSOR in this AGREEMENT are personal to LICENSEE and LICENSEE shall not assign or otherwise transfer any license or right granted
hereunder or any interest therein without the prior written consent of LICENSOR (which shall not be unreasonably withheld), except to a purchaser of all or substantially all of the business of
LICENSEE to which this AGREEMENT relates, whether by merger, sale of stock, sale of assets or otherwise; provided, however that (i) prior to the transfer of ownership such purchaser must
expressly assume in writing LICENSEE's obligations under this AGREEMENT; (ii) LICENSEE expressly acknowledges in writing that products and/or services of such purchaser existing prior to the
transfer of ownership shall not be LICENSED SERVICES; and (iii) LICENSEE obtains LICENSOR's prior written consent, which consent shall not be unreasonably withheld. 

        4.3   All
rights not explicitly granted to LICENSEE are reserved by LICENSOR. Not limiting the foregoing, LICENSEE acknowledges that it is not granted any rights to any other
patents or other intellectual property rights of LICENSOR or any third party and that it is not granted any rights now held by Applera Corporation, acting by and through its Celera Genomics Group,
under the February 28, 2002 License Agreement between LICENSOR and PE Corporation (NY). 

        4.4   LICENSEE
shall be responsible for all acts and omissions of its SUBSIDIARIES related to the rights granted to its SUBSIDIARIES under this AGREEMENT and LICENSEE shall
ensure that its SUBSIDIARIES are in compliance with the terms and conditions of this AGREEMENT at all times during the TERM. 

        4.5   Notwithstanding
anything in this Article IV to the contrary, no grant of license is made to LICENSEE to make, have made, import, and sell for internal use by its
customers any APPLERA-LICENSED PRODUCTS, which are the subject of an exclusive February 28, 2002 License Agreement by LICENSOR to PE Corporation (NY) which has since been assigned by such
license to Applera Corporation, acting by and through its Celera Genomics Group. LICENSOR represents to LICENSEE, however, that such 2002 License Agreement provides that PE (and its successors and
assigns) is not licensed to provide services to third parties under the Licensed Patents (which right was reserved by LICENSOR). 

        4.6   Nothing
in this Article IV provides LICENSEE with any license to any Microsoft® or other third-party operating software intellectual property. 

ARTICLE V
 CONSIDERATION  

        5.1   In
consideration for the release of Article III and the licenses granted by this AGREEMENT, LICENSEE agrees to pay to LICENSOR a non-refundable
license fee of one hundred thousand United States Dollars ($100,000.00) within fifteen (15) days of the EFFECTIVE DATE. 

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        5.2   The
license fee payment by LICENSEE to LICENSOR shall be sent by electronic wire transfer to: 

Bank
of America, N.A.

ABA (Bank Routing) Number: 052 001 633

Account Number: 39 636 2583

Account Name: MetaMorphix, Inc.

Bank Address: 10 Light Street, Baltimore, Maryland 21202 

        5.3   LICENSEE
agrees to pay interest of ten percent (10%) per year or the maximum rate allowed by law, whichever is less, on fees payable but not paid to LICENSOR when due. 

        5.4   All
fees payable hereunder by LICENSEE are payable to LICENSOR's successors, heirs, or assigns, as appropriate. 

        5.5   MATERIAL
BREACH: Breach of any provision of this Article V or part thereof shall be deemed a material breach. 

ARTICLE VI
 TRANSFER OF TECHNOLOGY  

        6.1   LICENSOR
shall use reasonable efforts to fully disclose the TECHNOLOGY as it has been practiced by the LICENSOR (which disclosure would be best and fully understood if
LICENSEE were to participate in the Additional Services offered in accordance with Appendix "B"). 

        6.2   Within
one week of the LICENSOR's receipt of payment under Section 5.1, LICENSOR shall provide to LICENSEE an initial package of TECHNOLOGY containing materials
related to the know-how and technology set forth in the attached Appendix "B". Such initial package shall be furnished by LICENSOR in the English language. The cost of additional copies
and translation shall be borne by LICENSEE. Nothing in this AGREEMENT shall be construed to require LICENSOR to either (a) engage in special engineering or technical studies on behalf of
LICENSEE (notwithstanding the provisions of Section 6.3) or (b) except as expressly set forth in Section 6.3 and Section 6.4, have a continuing, post-EFFECTIVE
DATE obligation to provide new, additional, or evolving TECHNOLOGY. 

        6.3   During
the first three (3) years of the TERM, upon prior written request of the LICENSEE (reasonably made and not more than twice each year), LICENSOR shall have
its management representatives meet from time to time (by phone or in person), and whenever reasonably requested by LICENSEE, with representatives of LICENSEE, to review generally the scope and
content of any new, additional, or evolved TECHNOLOGY of interest to LICENSEE and to work out practical procedures for promptly disclosing any such item of TECHNOLOGY to LICENSEE. LICENSOR shall,
during the first three (3) years of the TERM, upon prior written request of LICENSEE disclose to LICENSEE's designated representatives, without unjustified delay, any new, additional, or
evolved TECHNOLOGY requested by LICENSEE. Such requests shall, in each case, be for specific items of such TECHNOLOGY. LICENSOR and LICENSEE shall each bear their own costs associated with the
provision of TECHNOLOGY to LICENSEE. 

        6.4   LICENSOR
shall, during the first three (3) years of the TERM, upon prior written request of LICENSEE (reasonably made and not more than twice each year), arrange
for duly authorized representatives of LICENSEE to visit offices, laboratories, or other facilities of LICENSOR where LICENSOR exploits the LICENSED PATENTS, the TECHNOLOGY and/or microsatellite-based
cattle or canine identity and parentage genotyping to inspect, at such offices, laboratories, or other facilities, all such operations that utilize TECHNOLOGY. LICENSOR shall not be obligated to
arrange for visits to an extent that by reason of the number of visits, or the number of representatives, such visits shall interfere with the operation of any of LICENSOR's facilities so visited. 

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        6.5   LICENSOR
shall, during the first three (3) years of the TERM (but only as provided for under the "Additional Services" provisions of Appendix "B"), upon prior
written request of LICENSEE (reasonably made and not more than twice per year), make available to LICENSEE, without charge, at offices, laboratories, or other facilities of LICENSOR in the United
States of America, the services of personnel of LICENSOR who are familiar with the LICENSED SERVICES, for consultation and advice concerning LICENSEE's operations relating to LICENSED SERVICES and the
evaluation and/or purchase by LICENSEE of any machines, devices, laboratory equipment, production systems, or reagents which were used or have been considered by LICENSOR in connection with the
exploitation of the LICENSED PATENTS and/or performance of microsatellite-based canine and cattle identity and/or parentage testing. LICENSOR shall not be required under this paragraph to provide more
than ten (10) man days of such services in any calendar year. 

        6.6   LICENSOR
shall, during the first three (3) years of the TERM (but only as provided for under the "Additional Services" provisions of Appendix "B"), upon prior
written request of LICENSEE (reasonably made and not more than twice each year), make available to LICENSEE, at its Davis, California facility, the services of one or more employees of LICENSOR who
are familiar with TECHNOLOGY for the following tasks: (a) consultation and advice concerning LICENSOR's utilization of the TECHNOLOGY and LICENSEE's utilization of the TECHNOLOGY; and
(b) the training of LICENSEE's personnel, provided that LICENSOR shall not furnish more than two qualified personnel at a time, no more than two weeks at a time, and no more than twice in any
calendar year. LICENSEE shall pay LICENSOR, in United States Dollars, or the currency in which the expense is incurred, or the salary paid, the amount of (a) the reasonable travel and
subsistence expense incurred by any such LICENSOR employee in traveling from his place of regular employ to, visiting, and returning to his place of regular employ from the plants of LICENSEE, and
(b) the allowances for any such employee, on a per-diem basis, for the entire period such employee is engaged away from his place of regular employ in providing services to LICENSEE
and in traveling to and returning from LICENSEE's plant or plants, the total of such allowances not varying unreasonably from an estimate thereof provided by LICENSOR prior to the rendering of such
services. After the return of such employee, LICENSOR will advise LICENSEE of the actual amounts of items (a) and (b) above, and LICENSEE shall pay such total within thirty
(30) days after receipt of LICENSOR's invoice. LICENSEE shall pay all salaries, travel and subsistence expenses of LICENSEE's representatives in availing itself of LICENSOR's facilities or
assistance under any provision of this Article VI. 

