Document:

Exhibit 10.6

 

DUTY OF LOYALTY AGREEMENT

 

THIS DUTY OF LOYALTY AGREEMENT (this “Agreement”) is entered into on January 11, 2011, and is effective as of the Effective Date (as defined below), between Herbst Gaming, LLC, a Nevada limited liability company (the “Company”), and Donna Lehmann, an individual (the “Executive”).

 

Recitals

 

A.            The Company and its Affiliates are engaged in a highly competitive business involving the ownership and operation of casinos and slot route operations. Their success depends on their goodwill and sound reputation in the marketplace.

 

B.            The Executive’s employment by Company creates a relationship of confidence and trust between the Executive and the Company.  The purpose of the restrictions contained in this Agreement is to protect the goodwill, sound reputation and other legitimate business interests of the Company and its Affiliates.

 

C.            The Company would not have entered into the Executive Severance Agreement (as defined below) in the absence of such restrictions.

 

1.                                       Definitions.

 

(a)                                  “Affiliate” means the Company and any person, limited liability company or other entity directly or indirectly under the common control of, or controlling, the Company.  For the purposes of this definition, “control” when used with respect to any person, corporation or other entity means the power to direct the management and policies of such person or entity, directly or indirectly, whether through the ownership of voting securities, by contract or otherwise; and the terms “controlling” and “controlled” have meanings correlative to the foregoing.

 

(b)                                 “Confidential Information” means any and all non-public, secret or proprietary information and trade secrets, in whatever form, including, without limitation, information that is written, electronically stored, orally transmitted, or memorized, that is, in the Company’s opinion, of commercial value to the Company and that is created, discovered, developed, or otherwise becomes known to the Company, or in which property rights are held, assigned to, or otherwise acquired by or conveyed to the Company, including, without limitation, any idea, knowledge, know-how, process, system, method, technique, research and development, technology, software, technical information, trade secret, trademark, copyrighted material, reports, records, documentation, data, customer or supplier lists, pricing lists, tax or financial information, and business or marketing plans, strategies, or forecasts.  Confidential Information does not include information that is or becomes generally known within the gaming and slot route industry through no act or omission by the Executive or any other person that owes a duty of confidentiality to the Company; provided, however,  that the compilation, manipulation or other exploitation of generally known information may constitute Confidential Information.

 

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(c)                                  “Effective Date” means the date ascribed to it in the Executive Severance Agreement.

 

(d)                                 “Executive Severance Agreement” means that certain agreement between the Company and the Executive, dated as of January 11, 2011.

 

(e)                                  “Intellectual Property” means all tangible and intangible information, materials and intellectual property, including, without limitation, ideas, concepts, designs, products, methods, computer programs and models (whether in source code or object code), financial models, valuation models, software manuals, compositions, prototypes, reports, inventions, drawings and/or specifications developed, conceived, created or prepared by the Executive in the course of her employment with the Company, which may pertain to the business, products, or processes of the Company, regardless of whether developed, conceived, created or prepared by the Executive (i) at the request or suggestion of the Company or otherwise, (ii) alone or in conjunction with others or by others under the Executive’s supervision, and/or (iii) during regular hours of work or otherwise, and regardless of whether or not patentable or copyrightable, and all related papers, drawings, models, data and documents.

 

(f)                                    “Restricted Area” shall mean any area within a one hundred fifty (150) mile radius of any location in which the Company or any of its Affiliates are directly or indirectly engaged in the development, ownership, operation or management of casinos or slot route operations or are actively pursuing any such activities; provided, however, that the Restricted Area shall exclude the following:

 

(i)                                     the Las Vegas Strip (which is defined as that area bounded by Koval Lane and straight extensions thereof on the East, Charleston Boulevard on the North, I-15 on the West, and Sunset Road on the South), and

 

(ii)                                  Downtown Las Vegas (which is defined as that area bounded by Eastern Avenue and straight extensions thereof on the East, I-515 (U.S. Highway 93/95) on the North, I-15 on the West, and Charleston Boulevard on the South).

 

(g)                                 “Restricted Period” means the period of the Executive’s employment with the Company, plus any period during which the Executive is receiving the Severance Package under Section 4 of the Executive Severance Agreement or, if the Executive’s employment ceases for any reason that does not entitle her to the Severance Package, a period of time equal to the balance of the Term (as defined in the Letter Agreement).

 

2.             The Executive Severance Agreement.  Simultaneous with the execution of this Agreement, and as a condition of the Executive’s willingness to agree to the restrictions described herein, the Company and the Executive are executing an Executive Severance Agreement that provides protections to the Executive.

 

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3.             Confidential Information and Other Company Property.  The Executive shall not, during the course of her employment with the Company or anytime thereafter, without prior written consent of the Company, divulge, publish or otherwise disclose to any other person or entity any Confidential Information regarding the Company, except in the course of carrying out the Executive’s responsibilities on behalf of the Company (e.g., providing information to the Company’s attorneys, accountants, bankers, etc.) or if required to do so pursuant to the order of a court of competent jurisdiction or a summons, subpoena or order of any governmental or administrative agency or legislative body (including any committee thereof).  The Executive agrees that upon termination of her employment for any reason, or at such earlier time as the Company may request, the Executive shall forthwith return to the Company all documents and other property in her possession belonging to the Company or any of its Affiliates.

 

4.             Intellectual Property.  All Intellectual Property which the Executive makes, conceives, reduces to practice or develops during her employment (in whole or in part, either alone or jointly with others) shall be deemed “work made for hire” under all applicable laws, which means that it shall be the sole property of the Company. If for any reason any Intellectual Property is not considered “work made for hire,” the Executive hereby assigns, conveys and transfers to the Company her entire right, title and interest worldwide in and to the Intellectual Property, including all contract and licensing rights and all claims with respect thereto.

 

5.             Non-Interference with Business Relationships.  During the Restricted Period, the Executive will not directly or indirectly, as a director, officer, employee, manager, consultant, independent contractor, advisor or otherwise, individually or in concert with others:

 

(a)                                  make any statements or perform any acts intended to interfere with, reasonably likely to interfere with or having the effect of interfering with (i) any interest of the Company or any of its Affiliates in their relationships and dealings with existing or potential customers or clients, and (ii) any other business interests, prospects or opportunities the Company or any of its subsidiaries may have;

 

(b)                                 make any statements or do any acts intended to cause, reasonably likely to cause or having the effect of causing, any customers or clients of the Company or any of its Affiliates to make use of the services of any business in which the Executive has or expects to acquire any interest, is or expects to become an employee, officer or director, or has received or expects to receive any remuneration, if such statements or acts would result or would likely result in such customers or clients ceasing to do business, or reducing their business, with the Company or any Affiliates;

 

(c)                                  engage in competition with, own any interest in, perform any services for, participate in or be connected with any business or organization which engages in competition with the Company or any of its Affiliates in the Restricted Area; provided, however, that the provisions of this Section 5(c) shall (i) only apply during any period in which the Executive is receiving payments constituting the Severance Package, and (ii) not prohibit the Executive’s ownership of not more than five percent (5%) of the total shares of all classes of stock outstanding of any publicly held company;

 

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(d)                                 solicit any business from, or engage in any business with, any customers or clients of the Company or any Affiliates with whom the Executive had contact during, or of which the Executive had knowledge solely as a result of, her employment with the Company; or

 

(e)                                  request, induce, encourage or advise any customer or client of the Company with whom the Executive had contact during the course of her employment to withdraw, curtail or cancel its business with the Company or any Affiliates.

 

6.             Non-Solicitation. During the Restricted Period, except with the prior written consent of the Board of Directors of the Company, the Executive shall not, directly or indirectly, as a director, officer, employee, manager, consultant, independent contractor, advisor or otherwise, individually or in concert with others, engage in any of the following:

 

(a)                                  engage, employ, solicit for employment, or advise or recommend to any other person that they engage, employ or solicit for employment, or carry on any business with, any employee of the Company or any of its Affiliates;

 

(b)                                 retain or attempt to retain the services of any independent contractor of the Company or any of its Affiliate if doing so would materially diminish the services being provided to the Company and/or an Affiliate; or

 

(c)                                  solicit or encourage any employee of the Company or any of its Affiliates to leave the employ of the Company or an Affiliate, to do any act that is disloyal to the Company or any of its Affiliates, is inconsistent with the interests of the Company or any of its Affiliates or violates any provision of this Agreement or any agreement such employee has with the Company or any Affiliate, or to do any of the foregoing with respect to any independent contractors of the Company or any Affiliate.

 

For purposes of the foregoing, an “employee of the Company or any of its Affiliates” and an “independent contractor of the Company or any of its Affiliate” shall include any person who was an employee or independent contractor of or for the Company or any Affiliate at any time (i) within six (6) months prior to the prohibited conduct, or (ii) during the six (6) month period prior to the cessation of the Executive’s employment.

