Document:

EXHIBIT 10.1

[ * ] = Certain confidential information contained
in this document, marked by brackets, has been omitted and filed separately
with the Securities and Exchange Commission pursuant to Rule 24b-2 of the
Securities Exchange Act of 1934, as amended.

 

SECOND AMENDMENT TO DRUG
DISCOVERY COLLABORATION AGREEMENT

 

THIS AMENDMENT NO. 2 (“Second Amendment”), effective as of
October 1, 2005 (Amendment Date”), is entered into by and between Genentech,
Inc., a Delaware corporation, having a principal place of business at
1 DNA Way, South San Francisco, California 94080 (“Genentech”)
and Array BioPharma Inc., a Delaware corporation, having a principal place of
business at 3200 Walnut Street, Boulder, Colorado 80301 (“Array”)
(collectively, the “Parties” or individually, a “Party”).

 

WHEREAS,
Genentech and Array entered into a Drug Discovery Collaboration Agreement,
effective as of December 22, 2003, which was subsequently modified by
a Letter Agreement, dated October 11, 2004, and amended by a First
Amendment, dated May 20, 2005 (collectively, the “Agreement”).

 

WHEREAS, the Parties desire to amend the Agreement as set
forth below.

 

NOW,
THEREFORE,
the Parties agree as follows:

 

1.               This Second Amendment hereby amends and
revises the Agreement to incorporate the terms and conditions set forth in this
Second Amendment.  The relationship of
the Parties shall continue to be governed by the terms of the Agreement, as
amended.

 

2.               All capitalized terms used in this Second
Amendment shall have the meanings defined in the Agreement unless otherwise
defined herein.

 

3.               Section 1.55 of the Agreement is hereby
amended and replaced in its entirety as follows:

 

“              1.55        “Research Term” means the period commencing
on January 30, 2004 (the date that the Research Plan was Approved by the JRC)
and ending on the first to occur of (a) termination of this Agreement by
either Party under Article 10; or (b) [*].  Genentech has the right to extend the
foregoing Research Term, in its sole discretion, for [*],
upon written notice to Array at least six (6) months prior to the expiration of
the Research Term.  Any such notice shall
specify the number of [*] for which
Genentech is extending the Research Term.”

 

4.               As of the Amendment Date, there are three
(3) Collaboration Targets ([*], [*] and [*]) and Array
is currently devoting, and Genentech is paying for, [*]
to perform activities under the Research Plan ([*]
for each Collaboration Target, pursuant to Section 2.7 of the Agreement, and an
additional [*] that are [*]
pursuant to the Letter Agreement, dated October 11, 2004).  As of the Amendment Date, pursuant to this
Second Amendment, the number of [*] shall
increase by an additional [*] (i.e., for a total of [*]).  As of January 1, 2006, the number of [*] shall further increase by an additional [*] (i.e., for a
total of [*]. 
Beginning on January 1, 2006, and during the remainder of the Research
Term, the JRC

 

 

shall have the
right, with the agreement of Array, to further increase the number of [*] devoted to performing activities under the Research Plan
by up to an additional [*] (i.e., for
a total of [*]).  Any of the [*]
added pursuant to the provisions of this Second Amendment shall be [*], and Genentech shall have the right, upon two (2) months
written notice to Array, to reduce the number of such additional [*].

 

5.               Section 6.2 of the Agreement is hereby
amended and replaced in its entirety as follows:

 

	
  “

  	
   

  	
  6.2

  	
  [*]; Outsourcing.

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
  (a) [*].

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
  (b) [*]

  

 

 

6.               This Second Amendment and the Agreement
constitute the entire agreement between the Parties in connection with the
subject matter of this Second Amendment. 
The Agreement, as herein amended, is and remains in full force and
effect.

 

IN WITNESS
WHEREOF,
the Parties have caused this Second Amendment to be executed by their respective
duly authorized representatives as set forth below.

 

 

	
  GENENTECH, INC.

  	
  ARRAY BIOPHARMA INC.

  
	
   

  	
   

  
	
  By:

  	
   

  	
   

  	
  By:

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Name:

  	
   

  	
   

  	
  Name:

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Title:

  	
   

  	
   

  	
  Title:

  	
   

  	
   

  

 

2EXHIBIT 10.2

 

[ * ] = Certain confidential
information contained in this document, marked by brackets, has been omitted
and filed separately with the Securities and Exchange Commission pursuant to Rule 24b-2
of the Securities Exchange Act of 1934, as amended.

 

DRUG DISCOVERY AGREEMENT

 

THIS DRUG DISCOVERY AGREEMENT (the “Agreement”),
is made and entered into, effective as of November 1, 2005 (the “Effective Date”), by and between
Ono Pharmaceutical Co., Ltd., a Japanese corporation having a principal place of
business at 8-2 Kyutaromachi 1-Chome, Chuo-Ku Osaka 541-8564, JAPAN  (“ONO”), and Array BioPharma Inc., a Delaware
corporation having a principal place of business at 3200 Walnut Street,
Boulder, Colorado 80301, USA (“ARRAY”).

 

RECITALS

 

A.                                                   ARRAY
has skills, expertise and proprietary technology for the discovery, generation,
optimization and preclinical testing of small molecule clinical candidates from
drug discovery programs.  ONO is a pharmaceutical company involved in the
research, development, manufacture and sale of pharmaceutical products.

 

B.                                                     ONO
has identified multiple protein targets that have the potential to be used as
the basis for drug discovery programs.

 

C.                                                     ONO
and ARRAY desire to enter a collaboration wherein ARRAY will perform certain drug discovery research on protein targets requested by ONO with assistance from ONO, with the goal of delivering to ONO multiple preclinical candidates for selection as clinical lead
compounds for clinical development and commercialization by ONO.

 

AGREEMENT

 

NOW, THEREFORE, in consideration of the foregoing premises and
the mutual promises and covenants contained herein and other good and valuable consideration, the receipt and
sufficiency of which is hereby acknowledged, ONO and ARRAY, intending to be legally
bound, hereby agree as
follows:

 

ARTICLE 1

DEFINITIONS

 

Capitalized terms used in this Agreement, whether used in the
singular or plural, shall have the meanings set forth below, unless otherwise
specifically indicated herein.

 

1.1                                                         “Active Claimed Compound” means a Claimed Compound which
demonstrates activity against a
Collaboration Target in accordance with
the activity criteria set forth in the definition of Active
Compound, as confirmed by ONO or Array.

 

 

1.2                                                         “Active Compound” means any Compound, whether or not covered under claims of a Collaboration
Patent, which has a level
of activity against a Collaboration Target, expressed as [*]
as measured in the applicable [*] set forth
in the Research Plan.

 

1.3                                                         “Affiliate” means any corporation or other entity,
whether de jure or de facto,
which is directly or indirectly controlling, controlled by or under common
control of a Party hereto for so long as such control exists.  For the purposes of this Section 1.3, “control” shall mean the direct or
indirect ownership of at least fifty percent (50%) of the outstanding
shares or other voting rights of the subject entity having the power to vote on
or direct the affairs of the entity, or if not meeting the preceding, the
maximum voting right that may be held by the particular Party under the laws of
the country where such entity exists.

 

1.4                                                         “Claimed Compound” means a chemical entity which has not been synthesized by ARRAY during
the Collaboration Term, the composition of matter of which is claimed in
a Collaboration Patent.

 

1.5                                                         “Collaboration” shall mean the drug
discovery research activities for each
Collaboration Target undertaken by the Parties pursuant to Article 2
below.

 

1.6                                                         “Collaboration Product”
means a product which contains any Active Compound, Active Claimed Compound or
Derivative Compound for use in the Field in the Territory.

 

1.7                                                         “Collaboration Know-How”
means Compounds not covered under the claims of the Collaboration Patent, any
and all technologies
including, but not limited to, trade secrets, know-how, inventions, information
(including structure-activity data) and materials, whether patentable or not,
directed to processes, formulations and/or methods discovered, developed,
owned, licensed or acquired solely by
ARRAY, solely by ONO or jointly by ARRAY and
ONO, in the course of the Collaboration during the Collaboration Term.

 

1.8                                                         “Collaboration Patent”
means (i) any and all patent applications and patents thereof the
subject of which is an invention (a “Collaboration
Invention”) conceived or
reduced to practice solely by ARRAY,
solely by ONO or jointly by ARRAY and
ONO in the course of the Collaboration during the Collaboration Term,
including without limitation any such inventions comprising any Active Compound, Inactive
Compound and/or any Active Claimed Compound, or method
of use or process for the synthesis thereof or composition-of-matter containing
such Active Compound, Inactive Compound and/or Active Claimed
Compound, and (ii) any divisions, continuations,
continuations-in-part, reissues, reexaminations, extensions or other
governmental actions which extend any of the subject matter of the patent
applications and/or patents in (i) above,
and any substitutions, confirmations, registrations or revalidations of any of
the foregoing.

 

1.9                                                         “Collaboration Target(s)” means (i) [*].

 

1.10                                                   “Collaboration Term” means the term of the
Collaboration, as provided in Section 2.6 below.

 

2

 

1.11                                                   “Compound” means any chemical entity synthesized by ARRAY and
made available to ONO during the Collaboration Term in accordance with the Research Plan mutually agreed upon by the
Parties.

 

1.12                                                   “Consumer Price Index” or “CPI” means the Consumer Price Index, All
Urban Consumers, as published by the U.S. Bureau of Labor Statistics.

 

1.13                                                   “Derivative Compound” means any chemical entity, other than a
Compound or Claimed Compound, synthesized
by or on behalf of ONO after the
Collaboration Term that:

 

(i)                                     results
from a chemical synthesis program based on one or more Compounds;

 

(ii)                                  is
based on structure-activity data relating to a Compound; or

 

(iii)                               is covered by the claims
of any ONO Patent, which patent
application or patent discloses any compound in (i) or (ii) above.

 

ONO will not synthesize any
chemical entities for use against a Collaboration Target during the
Collaboration Term.

 

1.14                                                   “Field” means the discovery, development and
commercialization of small molecules for the diagnosis or therapeutic or
prophylactic treatment of diseases and conditions, wherein the primary mechanism
of action of such small molecules
is to modulate the activity of a Collaboration Target.

 

1.15                                                   “FTE” means a full-time employee of ARRAY dedicated
to each Collaboration, or in the
case of less than a full-time dedicated employee,
a full-time, equivalent employee year,
based upon a total of one thousand eight hundred eighty (1,880) hours per
year of work in connection with each
Collaboration.

 

1.16                                                   “Inactive Compound” means any Compound, whether or not covered under claims of a Collaboration
Patent, which does not meet the level of activity specified in the definition of Active Compound.