        6.7   From
time to time during the first three (3) years of the TERM, LICENSOR shall provide to LICENSEE copies of technical reports and evaluations relating to the
manufacture, performance, use and interpretation of results of LICENSED SERVICES which LICENSOR, in its sole discretion, shall deem to be of interest to LICENSEE. During any meeting of representatives
of LICENSEE and LICENSOR, or in response to any subsequent written request of LICENSEE, subject to the other terms of this Article VI, LICENSOR shall transmit to LICENSEE any requested specific
item of technical data at its disposal, relating to the LICENSED PATENTS, TECHNOLOGY, microsatellite-based canine and cattle identity and/or parentage testing, or the interpretation of results of
LICENSED SERVICES, including the design and implementation of production systems and equipment employed in such performance, use and/or interpretation. Subject to LICENSEE's obligations under
Article VI, LICENSOR hereby grants to LICENSEE a nonexclusive, unrestricted right and license to use such information transmitted to LICENSEE in the manufacture, performance, use,
interpretation of results, and sale of LICENSED SERVICES subject to the limitations of the license set forth in Article IV. 

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ARTICLE VII
 WAIVER  

        7.1   No
waiver by either party, express or implied, of any breach of any term, condition, or obligation of this AGREEMENT by the other party shall be construed as a waiver of
any subsequent breach of that term, condition, or obligation, or of any other term, condition, or obligation of this AGREEMENT of the same or different nature. 

ARTICLE VIII
 TERM AND TERMINATION OF AGREEMENT  

        8.1   This
AGREEMENT shall be in effect for the TERM, unless terminated earlier as provided herein. 

        8.2   Either
party shall have the right to terminate this AGREEMENT upon any material breach of any term or condition of this AGREEMENT by the other party (including, but not
limited to LICENSEE's failure to make payment under Article V), which has not been corrected within thirty (30) days after receipt of a notice in writing with reference to this
Section 8.2 and such termination shall be without prejudice to any other rights or claims the aggrieved party may have against the other party. 

        8.3   LICENSOR
shall have the right to terminate this AGREEMENT, upon written notice, in the event that LICENSEE discontinues its cattle and canine identity and parentage
verification genotyping services business for any reason and LICENSEE does not resume such business (or refute such allegation) within one hundred twenty (120) days of receiving such notice. 

        8.4   Termination
or expiration of this AGREEMENT shall not affect any obligation owed by one party to the other party prior to the termination or expiration. Upon termination
of this AGREEMENT due to (a) LICENSEE's material breach of its obligations set forth herein, (b) in accordance with Section 8.3, or (c) upon LICENSEE's intentional
relinquishment and surrender of its license under this Agreement, all rights granted to LICENSEE hereunder shall revert to LICENSOR and, in the event of a pre-expiration termination,
LICENSEE shall immediately cease all activities authorized by this AGREEMENT. 

        8.5   Upon
termination or expiration of this AGREEMENT for any reason the parties shall promptly return all CONFIDENTIAL INFORMATION and copies thereof of the other party to
the other party or certify that they have destroyed all CONFIDENTIAL INFORMATION and copies thereof. 

        8.6   SURVIVAL:
Article II, III, IX, X and XII and all payment obligations incurred prior to termination or expiration shall survive the termination or expiration of
this AGREEMENT. 

ARTICLE IX
 CONFIDENTIALITY, PUBLICITY AND PRESS RELEASES  

        9.1   LIMITATIONS
ON USE AND DISCLOSURE: The parties agree that the terms and conditions set forth in this AGREEMENT are CONFIDENTIAL INFORMATION. The CONFIDENTIAL INFORMATION
disclosed by either party ("DISCLOSING PARTY") to the other party ("RECEIVING PARTY") constitutes the confidential and proprietary information of the DISCLOSING PARTY and the RECEIVING PARTY agrees to
treat all CONFIDENTIAL INFORMATION of the other in the same manner as it treats its own similar proprietary information, but in no case will the degree of care be less than reasonable care. The
RECEIVING PARTY shall use CONFIDENTIAL INFORMATION of the DISCLOSING PARTY only in performing under this AGREEMENT and shall retain the CONFIDENTIAL INFORMATION in confidence and not disclose to any
third party (except as authorized under this AGREEMENT) without the DISCLOSING 

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PARTY's
express written consent. The RECEIVING PARTY shall disclose the DISCLOSING PARTY's CONFIDENTIAL INFORMATION only to those employees and contractors of the RECEIVING PARTY who have a need to
know such information for the purposes of this AGREEMENT, and such employees and contractors must have entered into agreements with the RECEIVING PARTY containing confidentiality provisions covering
the CONFIDENTIAL INFORMATION, or similar confidential information, with terms and conditions at least as restrictive as those set forth herein. Notwithstanding the foregoing, each party's
confidentiality obligations hereunder shall not apply to information which as evidenced by written records: 

        9.1.1 is
already known to the RECEIVING PARTY, without an obligation of confidentiality, prior to disclosure by the DISCLOSING PARTY; 

        9.1.2 becomes
publicly available without fault of the RECEIVING PARTY; 

        9.1.3 is
rightfully obtained by the RECEIVING PARTY from a third party without restriction as to disclosure, or is approved for release by written authorization of the
DISCLOSING PARTY; or 

        9.1.4 is
developed independently by the RECEIVING PARTY without use of or access to the DISCLOSING PARTY's CONFIDENTIAL INFORMATION. 

        9.2   PERMITTED
USE AND DISCLOSURE: Each party hereto is permitted to disclose this AGREEMENT and use or disclose the CONFIDENTIAL INFORMATION disclosed to it by the other
party: 

        9.2.1 To
the extent such use or disclosure is reasonably necessary in connection with complying with stock exchange rules; or 

        9.2.2 To
its legal and/or financial advisors, provided such advisors maintain the confidentiality of this AGREEMENT; or 

        9.2.3 To
the extent such use or disclosure is reasonably necessary in prosecuting or defending litigation, complying with applicable law, governmental regulation or court
order, submitting information to tax or other governmental authorities, or otherwise exercising its rights hereunder; or 

        9.2.4 To
the extent necessary to enforce its rights under this AGREEMENT in connection with a legal proceeding or as required to be disclosed by law or governmental
regulation. 

        9.2.5 In
the instances set forth in Sections 9.2.3 or 9.2.4, the RECEIVING PARTY shall provide reasonable advance written notice to DISCLOSING PARTY of such disclosure and
reasonably cooperate with the DISCLOSING PARTY in limiting such disclosure. 

        9.3   PUBLICITY
AND PRESS RELEASES: The parties shall mutually agree upon and jointly issue one or more appropriate media/press releases with regard to the existence of this
AGREEMENT within seven (7) days of the EFFECTIVE DATE or as soon as reasonably practical thereafter. Neither party shall issue any other press releases relating to this AGREEMENT without prior
written approval of the other party; provided however, that: 

        9.3.1 Each
party shall be permitted to post a copy of or provide a link on its web site to any permitted disclosures made under this AGREEMENT; 

        9.3.2 LICENSOR
shall be able to disclose to other licensees and/or prospective licensees the identity of LICENSEE and the existence of this AGREEMENT; and 

        9.3.3 LICENSEE
shall be able to disclose to its SUBSIDIARIES the existence of this AGREEMENT and the general nature, scope and limitations of this AGREEMENT. 