 

7.             Non-Disparagement.  During the course of her employment and thereafter, the Executive shall not, directly or indirectly, individually or in concert with others, engage in any conduct or make any statement that has, or is likely to have, the effect of undermining or disparaging the Company or any Affiliate, or their goodwill, products or business opportunities, or that has or is likely to have the effect of undermining or disparaging the reputation of any officer, director, agent, representative or employee, past or present, of the Company or any Affiliate.

 

8.                                       Remedies.

 

(a)                                  The Executive acknowledges and agrees that immediate and irreparable harm, for which damages would be an inadequate remedy, would occur in the event any of the provisions of this Agreement were violated.  Accordingly, the Executive

 

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agrees that the Company shall be entitled to an injunction to prevent breach of any such provisions and to enforce specifically the terms and provisions thereof without the necessity of proving actual damages or securing or posting any bond or providing prior notice, in addition to any other remedy to which it may be entitled at law or equity.

 

(b)                                 Nothing in this Agreement is intended to waive or diminish any rights the Company may have at law or in equity at any time to protect and defend its legitimate property interests (including its business relationships with third parties), the foregoing provisions being intended to be in addition to and not in derogation or limitation of any other rights the Company may have at law or equity.

 

(c)                                  Each party hereby irrevocably consents to the exclusive jurisdiction and venue of the state courts of Clark County, Nevada, and the United States district courts with jurisdiction in Nevada with respect to any matter arising out of or relating to this Agreement.

 

9.             Reasonableness of Restrictions.  The Executive represents that her experience, capabilities and circumstances are such that the restrictions contained herein will not prevent him from earning a livelihood.  The Executive further agrees that the limitations set forth in this Agreement are reasonable in duration, geographic area (which for purposes of this Agreement shall mean the Restricted Area) and scope and are properly required for the adequate protection of the Company’s business.

 

10.                                 Miscellaneous.

 

(a)                                  Notices.  Any notice given to either party shall be in writing and shall be deemed to have been given when delivered personally or sent by a nationally recognized overnight carrier, duly addressed to the party concerned at the address indicated below the signature lines of this Agreement or to such address as a party may subsequently give notice.

 

(b)                                 Entire Agreement.  This Agreement contains the entire agreement between the parties and supersedes all prior agreements, understandings, discussions, negotiations and undertakings, whether written or oral, between the parties relating to the subject matter set forth herein.  The parties acknowledge and agree that any prior agreements between the Company or any Affiliate, on the one hand, and the Executive, on the other hand, have been terminated as of the date immediately prior to the Effective Date (or such earlier date as provided in such agreements), and have been superseded by this Agreement, the Executive Severance Agreement, and the Letter Agreement to which both this Agreement and the Executive Severance Agreement are attached.

 

(c)                                  Amendment or Waiver.  This Agreement cannot be changed, modified or amended without the consent in writing of both parties.  No waiver by either party at any time of any breach by the other party of any condition or provision of this

 

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Agreement shall be deemed a waiver of a similar or dissimilar condition or provision at the same or at any prior or subsequent time. Any waiver must be in writing and signed by the Executive or an authorized officer of the Company, as the case may be.

 

(d)                                 Severability.  The provisions of this Agreement shall be construed as a series of separate covenants, one for each city, county and state in the Restricted Area.  The provisions of this Agreement shall be severable, and the invalidity, illegality or unenforceability of any provision of this Agreement shall not affect, impair or render unenforceable this Agreement or any other provision hereof, all of which shall remain in full force and effect.  If any provision of this Agreement is adjudicated by a court of competent jurisdiction to be invalid, illegal or otherwise unenforceable, but such provision may be made valid, legal and enforceable by a limitation or reduction of its scope, the parties agree to abide by such limitation or reduction as may be necessary so that said provision shall be enforceable to the fullest extent permitted by law.

 

(e)                                  Survival.  The respective rights and obligations of the parties shall survive any termination of this Agreement to the extent necessary to the intended preservation of such rights and obligations.

 

(f)                                    Governing Law.  This Agreement shall be governed by and construed under the laws of the State of Nevada, disregarding any conflict of law principles that would otherwise provide for the application of the substantive law of another jurisdiction.  Both parties waive the right to a trial by jury, except as such waiver is prohibited by the laws applicable to the specific action or proceeding.

 

(g)                                 Counterparts.  This Agreement may be executed in counterparts, each of which shall be deemed an original, but both of which together shall constitute one and the same instrument.

 

(h)                                 Acknowledgment.  The Executive acknowledges that she has been given a reasonable period of time to review this Agreement before signing it and has had an opportunity to secure counsel of her own choosing. By executing this Agreement, the Executive certifies that she has fully read and completely understands the terms, nature and effect of this Agreement.  The Executive further acknowledges that she is executing this Agreement freely, knowingly and voluntarily and that the Executive’s execution of this Agreement is not the result of any fraud, duress, mistake, or undue influence whatsoever. In executing this Agreement, the Executive has not relied on any inducements, promises, or representations by the Company other than as stated in this Agreement.

 

[Signatures on following page.]

 

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IN WITNESS WHEREOF, the undersigned have executed this Agreement to be effective as of the Effective Date.

 

	
THE “COMPANY”
  	
THE “EXECUTIVE”
  
	
Herbst Gaming, LLC
  	
 
  
	
 
  	
 
  
	
 
  	
 
  
	
By:
  	
/s/ DAVID D. ROSS
  	
 
  	
/s/ DONNA LEHMANN
  
	
 
  	
David D. Ross
  	
 
  	
Donna Lehmann
  
	
 
  	
 
  	
 
  	
 
  
	
Its:
  	
Chief Executive Officer
  	
 
  	
 
  
	
 
  	
 
  	
 
  
	
3440 West Russell Road
  	
 
  	
 
  
	
Las Vegas, Nevada 89118
  	
 
  	
 
  

 

7Exhibit
10.1

     

    Portions
herein identified by [*****] have been omitted pursuant to a request for
confidential treatment under Rule 24b-2 of the Securities Exchange Act of 1934,
as amended.  A complete copy of this document has been filed
separately with the Securities and Exchange Commission.

     

    Exclusive
Channel Partner Agreement

     

    This
Exclusive Channel Partner Agreement (the “Agreement”) is made and
entered into effective as of January 6, 2011 (the “Effective Date”) by and
between Intrexon
Corporation, a Virginia corporation with offices at 20358 Seneca Meadows
Parkway, Germantown, MD 20876 (“Intrexon”), and ZIOPHARM
Oncology, Inc., a Delaware corporation having its principal place of
business at 1180 Avenue of the Americas, 19th Floor,
New York, NY 10036 (“ZIOPHARM”).  Intrexon
and ZIOPHARM may be referred to herein individually as a “Party”, and collectively as
the “Parties.”

     

    Recitals

     

    Whereas, Intrexon has expertise in
and owns or controls proprietary technology relating to the design and
production of DNA vectors or their in vivo expression;
and

     

    Whereas,
ZIOPHARM now desires to become Intrexon’s exclusive channel
partner  with respect to such technology for the purpose of developing
the Cancer Program (as defined herein), and Intrexon is willing to appoint
ZIOPHARM as a channel partner in such field under the terms and conditions of
this Agreement.

     

    Now
Therefore, in consideration of the foregoing and the covenants and
promises contained herein, the Parties agree as follows:

     

    ARTICLE
1

     

    Definitions

     

    As used
in this Agreement, the following capitalized terms shall have the following
meanings:

     

    1.1             “Affiliate” means, with respect
to a particular Party, any other person or entity that directly or indirectly
controls, is controlled by, or is in common control with such
Party.  As used in this Section 1.1, the term “controls” (with
correlative meanings for the terms “controlled by” and “under common control
with”) means the ownership, directly or indirectly, of more than fifty percent
(50%) of the voting securities or other ownership interest of an entity, or the
possession, directly or indirectly, of the power to direct the management or
policies of an entity, whether through the ownership of voting securities, by
contract, or otherwise.  Notwithstanding the foregoing, except as set
forth in Section 2.3(a), Third Security shall be deemed not to be an Affiliate
of Intrexon, and any other person, corporation, partnership, or other entity
that would be an Affiliate of Intrexon solely because it and Intrexon are under
common control by Randal J. Kirk or by investment funds managed by Third
Security or an affiliate of Third Security shall also be deemed not
to be an Affiliate of Intrexon.
 

    
      
         

      

      
         

        
          

        

      

      
         

      

    

     

    1.2             “Allowable Expenses” means any
of the following expenses incurred by ZIOPHARM or an Affiliate of ZIOPHARM after
the First Commercial Sale in the Territory of a ZIOPHARM Product, in each case
to the extent specifically attributable to such ZIOPHARM Product and
specifically attributable to the Commercialization of such ZIOPHARM
Product:  (a) Cost of Goods Sold, (b) Marketing Expenses, (c)
Distribution Expenses, (d) Post-Launch Product R&D Expenses, and (e)
Additional Commercialization Expenses, in each case as such terms are defined
and calculated in this Article 1 and in Exhibit A.