 

1.17                                                   “JMC” or “Joint
Management Committee” shall have the meaning set forth in Section 3.1.

 

1.18                                                   “Marketing Approval” means all approvals, licenses, registrations or authorizations of
any federal, state or local regulatory agency, department, bureau or other
governmental entity, necessary for the manufacturing, use, storage, import,
transport and sale of a Collaboration Product in a regulatory jurisdiction in the Territory.

 

1.19                                                   “NDA” means a New Drug Application, as
defined in the U.S. Food, Drug and Cosmetic Act and the regulations promulgated
thereunder.

 

1.20                                                   “Net Sales” means the gross invoice price of
Collaboration Products (such Collaboration Products being in final form
intended for use by the end user) sold by
ONO

 

3

 

or its Affiliates or Sublicensees, as the case may be (or Distributors
on behalf of the foregoing parties), in arms length transactions with Third Parties after deducting, if not previously deducted, from the amount invoiced or received:

 

(i)                                     trade,
cash and quantity discounts or rebates actually allowed or taken;

 

(ii)                                  credits
or allowances given or made for rejection or return of, and for uncollectible
amounts on, previously sold Collaboration Products or for retroactive price
reductions (including, without
limitation, rebates similar to Medicare and/or Medicaid);

 

(iii)                               taxes,
duties or other governmental charges levied on or measured by the billing
amount, as adjusted for rebates or refunds, that are borne by the seller
thereof and that are not refundable and to the extent non-creditable;

 

(iv)                              charges
for freight and insurance directly related to the distribution of the
Collaboration Products (to the extent not paid by the Third Party customer);
and

 

(v)                                 credits
or allowances given or made for wastage replacement, indigent patient and
similar programs.

 

For
purposes of this Section 1.20, “Distributor”
means a Third Party that is employed by or otherwise under written contract
with ONO or its Affiliates or Sublicensees to sell, promote, distribute,
market, import, and/or export Collaboration Products on behalf of or in
partnership with ONO or its Affiliates or Sublicensees.

 

1.21                                                   “ONO Patent”
means (i) any and all patent applications and patents thereof the subject
of which is an invention conceived or reduced to practice solely by ONO after the Collaboration Term,
including without limitation any such inventions comprising any Derivative Compound, or method of use or process for the synthesis
thereof or composition-of-matter containing such Derivative Compound, and (ii) any divisions, continuations,
continuations-in-part, reissues, reexaminations, extensions or other
governmental actions which extend any of the subject matter of the patent
applications and/or patents in (i) above,
and any substitutions, confirmations, registrations or revalidations of any of
the foregoing.

 

1.22                                                   “Party” or “Parties” shall mean, respectively, ARRAY or ONO individually,
or ARRAY and ONO collectively.

 

1.23                                                   “Phase II” means human clinical trials, for
which the primary endpoints include a determination of dose ranges and/or a
preliminary determination of efficacy in patients being studied as required in
21 C.F.R. §312, or similar clinical study in a country other than the
United States.

 

1.24                                                   “Phase III” means human clinical trials, the
principal purpose of which is to establish safety and efficacy of one or more
particular doses in patients being studied, and which will (or are intended to)
satisfy the requirements of a pivotal trial for purposes of

 

4

 

obtaining approval of a product in a country by the health regulatory
authority in such country to market such product.

 

1.25                                                   “Pre-existing ARRAY
Know-How” means any ARRAY
library compounds not covered under the claims of Pre-existing ARRAY Patent
and all other technologies (i) including, but not limited to,
trade secrets, know-how, inventions, information (including structure-activity
data) and materials, whether patentable or not, directed to processes,
formulations and/or methods discovered, developed, owned, licensed or acquired
by ARRAY
prior to the Effective Date, and (ii) which
is useful in conducting the Collaboration under the Research Plan.

 

1.26                                                   “Pre-existing ARRAY Patent”
means (i) any and all
patent applications and patent thereof, existing as of the Effective
Date, that claim any ARRAY
library compound, or method of use or process for the synthesis thereof
or composition-of-matter containing such ARRAY
library compound for any target including the Collaboration Target, but
activities to such Collaboration Target has not been demonstrated, and (ii) any
divisions, continuations, reissues, reexaminations, or extensions to the extent
the same have an earliest effective filing date prior to the Effective Date, and any substitutions,
confirmations, or registrations of any of the foregoing, in each case, which is
owned by ARRAY (solely or
jointly), to the extent ARRAY
has the right to license or sublicense the same.

 

1.27                                                   “Pre-existing ONO Compound”
means any chemical entity which has been synthesized by ONO against the
Collaboration Target prior to the Effective Date, whether or not covered under Pre-existing ONO Patent.

 

1.28                                                   “Pre-existing ONO Know-How”
means any Pre-existing ONO Compound not covered under Pre-existing ONO Patent
and all other technologies (i) including, but not limited to,
trade secrets, know-how, inventions, information (including structure-activity data)
and materials, whether patentable or not, directed to processes, formulations
and/or methods discovered, developed, owned, licensed or acquired by ONOprior to the Effective Date, and (ii) which is useful in conducting
the Collaboration under the Research Plan.

 

1.29                                                   “Pre-existing ONO Patent”
means (i) any and all
patent applications and patents thereof that claim any
Pre-existing ONO Compound, or method of use or process for the synthesis thereof or
composition-of-matter containing such chemical entity for the Collaboration Target, which exist as of the Effective Date, and (ii) any divisions,
continuations, reissues, reexaminations, or extensions to the extent the same
have an earliest effective filing date prior to the Effective Date, and any substitutions, confirmations, or
registrations of any of the foregoing, in each case, which is owned by ONO.

 

1.30                                                   “Product” means
a product which contains any Active Compound and Active Claimed Compound [*].

 

1.31                                                   “Research Plan” means the written research
plan governing the joint effort of the Parties in conducting the Collaboration,
which may be amended from time to time by mutual agreement of the Parties.  The initial Research Plan is attached hereto
as Exhibit 1.31.

 

5

 

1.32                                                   “Sublicensee” shall mean, with respect to a particular
Collaboration Product, a Third Party to whom ONO has granted a sublicense of the right to make, use, sell,
offer for sale, import and/or export such Collaboration Product.

 

1.33                                                   “[*].

 

1.34                                                   “Territory” means worldwide.

 

1.35                                                   “Third Party” means any person or entity
other than ARRAY and ONO, their respective Affiliates and Sublicensee.

 

ARTICLE 2

RESEARCH COLLABORATION

 

2.1                                                         Goals.  The goal of the Collaboration is the
discovery and optimization of small molecule inhibitors against each Collaboration Target by ARRAY pursuant to a Research
Plan, and the delivery of one or more
preclinical candidates to ONO, during the Collaboration Term, for selection as clinical lead compounds for
clinical development and commercialization by ONO.

 

2.2                                                         Conduct
of the Collaboration.  Subject to the
terms and conditions set forth herein, ARRAY and ONO will undertake research
directed to (i) research and development of small molecule inhibitors of [*] which, if possible, will also inhibit [*],
for the treatment of [*], and (ii) research
and development of small molecule inhibitors of [*] or,
preferably, both for the treatment of [*].  The
Collaboration shall be funded as set forth in Article 5 below.  During the Collaboration Term for each Collaboration Target, ARRAY
and ONO shall collaborate and use their commercially reasonable efforts to
conduct the Collaboration for each
Collaboration Target in accordance with the Research Plan within the
time schedules contemplated therein and to keep the other Party informed as to
the progress and results of the Collaboration hereunder.  Once per quarter during the Collaboration Term, ONO will have the right
to send, to observe the progress of the Collaboration in accordance with
the Research Plan, one (1) ONO
scientist to ARRAY’s facilities,
with such visit to last up to two (2) weeks in duration.

 

2.3                                                         Research
Plan.  The Collaboration for each Collaboration Target shall be
carried out in accordance with a mutually agreed upon the written Research Plan, which shall establish specific research
objectives and the research tasks to be performed and resources to be provided
by each Party.  The Research Plan shall,
among other things, establish: (i) the scope of the research activities
which will be performed; (ii) the research objectives and work plan
activities with respect to the Collaboration for each Collaboration Target; and (iii) specific screening
assays for identifying and testing the activity of Compounds against each Collaboration Target to determine
when a Compound shall be deemed an Active Compound.  The Research Plan shall be reviewed on an
ongoing basis and may be amended by the Joint Management Committee in
accordance with Article 3.

 

2.4                                                         Additional
Target(s). 
In the event that ONO wishes to
collaborate with ARRAY, and ARRAY accept
to collaborate with ONO, with
respect to drug discovery research on any other molecular
target(s) than the Collaboration
Target(s), the Parties shall enter

 

6

 

into the separate drug discovery agreement with
substantially the same terms and conditions as
applied under this Agreement.

 

2.5                                                         Collaboration
Staffing.  ONO will fund ARRAY’s
activities under the Collaboration for
each Collaboration Target in accordance with the applicable Research Plan.  During the Collaboration and subject to ONO
funding FTEs for such Collaboration pursuant
to Section 5.1, ARRAY shall devote that number of FTEs to the conduct of
the Collaboration for each Collaboration
Target specified in the initial Research Plan.  The number of ARRAY FTEs may be increased or
decreased upon mutual agreement.

 

2.6                                                         Term
and Termination of Collaboration.

 

2.6.1                        Term.  The Collaboration Term for the Collaboration Target set forth in Section 1.9
(i) shall commence on the Effective Date and shall end upon [*] after the Effective Date.  Further,
the Collaboration Term for the Collaboration Target set forth in Section 1.9
(ii) shall commence on the Effective Date and shall end upon [*] after the Effective Date.  ONO shall have the right to
extend the Collaboration Term for each
Collaboration Target for [*] by
providing written notice to ARRAY at least [*] before the
end of the then-current Collaboration Term.

 

2.6.2                        [*].  ONO
shall have the right [*] for each
Collaboration Target, of this Agreement within [*] following
the first anniversary of the Collaboration Term for each Collaboration Target,
with [*] from ONO to ARRAY.  In such event, the provisions of [*] shall apply.

 

2.7                                                         Third
Party Licenses.  In the event that
the Parties agree to acquire additional technologies from a Third Party
specifically for use in the conduct of each
Collaboration in the Field, ONO will be responsible for the payment of any
amounts due to Third Parties for the licenses of intellectual property which directly applies to any
Collaboration Target, and the costs of negotiating, preparing and executing any
such license.  Such licenses are granted to ONO asa licensee, and ONO will grant the sublicense to ARRAY in order for ARRAY to conduct the
Collaboration only.  Upon the termination of the Collaboration and/or this Agreement, ONO may, at the sole option of ONO, terminate such sublicense to ARRAY.