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        9.4   NON-DISPARAGEMENT:
LICENSEE shall not make any disclosures, issue any statements or otherwise cause to be disclosed any information, statement, press release
or other public disclosure which is designed, intended, or might reasonably be anticipated to disparage, defame, criticize or denigrate LICENSOR, or its officers, directors, and employees, the
LICENSED PATENTS, this AGREEMENT, or LICENSOR's patent licensing activities ("STATEMENTS"). Additionally, LICENSEE shall not direct or expressly permit its officers, directors or employees or those of
its SUBSIDIARIES to issue any such STATEMENTS. 

ARTICLE X
 REPRESENTATIONS AND WARRANTIES  

        10.1 LICENSOR
represents and warrants that, except in respect to the February 28, 2002 License Agreement between LICENSOR and PE Corporation (NY), it has the sole and
exclusive ownership of the LICENSED PATENTS and TECHNOLOGY, and that it has sole and exclusive power and authority to prosecute and enforce the LICENSED PATENTS worldwide. 

        10.2 LICENSOR
represents and warrants that, other than the LICENSED PATENTS and the TECHNOLOGY, LICENSOR owns and/or controls no other intellectual property rights to which
a right or a license is required from LICENSOR for use and commercialization as intended hereunder by LICENSOR of the TECHNOLOGY and methods undertaken in the provision of the LICENSED SERVICES. 

        10.3 LICENSOR
represents and warrants that it has the full right, power, and authority to enter into and perform its obligations under this AGREEMENT and grant to LICENSEE
the license and other rights as set forth herein without violating any third party's rights, and there are no outstanding agreements, grants, licenses, encumbrances, liens, or agreements, either
written or implied, inconsistent therewith or pursuant to which this AGREEMENT or the parties' performance hereunder would violate, breach, or cause a default. 

        10.4 LICENSOR
represents and warrants that the execution, delivery, and performance of this AGREEMENT have been duly authorized by all necessary corporate actions on the
part of LICENSOR. 

        10.5 LICENSEE
represents and warrants that it has the full right, power, and authority to enter into and perform its obligations under this AGREEMENT, and there are no
outstanding agreements, grants, licenses, encumbrances, liens, or agreements, either written or implied, inconsistent therewith or pursuant to which this AGREEMENT or the parties' performance
hereunder would violate, breach, or cause a default. 

        10.6 LICENSEE
represents and warrants that the execution, delivery, and performance of this AGREEMENT have been duly authorized by all necessary corporate actions on the
part of LICENSEE. 

        10.7 INDEMNIFICATION:

        10.7.1 BY
LICENSEE: LICENSEE agrees to hold LICENSOR harmless from any claims by third parties arising from and/or associated with either (a) LICENSEE'S provision of
the LICENSED SERVICES and shall indemnify, hold harmless, and defend LICENSOR, and LICENSOR'S subsidiaries, affiliates, officers, directors, representatives, employees, or agents against any and all
claims, causes of action, demands, judgments, settlements, expenses, or losses including, but not limited to, reasonable attorneys' fees and court costs arising out of or in connection with:
(i) any breach by LICENSEE of any representation, warranty, or covenant hereunder; (ii) the failure of LICENSEE to perform any covenants or obligations contained in this AGREEMENT; or
(iii) LICENSEE'S negligent, reckless, or willful misconduct; or (b) LICENSEE's sale of APPLERA-LICENSED PRODUCTS to LICENSEE's customers or other 

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third
parties (unless it has first obtained a license from Applera Corporation, its successors or assigns). 

        10.7.2 BY
LICENSOR: LICENSOR shall indemnify and defend LICENSEE, and LICENSEE'S subsidiaries, affiliates, officers, directors, representatives, employees, or agents against
any and all claims, causes of action, demands, judgments, settlements, expenses, or losses including, but not limited to, reasonable attorneys' fees and court costs arising out of or in connection
with: (i) any breach by LICENSOR of any representation, warranty, or covenant hereunder; (ii) the failure of LICENSOR to perform any covenants or obligations contained in this AGREEMENT;
or (iii) LICENSOR's negligent, reckless, or willful misconduct.

        10.7.3 The
indemnifying party's indemnification obligations under this Section 10 are conditioned upon the indemnified party (i) giving prompt notice of the
claim to the indemnifying party; (ii) granting sole control of the defense or settlement of the claim or action to the indemnifying party; and (iii) providing reasonable cooperation to
the indemnifying party and, at the indemnifying party's request and expense, assistance in the defense or settlement of the claim. 

        10.8 DISCLAIMER
OF WARRANTIES: EXCEPT AS EXPRESSLY SET FORTH HEREIN, EACH PARTY EXPRESSLY DISCLAIMS, TO THE EXTENT ALLOWED BY APPLICABLE LAW, ANY AND ALL WARRANTIES OF ANY
KIND, EXPRESS OR IMPLIED, INCLUDING WITHOUT LIMITATION THE WARRANTIES OF DESIGN, TITLE, MERCHANTABILITY, FITNESS FOR A PARTICULAR PURPOSE (EVEN IF INFORMED OF SUCH PURPOSE), NONINFRINGEMENT OF THE
INTELLECTUAL PROPERTY RIGHTS OF THIRD PARTIES, OR ARISING FROM A COURSE OF DEALING, USAGE OR TRADE PRACTICES, IN ALL CASES WITH RESPECT THERETO. 

        10.9 LIMITATION
OF LIABILITY: TO THE GREATEST EXTENT PERMISSIBLE UNDER APPLICABLE LAW, EXCEPT FOR A BREACH OF A PARTY'S OBLIGATIONS PURSUANT TO ARTICLE IX, WITH RESPECT TO
ANY CAUSE OF ACTION RELATING TO OR ARISING FROM THIS AGREEMENT (WHETHER UNDER THIS ARTICLE X OR OTHERWISE): (I) NEITHER PARTY SHALL BE ENTITLED TO RECOVER FROM THE OTHER PARTY ANY SPECIAL,
INCIDENTAL, CONSEQUENTIAL OR PUNITIVE DAMAGES IN CONNECTION WITH THIS AGREEMENT OR ANY LICENSE GRANTED HEREUNDER AND (II). LICENSOR SHALL NOT BE LIABLE FOR ANY AMOUNTS IN EXCESS OF THE TOTAL AMOUNTS
PAID TO LICENSOR BY LICENSEE HEREUNDER. 

        10.10 Except
as expressly set forth herein, nothing contained in this AGREEMENT shall be construed as: 

        10.10.1 a
warranty or representation that any use or performance contemplated herein will be free from infringement of patents other than, subject to Section 4.5,
those LICENSED PATENTS under which and to the extent to which licenses are in force hereunder; 

        10.10.2 an
agreement to bring or prosecute actions or suits against third parties for infringement or conferring any right to bring or prosecute actions or suits against
third parties for infringement; 

        10.10.3 conferring
any right to use by either party, in advertising, publicity, or otherwise, any trademark, trade name or name, or any contraction, abbreviation or
simulation thereof, of the other party; 

        10.10.4 conferring
by implication, estoppel or otherwise, upon LICENSEE, any license or other right under any intellectual property or patent. 

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ARTICLE XI
 NOTICE  

        11.1 Any
notice, request or statement hereunder shall be deemed to be sufficiently given or rendered when personally delivered, delivered by a major commercial rapid
delivery courier service, or mailed by certified or registered mail, return receipt requested, and if given or rendered to LICENSOR, addressed to: 

Edwin
C. Quattlebaum, Ph.D.

President and CEO

MetaMorphix, Inc.

8510A Corridor Road

Savage, MD 20763

USA 

and

Dennis
Fantin, Ph.D.

Director, Operations,

MMI Genomics

1756 Picasso Avenue

Davis, CA 95616

USA 

with
a copy to: 

William
E. Carlson, Esq.

Shapiro Sher Guinot & Sandler

36 S. Charles Street, Suite 2000

Baltimore, MD 21201

USA 

or,
if given or rendered to LICENSEE, addressed to: 

Dr. Mervyn
Jacobson

Executive Chairman

Genetic Technologies Limited

60 Hanover Street

Fitzroy, Victoria 3065

Australia 

with
a copy to: 

Michael
A. DeSanctis, Esq.