     

    1.3             “Applicable Laws” has the
meaning set forth in Section 8.2(d)(xiii).

     

    1.4             “Authorizations” has the
meaning set forth in Section 8.2(d)(xiii).

     

    1.5             [*****].

     

    1.6             “Cancer Program” has the
meaning set forth in Section 2.1.

     

    1.7             “CC” has the meaning set forth
in Section 2.2(b).

     

    1.8             “Channel-Related Program IP”
has the meaning set forth in Section 6.1(c).

     

    1.9             “Claims” has the meaning set
forth in Section 9.1.

     

    1.10           “CMCC” has the meaning set
forth in Section 2.2(b).

     

    1.11           “Committees” has the meaning
set forth in Section 2.2(a).

     

    1.12           “Commercialize” or “Commercialization” means any
activities directed to marketing, promoting, distributing, importing for sale,
offering to sell and/or selling ZIOPHARM Products.

     

    1.13           “Confidential Information”
means each Party’s confidential information, inventions, non-public know-how or
non-public data disclosed pursuant to this Agreement or any other
confidentiality agreement between the Parties and shall include, without
limitation, manufacturing, marketing, financial, personnel and other business
information and plans, whether in oral, written, graphic or electronic
form.

     

    1.14           “Control” means, with respect
to a Patent or other intellectual property right, that a Party owns or has a
license to such right and has the ability to grant a license or sublicense as
provided for in this Agreement under such right without violating the terms of
any agreement or other arrangement with any Third Party.

     

    1.15           “CRC” has the meaning set forth
in Section 2.2(b).

     

    1.16           “Diligent Efforts” means, with
respect to a Party’s obligation under this Agreement, the level of efforts and
resources reasonably required to diligently develop, manufacture, and/or
commercialize (as applicable) a ZIOPHARM Product in a sustained manner,
consistent with the efforts and resources a similarly situated company working
in the Field would typically devote to a product of similar market potential,
profit potential, strategic value and/or proprietary protection, based on market
conditions then prevailing.  With respect to a particular task or
obligation, Diligent Efforts requires that the applicable Party promptly assign
responsibility for such task and consistently make and implement decisions and
allocate resources designed to advance progress with respect to such task or
obligation.
 

    
      
         

      

      
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    1.17           “Equity Agreements” has the
meaning set forth in Section 5.1.

     

    1.18           “Excess Product Liability
Costs” has the meaning set forth in Section 9.3.

     

    1.19           “Executive Officer” means the
Chief Executive Officer of the applicable Party, or another senior executive
officer of such Party who has been duly appointed by the Chief Executive Officer
to act as the representative of the Party to resolve, as the case may be, (a) a
Committee dispute, provided that such officer is not a member of the applicable
Committee and occupies a position senior to the positions occupied by the
applicable Party’s members of the applicable Committee, or (b) a dispute
described in Section 11.1.

     

    1.20           “Existing Cancer Programs” has
the meaning set forth in Section 2.1.

     

    1.21           “FDA” has the meaning set forth
in Section 8.2(d)(xiii).

     

    1.22           [*****].

     

    1.23           “Field” means the use of DNA
administered to humans for expression of anti-cancer effectors for the purpose
of treatment or prophylaxis of cancer; provided, however, that the Field does
not include any therapies or other medical interventions that are directed
toward the treatment or prophylaxis of a non-cancer disease or condition (e.g.,
infectious disease) unless the primary reason for such treatment or prophylaxis
is to prevent cancer.  For the avoidance of doubt, the Field excludes
(a) the treatment or prophylaxis of cancer in non-human animals and (b) the
amelioration of symptoms or complications of cancer, including side effects of
other cancer treatments (as opposed to the treatment of the cancer
itself).

     

    1.24           “First Commercial Sale” means,
with respect to a ZIOPHARM Product and country, the first sale to a Third Party
of such ZIOPHARM Product in such country after regulatory approval (and any
pricing or reimbursement approvals, if necessary) has been obtained in such
country.

     

    1.25           “Fully Loaded Cost” means the
direct cost of the applicable good, product or service plus indirect charges and
overheads reasonably allocable to the provision of such good, product or service
in accordance with US GAAP.

     

    1.26           “Information” means
information, results and data of any type whatsoever, in any tangible or
intangible form whatsoever, including without limitation, databases, inventions,
practices, methods, techniques, specifications, formulations, formulae,
knowledge, know-how, skill, experience, test data including pharmacological,
biological, chemical, biochemical, toxicological and clinical test data,
analytical and quality control data, stability data, studies and procedures, and
patent and other legal information or descriptions.

     

    1.27           “Infringement” has the meaning
set forth in Section 6.3(a).
 

    
      
         

      

      
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    1.28           “Intrexon Channel Technology”
means Intrexon’s technology directed towards in vivo expression of effectors,
including without limitation the technology embodied in the Intrexon Materials
and the Intrexon IP.

     

    1.29           “Intrexon Indemnitees” has the
meaning set forth in Section 9.2.

     

    1.30           “Intrexon IP” means the
Intrexon Patents and Intrexon Know-How.

     

    1.31           “Intrexon Know-How” means all
Information (other than Intrexon Patents) that (a) is Controlled by Intrexon as
of the Effective Date or during the Term and (b) is reasonably required or
useful for ZIOPHARM to conduct the Cancer Program.  For the avoidance
of doubt, the Intrexon Know-How shall include any Information (other than
Intrexon Patents) in the Channel-Related Program IP.

     

    1.32           “Intrexon Materials” means the
genetic code and associated gene constructs used alone or in combination and
such other proprietary reagents including but not limited to plasmid vectors,
virus stocks, and cells and cell lines (e.g., natural killer cells and dendritic
cells), in each case that are reasonably required or provided to ZIOPHARM to
conduct the Cancer Program.

     

    1.33           “Intrexon Patents” means all
Patents that (a) are Controlled by Intrexon as of the Effective Date or during
the Term; and (b) are reasonably required or useful for ZIOPHARM to conduct the
Cancer Program.  For the avoidance of doubt, the Intrexon Patents
shall include any Patent in the Channel-Related Program IP.

     

    1.34           “Intrexon Trademarks” means
those trademarks related to the Intrexon Channel Technology that are established
from time to time by Intrexon for use across its channel
partnerships.

     

    1.35           “Inventions” has the meaning
set forth in Section 6.1(b).

     

    1.36           “IPC” has the meaning set forth
in Section 2.2(b).

     

    1.37           “JSC” has the meaning set forth
in Section 2.2(b).

     

    1.38           “Losses” has the meaning set
forth in Section 9.1.

     

    1.39           “Net Sales” means, with respect
to any ZIOPHARM Product, the net sales of such ZIOPHARM Product by ZIOPHARM or
an Affiliate of ZIOPHARM (including without limitation net sales of ZIOPHARM
Product to a non-Affiliate sublicensee but not including net sales by such
non-Affiliate sublicensee), as determined in accordance with US
GAAP.

     

    1.40           “Patents” means (a) all patents
and patent applications (including provisional applications), (b) any
substitutions, divisions, continuations, continuations-in-part, reissues,
renewals, registrations, requests for continued examination, confirmations,
re-examinations, extensions, supplementary protection certificates and the like
of the foregoing, and (c) any foreign or international equivalents of any of the
foregoing.
 

    
      
         

      

      
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    1.41           “Product Profit” means Net
Sales less Allowable Expenses.

     

    1.42           “Product-Specific Program
Patent” means any issued Intrexon Patent where all the claims are
directed to Inventions that relate solely and specifically to ZIOPHARM
Products.  [*****].

     

    1.43           “Proposed Terms” has the
meaning set forth in Section 11.2.

     

    1.44           “Prosecuting Party” has the
meaning set forth in Section 6.2(c).

     

    1.45           [*****].

     

    1.46           [*****].

     

    1.47           “Retained Product” has the
meaning set forth in Section 10.4(a).

     

    1.48           “Reverted Product” has the
meaning set forth in Section 10.4(c).

     

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

     

    1.50           “Sublicensing Revenue” means
any cash consideration (including upfront payments, milestone payments, and
royalties), and the cash equivalent of all other consideration, actually
received by ZIOPHARM or its Affiliate from a Third Party in consideration for a
grant of a sublicense under the Intrexon IP or any rights to develop or
commercialize ZIOPHARM Products, but excluding: (a) any amounts paid as bona
fide reimbursement for research and development costs to the extent incurred
following such grant; (b) bona fide loans or any payments in consideration for a
grant of equity of ZIOPHARM to the extent that such consideration is equal to or
less than fair market value (i.e. any amounts in excess of fair market value
shall be Sublicensing Revenue); or (c) amounts received from sublicensees in
respect of any ZIOPHARM Product sales that are included in Net
Sales.