 

2.8                                                         Records;
Inspection.

 

(a)                                  Records.  Each
Party shall maintain records of the Collaboration for each Collaboration Target (or cause
such records to be maintained) in sufficient detail and in good scientific
manner as will properly reflect all work done and results achieved in the
performance of such Collaboration
(including all data in the form required under any applicable governmental
regulations and as directed by the JMC).

 

(b)                                 Reports
and Information Exchange.  Each Party shall use commercially reasonable
and diligent efforts to disclose to the other Party all material information (including any documents, data and electronic information
related thereto) relating to the Collaboration, including without
limitation any Active Compound, promptly after it is learned or its materiality
is appreciated.  Each Party shall also keep
the other Party, including the Joint Management Committee, informed as to its
progress under the Research Plan. Within

 

7

 

[*]
following the end of each calendar quarter during the Collaboration, each Party shall provide the other Party with
a reasonably detailed written report describing the progress to date of all
activities for which such Party was allocated responsibility during such
quarter under the Research Plan. 
Notwithstanding the foregoing, in no event shall ARRAY be required to
disclose to ONO any Pre-existing
ARRAY Know-How or Pre-existing ARRAY Patents; provided, however, that to the extent that such Pre-existing ARRAY Know-How and/or Pre-existing ARRAY Patents are specifically related to the Collaboration,
ARRAY shall disclose them to ONO.

 

2.9                                                         Supply of Compounds.  In accordance with a schedule determined
by the JMC, ARRAY will provide to ONO an agreed amount of each Compound, up to [*].

 

2.10                                                   Post
Collaboration Activities.  For each
Active Compound, Active Claimed Compound and Collaboration Product to which ONO
retains exclusive rights under
this Agreement, ONO shall be responsible, at its sole expense, for conducting
all clinical development of such Active Compound, Active Claimed Compound or
Collaboration Product following the Collaboration Term for each Collaboration Target, and all commercialization of such
Active Compound, Active Claimed Compound or Collaboration Product.  In
addition to the above monetary
responsibility for clinical development by ONO, ONO shall be responsible
for all costs and expenses for commercializing the Collaboration Product for use in the Field, including without
limitation, preclinical development, pre-marketing
and commercial activities

 

2.11                                                   Exclusivity.  Except as set forth herein, for each
Collaboration Target, during (a) the Collaboration Term, and (b) thereafter for (i) so long as ONO is
using commercially reasonable efforts to pursue research and/or
development on the Collaboration
Product directed to such Collaboration Target consistent with ONO’s
usual practices for its own research and
development, where such efforts could result in ARRAY accruing milestones and royalties, or (ii) [*] from the
end of the Collaboration Term, [*],
ARRAY will not conduct, participate in, or fund, directly or indirectly, either
alone or with a Third Party,
research or development activities directed to the discovery of small molecule
chemical entities that modulate the activity of the Collaboration Target; [*]. 
However, in the event of a Change
of Control, the surviving entity shall be bound by all other terms and conditions of this Agreement as
provided in Section 12.3.  It is understood and agreed that testing of a
chemical entity against the Collaboration Target for the purpose of
establishing selectivity of such chemical entity against a target other than
the Collaboration Target shall not be deemed a violation of this Section 2.11.  For purposes
of this Section 2.11, “Change of Control” means the merger,
consolidation, sale of substantially all of its assets or similar transaction
or series of transactions, as a result of which ARRAY’s shareholders before
such transaction or series of transactions own less than fifty percent (50%) of
the total number of voting securities of the surviving entity immediately after
such transaction or series of transactions. 
Notwithstanding the foregoing, if as a result of any such Change of
Control, ARRAY exists as a wholly owned subsidiary of a parent, then the
provisions of this Section 2.11 shall continue to
apply to ARRAY but not to such parent.

 

8

 

ARTICLE 3

MANAGEMENT

 

3.1                                                         Joint Management Committee.  Promptly
after the Effective Date, the Parties
will establish a joint management committee
(the “Joint Management Committee” or “JMC”), which shall be responsible for
monitoring, planning and
coordinating research activities
under the Research Plan during the
Collaboration Term.  The responsibilities of the Joint
Management Committee shall include, among other things, establishing research objectives,
reviewing data and allocating resources.

 

3.2                                                         Membership.  The JMC shall consist of three (3) representatives of
each of ONO and ARRAY, each Party’s members selected by such Party.  ARRAY and ONO may
each replace its JMC representatives at any time, upon written notice to the
other Party.  From time to time, the JMC
may establish subcommittees, to oversee particular projects or activities, and
such subcommittees will be constituted as the JMC agrees.

 

3.3                                                         Meetings.  During the Collaboration Term, the JMC shall
meet at least semi-annually, at each Party’s
facilities alternately or at a mutually agreed location.  In
addition to regular JMC meetings,
either Party may request an ad-hoc meeting at a mutually agreeable date and location.  The JMC meetings do not necessarily have to
be face-to-face meetings but, upon agreement of both Parties, can be via other
methods of communication such as teleconferences and/or videoconferences.  With the consent of the Parties, other
representatives than JMC members of
ARRAY or ONO may attend JMC meetings as nonvoting observers.  Each Party shall be responsible for all of
its own expenses associated with attendance of such meetings.  The first meeting of the JMC shall occur
within thirty (30) days after the Effective Date.  In addition to such JMC meetings, the Parties will
otherwise communicate from time to time by
telephone, electronic mail, facsimile and/or video conference.

 

3.4                                                         Minutes.  The JMC shall keep accurate minutes of its
deliberations which shall record all proposed decisions and all actions
recommended or taken.  The host of the JMC meeting shall be
responsible for the preparation of draft minutes.  Draft minutes shall be sent to all members of
the JMC within five (5) working
days after each meeting and shall be approved, if appropriate, at the
next meeting.  All records of the JMC meetings shall at all times be available
to both ARRAY and ONO.

 

3.5                                                         Decision
Making.  Each Party shall
have one (1) vote in all JMC decisions, and the Parties shall attempt to make decisions by consensus.  In the event the JMC cannot reach consensus,
the dispute shall be referred to executive officers of each Party for resolution.  If the executives cannot resolve the dispute,
then, other than with respect to (i) setting criteria for Active Compounds
and (ii) any other matter that requires mutual consent under this
Agreement, ONO shall have the deciding vote; provided, however, that ARRAY
shall not be obligated, as a result of such a deciding vote by ONO, to violate
any obligation or agreement it may have with any Third Party, or to incur any
extraordinary costs.

 

ARTICLE 4

LICENSES

 

4.1                                                         Exclusive
License.  Subject to the terms and
conditions of this Agreement, ARRAY hereby grants to ONO an exclusive right and license in the Territory under ARRAY’s
interest in the Collaboration Patent and
the Collaboration Know-How, with
a right to sublicense, to develop, make, have made, use, offer for sale and/or sell, import and export
any Active Compound, Active Claimed Compound and/or Derivative Compound,and, also with a right to

 

9

 

sublicense, to develop, make, have made, use, import and export, offer for sale
and/or sell any Collaboration Product or Product.

 

4.2                                                         Non-Exclusive Licenses.

 

4.2.1                        Collaboration
Technology.  Subject to the terms and
conditions of this Agreement, ARRAY hereby
grants to ONO (i) a non-exclusive, sublicensable, royalty free license in the Territory under
ARRAY’s interest in the Collaboration
Patent and the Collaboration Know-How,
to develop, make, have made, use, offer to sell, sell, import and export any Inactive Compound or Claimed
Compound (other than Active
Claimed Compounds, which are
subject to the license in Section 4.1 above), and (ii) upon ONO’s
discovery that a particular Inactive Compound or such Claimed Compound is active against a particular target, the
right to negotiate to obtain the exclusive rights to such Inactive Compound or Claimed Compound, in each case in
the Territory.

 

4.2.2                        Pre-existing ARRAY Patents.  In the
event that the development, making,
having made, use, offer for sale, sale, import
and export by ONO of (i) any Active Compound, Inactive Compound, Active
Claimed Compound, Claimed Compound or Derivative Compound, (ii) any Collaboration
Product, Product or any product
containing an Inactive Compound, a Claimed Compound or Derivative Compound would infringe during the term of the Agreement a claim of Pre-existing ARRAY Patent, ARRAY hereby grants to ONO, to the extent ARRAY is legally able to do so, a
non-exclusive, sublicensable, royalty-free license in the Territory under such Pre-existing ARRAY Patent for those purposes.

 

4.3                                                         Inactive
Compounds and Claimed Compounds.  With respect to an Inactive Compound or a
Claimed Compound (other than an Active Claimed Compound, which is subject to
the license in Section 4.1 above), at
least [*] prior to ARRAY entering into
material and substantial negotiations to grant to a Third Party any rights
to such Inactive Compound or Claimed Compound, ARRAY agrees to notify ONO in
writing, together with a description of the chemical entity that would be the
subject of such negotiations.  Within
thirty (30) days after receipt from ARRAY
of such notice, ONO shall notify ARRAY whether or not it desires to
discuss terms and conditions under which ARRAY would grant exclusive rights to such Inactive or Claimed Compound to ONO.  However, in the event that ONO reasonably determines that a sample evaluation of such Inactive Compound or Claimed Compound
is crucial for ONO’s decision-making ONO shall immediately inform ARRAY, and ARRAY shall provide such sample(s) to ONO, and such thirty (30)-day period shall be
extended for a certain period of time as mutually agreed by the Parties.  ARRAY and ONO will then negotiate in
good faith for [*] to finalize the terms and
conditions of such grant of rights.

 

4.4                                                         No
Implied Licenses.  Only the licenses
granted pursuant to the express terms of this Agreement shall be of any legal
force or effect.  No other license or
rights shall be created by implication, estoppel or otherwise.

 

10

 

ARTICLE 5

PAYMENTS; BOOKS AND RECORDS

 

5.1                                                         Collaboration
Funding.

 

5.1.1                        Research
Phase Payment Schedule.  ONO agrees
to pay ARRAY research funding for the conduct of the Collaboration quarterly,
in advance, in an amount equal to the number of ARRAY FTEs called for in the
Research Plan for the applicable quarter multiplied by the ARRAY FTE Rate (as defined below).  Such payments shall be paid in quarterly
installments, in advance.  The initial
payment shall be made within thirty (30) days after the Effective Date, and
subsequent payments shall be made before the first day of each quarter
thereafter.  ARRAY shall submit to ONO an invoice for such payment calculated based on
the Research Plan and the ARRAY FTE Rate at least thirty (30) days prior to the
initiation of each quarter for relevant research, except for the invoice for
initial payment which shall be submitted to ONO immediately after the Effective
Date.