Faegre & Benson LLP

3200 Wells Fargo Center

1700 Lincoln Street

Denver, CO 80203

USA 

or,
in any case, to such changed address or person as LICENSOR or LICENSEE shall have specified to the other by written notice. 

10

 
ARTICLE XII
 MISCELLANEOUS  

        12.1 CONSTRUCTION:
This AGREEMENT has been negotiated by the parties and their respective counsel. This AGREEMENT shall be interpreted fairly in accordance with its terms
and without any strict construction in favor of or against either party. This AGREEMENT shall not be construed in favor or against either party by reason of the authorship of any provisions hereof.
The existence or absence of any term or condition of this AGREEMENT shall not be used in the construction or interpretation of any other AGREEMENT between the parties. 

        12.2 MARKINGS:
LICENSEE shall use markings as LICENSOR may reasonably request from time to time, including, but not limited to, marking materials related to the LICENSED
SERVICES with patent number(s). 

        12.3 NOTICE
REGARDING INFRINGEMENT: LICENSEE shall promptly notify LICENSOR of any third party that it reasonably believes to be infringing a LICENSED PATENT, and shall use
reasonable efforts to provide to LICENSOR any non-confidential information it has in support of such belief. If such third party competes in the markets of LICENSEE's LICENSED SERVICES,
then upon receipt of a written request from LICENSEE with reference to this Section 12.2, LICENSOR shall undertake a review of the activities of such third party and if such activities are
found to be infringing one or more of the LICENSED PATENT(S) within the FIELD OF USE (determined in LICENSOR's sole and absolute discretion), LICENSOR agrees to reasonably pursue a license with such
third party. 

        12.4 ACKNOWLEDGEMENT
REGARDING VALIDITY AND ENFORCEABILITY: LICENSEE hereby acknowledges that to the best of LICENSEE's knowledge, as of the EFFECTIVE DATE the LICENSED
PATENTS are valid and enforceable. During the TERM, LICENSEE will not knowingly induce, encourage or assist any third party in connection with attacking the title or right of LICENSOR in and to the
LICENSED PATENTS or attacking the validity or enforceability of the LICENSED PATENTS. 

        12.5 MODIFICATION:
This AGREEMENT sets forth the entire AGREEMENT and understanding between the parties as to the subject matter of this AGREEMENT and merges all prior
discussions between the parties, and no one of the parties shall be bound by any modification of this AGREEMENT, or by any conditions, definitions, warranties, or representations with respect to the
subject matter of this AGREEMENT, other than as expressly provided for herein, or as duly set forth on or subsequent to the EFFECTIVE DATE in writing and signed by duly authorized representatives of
the party to be bound thereby. 

        12.6 CHOICE
OF LAW: This AGREEMENT and matters connected with the performance thereof shall be construed, interpreted, applied and governed in all respects in accordance
with the laws of the State of New York and the United States (which also governs the 2002 License Agreement between LICENSOR and PE Corporation (NY)). 

        12.7 DISPUTE
RESOLUTION: 

        12.7.1 In
the event of any difference, dispute or question, arising from this AGREEMENT, the parties will endeavor to settle such matters amicably between themselves in good
faith. Should the parties be unable to do so within a period of thirty-five (35) working days, except as provided for elsewhere herein, the matter shall be promptly submitted to
arbitration in accordance with the rules of the American Arbitration Association (within which pre-hearing discovery shall be permitted), and judgment upon the award rendered by the
arbitrators may be entered in any court in California having jurisdiction thereof. This arbitration AGREEMENT shall not apply to any controversy or claim involving either (a) an issue of the
infringement, validity, or enforceability of any patent or (b) a dispute involving Applera Corporation and/or any necessary third party (e.g., third-party defendant or cross-claimant) unless
such party agrees to participate in such arbitration. 

11

 

The
arbitration shall be governed by the United States Arbitration Act, 9 U.S.C. §§ 1-16, to the exclusion of any provisions of state law inconsistent
therewith or which would produce a different result. 

        12.7.2 A
single arbitrator who is (i) fluent in written and spoken English; and (ii) skilled and experienced in technology licensing shall be selected by
AGREEMENT between the parties. If the parties fail to agree on an arbitrator, a single arbitrator shall be selected in accordance with the procedures set forth in the Arbitration Rules. The arbitrator
shall render a final award in accordance with the substantive law of the State of New York, excluding the conflicts provisions of such law. 

        12.7.3 The
arbitrator shall be fully compensated in accordance with his or her normal hourly or per diem rates for all time spent in connection with the arbitration
proceeding. Pending a final award, the arbitrator's compensation and expenses shall be advanced equally by the parties. 

        12.7.4 The
parties may request a court for interim or provisional relief, and any such request shall not be deemed incompatible with the AGREEMENT to arbitrate or as a
waiver of that AGREEMENT. 

        12.7.5 In
no event will the arbitrator have the power to include any element of punitive damages or incidental or consequential damages in the arbitration award. 

        12.7.6 Notwithstanding
the foregoing or anything to the contrary herein, either party may seek and obtain an injunction or other appropriate relief from a court to preserve
the status quo with respect to any matter pending conclusion of the arbitration proceeding or to enforce or protect any of its intellectual property rights. 

        12.8 EQUITABLE
REMEDIES: LICENSEE acknowledges that its failure to perform any of the material terms or conditions of this AGREEMENT shall result in immediate and
irreparable damage to LICENSOR. LICENSEE also acknowledges that there may be no adequate remedy at all for such failures and that in the event thereof, LICENSOR shall be entitled to equitable relief
in the nature of an injunction, pre-award attachment of assets, and/or other equitable remedies. 

        12.9 ASSIGNMENT:
Except as set forth in Section 4.2, neither party may assign (including in connection with the sale of all or substantially all of a party's capital
stock, business, or assets, whether by merger or otherwise pertaining to the subject matter of this AGREEMENT) this AGREEMENT without the prior written consent of the other party. 

        12.10 GOVERNING
DOCUMENT: This AGREEMENT may be translated into languages other than English for the convenience of the parties hereto provided, however, the English
language version of this AGREEMENT shall be the governing version and shall not be affected by the interpretation of any other language versions. 

        12.11 INDEPENDENT
BUSINESS: The parties acknowledge that their business operations are completely independent and nether party shall at any time hold itself out as an agent
or representative of the other party. No partnership, joint venture, or other relationship shall be deemed to exist by virtue of this AGREEMENT. 

        12.12 INDEPENDENT
TERMS: All the terms of this AGREEMENT shall be independent and unconditional so that the performance of any one term shall not be subject to any set off
or counterclaim. 

        12.13 SEVERABILITY:
In the event any clause or term of this AGREEMENT is determined to be void, invalid, or unenforceable, the clause shall be reformed to the extent
necessary in order to overcome the limitation and give effect to the original intent and economic effect of the original provision and, as revised this AGREEMENT shall remain in full force and effect. 

12

 

        12.14 HEADINGS:
The headings contained within this AGREEMENT are for convenience and reference purposes only. They do not form a part hereof and shall not affect the
meaning or interpretation of this AGREEMENT. 

        12.15 FURTHER
ASSURANCES: The parties hereto shall execute such further documents and perform such further acts as may be necessary to comply with the terms of this
AGREEMENT and consummate the transactions herein provided. 

        12.16 FORCE
MAJEURE: Neither party shall be held responsible if the fulfillment of any terms or provisions of this AGREEMENT are delayed or prevented by wars, revolutions,
fires, floods, acts of God, acts of terrorism whether actual or threatened, or other causes similar to those enumerated and not within the control of the party whose performance is interfered with,
and which by the exercise of reasonable diligence, the party is unable to prevent. 

        12.17 COUNTERPARTS:
This AGREEMENT may be executed in counterparts (and evidenced by facsimile signatures), each of which will be deemed an original and all of which
together constitute one instrument. 

        IN
WITNESS WHEREOF, the parties hereto have caused their authorized representatives to execute this AGREEMENT. 

	LICENSOR:	 	LICENSEE:
	

MetaMorphix, Inc.	
 	