     

    1.51           “Superior Therapy” means a
cancer therapy in the Field that, based on the data then available, (a)
demonstrably appears to offer superior efficacy, safety or cost, as compared
with both (i) those therapies that are marketed (either by ZIOPHARM or others)
at such time for a given cancer indication and (ii) those therapies that are
being actively developed by ZIOPHARM for such cancer indication; (b)
demonstrably appears to represent a substantial improvement over such existing
therapies; and (c) has intellectual property protection and a regulatory
approval pathway that, in each case, would not present a significant barrier to
commercial development.

     

    1.52           “Support Memorandum” has the
meaning set forth in Section 11.2.

     

    1.53           “Third Party” means any
individual or entity other than the Parties or their respective
Affiliates.

     

    1.54           [*****].

     

    1.55           “Third Security” means Third
Security, LLC.
 

    
      
         

      

      
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    1.56        “Territory” means the entire
world.

     

    1.57        “US GAAP” means generally
accepted accounting principles in the United States.

     

    1.58        “Working Group” has the meaning
set forth in Section 2.3(d).

     

    1.59        “ZIOPHARM Indemnitees” has the
meaning set forth in Section 9.1.

     

    1.60        “ZIOPHARM Product” means any
product in the Field that is created, produced, developed, or identified
directly or indirectly by or on behalf of ZIOPHARM during the term of this
Agreement, whether through use or practice of Intrexon Channel Technology or the
Intrexon Materials or otherwise, including, without limitation, any products
that are the subject of the Existing Cancer Programs.

     

    1.61        “ZIOPHARM Program Patent” has
the meaning set forth in Section 6.2(b).

     

    1.62        “ZIOPHARM Termination IP” means
all Patents or other intellectual property that ZIOPHARM or any of its
Affiliates Controls as of the Effective Date or during the Term that Cover, or
is otherwise necessary or useful for, the development, manufacture or
commercialization of a Reverted Product or necessary or useful for Intrexon to
operate in the Field.

     

    ARTICLE
2

     

    Scope
of Channel Partnership; Management

     

    2.1          General.  The
general purpose of the channel partnership described in this Agreement will be
to use the Intrexon Channel Technology (a) in connection with the following
currently existing Intrexon programs in the Field:  DC-RTS IL-12 Phase
Ib clinical cancer program (IND #13565) and the AdV RTS-IL-12 cancer program
(the “Existing Cancer
Programs”) and (b) generally to research, develop and commercialize
products for use in the Field (collectively, the “Cancer
Program”).  As provided below, the JSC shall establish projects
for the Cancer Program.  Either Party may propose potential projects
in the Field for review and consideration by the JSC.

     

    2.2          Committees.

     

    (a)           Generally.  The
Parties desire to establish several committees (collectively, “Committees”) to oversee the
Cancer Program and to facilitate communications between the Parties with respect
thereto.  Each of such Committees shall have the responsibilities and
authority allocated to it in this Article 2.  Each of the Committees
shall have the obligation to exercise its authority consistent with the
respective purpose for such Committee as stated herein and any such decisions
shall be made in good faith.

     

    (b)           Formation and
Purpose.  Promptly following the Effective Date, the Parties
shall create the Committees listed in the chart below, each of which shall have
the purpose indicated in the chart.
 

    
      
         

      

      
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              Committee

            	 
      	
              Purpose

            
	 
      	 
      	 
      
	
              Joint
      Steering Committee (“JSC”)

            	 
      	
              Establish
      projects for the Cancer Program and establish the priorities for such
      projects.

            
	 
      	 
      	 
      
	
              Chemistry,
      Manufacturing and Controls Committee (“CMCC”)

            	 
      	
              Establish
      project plans and review and approve activities and budgets for chemistry,
      manufacturing, and controls under the Cancer Program.

            
	 
      	 
      	 
      
	
              Clinical/Regulatory
      Committee (“CRC”)

            	 
      	
              Review
      and approve all research and development plans, clinical projects and
      publications, and regulatory filings and correspondence under the Cancer
      Program; review and approve itemized budgets with respect to the
      foregoing.

            
	 
      	 
      	 
      
	
              Commercialization
      Committee (“CC”)

            	 
      	
              Establish
      project plans and review and approve activities and budgets for
      commercialization activities under the Cancer Program.

            
	 
      	 
      	 
      
	
              Intellectual
      Property Committee (“IPC”)

            	
                

            	
              Evaluate
      intellectual property issues in connection with the Cancer Program; review
      and approve itemized budgets with respect to the
  foregoing.

            

    

    

    2.3          General Committee Membership and
Procedure.

     

    (a)           Membership.  For
each Committee, each Party shall designate an equal number of representatives
who are employees of such Party or an Affiliate of such Party (not to exceed
three (3) for each Party) with appropriate expertise to serve as members of such
Committee (and Third Security shall be deemed to be an Affiliate of Intrexon
solely for purposes of this Section 2.3).  Each representative may
serve on more than one Committee as appropriate in view of the individual’s
expertise.  Each Party may replace its Committee representatives at
any time upon written notice to the other Party.  Each Committee shall
have a chairperson; the chairperson of each committee shall serve for a two-year
term and the right to designate which representative to the Committee will act
as chairperson shall alternate between the Parties, with ZIOPHARM selecting the
chairperson first for the JSC, CRC and CC, and Intrexon selecting the
chairperson first for the CMCC and IPC. The chairperson of each Committee shall
be responsible for calling meetings, preparing and circulating an agenda in
advance of each meeting of such Committee, and preparing and issuing minutes of
each meeting within thirty (30) days thereafter.
 

    
      
         

      

      
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    (b)           Meetings.  Each
Committee shall hold meetings at such times as it elects to do so, but in no
event shall such meetings be held less frequently than once every six (6)
months. Meetings of any Committee may be held in person or by means of
telecommunication (telephone, video, or web conferences).  To the
extent that a Committee holds any meetings in person, the Parties will alternate
in designating the location for such in-person meetings, with ZIOPHARM selecting
the first meeting location for each Committee.  A reasonable number of
additional representatives of a Party may attend meetings of a Committee in a
non-voting capacity.  Each Party shall be responsible for all of its
own expenses of participating in any Committee (including without limitation in
any Working Group).

     

    (c)           Meeting
Agendas.  Each Party will disclose to the other proposed agenda
items along with appropriate information at least seven (7) business days in
advance of each meeting of the applicable Committee; provided, that a Party may
provide its agenda items to the other Party within a lesser period of time in
advance of the meeting, or may propose that there not be a specific agenda for a
particular meeting, so long as such other Party consents to such later addition
of such agenda items or the absence of a specific agenda for such Committee
meeting.

     

    (d)           Working
Groups.  From time to time, each Committee may establish and
delegate duties to other committees, sub-committees or directed teams (each, a
“Working Group”) on an
“as-needed” basis to oversee particular projects or activities.  Each
such Working Group shall be constituted and shall operate as the applicable
Committee determines; provided, that each Working Group shall have equal
representation from each Party.  Each Working Group and its activities
shall be subject to the oversight, review and approval of, and shall report to,
the Committee that established such Working Group.  In no event shall
the authority of the Working Group exceed that specified for the relevant
Committee in this Article 2.

     

    (e)           Limitations of Committee
Powers.  Each Committee shall have only such powers as are
specifically delegated to it hereunder or from time to time as agreed to by the
mutual consent of the Parties and shall not be a substitute for the rights of
the Parties.  Without limiting the generality of the foregoing, no
Committee shall have any power to amend this Agreement.  Any amendment
to the terms and conditions of this Agreement shall be implemented pursuant to
Section 12.7 below.

     

    2.4          Committee
Decision-Making.  If a Committee is unable to reach unanimous
consent on a particular matter within thirty (30) days of its initial
consideration of such matter, then either Party may provide written notice of
such dispute to the Executive Officer of the other Party.  The
Executive Officers of each of the Parties will meet at least once in person or
by means of telecommunication (telephone, video, or web conferences) to discuss
the dispute and use their good faith efforts to resolve the dispute within
thirty (30) days after submission of such dispute to the Executive
Officers.  If any such dispute is not resolved by the Executive
Officers within thirty (30) days after submission of such dispute to such
officers, then the Executive Officer of the Party specified in the applicable
subsection below shall have the authority to finally resolve such dispute acting
in good faith.

     

    (a)           Casting Vote at
JSC.  If a dispute at the JSC is not resolved pursuant to
Section 2.4 above, then the Executive Officer of ZIOPHARM shall have the
authority to finally resolve such dispute

    
      
         

      

      
        8

        
          

        

      

      
         

      

    

     

    (b)           Casting Vote at
CMCC.  If a dispute at the CMCC is not resolved pursuant to
Section 2.4 above, then (i) in the case of any disputes relating to the Intrexon
Materials, the manufacture of a ZIOPHARM Product active pharmaceutical
ingredient, or the manufacturing  of other components of ZIOPHARM
Products contracted for or manufactured by Intrexon, the Executive Officer of
Intrexon shall have the authority to finally resolve such dispute; and (ii) in
the case of any other disputes, the Executive Officer of ZIOPHARM shall have the
authority to finally resolve such dispute.