 

5.1.2                        FTE
Rate.  The “ARRAY FTE Rate” shall be equal to [*] per FTE per year. 
Beginning on the first anniversary of the Effective Date, the ARRAY FTE
Rate shall increase no more than once annually by the percentage increase, if
any, in the Consumer Price Index, since the Effective Date or the last
adjustment hereunder, whichever is later.

 

5.1.3                        Non-FTE
Costs.  Non-FTE costs and research
requirements associated with the research activities specified in the
Research Plan shall be borne by ARRAY, except that ARRAY shall not be
required to incur any extraordinary chemical or screening costs without ARRAY’s
prior written consent.  In the event that
ONO agrees, in the course of the Collaboration during the Collaboration Term, to enter into one or more agreements
with a Third Party for the performance of additional activities which are not covered under the Research Plan, ONO will be responsible
for the payment of all additional amounts incurred as a result of any such agreement.

 

5.2                                                         Milestones.  Except as set forth below, ONO shall pay to
ARRAY upon achievement by ONO or its Affiliates, Sublicensees or other
designees, as the case may be, of
the corresponding events set forth below (each, a “Development
Milestone”) for each Collaboration
Product, regardless of whether the development,
promotion, or marketing of such Collaboration Product is discontinued at any
time after the  achievement of
such milestone:

 

5.2.1                        Collaboration
Products Containing Active Compounds.

 

(a)                                  [*].  For each Collaboration Product containing an
Active Compound, which Active Compound is demonstrated [*]:

 

 

	
  Milestone

  	
   

  	
  Cash Payment

  (in U.S. Dollars)

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  1. 

  	
  [*]

  	
   

  	
   

  	
   

  	
  [*]

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  2. 

  	
  [*]

  	
   

  	
   

  	
   

  	
  [*]

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  3. 

  	
  [*]

  	
   

  	
   

  	
   

  	
  [*]

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  4. 

  	
  [*]

  	
   

  	
   

  	
   

  	
  [*]

  

 

11

 

	
  5.

  	
  [*]

  	
   

  	
   

  	
   

  	
  [*]

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  6.

  	
  [*]

  	
   

  	
   

  	
   

  	
  [*]

  

 

(b)                                 [*].  For each Collaboration Product containing an
Active Compound, which Active Compound is demonstrated [*]:

 

	
  Milestone

  	
   

  	
  Cash Payment

  (in U.S. Dollars)

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  1. 

  	
  [*]

  	
   

  	
   

  	
   

  	
  [*]

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  2. 

  	
  [*]

  	
   

  	
   

  	
   

  	
  [*]

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  3. 

  	
  [*]

  	
   

  	
   

  	
   

  	
  [*]

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  4. 

  	
  [*]

  	
   

  	
   

  	
   

  	
  [*]

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  5.

  	
  [*]

  	
   

  	
   

  	
   

  	
  [*]

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  6.

  	
  [*]

  	
   

  	
   

  	
   

  	
  [*]

  

 

5.2.2                        Collaboration
Products Containing Active Claimed Compounds.  For each Collaboration Product containing an
Active Claimed Compound:

 

	
  Milestone

  	
   

  	
  Cash Payment

  (in U.S. Dollars)

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  1. 

  	
  [*]

  	
   

  	
   

  	
   

  	
  [*]

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  2. 

  	
  [*]

  	
   

  	
   

  	
   

  	
  [*]

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  3. 

  	
  [*]

  	
   

  	
   

  	
   

  	
  [*]

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  4. 

  	
  [*]

  	
   

  	
   

  	
   

  	
  [*]

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  5.

  	
  [*]

  	
   

  	
   

  	
   

  	
  [*]

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  6.

  	
  [*]

  	
   

  	
   

  	
   

  	
  [*]

  

 

 

5.2.3                        Collaboration
Products Containing Derivative Compounds. 
For each Collaboration Product containing a Derivative Compound:

 

	
  Milestone

  	
   

  	
  Cash Payment

  (in U.S. Dollars)

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  1. 

  	
  [*]

  	
   

  	
   

  	
   

  	
  [*]

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  2. 

  	
  [*]

  	
   

  	
   

  	
   

  	
  [*]

  

 

12

 

	
  3. 

  	
  [*]

  	
   

  	
   

  	
   

  	
  [*]

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  4. 

  	
  [*]

  	
   

  	
   

  	
   

  	
  [*]

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  5.

  	
  [*]

  	
   

  	
   

  	
   

  	
  [*]

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  6.

  	
  [*]

  	
   

  	
   

  	
   

  	
  [*]

  

 

ARRAY acknowledges and agrees
that any Derivative Compound is covered under ONO Patent and ONO has rights to
research, develop, use, make, have made and commercialize a product containing
such Derivative Compound without any restriction or obligation hereof.  However, in case any [*]
has been developed and commercialized as a [*] ONO shall
pay to ARRAY [*]

 

(a)                                                          The
milestone payments set forth above shall be due with respect to each
Collaboration Product (on a Collaboration Product-by-Collaboration Product
basis).  For purposes of Section 5.2, and Section 5.3 below, all dosage forms, and all
formulations, of the same active ingredient shall be deemed a single
Collaboration Product.  Collaboration Products having different
active ingredients shall be deemed separate Collaboration Products.

 

(b)                                                         Should
all development of a particular Collaboration Product discontinue for any
reason, and be replaced by an alternative Collaboration Product directed to the
same Collaboration Target, then, when the alternative Collaboration Product
achieves a milestone for which a corresponding milestone payment was made for
the discontinued Collaboration Product, no payment shall be due with respect to
such alternative Collaboration Product with respect to such milestone.

 

(c)                                                          If
Development Milestone 5 or 6 is achieved with respect to a particular
Collaboration Product without occurrence of Development Milestone 4, then such Development Milestone 4 shall be deemed achieved upon achievement of
either Development Milestone 5 or 6,
and Development Milestone 4 shall
be paid together with such Development Milestone 5 or 6, whichever is earlier.

 

(d)                                                         For a [*], if it is later demonstrated that such [*] then the Development Milestones set forth in Section 5.2.1(a) above shall be paid with
respect to such Collaboration Product.  ONO agrees to promptly notify ARRAY if [*] is demonstrated to [*].

 

(e)                                                          For
purposes of this Section 5.2,
a clinical trial shall be deemed initiated upon the first dosing of the first
patient in such trial.

 

(f)                                                            It
is understood that no milestone
payments under this Section 5.2
and no royalty payments under Section 5.3 below shall be due for development and commercialization
activities with respect to [*].

 

5.2.5                                                Milestone
Payment Timing.  The payments set
forth in Section 5.2 hereof
shall each be due and payable by ONO to ARRAY within thirty (30) days of
the occurrence of the milestone event set forth therein.  ONO agrees to promptly notify ARRAY
of its achievement of any milestone.

 

13

 

5.3                                                 Royalties.  In
partial consideration for the licenses granted to ONO under Section 4.1, ONO shall pay
ARRAY a royalty on the worldwide
Net Sales of Collaboration Products by ONO, its Affiliates or Sublicensees.  Such royalty shall be paid based on the total
annual worldwide Net Sales, on a
Collaboration Product-by-Collaboration Product basis.

 

5.3.1                                                Royalty
Rate.  The royalty rate for a
particular Collaboration Product shall be as follows:

 

 

	
  Collaboration Product

  	
   

  	
  Royalty rate

  	
   

  
	
  [*]

  	
   

  	
   

  	
  [*]

  
	
  [*]

  	
   

  	
   

  	
  [*]

  
	
  [*]

  	
   

  	
   

  	
  [*]

  

 

ARRAY acknowledges and agrees
that any Derivative Compound is covered under ONO Patent and ONO has rights to
research, develop, use, make, have made, import and export, and commercialize a
product containing such Derivative Compound without any restriction or obligation hereof.  However, in case any [*]
has been developed and commercialized as a [*] ONO shall
pay to ARRAY [*].

 

5.3.2                                                Royalty
Term.  Royalties shall be paid on a
country-by-country basis from the date of the first commercial sale of each
Collaboration Product with respect to which royalty payments are due for a
period which is the longer of:

 

(a)                                                          the
expiration of the last to expire the Collaboration
Patent in such country covering the composition of matter, a method of
manufacture or the use of such Collaboration Product; or

 

(b)                                                         ten (10) years after the first commercial sale of such Collaboration
Product in such country.

 

5.3.3                                                Third
Party Royalties.  ONO shall be
responsible for all payments due to Third Parties for the manufacture, use, or
sale of Collaboration Products by ONO, its Affiliates or Sublicensees.

 

5.4                                                         Reports.  Until first commercial sale of each royalty-bearing
Collaboration Product, ONO shall keep ARRAY apprised of the status of the
pre-clinical, clinical and commercial development of such Collaboration Product
by semi-annually providing ARRAY with a written report reasonably detailing such activities with respect to each
applicable Collaboration Product.

 

5.5                                                         Payment
Method.  All payments due under this
Agreement shall be made by bank wire transfer to a bank account designated by
ARRAY.  All payments hereunder shall be
made in U.S. dollars.  In the event that
the due date of any payment subject to Article 5 hereof is a Saturday,
Sunday or national holiday, such payment may be paid on the following 

 

 

14

 

business day.  Any payments that are not paid on the date
such payments are due under this Agreement shall bear interest to the extent
permitted by applicable law at the U.S. prime rate per annum quoted in the “Money
Rates” column of The Wall Street Journal, Eastern Edition, on the first business day after such
payment is due, plus an additional [*] calculated
on the number of days such payment is delinquent.  This Section 5.5 shall in no way
limit any other remedies available to ARRAY.

 

5.6                                                         Royalty
Payments, Reports and Audits.

 

5.6.1                        Payments
and Reports.  Royalty payments under
this Agreement shall be made to ARRAY semi-annually
within [*] following the end of March or September for which
royalties are due.  Each royalty payment
shall be accompanied by a report summarizing the Net Sales during the relevant six (6)-month period,
setting forth all the information necessary for the calculation of such royalty
payment.  Unless otherwise requested, or
consented to in writing, by ARRAY, all royalty payments and reports related to the Net Sales by ONO’s Sublicensees
shall be made to ARRAY by ONO together with (or as a part of) ONO’s payments
and reports.

 

5.6.2                        Records.  ONO shall keep full, true and accurate books
of account, in accordance with generally accepted accounting practices in Japan, relevant to payments under
this Agreement and containing all particulars that may be necessary for the
purpose of showing the Net Sales
and demonstrating the calculation of royalty payments.  Such books of account and the supporting data
and other records shall be kept by
ONO.  ONO’s books and records shall be
open at all reasonable times, for [*] following the end of
March or September to
which they pertain, for examination in accordance with the provisions of Section 5.6.3 below.