Genetic Technologies Limited
	

By:	

    
 Edwin C. Quattlebaum, Ph.D.

President and CEO	
 	

By:	

    

	 	 	 	    
 Printed Name/Date
	

Date: September    , 2004	
 	

    
 Title
	

 	

 	
 	

Date: September    , 2004
	

MMI Genomics, Inc.	
 	

 	

 
	

By:	

    
 Stephen Bates

Executive Vice President	
 	

 	

 
	

Date: September    , 2004	
 	

 	

 

13

  

 
 

APPENDIX "A"
  Licensed Patents    
    

United States  

United
States Patent No. 5,874,217, granted February 23, 1999 ("Microsatellite Sequences for Canine Genotyping") 

Australia  

Australian
Patent No. 699,308, granted March 18, 1999 ("Microsatellite Sequences for Canine Genotyping Containing Trinucleotide and Tetranucleotide Repeat Motifs") 

Japan  

Japanese
Patent Pending No. 9-515067 applied for on September 27, 1996 ("Microsatellite Sequences for Canine Genotyping Containing Trinucleotide and Tetranucleotide Repeat
Motifs") 

[REMAINDER
OF PAGE INTENTIONALLY LEFT BLANK] 

14

 
 
 

APPENDIX "B"
  Know-How    
    

        In accordance with Article VI, LICENSOR will provide to LICENSEE the following: 

        1.     Dogs:

        a)    LICENSOR's
Canine Laboratory Information Management System (LIMS) database to store sample records and genotypes with automated ID and parentage evaluation: 

	•
	Microsoft
Access-based Canine System Software and standard operating protocols 

        b)    Sampling
protocols and sample collection procedures: 

	•
	DNA
CheekSwab specifications, template of sampling instruction pamphlet with video demonstrating sampling 

        c)     DNA
preparation/extraction protocols: 

	•
	Protocols
for preparing Chelex stock solutions and for DNA extraction from buccal cheek cell samples 

        d)    PCR
protocols, including setup, post-PCR preparation, and electrophoresis (ABI 10-plex kit plus LICENSOR's custom 5-plex): 

	•
	2
PCR reactions assay 13 STR markers plus Gender marker in 2 capillary runs

	•
	Primary
panel of 10 STRs uses Applied Biosystems' 10-plex commercial kit (assays markers PEZ1, PEZ3, PEZ5, PEZ6, PEZ8, PEZ12, PEZ20, FH2010, FH2054, and FH2079).

	•
	Auxiliary
panel of 4 STRs with Gender marker uses LICENSOR's custom 5-plex (assays markers PEZ 3, PEZ16, PEZ17, PEZ21 and Gender). PEZ3 and Gender results
provide system quality assurance. Primer sequences and fluorescent labeling instructions, primer concentrations, PCR reaction chemistry setup and thermocycling parameters provided to build custom
5-plex. 

        e)    ABI
3100 protocols: 

	•
	Automated
sample sheet generator, collection and analysis parameters, matrices instructions 

        f)     Data
analysis protocols: 

        (1)   Macro
to enable automated allelic calling 

	•
	Primary
10-plex genotyping macro

	•
	Auxiliary
5-plex macro 

        (2)   Data
review and interpretation guidelines 

	•
	Training
based on standardized protocols 

        (3)   Standardized
allele nomenclature: 

	•
	LICENSOR's
proprietary alphabetic allele naming system 

        2.     Cattle:

        a)    LICENSOR's
Cattle LIMS: 

	•
	Corel
Paradox-based SuperDams program and standard operating protocols 

15

 

        b)    Sampling
protocols and sample collection procedures 

	•
	Blood
spotted onto Whatman FTATM paper 

        c)     DNA
preparation/extraction protocols 

	•
	Blood
spotted onto Whatman FTATM paper 

        d)    PCR
protocols, including setup, post-PCR preparation, and electrophoresis (ABI's 11-plex kit): 

	•
	1
PCR reaction assays 11 STR markers in 1 capillary run 

        e)    ABI
3100 protocols: 

	•
	Automated
sample sheet generator, collection and analysis parameters, matrices instructions 

        f)     Data
analysis protocols 

        (1)   Automated
allelic calling software 

	•
	11-plex
genotyping macro 

        (2)   Data
review and interpretation guidelines 

	•
	Training
based on standardized protocols 

        (3)   Standardized
allele nomenclature—ISAG and/or 

        LICENSOR's
proprietary alphabetic allele naming system 

Additional
Services Available during the first two (2) years on a "fee" basis: 

	•
	At
LICENSEE's request, LICENSOR will provide up to three weeks (15 days) of training for up to three people concurrently at LICENSOR's Davis site at a date to be
mutually agreed in good faith. Such training will focus on working with LICENSOR's custom 5-plex formulation and the 10-plex kit from Applied Biosystems, Inc. (ABI) for
the canine microsatellite system and the ISAG panel of 11 cattle markers. LICENSOR will be compensated at a rate of $1,600.00 (US)/day for such on-site training.

	•
	At
LICENSEE's request, LICENSOR will provide 1 week (5 days) of on-site training at LICENSEE's laboratory in Australia to ensure proper installation,
implementation, and running of LICENSEE's production systems. At LICENSEE's request, a second week (5 days) of on-site training at LICENSEE's laboratory in Australia will be
provided by LICENSOR. LICENSOR will be compensated at a rate of $2,000.00 (US)/day plus travel and expenses for such on-site training in accordance with Section 6.5.

	•
	At
LICENSEE's request, LICENSOR will provide occasional QC analysis of samples characterized by LICENSOR. LICENSOR will be compensated for such QC testing and analysis at a
rate of $25.00 (US) per sample. 

16

QuickLinks

Exhibit 4.17

LICENSE AGREEMENT

APPENDIX "A" Licensed Patents

APPENDIX "B" Know-How<Page>

                                                                   Exhibit 10.26

                    FIRST AMENDED EMPLOYMENT, CONFIDENTIALITY
                          AND NON-COMPETITION AGREEMENT

         This Second Amended Employment, Confidentiality and Non-Competition
Agreement (hereafter referred to as this "Agreement") is made by and between
CombinatoRx, Incorporated, a Delaware corporation having a usual place of
business at 650 Albany Street, Boston, Massachusetts 02118, (the "Company") and
Curtis T. Keith, Ph.D. of 57 Warren Street, Apartment No. 1, Boston, MA 02116
(the "Employee") as of the 1st day of July, 2005 (the "Effective Date"),
amending in part and restating that certain Employment, Confidentiality and
Non-Competition Agreement between the parties dated as of the 1st day of July,
2004 (the "First Amended Agreement").

         In consideration of the mutual promises, terms and conditions contained
in this Agreement, the parties agree as follows:

         1.    EMPLOYMENT. The Company agrees to continue the employment of the
Employee, and the Employee agrees to continue in the service of the Company,
subject to the terms and conditions contained in this Agreement.

         2.    TERM. Subject to earlier termination, as provided in Section 5
hereof, the Employee's employment hereunder shall be for a term of one year,
commencing on the effective date hereof and may be extended or renewed only by
the written agreement of the parties. The term of the Employee's employment
hereunder, including any extensions or renewals of the original term, is
hereafter referred to as "the term of this Agreement" or "the term hereof."

         3.    CAPACITY AND PERFORMANCE.

               (a)   During the term hereof, the Employee shall serve the
Company as its Senior Vice President of Research. In addition, without further
compensation, the Employee shall serve as a director and/or officer of one or
more of the Company's Affiliates if so elected or appointed from time to time.

               (b)   During the term hereof, the Employee shall be employed by
the Company on a full-time basis and shall perform the duties and
responsibilities of his position and such other duties and responsibilities,
reasonably consistent with his position, as may be designated from time to time
by the Board.

               (c)   During the term hereof, the Employee shall devote his full
business time and his best efforts, business judgment, skill and knowledge
exclusively to the advancement of the business and interests of the Company and
its Affiliates and to the

                                       -1-

<Page>

discharge of his duties and responsibilities hereunder. The Employee may serve
on the board of directors or similar bodies of corporations or other entities
approved by the Board.