     

    (c)           Casting Vote at
CRC.  If a dispute at the CRC is not resolved pursuant to
Section 2.4 above, then the Executive Officer of ZIOPHARM shall have the
authority to finally resolve such dispute.

     

    (d)           Casting Vote at
CC.  If a dispute at the CC is not resolved pursuant to Section
2.4 above, then the Executive Officer of ZIOPHARM shall have the authority to
finally resolve such dispute.

     

    (e)           Casting Vote at
IPC.  If a dispute at the IPC is not resolved pursuant to
Section 2.4 above, then the Executive Officer of Intrexon shall have the
authority to finally resolve such dispute, [*****].

     

    (f)           Other
Committees.  If any additional Committee is formed, then the
Parties shall, at the time of such formation, agree on which Party shall have
the authority to finally resolve a dispute that is not resolved pursuant to
Section 2.4 above.

     

    (g)           Restrictions.  Neither
Party shall exercise its right to finally resolve a dispute at a committee in
accordance with this Section 2.4 in a manner that (i) excuses such Party from
any of its obligations specifically enumerated under this Agreement; (ii)
expands the obligations of the other Party under this Agreement; (iii) negates
any consent rights or other rights specifically allocated to the other Party
under this Agreement; (iv) purports to resolve any dispute involving the breach
or alleged breach of this Agreement; (v) resolves a matter if the provisions of
this Agreement specify that mutual agreement is required for such matter; or
(vi) would require the other Party to perform any act that is inconsistent with
applicable law.

     

    ARTICLE
3

     

    License
Grants

     

    3.1          Licenses to
ZIOPHARM.

     

    (a)           Subject
to the terms and conditions of this Agreement, Intrexon hereby grants to
ZIOPHARM a license under the Intrexon IP to research, develop, use, import,
make, have made, sell, and offer for sale ZIOPHARM Products in the Field in the
Territory.  Such license shall be exclusive (even as to Intrexon) with
respect to any clinical development, selling, offering for sale or other
Commercialization of ZIOPHARM Products in the Field, and shall be otherwise
non-exclusive.
 

    
      
         

      

      
        9

        
          

        

      

      
         

      

    

     

    (b)           Subject
to the terms and conditions of this Agreement, Intrexon hereby grants to
ZIOPHARM a non-exclusive, royalty-free license to use and display the Intrexon
Trademarks, solely in connection with the Commercialization of ZIOPHARM
Products, in the promotional materials, packaging, and labeling for ZIOPHARM
Products, as provided under and in accordance with Section 4.9.

     

    3.2          Sublicensing.  Except
as provided below, ZIOPHARM shall not sublicense the rights granted under
Section 3.1 to any Third Party, or transfer the Intrexon Materials to any Third
Party, or otherwise grant any Third Party the right to research, develop, use,
or commercialize ZIOPHARM Products, in each case except with Intrexon’s written
consent, which written consent may be withheld in Intrexon’s sole
discretion.  Notwithstanding the foregoing, ZIOPHARM may transfer, to
the extent reasonably necessary, Intrexon Materials to a Third Party contractor
performing post-API fill/finish responsibilities for ZIOPHARM Products, and may
grant any sublicenses necessary to enable such Third Party to perform such
activities.  In addition, ZIOPHARM shall not sublicense the rights
granted under Section 3.1 to an Affiliate, or transfer the Intrexon Materials to
any Affiliate, or otherwise grant any Affiliate the right to research, develop,
use, or commercialize ZIOPHARM Products, in each case except with Intrexon’s
written consent, which written consent shall not be unreasonably withheld or
delayed.  In the event that Intrexon consents to any such grant or
transfer to an Affiliate, ZIOPHARM shall remain responsible for, and be
guarantor of, the performance by any such Affiliate and shall cause such
Affiliate to comply with the provisions of this Agreement in connection with
such performance (as though such Affiliate were ZIOPHARM), including any payment
obligations owed to Intrexon hereunder.  None of the enforcement
rights under the Intrexon Patents that are granted to ZIOPHARM pursuant to
Section 6.3 shall be transferred to, or exercised by, a sublicensee except with
Intrexon’s prior written consent, which may be withheld in Intrexon’s sole
discretion.

     

    3.3          No Non-Permitted
Use.  ZIOPHARM hereby covenants that it shall not, nor shall it
permit any Affiliate or, if applicable, (sub)licensee, to use or practice,
directly or indirectly, any Intrexon IP, Intrexon Channel Technology, or
Intrexon Materials for any purposes other than those expressly permitted by this
Agreement.

     

    3.4          Exclusivity.  Intrexon
and ZIOPHARM mutually agree that, under the channel partnership established by
this Agreement, it is intended that the Parties will be exclusive to each other
in the Field.  To this end, neither Intrexon nor its Affiliates shall
make the Intrexon Channel Technology or Intrexon Materials available to any
Third Party for the purpose of developing or commercializing products in the
Field, and neither Intrexon nor any Affiliate shall pursue (either by itself or
with a Third Party or Affiliate) the research, development or commercialization
of any product for purpose of sale in the Field, outside of the Cancer
Program.  Further, neither ZIOPHARM nor its Affiliates shall pursue
(either by itself or with a Third Party or Affiliate) the research, development
or commercialization of any product for purpose of sale in the Field, outside of
the Cancer Program.

     

    3.5          [*****].
 

    
      
         

      

      
        10

        
          

        

      

      
         

      

    

     

    3.6          No Prohibition on
Intrexon.  Except as explicitly set forth in Sections 3.1 and
3.4, nothing in this Agreement shall prevent Intrexon from practicing or using
the Intrexon Materials, Intrexon Channel Technology, and Intrexon IP for any
purpose, and to grant to Third Parties the right to do the
same.  Without limiting the generality of the foregoing, ZIOPHARM
acknowledges that Intrexon has all rights, in Intrexon’s sole discretion, to
make the Intrexon Materials, Intrexon Channel Technology (including any active
pharmaceutical ingredient used in a ZIOPHARM Product), and Intrexon IP available
to Third Party channel partners for use in fields outside the
Field.

     

    3.7          [*****].

     

    (a)           [*****]

     

    (b)           [*****]

     

    (c)           [*****]

     

    (d)           For
any Third Party license under which ZIOPHARM or its Affiliates obtain a license
under Patents claiming inventions or know-how specific to or used or
incorporated into the development, manufacture, and/or commercialization of
ZIOPHARM Products, ZIOPHARM shall use commercially reasonable efforts to ensure
that ZIOPHARM will have the ability, pursuant to Section 10.4(h), to assign such
agreement to Intrexon or grant a sublicense to Intrexon thereunder (having the
scope set forth in Section 10.4(h)).

     

    (e)           The
licenses granted to ZIOPHARM under Section 3.1 may include sublicenses under
Intrexon IP that has been licensed to Intrexon by one or more Third
Parties.  Any such sublicenses are subject to the terms and conditions
set forth in the applicable upstream license agreement, subject to the cost
allocation set forth in Section 3.7(c), provided that Intrexon shall
either provide unredacted copies of such upstream license agreements to ZIOPHARM
or shall disclose in writing to ZIOPHARM all of such terms and conditions that
are applicable to ZIOPHARM.  ZIOPHARM shall not be responsible for
complying with any provisions of such upstream license agreements unless, and to
the extent that, such provisions have been disclosed to ZIOPHARM as provided in
the preceding sentence.

     

    3.8          Licenses to
Intrexon.  Subject to the terms and conditions of this
Agreement, ZIOPHARM hereby grants to Intrexon a non-exclusive, worldwide,
fully-paid, royalty-free license, under any applicable Patents or other
intellectual property Controlled by ZIOPHARM or its Affiliates, solely to the
extent necessary for Intrexon to conduct those responsibilities assigned to it
under this Agreement, which license shall be sublicensable solely to Intrexon’s
Affiliates or to any of Intrexon’s subcontractors.

     

    3.9          Restrictions Relating to Intrexon
Materials.  ZIOPHARM shall use the Intrexon Materials solely
for purposes of the Cancer Program and not for any other purpose without the
prior written consent of Intrexon.  With respect to the Intrexon
Materials comprising Intrexon’s vector assembly technology, ZIOPHARM shall not,
and shall ensure that ZIOPHARM personnel do not (a) distribute, sell, lend or
otherwise transfer such Intrexon Materials to any Third Party; (b) co-mingle
such Intrexon Materials with any other proprietary biological or chemical
materials without Intrexon’s written consent; or (c) analyze such Intrexon
Materials or in any way attempt to reverse engineer or sequence such Intrexon
Materials.
 