 

5.6.3                        Audits.  Upon
the written request and at expense of ARRAY, ONO shall permit an
independent certified public accounting firm of internationally recognized
standing selected by ARRAY and reasonably acceptable to ONO, to examine, not more than once in each calendar year during the period in which ONO has an obligation to pay royalty
payments under this Agreement, such books of account and records under Section 5.6.2 as may be necessary to determine the correctness of any report
or payment related to royalty payments under this Agreement.  Such examination shall be made during regular
business hours and upon reasonable prior written notice and prior to such examination, ARRAY shall cause its accounting
firm to enter into an acceptable confidentiality agreement with ONO, obligating it to retain all such
information in confidence pursuant to such confidentiality agreement.  The accounting firm shall disclose to ARRAY only whether the calculation of royalty is correct or incorrect and the
amount of discrepancy.  No other
information shall be provided to ARRAY.  The
Parties agree that all information subject to review under this Section 5.6.3 is the Confidential
Information of ONO.

 

If such accounting firm correctly identifies a discrepancy made during the period covered by such examination, the appropriate Party shall pay the
other Party the amount of the discrepancy [*] of the date
ARRAY delivers to ONO such
accounting firm’s written report so correctly concluding, or as otherwise
agreed upon by the Parties.  If such
examination establishes that royalty payments payable under this Agreement have
been, for the

 

15

 

period covered by such examination, understated by
more than [*], ONO shall pay the reasonable costs
of the examination.

 

5.6.4                        Currency
Conversion.  For the purpose of
computing the Net Sales in a
currency other than United States Dollars, such currency shall be converted
into U.S. dollars using the buying exchange rate for conversion of the foreign
currency with U.S. dollars, quoted for current transactions reported in The
Wall Street Journal, Eastern
Edition for the last business day of March or September to which such payment pertains.

 

5.7                                                         Taxes.  All payments due to
ARRAY under this Agreement will be made after
any deduction or withholding taxes
or other similar governmental charge (the
“Withholding Taxes”) (For example, if an amount of payment due from ONO
to ARRAY is one million US dollar (US$1,000,000), supposing Withholding Taxes
to be 10%, Ono will deduct one hundred thousand US dollar (US$100,000) as
Withholding Taxes and remit nine hundred thousand US dollar (US$900,000) to
Array).  ONO shall provide ARRAY with a certificate evidencing payment of
any Withholding Taxes hereunder and shall
reasonably assist ARRAY, at ARRAY’s expense, to obtain the benefit
of any applicable tax treaty.  However, under the current CONVENTION
BETWEEN THE GOVERNMENT OF JAPAN AND THE GOVERNMENT OF THE UNITED STATES OF
AMERICA FOR THE AVOIDANCE OF DOUBLE TAXATION AND THE PREVENTION OF FISCAL
EVASION WITH RESPECT TO TAXES ON INCOME
issued on March 30, 2003 (the “Taxation Treaty”), all payments paid by ONO
to ARRAY will be made without Withholding Taxes.  In the event the change of Taxation Treaty requires the Withholding Taxes become due in Japan,
the Parties shall negotiate which Party shall have the obligation to pay such Withholding Taxes.

 

ARTICLE 6
DILIGENCE

 

ONO shall use diligent
efforts to research, develop and commercialize Collaboration Products, and to
perform its obligations under Section 2.10 of this Agreement, and to obtain the
optimum commercial return for each Collaboration Product in all major markets
throughout the world, consistent
with the practice of ONO in pursuing the research, development,
commercialization, and marketing of pharmaceutical products of its own
development and of similar commercial value potential.

 

ARTICLE 7
INTELLECTUAL PROPERTY

 

7.1                                                         Ownership
of Inventions; Disclosure.

 

7.1.1                        Ownership.  Title to all inventions and other
intellectual property made by ARRAY in the course of performing, or in
connection with, the Collaboration during
the Collaboration Term shall be owned by ARRAY; title to all inventions
and other intellectual property made by ONO in the course of performing, or in
connection with, the Collaboration during
the Collaboration Term shall be owned by ONO; title to all inventions
and other intellectual property made jointly by ONO and ARRAY in the course of
performing, or in

 

16

 

connection with, the Collaboration during the Collaboration Term shall be
owned jointly by ONO and ARRAY.  Inventorship
of inventions and other intellectual property made pursuant to this Agreement
shall be determined in accordance with the patent laws of the United
States.  Except as provided in Articles 4 and 5, neither Party shall have an
obligation to account to the other, or obtain the consent of the other, with
respect to the exploitation (directly or through licensees or third parties) of
any jointly owned invention or intellectual property right, and each Party
hereby waives any right it may have under the laws of any jurisdiction to
require such an accounting or consent.

 

7.1.2                        [*].  Upon
receipt by ARRAY of [*], ARRAY
shall [*] its right, title and interest in
any Collaboration Patent claiming the Active Compound or Active Claimed Compound contained in such Collaboration Product
or a method of using or a method of making such Active Compound, Active Claimed Compound or
Collaboration Product.

 

7.1.3                        Disclosure
of Inventions.  Each Party shall
promptly disclose to the other Party any
inventions made in connection with this Agreement.

 

7.2                                                         Patent
Prosecution.

 

7.2.1                        Collaboration
Technology.  ONO shall be
responsible, at its expense, (i) for preparing, filing, prosecuting and
maintaining the Collaboration Patent,
and (ii) for conducting any interferences, re-examinations, reissues and
oppositions relating thereto.  ONO may
elect, upon ninety (90)-day prior notice, to discontinue prosecution
of any such Collaboration Patent and/or
not to file or conduct any further activities with respect to such Collaboration Patent.  In the event ONO declines to file, or having filed, fails to further prosecute or
maintain any such Collaboration Patent,
or conduct any proceedings including, but not limited to, interferences,
re-examinations, reissues and oppositions
relating thereto, then ARRAY shall have the right to prepare, file, prosecute
and maintain such Collaboration Patent
in such countries as it deems appropriate, and conduct such proceedings, at its
sole expense.  In such case, ONO shall
immediately execute all necessary documents that may be required in order to
enable ARRAY to file, prosecute and maintain such Collaboration Patent and to conduct any such proceedings.

 

7.2.2                        Other
Technology.  Except as provided in Section 7.2.1, each Party shall be responsible,
at its own expense and in its sole discretion, for preparing, filing,
prosecuting and maintaining, in such countries as it deems appropriate, any and
all patent applications and patents directed to inventions owned or controlled
by such Party outside the Collaboration and
conducting any interferences, re-examinations, reissues and oppositions
relating to such patent applications and patents.

 

7.2.3                        Cooperation.  Each Party
shall keep the other Party fully
informed as to the status of patent matters described in Section 7.2.1, including without limitation, by
providing the other Party with the
opportunity, as far in advance of filing dates as possible, to fully review and
comment on any documents which will be filed in any patent office, and by providing the other Party with copies of any substantive
documents received by such Party from such patent offices
promptly after receipt by such Party,
including notice of all interferences, reissues, re-examinations, oppositions
or requests for patent term extensions and shall incorporate all
reasonable comments of the other Party
in documents which will be filed in

 

17

 

any patent office. 
Each Party
shall reasonably cooperate with and assist the other Party in connection with such activities, at such other Party’s reasonable request
and expense, including without limitation by making scientists and scientific
records reasonably available to the prosecuting Party.

 

7.3                                                         Enforcement
and Defense.

 

7.3.1                        Notice.  Each Party shall promptly notify the other Party of either (i) any infringement of any Collaboration Patent by any Third Party or (ii) any misappropriation or misuse of the Collaboration Know-How
by a Third Party that may come to such Party’s attention.

 

7.3.2                        ONO.  ONO shall have (i) the initial right,
but not the obligation, to take reasonable legal action to enforce against
infringements of the Collaboration Patent
or misappropriation or misuse of the Collaboration Know-how by any Third Party or defend any declaratory judgment action relating to the Collaboration Patent filed pursuant
to Section 7.2.1, and (ii) the
sole right, but not the obligation, to take reasonable legal action to enforce
against patent infringement by any Third
Party or defend any declaratory
judgment action relating to any patent filed by ONO pursuant to Section 7.2.2, or the Collaboration Patent [*] ONO pursuant to Section 7.1.2, at its sole cost and expense.  If, within six (6) months following
receipt of such notice from ARRAY, ONO fails to take such action to halt a
commercially significant infringement of the Collaboration Patent filed pursuant to Section 7.2.1 (but not [*]
ONO), ARRAY shall, in its sole discretion, have the right, at its sole expense,
to take such action.

 

7.3.3                        ARRAY.  ARRAY shall have the sole right, but not the
obligation, to take reasonable legal action to enforce against patent
infringement by Third Parties or defend any declaratory judgment action
relating to any patent filed by ARRAY pursuant to Section 7.2.2, at its sole cost and expense.

 

7.3.4                        Cooperation;
Costs and Recoveries.  Each Party
agrees to render such reasonable assistance as the enforcing Party may request,
at the enforcing Party’s expense, including but not limited to joining such actions and/or executing such
documents as may be necessary to, for example,
enable the enforcing Party to establish standing
in any court or tribunal to enforce the Collaboration Patent or the Collaboration
Know How.  Amounts recovered from
enforcing the Collaboration Patent filed
pursuant to Section 7.2.1 or [*] pursuant to Section 7.1.2, whether as payment in settlement or otherwise, shall belong
to the Party bringing the action, provided, however, that amounts recovered by
ONO shall first be used to reimburse ONO for its reasonable expenses in
enforcing the patent (including attorneys’ and experts fees), with the
remainder, and then the amount of any recovery remaining shall be allocated between
the Parties on a pro  rata
basis taking into consideration the relative economic losses suffered by each
Party.  For example, [*].  A settlement, consent judgment or other voluntary final disposition of a
suit under this Section 7.3 may be entered into by ONO without the consent
of ARRAY, provided that such settlement, consent judgment or other disposition
does not admit the invalidity or unenforceability of any Pre-existing ARRAY
Patent or any Collaboration Patent and provided further, that any rights to make
such settlement, consent judgment or other disposition shall be limited to
those rights ONO (and/or its Sublicensees) otherwise has the right to grant.  The costs in bringing any
action to enforce a patent filed

 

18

 

pursuant to Section 7.2.2 shall be paid by, and all
recoveries therefrom belong to, the Party
bringing such action.