         4.    COMPENSATION AND BENEFITS. As compensation for all services
performed by the Employee under and during the term hereof and subject to
performance of the Employee's duties and of the obligations of the Employee to
the Company and its Affiliates, pursuant to this Agreement or otherwise:

               (a)   BASE SALARY. During the term hereof, the Company shall pay
the Employee a base salary at the rate of not less than $215,000 per annum,
payable in accordance with the regular payroll practices of the Company for its
executives and subject to increase (but not decrease) from time to time by the
Board, in its discretion. Such base salary, as from time to time increased, is
hereafter referred to as the "Base Salary."

               (b)   PERFORMANCE BONUSES. The Employee shall be eligible to
earn a bonus annually during employment hereunder. Bonuses will be earned on the
basis of the Company's fiscal year. The amount of any bonus awarded to the
Employee shall be based on his performance and that of the Company against
reasonably attainable goals determined annually by the Board of Directors of the
Company (the "Board") after consultation with the Employee. The Employee's
target bonus is initially 30% of the Base Salary.

               (c)   STOCK OPTION AWARDS. The Board may, on an annual basis, in
its discretion, grant the Employee stock options based on his performance and
that of the Company against reasonably attainable goals. Such grants will be
made under the 2000 Stock Option Plan (the "Option Plan") and, except as
otherwise expressly provided herein, the awards will be governed by the terms of
the Option Plan.

               (d)   BENEFITS. During the term hereof, the Employee shall be
entitled to participate in any and all employee benefit plans from time to time
in effect for executives of the Company generally, except to the extent any such
plans are in a category of benefit otherwise provided to the Employee hereunder
(E.G., severance pay). Such participation shall be subject to the terms of the
applicable plan documents and Company policies generally applicable to its
executives.

               (e)   VACATIONS. During the term hereof, the Employee shall be
entitled to 3 weeks of vacation per year, to be taken at such times and
intervals as shall be determined by the Employee subject to the approval of the
Chief Executive Officer of the Company (the "CEO") or his designee and the
reasonable business needs of the Company. Vacation shall otherwise be governed
by the policies of the Company, as in effect from time to time.

               (f)   BUSINESS EXPENSES. The Company shall pay or reimburse the
Employee for all reasonable business expenses incurred or paid by the Employee
in the performance of his duties and responsibilities hereunder, subject to such
reasonable substantiation and documentation as may be specified by the Company
from time to time.

                                       -2-
<Page>

         5.    TERMINATION OF EMPLOYMENT AND SEVERANCE BENEFITS. The Employee's
employment hereunder shall terminate under the following circumstances:

               (a)   DEATH. In the event of the Employee's death during the term
hereof, the Employee's employment hereunder shall immediately and automatically
terminate. In such event, the Company shall pay to the Employee's designated
beneficiary or, if no beneficiary has been designated by the Employee, to his
estate, (i) the Base Salary earned but not paid through the date of termination,
(ii) pay for any vacation earned but not used through the date of termination
and (iii) any business expenses incurred by the Employee but un-reimbursed on
the date of termination, provided that such expenses and required substantiation
and documentation are submitted within ninety (90) days of termination and that
such expenses are reimbursable under Company policy (all of the foregoing,
"Final Compensation"). The Company also shall pay to the Employee's designated
beneficiary or, if none, his estate, any bonus compensation earned but unpaid
for the prior fiscal year. The Company shall have no further obligation to the
Employee hereunder.

               (b)   DISABILITY.

                     (i)   The Company may terminate the Employee's employment
         hereunder, upon notice to the Employee, in the event that the Employee
         becomes disabled through any illness, injury, accident or condition of
         either a physical or psychological nature and, as a result, is unable
         to perform substantially all of his duties and responsibilities
         hereunder, with or without reasonable accommodation, for one hundred
         and twenty (120) days during any period of three hundred and sixty-five
         (365) consecutive calendar days. In the event of such termination, the
         Company shall have no further obligation to the Employee, other than
         for payment of Final Compensation and any bonus compensation earned but
         unpaid for the prior fiscal year.

                     (ii)  The Board or the CEO may designate another employee
         to act in the Employee's place during any period of the Employee's
         disability. Notwithstanding any such designation, the Employee shall
         continue to receive the Base Salary in accordance with Section 4(a) and
         benefits in accordance with Section 4(d), to the extent permitted by
         the then-current terms of the applicable benefit plans, until the
         Employee becomes eligible for disability income benefits under the
         Company's disability income plan or until the termination of his
         employment, whichever shall first occur. While receiving disability
         income payments under the Company's disability income plan, the
         Employee shall not be entitled to receive any Base Salary under Section
         4(a) hereof, but shall continue to participate in Company benefit plans
         in accordance with Section 4(d) and the terms of such plans until the
         termination of his employment.

                     (iii) If any question shall arise as to whether during any
         period the Employee is disabled through any illness, injury, accident
         or condition of either a physical or psychological nature so as to be
         unable to perform substantially all of his duties and responsibilities
         hereunder, the Employee may, and at the request of the

                                       -3-
<Page>

         Company shall, submit to a medical examination by a physician selected
         by mutual agreement of the Company and the Employee to determine
         whether the Employee is so disabled and such determination shall for
         the purposes of this Agreement be conclusive of the issue. If such
         question shall arise and the Employee shall fail to submit to such
         medical examination, the Company's determination of the issue shall be
         binding on the Employee.

               (c)   BY THE COMPANY FOR CAUSE. The Company may terminate the
Employee's employment hereunder, upon notice, for Cause, meaning that there has
been a reasonable, good faith determination by the Board that one or more of the
following events has occurred, which determination is made after notice to the
Employee specifying in reasonable detail the nature of the Cause and a
reasonable opportunity for the Employee to be heard by the Board. The following
shall constitute Cause for termination:

                     (i)   The Employee's conviction of a felony;

                     (ii)  The Employee's willful failure to perform (other than
         by reason of disability), or gross negligence in the performance of,
         his duties and responsibilities as set forth in Section 3 hereof, which
         failure or negligence continues or remains uncured after thirty (30)
         days' notice to the Employee setting forth in reasonable detail the
         nature of such failure or negligence;

                     (iii) Material breach by the Employee of any provision of
         this Agreement, which breach continues or remains uncured after thirty
         (30) days' notice to the Employee setting forth in reasonable detail
         the nature of such breach; or

                     (iv)  Material fraudulent conduct by the Employee with
         respect to the Company.

In the event of termination for Cause, the Company shall have no further
obligation to the Employee, other than for Final Compensation.

               (d)   BY THE COMPANY OTHER THAN FOR CAUSE. The Company may
terminate the Employee's employment hereunder other than for Cause at any time
upon sixty (60) days' notice to the Employee or Base Salary in lieu thereof. In
the event of such termination, in addition to Final Compensation and any bonus
compensation earned but unpaid for the prior fiscal year, the Company (i) shall
provide the Employee six (6) months of severance pay, at the rate of the Base
Salary in effect immediately prior to the termination, payable in a single lump
sum within ten (10) business days following termination of employment; (ii)
shall pay the premium cost of the Employee's participation in the Company's
group medical and dental plans for a period of six (6) months following the date
of termination, provided that the Employee is entitled to continue such
participation under applicable law and plan terms; and (iii) shall cause to
become vested twenty-five percent (25%) of the options granted pursuant to
Section 4(c) hereof or otherwise which remain unvested on the date of
termination for each year of the Employee's employment with the Company, which
vesting shall be effective on

                                       -4-
<Page>

the date of termination, and the Employee shall have not less than ninety (90)
days following the date of termination to exercise all or any portion of such
options.

               (e)   BY THE EMPLOYEE. The Employee may terminate his employment
hereunder at any time upon sixty (60) days' notice to the Company. In the event
of termination by the Employee pursuant to this Section 5(e), the Board may
elect to waive the period of notice, or any portion thereof, and, if the Board
so elects, the Company will pay the Employee his Base Salary for the notice
period (or for any remaining portion of the period). The Company shall have no
further obligation to the Employee, other than for any Final Compensation and
any bonus compensation earned but unpaid for the prior fiscal year, due to him.