    
      
         

      

      
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    ARTICLE
4

     

    Other
Rights and Obligations

     

    4.1             Development and
Commercialization. Subject to Sections 4.6 and 4.7,  ZIOPHARM
shall be solely responsible for the performance of the Cancer Program and the
development and commercialization of ZIOPHARM Products in the
Field.  ZIOPHARM shall be responsible for all costs incurred in
connection with the Cancer Program except that Intrexon shall be responsible for
the following:  (a) costs of establishing manufacturing capabilities
and facilities in connection with Intrexon’s manufacturing obligation under
Section 4.6 (provided, however, that Intrexon may include an allocable portion
of such costs, through depreciation and amortization, when calculating the Fully
Loaded Cost of manufacturing ZIOPHARM Product, to the extent such allocation,
depreciation, and amortization is permitted by US GAAP, it being recognized that
the majority of non-facilities scale-up costs cannot be capitalized and
amortized under US GAAP); (b) costs of discovery-stage research with respect to
the Intrexon Channel Technology and Intrexon Materials (i.e., platform
improvements) (but, for clarity, excluding research described in Section 4.7);
(c) [*****]; and (d) costs of filing, prosecution and maintenance of Intrexon
Patents.  The costs encompassed within subsection (a) above shall
include the scale-up of Intrexon Materials and API for clinical trials and
commercialization of ZIOPHARM Products undertaken pursuant to Section 4.6, which
shall be at Intrexon’s cost whether it elects to conduct such efforts internally
or through Third Party contractors retained by either Intrexon or ZIOPHARM (with
Intrexon’s consent).

     

    4.2             Transfer of Existing Cancer
Programs.  Promptly following the Effective Date, Intrexon
shall promptly assign to ZIOPHARM, and will provide full copies of, all
regulatory approvals and regulatory filings that relate to the Existing Cancer
Programs.  Intrexon shall also (a) make available to ZIOPHARM all
Intrexon Materials associated with the conduct of the Existing Cancer Programs,
and (b) take such actions and execute such other instruments, assignments and
documents as may be necessary to effect the transfer of rights thereunder to
ZIOPHARM.  No later than sixty (60) days after the Effective Date (or
as soon thereafter as practicable), Intrexon shall provide to ZIOPHARM copies of
the relevant portions of all material reports and data, including clinical and
non-clinical data and reports, obtained or generated by or on behalf of Intrexon
or its Affiliates in connection with the Existing Cancer
Programs.  Thereafter, as additional projects are included in the
Cancer Program, the JSC shall develop a plan and protocol for each such project
relating to the transfer of relevant data and Intrexon Materials.

     

    4.3             Information and
Reporting.  ZIOPHARM will keep Intrexon informed about
ZIOPHARM’s efforts to develop and commercialize ZIOPHARM Products, including
reasonable and accurate summaries of ZIOPHARM’s (and its Affiliates’ and, if
applicable, (sub)licensees’) global development plans (as updated), global
marketing plans (as updated), progress towards meeting the goals and milestones
in such plans and explanations of any material deviations, and significant
developments in the development and/or commercialization of the ZIOPHARM
Products, including initiation or completion of a clinical trial, submission of
a United States or international regulatory filing, receipt of a response to
such United States or international regulatory filing, clinical safety event,
receipt of Regulatory Approval, or commercial launch.  Intrexon will
keep ZIOPHARM informed about Intrexon’s efforts (a) to establish manufacturing
capabilities and facilities for ZIOPHARM Products (and Intrexon Materials
relevant thereto) and otherwise perform its manufacturing responsibilities under
Section 4.6 and (b) to undertake discovery-stage research for the Cancer Program
with respect to the Intrexon Channel Technology and Intrexon
Materials.  Such disclosures by ZIOPHARM and Intrexon will be made in
the course of JSC meetings at least once every six (6) months while ZIOPHARM
Products are being developed or commercialized anywhere in the world, and shall
be reflected in the minutes of such meetings.

     

    
      
         

      

      
        12

        
          

        

      

      
         

      

    

     

    4.4          Regulatory
Matters.  At all times after the Effective Date, ZIOPHARM shall
own and maintain, at its own cost, all regulatory filings and Regulatory
Approvals for ZIOPHARM Products that ZIOPHARM is developing or Commercializing
pursuant to this Agreement.  As such, ZIOPHARM shall be responsible
for reporting all adverse events related to such ZIOPHARM Products to the
appropriate regulatory authorities in the relevant countries, in accordance with
the applicable laws and regulations of such countries.  The decision
to list or not list Patents in any regulatory filing for a ZIOPHARM Product (for
example, as required by 21 C.F.R. § 314.53(b)), or add or delete a Patent from a
regulatory filing shall be determined by Intrexon, after consultation with
ZIOPHARM, except with respect to Product Specific Program Patents, which will be
mutually determined by the Parties.

     

    4.5          Diligence.

     

    (a)           ZIOPHARM
shall use Diligent Efforts to develop and commercialize ZIOPHARM
Products.

     

    (b)           Without
limiting the generality of the foregoing, Intrexon may, from time to time,
notify ZIOPHARM that it believes it has identified a Superior Therapy, and in
such case shall provide to ZIOPHARM its then-available information about such
therapy.  ZIOPHARM shall have the following obligations with respect
to such proposed Superior Therapy:  (i) within sixty (60) days after
such notification, ZIOPHARM shall prepare and deliver to the JSC for review and
approval a development plan detailing how ZIOPHARM will pursue the Superior
Therapy (including a proposed budget); (ii) ZIOPHARM shall revise the
development plan as directed by the JSC; and (iii) following approval of the
development plan by the JSC, ZIOPHARM shall use Diligent Efforts to pursue the
development of the Superior Therapy under the Cancer Program in accordance with
such development plan.  If ZIOPHARM fails to comply with the foregoing
obligations, or if ZIOPHARM exercises its casting vote at the JSC to either (x)
prevent the approval of a development plan for a Superior Therapy; (y) delay
such approval more than sixty (60) days after delivery of the development plan
to the JSC; or (z) approve a development plan that is insufficient in view of
the nature and magnitude of the opportunity presented by the Superior Therapy,
then Intrexon shall have the termination right set forth in Section 10.2(b)
(subject to the limitation set forth therein).  For clarity, any
dispute arising under this 4.5, including any dispute as to whether a proposed
project constitutes a Superior Therapy (as with any other dispute under this
Agreement) shall be subject to dispute resolution in accordance with Article
11.

     

    (c)           The
activities of ZIOPHARM’s Affiliates and any permitted sublicensees shall be
attributed to ZIOPHARM for the purposes of evaluating ZIOPHARM’s fulfillment of
the obligations set forth in this Section 4.5.
 

    
      
         

      

      
        13

        
          

        

      

      
         

      

    

     

    4.6             Manufacturing.  Intrexon
shall use Diligent Efforts to perform any manufacturing activities in connection
with the Cancer Program that relate to the Intrexon Materials, the manufacture
of bulk drug product, the manufacturing of bulk quantities of other components
of ZIOPHARM Products, or any earlier steps in the manufacturing process for
ZIOPHARM Products.  Except as provided in Section 4.1, any
manufacturing undertaken by Intrexon pursuant to the preceding sentence shall be
performed in exchange for cash payments equal to Intrexon’s Fully Loaded Cost in
connection with such manufacturing, on terms to be negotiated by the Parties in
good faith.  In the event that Intrexon does not manufacture Intrexon
Materials, bulk drug product or bulk qualities of other components of ZIOPHARM
Products, then Intrexon shall provide to ZIOPHARM or a contract manufacturer
selected by ZIOPHARM and approved by Intrexon all Information Controlled by
Intrexon that is related to the manufacturing of such Intrexon Materials, bulk
drug product or bulk qualities of other components of ZIOPHARM Products, for use
in the Field and is reasonably necessary to enable ZIOPHARM or such contract
manufacturer (as appropriate) for the sole purpose of manufacturing such
Intrexon Materials, bulk drug product or bulk quantities of other components of
ZIOPHARM Products, in each case as manufactured by Intrexon.  The
costs and expenses incurred by Intrexon in carrying out such transfer shall be
borne by Intrexon.  Any manufacturing Information transferred
hereunder to ZIOPHARM or its contract manufacturer shall not be further
transferred to any Third Party or ZIOPHARM Affiliate without the prior written
consent of Intrexon; provided, however, that Intrexon shall not unreasonably
withhold such consent if necessary to permit ZIOPHARM to switch
manufacturers.

     

    4.7             Support
Services.  From time to time, on an ongoing basis, ZIOPHARM
shall request, or Intrexon may propose, that Intrexon perform certain support
services with respect to the Cancer Program, such services including but not
limited to, pre-clinical or clinical activities relating to transition of the
Cancer Program to ZIOPHARM.  To the extent that the Parties mutually
agree that Intrexon should perform such services, the Parties shall negotiate in
good faith the terms under which services would be performed, it being
understood that Intrexon would be compensated for such services by cash payments
equal to Intrexon’s Fully Loaded Cost in connection with such
services.