 

7.4                                                         Patent Registration in Territory.  Upon ONO’s request, ARRAY agrees that ONO shall be entitled to
register, at ONO’s sole expense, “Tsujo Jisshiken Tohroku” with respect to the Collaboration Patent in accordance with Patent Law of Japan, or other similar
rights in accordance with patent law in any other country, if any.  ARRAY shall render reasonable assistance for such
registration by ONO, including, but not limited to, providing ONO with any
documents reasonably necessary for such registration provided, however, that
ONO shall promptly cancel such registration of Tsujo Jisshiken Tohroku and/or other similar
rights in the event of the return of
licenses and rights by ONO to ARRAY
pursuant to Article 11 of this
Agreement or in the event ONO ceases to sell the Collaboration Product containing an Active Compound or Active Claimed
Compound during the term of this
Agreement.

 

ARTICLE 8

CONFIDENTIALITY

 

8.1                                                         Confidential
Information.  Except as otherwise
expressly provided herein, the Parties agree that, for the term of this
Agreement, the receiving Party shall not disclose to any Third Party or use for
any purpose any Confidential Information furnished to it by the disclosing Party hereto pursuant to this
Agreement, or the Collaboration Know-How.  For
purposes of this Article 8, “Confidential Information” shall mean any information,
which if disclosed in tangible form is marked “confidential” or with other
similar designation to indicate its confidential or proprietary nature, or, if
disclosed orally, is indicated orally to be confidential or proprietary at the
time of such disclosure and is confirmed in writing as confidential or
proprietary within forty-five (45) days after such disclosure.  It is understood and agreed by the Parties that the
Collaboration Know-How shall be the Confidential Information of both of the Parties, and neither Party shall disclose such
Collaboration Know-How as confidential information to a Third Party without the
written consent of the other Party; provided, however, that ONO may disclose
such Collaboration Know-How to its potential licensee for seeking business
relationship.  Notwithstanding the
foregoing, the Confidential
Information shall not include any information that:

 

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

 

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

 

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

 

(d)                                                 was
independently developed by the receiving Party as demonstrated by documented
evidence prepared contemporaneously with such independent development; or

 

19

 

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

 

8.2                                                         Permitted
Use and Disclosures.  Each Party
hereto may use or disclose the Confidential
Information and the Collaboration Know-How disclosed to it by the other
Party to the extent such use or disclosure is reasonably necessary and
permitted in the exercise of the rights granted hereunder in filing or
prosecuting patent applications, prosecuting or defending litigation, complying
with applicable governmental laws, regulations or court order or otherwise
submitting information to tax or other governmental authorities, conducting
clinical trials, or making a permitted sublicense or otherwise exercising
license rights expressly granted by the other Party to it pursuant to the terms
of this Agreement, provided that if a Party is required to make any such
disclosure, other than pursuant to a confidentiality agreement, it will give
reasonable advance notice to the other Party of such disclosure and, save to
the extent inappropriate in the case of patent applications, will use its
reasonable efforts to secure confidential treatment of such information in
consultation with the other Party prior to its disclosure (whether through
protective orders or otherwise) and disclose only the minimum necessary to
comply with such requirements.

 

8.3                                                         Termination
of Prior Agreement.  This Agreement
supersedes the Confidentiality
Agreement between the Parties dated April 12, 2005.  All information exchanged between the
Parties under the Confidentiality Agreement shall be deemed the Confidential Information and shall
be subject to the terms of this Article 8.

 

8.4                                                         Publicity/Use of the Name.  Each Party
agrees not to disclose to any Third Party the financial terms of this Agreement
without the prior written consent of the other Party hereto, except to
advisors, investors and others on a need-to-know basis under circumstances that
reasonably ensure the confidentiality thereof, or to the extent required by
law.  Notwithstanding the foregoing, the
Parties shall discuss the timing and
contents of a press release to announce the execution of this Agreement,
the achievement of Development Milestone
for a Collaboration Product or the progress of the Collaboration and make such press release if the Parties mutually agree upon the timing
and contents; thereafter, ONO and ARRAY may each disclose to any Third Party the information contained in such press release outline without
the need for further approval by the other Party.  During
the term hereof, neither Party
shall use the name, trademark, tradename or logo of the other Party’s, its Affiliates’ or their respective employees in any
publicity, promotion, press releases or disclosure relating to this Agreement
or its subject matter without the
prior consent of the other Party.

 

8.5                                                         Publication.  Except
for disclosures permitted pursuant to Section 8.1, in the event a
Party wishes to publish or orally present information relating to the Collaboration Know-How and the Confidential Information, such
Party shall submit to the other Party all materials related to the proposed
publication or presentation (including, without limitation, posters, abstracts,
manuscripts and written descriptions of oral presentations) at least ninety (90) days prior to the date of submission for the draft publication and
presentation.  The other Party shall
review such submitted materials and respond to the submitting Party as soon as
reasonably possible, but in any case within ninety (90) days of
receipt thereof.  The reviewing Party shall have the rights (a) to propose modifications
to publication or presentation for patent reasons, trade secret reasons or
business reasons or (b) to request a reasonable delay in publication or

 

20

 

presentation in order to protect patentable
information.  If the reviewing Party
requests a delay, the publishing Party shall delay submission or presentation
for a period of ninety (90) days to enable patent applications protecting each
Party’s rights in Collaboration Inventions to be filed in accordance with Section 7.2
above.  If the reviewing Party requests
modifications to publication or presentation, then the publishing Party shall
edit such publication or presentation to prevent disclosure of trade secret or
proprietary business information prior to submission of the publication or
presentation.  In the event the
reviewing Party does not respond within such ninety (90) day-period, the submitting Party will be free to
make such proposed publication or presentation.  Further,
should the reviewing Party make an objection to the publication or presentation of any such
Collaboration Know-How and Confidential Information, then the
Parties shall discuss the advantages and disadvantages of publishing such
Collaboration Know-How and Confidential Information.  If the Parties are unable to agree on whether
to publish the same, the Chief Executive Officer of ARRAY and the Chief
Executive Officer of ONO shall reasonably agree on the extent to which the
publication or presentation of
such Collaboration Know-How and Confidential Information shall be
made.

 

Notwithstanding the above, ONO has the sole right,
without any consent of ARRAY, to make any publication or presentation with respect
to the development and sale by or on behalf of ONO of any Collaboration
Product, Product or any product containing an Inactive Compound, a Claimed
Compound or Derivative Compound after the Collaboration Term.  ONO shall provide ARRAY, for information
purposes, with copies of publications by ONO’s or its Affiliates’ employees,
Sublicensees, academic entity or consultants following such publication or
presentation.

 

ARTICLE 9

REPRESENTATIONS AND WARRANTIES

 

9.1                                                         ONO.  ONO represents and warrants that: (i) it
has the legal power, authority and right to enter into this Agreement and to
perform all of its obligations hereunder; and (ii) this Agreement is a legal and valid obligation binding
upon it and enforceable in accordance with its terms.

 

9.2                                                         ARRAY.  ARRAY represents and warrants that: (i) it
has the full legal right and power
to grant to ONO the licenses under Article 4
hereof, to enter into this Agreement, and to fully perform its
obligations hereunder; (ii) this Agreement is a legal and valid obligation
binding upon it and enforceable in accordance with its terms; (iii) the execution and performance of this Agreement does not conflict with
any agreement or understanding to which ARRAY may be bound; (iv) it has not
previously assigned, transferred, conveyed or otherwise encumbered its right,
title and interest in Pre-existing ARRAY Know-How; and (v) it shall comply with all applicable laws,
regulations and guidelines in connection with the performance of its
obligations and rights pursuant to this Agreement, including the laws and
regulations of the U.S., Japan and any other relevant nation concerning any
export or other transfer of technology, services or product..

 

9.3                                                         Disclaimer.  ONO and ARRAY specifically disclaim any
guarantee that the Collaboration will be successful, in whole or in part.  The failure of the Parties to successfully
develop, Active Compounds, Inactive Compounds, Claimed Compounds and/or

 

21

 

Collaboration Products will not constitute a breach of any
representation or warranty or other obligation under this Agreement.  EXCEPT AS OTHERWISE EXPRESSLY SET FORTH IN
THIS AGREEMENT, ARRAY AND ONO MAKE NO REPRESENTATIONS AND EXTEND NO WARRANTIES
OR CONDITIONS OF ANY KIND, EITHER EXPRESS OR IMPLIED, WITH RESPECT TO THE
COLLABORATION PATENTS, COLLABORATION KNOW-HOW, PRE-EXISTING ARRAY KNOW-HOW,
PRE-EXISTING ARRAY PATENTS, PRE-EXISTING ONO KNOW-HOW, PRE-EXISTING ONO
PATENTS, PRE-EXISTING ONO COMPOUNDS, ACTIVE COMPOUNDS, CLAIMED COMPOUNDS,
INACTIVE COMPOUNDS,  HEREUNDER OR
COLLABORATION PRODUCTS INCLUDING, BUT NOT LIMITED TO, WARRANTIES OF
MERCHANTABILITY, FITNESS FOR A PARTICULAR PURPOSE, VALIDITY OF ANY
COLLABORATION PATENT OR KNOW-HOW, PATENTED OR UNPATENTED, OR NONINFRINGEMENT OF
THE INTELLECTUAL PROPERTY RIGHTS OF THIRD PARTIES.

 

ARTICLE 10

INDEMNIFICATION

 

10.1                                                   MUTUAL INDEMINFICATION.  Each
Party (the “Indemnitor, as defined in Section 10.4) shall defend,
indemnify and hold the other Party and its Affiliate, and their
respective directors, officers, employees, and agents (the “Indemnitee”, as defined in Section 10.4) harmless from and against any losses,
costs, claims, damages, liabilities or expense (including reasonable attorneys’
and professional fees and other expenses of litigation) (collectively, “Liabilities”)
arising, directly or indirectly out of or in connection with Third Party
claims, suits, actions, demands or judgments, relating to:

 

(i)                                     any
breach by the Indemnitor of its representations,
warranties, covenants or agreements under this Agreement; or

 

(ii)                                  any
personal injury or proprietary damage occurring at a location owned, leased or
under the control of the Indemnitor
in connection with the transactions contemplated by this Agreement (except to
the extent such Liabilities arose out of or resulted from the gross negligence, recklessness or willful misconduct of the other Party or
its Affiliates, and their respective directors, officers, employees, and
agents).

 

10.2                                                   Indemnification by ONO.  ONO agrees to indemnify, defend and hold Indemnitees of ARRAY harmless from and
against any Liabilities arising, directly or indirectly out of or in connection
with Third Party claims, suits, actions, demands or judgments, relating to:

 

(i)                                     any
Active Compound, Inactive
Compound, Claimed Compound, Derivative Compound, Product or Collaboration Product
developed, manufactured, used, sold or otherwise distributed by or on behalf of
ONO, its Affiliates or Sublicensees or other designees (including, without
limitation, product liability); or

 

(ii)                                  the
use of a Collaboration Target (including a nucleic acid encoding such
Collaboration Target, a Collaboration Target protein or a derivative,
modification or subunit of any of the foregoing) which is involved in the
conduct of the Collaboration and the making or use of modulators of such
Collaboration Target,

 

22

 

except, in each case, to the extent such Liabilities arose out of or
resulted from the gross negligence, recklessness or intentional misconduct of
Array or its Affiliates, directors, officers, employees, and agents.