               (f)   UPON A CHANGE OF CONTROL.

                     (i)   If a Change of Control (as defined below) occurs and,
within two (2) years following such Change of Control, the Company terminates
the Employee's employment other than for Cause, then, the Company (A) shall
provide the Employee six (6) months of severance pay, at the rate of the Base
Salary in effect immediately prior to the termination, payable in a single lump
sum within ten (10) business days following termination of employment; (B) shall
pay the premium cost of the Employee's participation in the Company's group
medical and dental plans for a period of six (6) months following the date of
termination, provided that the Employee is entitled to continue such
participation under applicable law and plan terms; and (C) shall cause to become
vested on the date of termination 100% of the options granted pursuant to
Section 4(c) hereof or otherwise which remain unvested on that date and the
Employee shall be entitled to not less than ninety (90) days following the date
of termination to exercise all or any portion of such options.

                     (ii)  In the event that it is determined that any payments
or benefits provided by the Company to the Employee or for his benefit, either
under this Agreement or otherwise, will be subject to the excise tax imposed by
section 4999 of the Internal Revenue Code or any successor provision ("section
4999"), the Employee may elect either to pay such excise tax or to have such
payments and benefits reduced to the extent necessary so that he shall not be
liable for any such excise tax.

         6.    EFFECT OF TERMINATION. The provisions of this Section 6 shall
apply to any termination pursuant to Section 5 or otherwise.

               (a)   Performance by the Company in accordance with the
applicable provision of Section 5 shall constitute the entire obligation of the
Company to the Employee hereunder.

               (b)   Except for medical and dental plan coverage continued
pursuant to Section 5(d) or 5(f) hereof, benefits shall terminate pursuant to
the terms of the applicable benefit plans based on the date of termination of
the Employee's employment without regard

                                       -5-
<Page>

to any continuation of Base Salary or other payment to the Employee following
such date of termination.

               (c)   Provisions of this Agreement shall survive any termination
if so provided herein or if necessary or desirable to accomplish the purposes of
other surviving provisions, including without limitation the obligations of the
Employee under Sections 7, 8 and 9 hereof.

         7.    CONFIDENTIAL INFORMATION.

               (a)   The Employee acknowledges that the Company and its
Affiliates continually develop Confidential Information, that the Employee may
develop Confidential Information for the Company or its Affiliates and that the
Employee may learn of Confidential Information during the course of employment.
The Employee shall comply with the policies and procedures of the Company and
its Affiliates for protecting Confidential Information and shall not disclose to
any Person or use, other than as required by applicable law or for the proper
performance of his duties and responsibilities to the Company and its
Affiliates, any Confidential Information obtained by the Employee incident to
his employment or other association with the Company or any of its Affiliates.
The Employee understands that this restriction shall continue to apply after his
employment terminates, regardless of the reason for such termination.

               (b)   All documents, records, tapes and other media of every
kind and description relating to the business, present or otherwise, of the
Company or any of its Affiliates and any copies, in whole or in part, thereof
(the "Documents"), whether or not prepared by the Employee, shall be the sole
and exclusive property of the Company and its Affiliates. The Employee shall
safeguard all Documents and shall surrender to the Company at the time his
employment terminates, or at such earlier time or times as the Board or its
designee may specify, all Documents then in the Employee's possession or
control.

         8.    ASSIGNMENT OF RIGHTS TO INTELLECTUAL PROPERTY. The Employee shall
maintain accurate and complete contemporaneous records of, and shall immediately
and fully disclose and deliver to the Company, all Intellectual Property, as
defined below. The Employee hereby assigns and agrees to assign to the Company
(or as otherwise directed by the Company) the Employee's full right, title and
interest in and to all Intellectual Property. The Employee agrees to execute any
and all applications for domestic and foreign patents, copyrights or other
proprietary rights and to do such other acts (including without limitation the
execution and delivery of instruments of further assurance or confirmation)
requested by the Company to assign the Intellectual Property to the Company and
to permit the Company to enforce any patents, copyrights or other proprietary
rights to the Intellectual Property. All copyrightable works that the Employee
creates shall be considered "work made for hire". If the Company is unable
because of the Employee's mental or physical incapacity or for any other reason
to secure the Employee's signature for any of the assignments or other
reasonably requested documents pertaining to the Intellectual Property, the
Employee hereby irrevocably designate and appoint the Company and its duly
authorized officers and agents as

                                       -6-
<Page>

the Employee's agent and attorney in fact, to act for and in his behalf and
stead to execute and file said documents and to do all other lawfully permitted
acts to further the perfection, defense, and enjoyment of the Company's rights
relating to the Intellectual Property with the same legal force and effect as if
executed by the Employee. The Employee stipulates and agrees that such
appointment is a right coupled with an interest and will survive his incapacity
or unavailability at any future time.

         9.    RESTRICTED ACTIVITIES. The Employee agrees that some restrictions
on his activities during and after his employment are necessary to protect the
goodwill, Confidential Information and other legitimate interests of the
Company:

               (a)   While the Employee is employed by the Company and for a
period of twenty-four (24) months after his employment terminates (in the
aggregate, the "Non-Competition Period"), the Employee shall not, directly or
indirectly, whether as owner, partner, investor, consultant, agent, employee,
co-venturer or otherwise, compete with the Company's Business anywhere in the
world. The foregoing, however, shall not prevent or restrict the Employee from
owning, directly or indirectly, not more than five percent (5%) of the voting
securities of any publicly traded company for the sole purpose of a passive
investment. For the purposes of this Section 9, the Company's Business means
researching and developing a discovery platform that identifies novel,
non-obvious combinations of active molecules that will then become
patent-protected therapeutics, utilizing an automated, high-throughput process
to search the combinatorial space using disease-specific assays.

               (b)   The Employee further agrees that, during the
Non-Competition Period, other than on behalf of the Company during his
employment hereunder or through responses to general advertisements and
headhunters which, in either case, are not specifically targeted to Company
employees, the Employee will not hire or attempt to hire any employee of the
Company, assist in such hiring by any Person, encourage any such employee to
terminate his or her relationship with the Company or solicit or encourage any
Person to hire any such employee; solicit or encourage any independent
contractor providing services to the Company to terminate or diminish its
relationship with the Company or solicit or encourage any Person to hire or
engage any such independent contractor; or solicit or encourage any customer,
supplier or vendor of the Company to terminate or diminish its relationship with
it, or, in the case of a customer, to conduct with any Person any business or
activity which such customer conducts or could conduct with the Company or any
of its Affiliates; or solicit or encourage any of the foregoing to terminate or
breach any agreement, written or oral, with the Company or any of its
Affiliates.

         10.   ENFORCEMENT OF COVENANTS. The Employee acknowledges that he has
carefully read and considered all the terms and conditions of this Agreement,
including the restraints imposed upon him pursuant to Sections 7, 8 and 9
hereof. The Employee agrees that those restraints are necessary for the
reasonable and proper protection of the Company and that each and every one of
the restraints is reasonable in respect to subject matter, length of time and
geographic area. The Employee further acknowledges that, were he to breach any
of the covenants contained in Sections 7, 8 or 9 hereof, the damage to the
Company would be

                                       -7-
<Page>

irreparable. The Employee therefore agrees that the Company, in addition to any
other remedies available to it, shall be entitled to preliminary and permanent
injunctive relief against any breach or threatened breach by the Employee of any
of said covenants. The parties further agree that, in the event that any
provision of Section 7, 8 or 9 hereof shall be determined by any court of
competent jurisdiction to be unenforceable by reason of its being extended over
too great a time, too large a geographic area or too great a range of
activities, such provision shall be deemed to be modified to permit its
enforcement to the maximum extent permitted by law.