     

    4.8             Compliance with
Law.  Each Party shall comply, and shall ensure that its
Affiliates, (sub)licensees and Third Party contractors comply, with all
applicable laws, regulations, and guidelines applicable to the Cancer Program,
including without limitation those relating to the transport, storage, and
handling of Intrexon Materials and ZIOPHARM Products.

     

    4.9             Trademarks.  To the
extent permitted by applicable law and regulations, ZIOPHARM shall, and shall
ensure that the packaging, promotional materials, and labeling for ZIOPHARM
Products shall carry, in a conspicuous location, the applicable Intrexon
Trademark(s), subject to ZIOPHARM’s reasonable approval of the size, position,
and location thereof.  ZIOPHARM shall provide Intrexon with copies of
any materials containing the Intrexon Trademarks prior to using or disseminating
such materials, in order to obtain ZIOPHARM’s approval
thereof.  ZIOPHARM’s use of the Intrexon Trademarks shall be subject
to prior review and approval of the IPC.  ZIOPHARM acknowledges
Intrexon’s sole ownership of the Intrexon Trademarks and agrees not to take any
action inconsistent with such ownership.  ZIOPHARM covenants that it
shall not use any trademark confusingly similar to any Intrexon Trademarks in
connection with any products (including any ZIOPHARM Product).  From
time to time during the Term, Intrexon shall have the right to obtain from
ZIOPHARM samples of ZIOPHARM Product sold by ZIOPHARM or its Affiliates or
sublicensees for the purpose of inspecting the quality of such ZIOPHARM Products
and use of the Intrexon Trademark(s).  In the event that Intrexon
inspects the quality of such ZIOPHARM Products and use of the Intrexon
Trademark, Intrexon shall notify the result of such inspection to ZIOPHARM in
writing thereafter.  ZIOPHARM shall comply with reasonable policies
provided by Intrexon from time-to-time to maintain the goodwill and value of the
Intrexon Trademarks.

    
      
         

      

      
        14

        
          

        

      

      
         

      

    

     

    ARTICLE
5

     

    Compensation

     

    5.1          Equity.  In partial
consideration for ZIOPHARM’s appointment as an exclusive channel partner and the
other rights granted to ZIOPHARM hereunder, ZIOPHARM has agreed to issue to
Intrexon certain shares of ZIOPHARM’s common stock, in accordance with the terms
and conditions of that certain Stock Purchase Agreement and Registration Rights
Agreement, each of even date herewith (the “Equity
Agreements”).  Pursuant to the Equity Agreements, Intrexon has
also agreed to purchase certain shares of the Company’s common stock for cash
consideration, subject to the terms and conditions therein.  Provided
that all closing conditions for the First Tranche Closing (as defined in the
Equity Agreements) that are within the reasonable control of Intrexon have been
satisfied or waived, the issuance of the First Tranche Shares (as defined in the
Equity Agreements) is a condition subsequent to the effectiveness of this
Agreement.

     

    5.2          Profit-Share.

     

    (a)           No
later than thirty (30) days after each calendar quarter in which there is
positive Product Profit arising from the sale of ZIOPHARM Product in the Field
in the Territory, ZIOPHARM shall pay to Intrexon fifty percent (50%) of such
Product Profit, on a ZIOPHARM Product-by-ZIOPHARM Product basis.  In
the event of negative Product Profit for a particular ZIOPHARM Product in any
calendar quarter, neither ZIOPHARM nor Intrexon shall owe any payments hereunder
with respect to such ZIOPHARM Product.  [*****].  Except as
set forth in the preceding sentence, ZIOPHARM shall not be permitted to carry
forward any negative Product Profits to subsequent quarters.

     

    (b)           No
later than thirty (30) days after each calendar quarter in which ZIOPHARM or any
ZIOPHARM Affiliate receives Sublicensing Revenue, ZIOPHARM shall pay to Intrexon
fifty percent (50%) of such Sublicensing Revenue.  As set forth in
Section 3.2, sublicensing shall require Intrexon’s prior written
consent.  Nevertheless, this Section 5.2(b) shall apply to
Sublicensing Revenue received by ZIOPHARM or any ZIOPHARM Affiliate, even if
rights were granted to the applicable sublicensee in violation of this
Agreement.  For purposes of clarity, sales of ZIOPHARM Products by
approved sublicensees shall not constitute Net Sales.

     

    5.3          Method of
Payment.  All payments due to Intrexon under this Agreement
shall be paid in United States dollars by wire transfer to a bank in the United
States designated in writing by Intrexon.  All references to “dollars”
or “$” herein shall refer to United States dollars.
 

    
      
         

      

      
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    5.4          Payment Reports and Records
Retention.  Within thirty (30) days after the end of each
calendar quarter during which Net Sales have been generated or Allowable
Expenses been incurred, ZIOPHARM shall deliver to Intrexon a written report that
shall contain at a minimum for the applicable calendar quarter:

     

    (a)           gross
sales of each ZIOPHARM Product (on a country-by-country basis);

     

    (b)           itemized
calculation of Net Sales, showing all applicable deductions;

     

    (c)           itemized
calculation of Allowable Expenses and Sublicensing Revenue;

     

    (d)           the
amount of the payment (if any) due pursuant to Section 5.2(a) and/or
5.2(b);

     

    (e)           the
amount of taxes, if any, withheld to comply with any applicable law;
and

     

    (f)           the
exchange rates used in any of the foregoing calculations.

     

    For three
(3) years after each sale of ZIOPHARM Product or the incurring of an item
included in Allowable Expenses, ZIOPHARM shall keep (and shall ensure that its
Affiliates and, if applicable, (sub)licensees shall keep) complete and accurate
records of such sales or Allowable Expenses (as the case may be) in sufficient
detail to confirm the accuracy of the payment calculations
hereunder.

     

    5.5          Audits.

     

    (a)           Upon
the written request of Intrexon, ZIOPHARM shall permit an independent certified
public accounting firm of internationally recognized standing selected by
Intrexon, and reasonably acceptable to ZIOPHARM, to have access to and to
review, during normal business hours and upon no less than thirty (30) days
prior written notice, the applicable records of ZIOPHARM and its Affiliates to
verify the accuracy and timeliness of the reports and payments made by ZIOPHARM
under this Agreement.  Such review may cover the records for sales
made in any calendar year ending not more than three (3) years prior to the date
of such request.  The accounting firm shall disclose to both Parties
whether the royalty reports and/or know-how reports conform to the provisions of
this Agreement and/or US GAAP, as applicable, and the specific details
concerning any discrepancies.  Such audit may not be conducted more
than once in any calendar year.

     

    (b)           If
such accounting firm concludes that additional amounts were owed during such
period, ZIOPHARM shall pay additional amounts, with interest from the date
originally due as set forth in Section 5.7, within thirty (30) days of receipt
of the accounting firm’s written report.  If the amount of the
underpayment is greater than five percent (5%) of the total amount actually owed
for the period audited, then ZIOPHARM shall in addition reimburse Intrexon for
all costs related to such audit; otherwise, Intrexon shall pay all costs of the
audit.  In the event of overpayment, any amount of such overpayment
shall be fully creditable against amounts payable for the immediately succeeding
calendar quarter(s); provided, however, that such credit cannot be
applied to reduce the amounts payable by ZIOPHARM to Intrexon for any particular
calendar quarter by more than [*****] of the amount otherwise due to
Intrexon.
 

    
      
         

      

      
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    (c)           Intrexon
shall (i) treat all information that it receives under this Section 5.5 in
accordance with the confidentiality provisions of Article 7 and (ii) cause its
accounting firm to enter into an acceptable confidentiality agreement with
ZIOPHARM obligating such firm to retain all such financial information in
confidence pursuant to such confidentiality agreement, in each case except to
the extent necessary for Intrexon to enforce its rights under this
Agreement.

     

    5.6          Taxes.  The Parties
will cooperate in good faith to obtain the benefit of any relevant tax treaties
to minimize as far as reasonably possible any taxes which may be levied on any
amounts payable hereunder.  ZIOPHARM shall deduct or withhold from any
payments any taxes that it is required by applicable law to deduct or
withhold.  Notwithstanding the foregoing, if Intrexon is entitled
under any applicable tax treaty to a reduction of the rate of, or the
elimination of, applicable withholding tax, it may deliver to ZIOPHARM or the
appropriate governmental authority (with the assistance of ZIOPHARM to the
extent that this is reasonably required and is expressly requested in writing)
the prescribed forms necessary to reduce the applicable rate of withholding or
to relieve ZIOPHARM of its obligation to withhold tax, and ZIOPHARM shall apply
the reduced rate of withholding tax, or dispense with withholding tax, as the
case may be, provided that ZIOPHARM has received evidence of Intrexon’s delivery
of all applicable forms (and, if necessary, its receipt of appropriate
governmental authorization) at least fifteen (15) days prior to the time that
the payment is due.  If, in accordance with the foregoing, ZIOPHARM
withholds any amount, it shall make timely payment to the proper taxing
authority of the withheld amount, and send to Intrexon proof of such payment
within forty-five (45) days following that latter payment.