 

10.3                                                   Indemnification by ARRAY.  ARRAY agrees to indemnify, defend and hold
Indemnitees of ONO harmless from
and against any Liabilities
arising, directly or indirectly out of or in connection with Third Party
claims, suits, actions, demands or judgments, relating to any Active Compound,
Inactive Compound and Claimed Compound developed, manufactured, used, sold or
otherwise distributed by or on behalf of ARRAY, its Affiliates or licensees or other designees (including,
without limitation, product liability), except to the extent such Liabilities
arose out of or resulted from the gross negligence, recklessness or intentional
misconduct of ONO or its Affiliates, directors, officers, employees, and
agents..

 

10.4                                                   Indemnification
Procedure.  A Party that intends to
claim indemnification (the “Indemnitee”) under this Article 10 shall promptly notify the other Party
(the “Indemnitor”) in writing of any claim, complaint, suit, proceeding or
cause of action with respect to which the Indemnitee intends to claim such
indemnification (for purposes of this Section 10.4, each a “Claim”),
and the Indemnitor shall have sole control of the defense and/or settlement
thereof; provided that the Indemnitee shall have the right to participate, at
its own expense, with counsel of its own choosing in the defense and/or
settlement of such Claim.  The
indemnification obligations of the Indemnitor
under this Article 10 shall
not apply in settlement of any Claim if such settlement is effected without the
consent of the Indemnitor.  The failure
to deliver written notice to the Indemnitor within a reasonable time after the
commencement of any such Claim, if prejudicial to its ability to defend such
action, shall relieve such Indemnitor of any liability to the Indemnitee under this
Article 10, but the omission
so to deliver written notice to the Indemnitor shall not relieve the Indemnitor
of any liability to any Indemnitee otherwise than under this Article 10. 
The Indemnitee under this Article 10, and its employees, at the Indemnitor’s request and expense, shall
provide full information and reasonable assistance to Indemnitor and its legal
representatives with respect to such Claims covered by this
indemnification.  It is understood that
only ONO may claim indemnity under this Article 10 (on its own behalf or on behalf of a ONO Indemnitee), and other
ONO Indemnitees may not directly claim indemnity hereunder.  Likewise, it is understood that only ARRAY
may claim indemnity under this Article 10 (on its own behalf or on behalf of an ARRAY Indemnitee), and other
ARRAY Indemnitees may not directly claim indemnity hereunder.

 

ARTICLE 11

TERM AND TERMINATION

 

11.1                                                   Term.  The term of this Agreement shall commence on
the Effective Date, and shall continue in full force and effect on a country-by-country
and Collaboration Product-by-Collaboration Product basis until ONO and its
Sublicensees have no remaining royalty payment obligations in a country, unless
terminated earlier as provided in this Article 11.

 

11.2                                                   Termination
Upon Notice.  During the Collaboration Term, ONO shall have the right to terminate this
Agreement [*] to ARRAY, provided that such notice
may not be given prior to the first anniversary of the Effective Date.  Further, after the Collaboration Term, ONO shall have the right to terminate this
Agreement [*] to ARRAY for scientific or

 

23

 

commercial reasons consistent with the usual practice
followed by ONO in pursuing the development and commercialization of its other pharmaceutical
products of similar commercial value and ONO shall timely
provide ARRAY with such reason for termination.

 

11.3                                                   Termination
for Breach.  Either Party to this
Agreement may terminate the Collaboration and this Agreement in the event the
other Party hereto shall have materially breached or defaulted in the
performance of any of its material obligations hereunder, and such default
shall have continued for ninety (90) days after written notice thereof
was provided to the breaching Party by the non-breaching Party.  Any termination shall become effective at the
end of such ninety (90) day period unless the breaching
Party (or any Third Party on its
behalf) has cured any such breach or default prior to the expiration of the ninety (90) day period; provided, however, in the case of a
failure to pay any amount due hereunder, such default may be the basis of
termination ten (10) business
days following the date that notice of such default was received by the breaching Party unless the breaching Party shall pay
any amount due within such ten (10) business days.

 

11.4                                                   Termination
for Insolvency.  If voluntary or
involuntary proceedings by or against a Party are instituted in bankruptcy
under any insolvency law, or a receiver or custodian is appointed for such
Party, or proceedings are instituted by or against such Party for corporate
reorganization, dissolution, liquidation or winding-up of such Party, which
proceedings, if involuntary, shall not have been dismissed within
sixty (60) days after the date of filing, or if such Party makes an
assignment for the benefit of creditors, or substantially all of the assets of
such Party are seized or attached and not released within sixty (60) days
thereafter, the other Party may immediately terminate the Collaboration and/or
this Agreement, effecttive upon notice of such termination.

 

11.5                                                   Survival
Sections.  Articles [*] and any other provisions, which by their meaning are intended to survive
this Agreement, shall
survive the expiration or termination of this Agreement for any reason.

 

11.6                                                   Effect
of Termination.

 

11.6.1                  Termination
Not Sole Remedy; Accrued Rights and Obligations.  Termination is not the sole remedy under this
Agreement and, whether or not termination is effected, all other remedies will
remain available except as agreed to otherwise herein.  Termination of this Agreement for any reason
shall not release either Party hereto from any liability which, at the time of
such termination, has already accrued to the other Party or which is
attributable to a period prior to such termination nor preclude either Party
from pursuing any rights and remedies it may have hereunder or at law or in
equity with respect to any breach of this Agreement.

 

11.6.2                  Upon
termination of this Agreement (i) by
ONO pursuant to Section 11.2, or (ii) by ARRAY pursuant to 11.3 and
11.4..  If this Agreement terminated (i) by ONO
pursuant to Section 11.2, or (ii) by ARRAY pursuant to 11.3 and 11.4,
all the licenses and rights granted to ONO by ARRAY under Article 4 shall
be terminated and each Party shall promptly return to the other Party all Confidential
Information (including, without limitation, all Know-How) received from such
Party, except one copy of which may be retained for archival purposes. 
Further, ONO shall promptly make payment of all amounts owing to ARRAY, and 

 

24

 

ONO
shall promptly [*] to ARRAY all of ONO’s right,
title and interest in any Collaboration Patent [*]
to ONO under Section 7.1.2.

 

11.6.3                  Upon termination by ONO of this Agreement
pursuant to Section 11.3.  If this Agreement is terminated by ONO pursuant to Section 11.3, all the licenses and
rights granted to ONO by ARRAY under Article 4 shall survive subject to ONO’s obligation to pay milestone and
royalty payments as set forth in
Sections 5.2 and 5.3; [*].  [*].  Further,
Article 7, Sections 2.11, 5.5,
5.6 and 5.7 shall also survive.  ARRAY
shall promptly return to ONO all Confidential Information (including, without
limitation, all Know-How) received from ONO.

 

11.6.4                  Upon termination by ONO of this Agreement
pursuant to Section 11.4.  If
this Agreement is terminated by ONO
pursuant to Section 11.4
due to the rejection of this Agreement by or on behalf of ARRAY under Section 365 of the United States
Bankruptcy Code (the “Code”) or
similar foreign laws, all licenses and rights to licenses granted under or
pursuant to this Agreement, including but not limited to Article 4, by ARRAY to ONO are, and shall otherwise
be deemed to be, if required for purposes of Section 365(n) of the Code,
licenses of rights to “intellectual property” as defined under Section 101(35A)
of the Code or similar foreign laws.  The
Parties agree that ONO, as a licensee of such
rights under this Agreement, shall retain and may fully exercise all of its rights
and elections under the Code or similar foreign laws, and that upon
commencement of a bankruptcy proceeding by or against ARRAY under the Code or similar foreign laws, ONO shall be entitled to a complete duplicate
of, or complete access to (as ONO deems
appropriate), any such intellectual property and all embodiments of such
intellectual property.  Such intellectual
property and all embodiments thereof shall be promptly delivered to ONO (i) upon any such commencement of a
bankruptcy proceeding upon written request therefor by ONO, unless ARRAY elects to continue to perform all of its obligations under this
Agreement or (ii) if not delivered under (i) above, upon the
rejection of this Agreement by or on behalf of ARRAY upon written request therefor by ONO.

 

11.7                                                   Effect of [*].  In
the event ONO [*], for
either Collaboration Target, [*], the following shall apply:

 

11.7.1                  ONO shall promptly assign to ARRAY all of ONO’s
right, title and interest in any jointly owned Collaboration Patent [*].

 

11.7.2                  With respect to [*]Sections 7.3, 2.11, 5.2.3, 7.1.2, 7.1.3 and 7.2.1 shall terminate.

 

11.7.3                  Section 4.1
shall be amended [*].

 

11.7.4                  The amounts payable to ARRAY under Sections 5.2.1 and 5.2.2 upon achievement of
Development Milestones shall be [*] provided
that ONO shall be required to pay Development Milestone only for Collaboration
Products [*] claimed in an unabandoned Collaboration
Patent owned by ARRAY covering the composition of matter, a method of manufacture or the use of such Collaboration
Product. 
For
the avoidance of doubt, ONO shall not be required to pay [*].

 

11.7.5                  Section 5.3 shall be amended [*]:

 

25

 

5.3 
Royalties.  ONO shall pay ARRAY a royalty of [*] on the worldwide
Net Sales by ONO, its Affiliates or Sublicensees of each Collaboration Product [*].  Such royalties
shall be paid on a country-by-country basis from the date of the first
commercial sale of each such Collaboration Product with respect to which
royalty payments are due until the expiration of the last to expire the Collaboration Patent owned by ARRAY in such
country covering the composition of matter, a method of manufacture or the use
of such [*]. 
It is understood and agreed that no royalty shall be due on sales of [*].

 

11.7.6                  It is acknowledged and agreed by the Parties
that each Party shall be relieved from [*] upon [*] of [*] pursuant to
[*] and each Party shall have the right
[*].

 

ARTICLE 12
MISCELLANEOUS

 

12.1                                                   Governing
Laws.  This Agreement shall be
governed by and construed, and enforced in accordance with, the laws of the
state of Colorado, without reference to conflicts of laws principles.

 

12.2                                                   Waiver.  It is agreed that no waiver by either Party
hereto of any breach or default of any of the covenants or agreements herein
set forth shall be deemed a waiver as to any subsequent and/or similar breach
or default.