         11.   CONFLICTING AGREEMENTS. The Employee hereby represents and
warrants that the execution of this Agreement and the performance of his
obligations hereunder will not breach or be in conflict with any other agreement
to which the Employee is a party or is bound and that the Employee is not now
subject to any covenants against competition or similar covenants or any court
order or other legal obligation that would affect the performance of his
obligations hereunder. The Employee will not disclose to or use on behalf of the
Company any proprietary information of a third party without such party's
consent.

         12.   DEFINITIONS. Words or phrases which are initially capitalized or
are within quotation marks shall have the meanings provided in this Section and
as provided elsewhere herein. For purposes of this Agreement, the following
definitions apply:

               (a)   "Affiliates" means all persons and entities directly or
indirectly controlling, controlled by or under common control with the Company,
where control may be by either management authority or equity interest.

               (b)   "Change of Control" means the occurrence hereafter of (i)
a sale, merger or consolidation after which securities possessing more than
fifty (50%) percent of the total combined voting power of the Company's
outstanding securities have been transferred to or acquired by a Person or
Persons different from the Persons who held such percentage of the total
combined voting power immediately prior to such transaction; (ii) the sale,
transfer or other disposition of all or substantially all of the Company's
assets to one or more Persons (other than a wholly owned subsidiary of the
Company or a parent company whose stock ownership after the transaction is the
same as the Company's ownership before the transaction), or (iii) an
acquisition, merger or similar transaction or a divestiture of a substantial
portion of the Company's business after which the Employee's role is not
substantially the same as such role prior to the transaction.

               (c)   "Confidential Information" means any and all information
of the Company and its Affiliates that is not generally known by others with
whom they compete or do business, or with whom any of them plans to compete or
do business and any and all information, publicly known in whole or in part or
not, which, if disclosed by the Company or its Affiliates would assist in
competition against them. Confidential Information includes without limitation
such information relating to (i) the development, research, testing,
manufacturing, marketing and financial activities of the Company and its
Affiliates, (ii) their products and services, (iii) the costs, sources of
supply, financial performance and strategic

                                       -8-
<Page>

plans of the Company and its Affiliates, (iv) the identity and special needs of
the customers of the Company and its Affiliates and (v) the people and
organizations with whom the Company and its Affiliates have business
relationships and those relationships. Confidential Information also includes
any information that the Company or any of its Affiliates have received, or may
receive hereafter, belonging to customers or others with any understanding,
express or implied, that the information would not be disclosed. Confidential
Information does not include information that enters the public domain, other
than through a breach by the Employee or another Person of an obligation of
confidentiality to the Company or any of its Affiliates.

               (c)   "Intellectual Property" means inventions, discoveries,
developments, methods, processes, compositions, works, concepts and ideas
(whether or not patentable or copyrightable or constituting trade secrets)
conceived, made, created, developed or reduced to practice by the Employee
(whether alone or with others, whether or not during normal business hours or on
or off Company premises) during the Employee's employment that relate to the
Company's business or that make use of Confidential Information or any of the
equipment or facilities of the Company.

               (d)   "Person" means an individual, a corporation, a limited
liability company, an association, a partnership, an estate, a trust and any
other entity or organization, other than the Company or any of its Affiliates.

         13.   WITHHOLDING. All payments made by the Company under this
Agreement shall be reduced by any tax or other amounts required to be withheld
by the Company under applicable law.

         14.   ASSIGNMENT. Neither the Company nor the Employee may make any
assignment of this Agreement or any interest herein, by operation of law or
otherwise, without the prior written consent of the other; provided, however,
that the Company may assign its rights and obligations under this Agreement
without the consent of the Employee in the event that the Company shall
hereafter affect a reorganization, consolidate with, or merge into, any Person
or transfer all or substantially all of its properties or assets to any Person.
This Agreement shall inure to the benefit of and be binding upon the Company and
the Employee, their respective successors, executors, administrators, heirs and
permitted assigns.

         15.   SEVERABILITY. If any portion or provision of this Agreement shall
to any extent be declared illegal or unenforceable by a court of competent
jurisdiction, then the remainder of this Agreement, or the application of such
portion or provision in circumstances other than those as to which it is so
declared illegal or unenforceable, shall not be affected thereby, and each
portion and provision of this Agreement shall be valid and enforceable to the
fullest extent permitted by law.

         16.   WAIVER. No waiver of any provision hereof shall be effective
unless made in writing and signed by the waiving party. The failure of either
party to require the performance of any term or obligation of this Agreement, or
the waiver by either party of any

                                       -9-
<Page>

breach of this Agreement, shall not prevent any subsequent enforcement of such
term or obligation or be deemed a waiver of any subsequent breach.

         17.   NOTICES. Any and all notices, requests, demands and other
communications provided for by this Agreement shall be in writing and shall be
effective when delivered in person, deposited in the United States mail, postage
prepaid, registered or certified, or consigned to a national overnight courier
and addressed to the Employee at his last known address on the books of the
Company or, in the case of the Company, at its principal place of business,
attention of the CEO, or to such other address as either party may specify by
notice to the other actually received.

         18.   ENTIRE AGREEMENT. This Agreement constitutes the entire agreement
between the parties and supersedes all prior communications, agreements and
understandings, written or oral, with respect to the terms and conditions of the
Employee's employment; provided, however, that this Agreement shall not
terminate or supersede any additional obligations of the Employee pursuant to
the Original Agreement or any other agreement with respect to the confidential
information or the like or with respect to any restrictions on the activities of
the Employee or with respect to the securities of the Company.

         19.   AMENDMENT. This Agreement may be amended or modified only by a
written instrument signed by the Employee and by an expressly authorized
representative of the Company.

         20.   HEADINGS. The headings and captions in this Agreement are for
convenience only and in no way define or describe the scope or content of any
provision of this Agreement.

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

         22.   GOVERNING LAW. This is a Massachusetts contract and shall be
construed and enforced under and be governed in all respects by the laws of the
Commonwealth of Massachusetts, without regard to the conflict of laws principles
thereof.

         23.   ARBITRATION. Any dispute or disagreement between the Employee and
the Company arising under this Agreement shall first be negotiated by the
parties in good faith for up to a period of thirty (30) days and the parties
shall use their best efforts to reach a resolution. In the event that the
parties, for any reason whatever, are unable to reach a resolution with thirty
(30) days, either party may then refer the matter to the American Arbitration
Association for resolution in accordance with the American Arbitration
Association National Rules for the Resolution of Employment Disputes, or any
successor rules. The arbitration shall be conducted in Boston, Massachusetts
before a single arbitrator. The function of the arbitrator shall be to determine
the interpretation and application of the specific provisions of this Agreement
to the issues submitted to arbitration. There shall be no right in arbitration
to obtain, and no arbitrator shall have any authority to award or determine,

                                      -10-
<Page>

any change in, addition to, or detraction from, any of the provisions of this
Agreement. The decision of the arbitrator shall be in writing; shall set
forth the basis for the decision. The decision of the arbitrator acting
within the scope of his/her authority shall be final and binding upon the
parties and may be enforced and executed upon in any court having
jurisdiction over the party against whom enforcement of such award is sought.
The parties involved in the dispute shall divide equally the administrative
charges, arbitrator's fees and related expenses of the arbitration, but each
party shall pay its own legal fees incurred in connection with such
arbitration. Nothing contained herein, however, shall limit the right of the
Company or any of its Affiliates to seek equitable or other relief from any
court of competent jurisdiction for violation of any provision of Section 7,
8 or 9 hereof.

         IN WITNESS WHEREOF, this Agreement has been executed as a sealed
instrument by the Company, by its duly authorized representative, and by the
Employee, as of the date first above written.

THE EMPLOYEE:                                   THE COMPANY

/s/ Curtis Keith                            By: /s/ Alexis Borisy
----------------------                         ----------------------

                                            Title: PRESIDENT & CEO
                                                  -------------------

         CombinatoRx, Incorporated - 650 Albany Street - Boston MA 02118
           Ph: 617 425 7000 - Fax: 617 425 7010 - www.combinatorx.com

                                      -11-

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