 

12.3                                                   Assignment.  This Agreement shall not be assignable by
either Party to any Third Party hereto without the written consent of the other
Party hereto.  Notwithstanding the
foregoing, either Party may assign this Agreement, without such consent, to an
entity that acquires all or substantially all of the business or assets of such
Party to which this Agreement pertains, whether by merger, reorganization,
acquisition, sale, or otherwise; provided, however, that within thirty (30)
days of such an assignment, the assignee shall agree in writing to be bound by
the terms and conditions of this Agreement. 
This Agreement shall be binding upon and inure to the benefit of any
permitted assignee, and any such assignee shall agree to perform the
obligations of the assignor.

 

12.4                                                   Independent
Contractors.  The relationship of the
Parties hereto is that of independent contractors.  The Parties hereto are not deemed to be agents,
partners or joint venturers of the others for any purpose as a result of this
Agreement or the transactions contemplated thereby.

 

12.5                                                   Compliance
with Laws.  In exercising their
rights under this license, the Parties shall fully comply in all material
respects with the requirements of any and all applicable laws, regulations, rules and
orders of any governmental body having jurisdiction over the exercise of rights
under this license including, without limitation, those applicable to the
discovery, development, manufacture, distribution, import and export and sale
of Collaboration Products pursuant to this Agreement.

 

12.6                                                   Patent
Marking.  ONO agrees to mark and have
its Affiliates and Sublicensees mark all Collaboration Products or packaging or labels where appropriate sold

 

26

 

pursuant to this Agreement in accordance with the applicable statute or
regulations relating to patent marking in the country or countries of
manufacture and sale thereof.

 

12.7                                                   Notices.  All notices, requests and other
communications hereunder shall be in writing and shall be personally delivered
or by registered or certified mail, return receipt requested, postage prepaid,
in each case to the respective address specified below, or such other address
as may be specified in writing to the other Party hereto and shall be deemed to have been given upon receipt:

 

	
  If to ONO:

  	
   

  	
  Ono Pharmaceutical
  Co., Ltd.

  
	
   

  	
   

  	
  8-2 Kyutaromachi 1-Chome, Chuo-Ku

  
	
   

  	
   

  	
  Osaka 541-8564, JAPAN

  
	
   

  	
   

  	
  Attention: Director,
  International Business

  
	
   

  	
   

  	
  Facsimile: +81 (6) 6263-2958

  
	
   

  	
   

  	
   

  
	
  With a copy to:

  	
   

  	
  Ono Pharma USA, Inc.

  
	
   

  	
   

  	
  2000 Lenox Drive

  
	
   

  	
   

  	
  Lawrenceville, NJ 08648, USA

  
	
   

  	
   

  	
  Attention: President

  
	
   

  	
   

  	
  Facsimile: +1 (609) 219-9229

  
	
   

  	
   

  	
   

  
	
  If to ARRAY:

  	
   

  	
  Array BioPharma Inc.

  
	
   

  	
   

  	
  3200 Walnut Street

  
	
   

  	
   

  	
  Boulder, CO 80301, USA

  
	
   

  	
   

  	
  Attention: Chief Operating Officer

  
	
   

  	
   

  	
  Facsimile: +1 (303)
  381-6697

  
	
   

  	
   

  	
   

  
	
  With a copy to:

  	
   

  	
  Array BioPharma
  Corporation

  
	
   

  	
   

  	
  3200 Walnut Street

  
	
   

  	
   

  	
  Boulder, CO 80301, USA

  
	
   

  	
   

  	
  Attention: General Counsel

  
	
   

  	
   

  	
  Facsimile: +1 (303)
  386-1290

  

 

12.8                                                   Severability. 
Each Party hereby agrees that it does not intend to violate any public policy,
statutory or common laws, rules, regulations, treaty or decision of any
government agency or executive body thereof of any country or community or
association of countries.  Should one or
more provisions of this Agreement be or become invalid, the Parties hereto
shall substitute, by mutual consent, valid provisions for such invalid
provisions which valid provisions in their economic effect are sufficiently
similar to the invalid provisions that it can be reasonably assumed that the
Parties would have entered into this Agreement with such valid provisions.  In case such valid provisions cannot be
agreed upon, the invalidity of one or several provisions of its Agreement shall
not affect the validity of this Agreement as a whole, unless the invalid
provisions are of such essential importance to this Agreement that it is to be
reasonably assumed that the Parties would not have entered into this Agreement
without the invalid provisions.  In the
event a Party seeks to avoid a material provision of this Agreement upon an
assertion that such provision is invalid, illegal or otherwise unenforceable,
the other Party shall have the right to terminate this Agreement upon sixty
(60) days prior written notice to

 

27

 

the asserting Party, unless such assertion is eliminated and cured
within such sixty (60) day period.  Such
a termination shall be deemed a termination by such Party for breach pursuant
to Section 11.3.

 

12.9                                                   Advice
of Counsel.  ARRAY and ONO have each
consulted counsel of their choice regarding this Agreement, and each
acknowledges and agrees that this Agreement shall not be deemed to have been
drafted by one Party or another and will be construed accordingly.

 

12.10                                             Performance
Warranty.  Each Party hereby warrants
and guarantees the performance of any and all rights and obligations of this
Agreement by its Affiliates and Sublicensees.

 

12.11                                             Dispute resolution.  Except
for the dispute to be resolved in accordance with Section 3.5, the
Parties agree that any dispute,
controversy, or difference which may arise between the Parties, out of or in
relation to or in connection with this Agreement shall be attempted in good
faith to amicably be settled by the Parties before having recourse to the
arbitration procedure.  In the event such dispute, controversy, or
difference is not resolved by the Parties, then such unresolved
dispute, controversy, or difference shall be resolved through binding
arbitration in accordance with the Rules of
Conciliation and Arbitration of the International Chamber of Commerce
applying the substantive law specified in Section 12.1.  A Party may initiate an arbitration by written
notice to the other Party of its intention to arbitrate, and such demand notice
shall specify in reasonable detail the nature of the dispute.   Each
Party shall select one (1) arbitrator, and the two (2) arbitrators so
selected shall choose a third arbitrator, and all three (3) shall serve as
neutrals.   If a Party fails to nominate its
arbitrator, or if the Parties’ arbitrators cannot agree on the third
arbitrator, the necessary appointments shall be made in accordance with the Rules of Conciliation and Arbitration
of the International Chamber of Commerce.   Within three (3) months
of the conclusion of an arbitration proceeding, the arbitration decision shall
be rendered in writing and shall specify the basis on which the decision was
made.  The award of the arbitration
tribunal shall be final and judgment upon such an award may be entered in any
competent court or application may be made to any competent court for judicial
acceptance of such an award and order of enforcement.  Unless otherwise mutually
agreed upon by the Parties, the arbitration proceedings shall be conducted in Osaka, Japan, in the event that ARRY
requests arbitration, and in Denver, Colorado, in the event ONO requests arbitration.  The Parties agree that they shall share
equally the cost of the arbitration filing and hearing fees, and the cost of
the arbitrator.  Each Party shall bear
its own attorneys’ fees and associated costs and expenses.

 

12.12                                             Force
Majeure.  Neither Party shall lose
any rights hereunder or be liable to the other Party for damages or losses
(except for payment obligations) on account of failure of performance by the
defaulting Party if the failure is occasioned by war, terrorism, strike, fire, Act of God, earthquake, flood, lockout, embargo,
governmental acts or orders or restrictions, failure of suppliers, or any other
reason where failure to perform is beyond the reasonable control and not caused
by the negligence, intentional conduct or misconduct of the non-performing
Party and such Party has exerted all reasonable efforts to avoid or remedy such
force majeure; provided, however, that in no event shall a Party be required to
settle any labor dispute or disturbance.

 

28

 

12.13                                             Complete
Agreement.  This Agreement with its
Exhibits, constitutes the entire agreement, both written and oral, between the
Parties with respect to the subject matter hereof, and all prior agreements
respecting the subject matter hereof, either written or oral, express or
implied, shall be abrogated, canceled, and are null and void and of no
effect.  No amendment or change hereof or
addition hereto shall be effective or binding on either of the Parties hereto
unless reduced to writing and executed by the respective duly authorized
representatives of ARRAY and ONO.

 

12.14                                             Headings.  The captions to the several Sections hereof
are not a part of this Agreement, but are included merely for convenience of
reference and shall not affect its meaning or interpretation.

 

12.15                                             Language.  This Agreement is in the English language
only, which language shall be controlling in all respects, and all versions
hereof in any other language shall not be binding on the Parties hereto.  All communications and notices to be made or
given pursuant to this Agreement shall be in the English language.

 

12.16                                             Counterparts.  This Agreement may be executed in
counterparts, each of which shall be deemed to be an original and all of which
together shall be deemed to be one and the same agreement.

 

IN
WITNESS WHEREOF, the Parties hereto have caused this Agreement to be duly
executed by their authorized representatives and delivered in duplicate
originals as of the Effective Date.

 

	
  ONO PHARMACEUTICAL CO., LTD.

  	
  ARRAY BIOPHARMA INC.

  	 

	
   

  	
   

  	 

	
   

  	
   

  	 

	
  By:

  	
   

  	
   

  	
  By:

  	
   

  	
   

  	 

	
   

  	
   

  	 

	
  Name:

  	
  Takashi Iwai

  	
  Name:

  	
   David L.
  Snitman, Ph.D.

  	 

	
   

  	
   

  	
   

  	
   

  	 

	
  Title:

  	
  President, Representative
  Director

  	
  Title

  	
  Chief Operating Officer& Vice

  	 

	
   

  	
  and Chief Executive Officer

  	
   

  	
  President, Business Development

  	 

	
   

  	
   

  	
   

  	 

	
  Date:

  	
   

  	
   

  	
  Date:

  	
   

  	
   

  
															

 

29

 

EXHIBIT 1.31

 

RESEARCH PLAN

 

Appendix
to Drug Discovery Agreement between ONO and ARRAY: Research Plan for [ * ]
Projects

 

The following is the research plan on [ * ] mutually agreed by ONO and
ARRAY.  It is derived from analysis of
the targets by ARRAY and after several discussions with ONO.  This Research Plan is intended to be a plan
and guide for the project team.  The
goasl, strategy and resource distribution can and will be changed in response
to ongoing results, competitive information and changing science.  Significant changes to the Research Plan must
be ratified by the Joint Management Committee.

 

 

Topics:

 

 

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

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

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

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

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

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

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

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

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

 

30

 

EXHIBIT 1.33

 

[*]

 

[*]

Source: [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00097-of-00352.parquet"}, [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00097-of-00352.parquet"}]]