     

    5.7          Late Payments.  Any
amount owed by ZIOPHARM to Intrexon under this Agreement that is not paid within
the applicable time period set forth herein shall accrue interest at the lower
of (a) two percent (2%) per month, compounded, or (b) the highest rate permitted
under applicable law.

     

    ARTICLE
6

     

    Intellectual
Property

     

    6.1          Ownership.

     

    (a)           Subject
to the license granted under Section 3.1, all rights in the Intrexon IP shall
remain with Intrexon.

     

    (b)           ZIOPHARM
and/or Intrexon may solely or jointly conceive, reduce to practice or develop
discoveries, inventions, processes, techniques, and other technology, whether or
not patentable, in the course of performing the Cancer Program (collectively
“Inventions”).  Each
Party shall promptly provide the other Party with a detailed written description
of any such Inventions that relate to the Field.  Inventorship shall
be determined in accordance with United States patent laws.

    
      
         

      

      
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    (c)           Intrexon
shall solely own all right, title and interest in all Inventions related to
Intrexon Channel Technology, together with all Patent rights and other
intellectual property rights therein (the “Channel-Related Program
IP”).  ZIOPHARM hereby assigns all of its right, title and
interest in and to the Channel-Related Program IP to
Intrexon.  ZIOPHARM agrees to execute such documents and perform such
other acts as Intrexon may reasonably request to obtain, perfect and enforce its
rights to the Channel-Related Program IP and the assignment
thereof.

     

    (d)           Notwithstanding
anything to the contrary in this Agreement, any discovery, invention, process,
technique, or other technology, whether or not patentable, that is conceived,
reduced to practice or developed by ZIOPHARM solely or jointly through the use
of the Intrexon Channel Technology, Intrexon IP, or Intrexon Materials in breach
of the terms and conditions of this Agreement, together with all patent rights
and other intellectual property rights therein, shall be solely owned by
Intrexon and shall be included in the Channel-Related Program IP.

     

    (e)           All
information regarding Channel-Related Program IP shall be Confidential
Information of Intrexon.  ZIOPHARM shall be under appropriate written
agreements with each of its employees or agents working on the Cancer Program,
pursuant to which such person shall grant all rights in the Inventions to
ZIOPHARM (so that ZIOPHARM may convey certain of such rights to Intrexon, as
provided herein).

     

    6.2          Patent
Prosecution.

     

    (a)           Intrexon
shall have the sole right, but not the obligation, to conduct and control the
filing, prosecution and maintenance of the Intrexon Patents.  At the
reasonable request of Intrexon, ZIOPHARM shall cooperate with Intrexon in
connection with such filing, prosecution, and maintenance, at Intrexon’s
expense.  Under no circumstances shall ZIOPHARM (a) file, attempt to
file, or assist anyone else in filing, or attempting to file, any Patent
application, either in the United States or elsewhere, that claims or uses or
purports to claim or use or relies for support upon an Invention owned by
Intrexon or use, attempt to use, or assist anyone else in using or attempting to
use, the Intrexon Know-How, Intrexon Materials, or any Confidential Information
of Intrexon to support the filing of a Patent application, either in the United
States or elsewhere, that contains claims directed to the Intrexon IP, Intrexon
Materials, or the Intrexon Channel Technology.

     

    (b)           ZIOPHARM
shall have the sole right, but not the obligation, to conduct and control the
filing, prosecution and maintenance of any Patents claiming Inventions that are
owned by ZIOPHARM or its Affiliates and not assigned to Intrexon under Section
6.1(c) ( “ZIOPHARM Program
Patents”).  At the reasonable request of ZIOPHARM, Intrexon
shall cooperate with ZIOPHARM in connection with such filing, prosecution, and
maintenance, at ZIOPHARM’s expense.

     

    (c)           The
Prosecuting Party shall be entitled to use patent counsel selected by it and
reasonably acceptable to the non-Prosecuting Party (including in-house patent
counsel as well as outside patent counsel) for the prosecution of the Intrexon
Patents and ZIOPHARM Program Patents, as applicable.  The Prosecuting
Party shall:
 

    
      
         

      

      
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    (i)           regularly
provide the other Party in advance with reasonable information relating to the
Prosecuting Party’s prosecution of Patents hereunder, including by providing
copies of substantive communications, notices and actions submitted to or
received from the relevant patent authorities and copies of drafts of filings
and correspondence that the Prosecuting Party proposes to submit to such patent
authorities (it being understood that, to the extent that any such information
is readily accessible to the public, the Prosecuting Party may, in lieu of
directly providing copies of such information to such other Party, provide such
other Party with sufficient information that will permit such other Party to
access such information itself directly);

     

    (ii)           consider
in good faith and consult with the non-Prosecuting Party regarding its timely
comments with respect to the same; provided, however, that if, within fifteen
(15) days after providing any documents to the non-Prosecuting Party for
comment, the Prosecuting Party does not receive any written communication from
the non-Prosecuting Party indicating that it has or may have comments on such
document, the Prosecuting Party shall be entitled to assume that the
non-Prosecuting Party has no comments thereon;

     

    (iii)           consult
with the non-Prosecuting Party before taking any action that would reasonably be
expected to have a material adverse impact on the scope of claims within the
Intrexon Patents and ZIOPHARM Program Patents, as applicable.

     

    As used
above “Prosecuting
Party” means Intrexon in the case of Intrexon Patents and ZIOPHARM in the
case of ZIOPHARM Program Patents.

     

    6.3          Infringement of Patents by Third
Parties.

     

    (a)           Except
as expressly provided in the remainder of this Section 6.3, Intrexon shall have
the sole right to take appropriate action against any person or entity directly
or indirectly infringing any Intrexon Patent (or asserting that a Intrexon
Patent is invalid or unenforceable) (collectively, “Infringement”), either by
settlement or lawsuit or other appropriate action.

     

    (b)           Notwithstanding
the foregoing, [*****] shall have the [*****] right, but not the obligation, to
take appropriate action to enforce [*****] against any Infringement that
involves a [*****] of allegedly infringing activities in the Field (“[*****]”),
either by settlement or lawsuit or other appropriate action.  If
[*****] fails to take the appropriate steps to enforce [*****] against any
[*****] within [*****] days of the date one Party has provided notice to the
other Party pursuant to Section 6.3(g) of such [*****], then [*****] shall have
the right (but not the obligation), at its own expense, to enforce [*****]
against such [*****], either by settlement or lawsuit or other appropriate
action.

     

    (c)           With
respect to any [*****] that cannot reasonably be abated through the enforcement
of [*****] pursuant to Section 6.3(b) but can reasonable be abated through the
enforcement of [*****] (other than the [*****]),[*****] shall be obligated to
choose one of the following courses of action: [*****].  The
determination of which [*****] to assert shall be made by [*****] in its sole
discretion; provided, however, that [*****] shall consult in good faith with
[*****] on such determination.  For the avoidance of doubt, [*****]
has no obligations under this Agreement to enforce any [*****] against, or
otherwise abate, any Infringement that is not a [*****].
 

    
      
         

      

      
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    (d)           In
the event a Party pursues an action under this Section 6.3, the other Party
shall reasonably cooperate with the enforcing Party with respect to the
investigation and prosecution of any alleged, threatened, or actual
Infringement, at the enforcing Party’s expense (except with respect to an action
under Section 6.3(c), where all costs and expenses will be shared equally in
accordance with terms thereof).

     

    (e)           [*****]
shall not settle or otherwise compromise any action under this Section 6.3 in a
way that diminishes the rights or interests of [*****] or adversely affects any
[*****] without [*****]’s prior written consent, which consent shall not be
unreasonably withheld.  [*****] shall not settle or otherwise
compromise any action under this Section 6.3 in a way that diminishes the rights
or interests of [*****] in the [*****] or adversely affects any [*****] with
respect to the [*****] without [*****]’s prior written consent, which consent
shall not be unreasonably withheld.

     

    (f)           Except
as otherwise agreed to by the Parties in writing, any settlements, damages or
other monetary awards recovered pursuant to a suit, proceeding, or action
brought pursuant to Section 6.3 will be allocated first to the costs and
expenses of the Party controlling such action, and second, to the costs and
expenses (if any) of the other Party (to the extent not otherwise reimbursed),
and any remaining amounts (the “[*****]”) will be shared by the
Parties as follows:  [*****].  In any action initiated by
[*****] pursuant to Section 6.3(c), the Parties shall share the [*****] equally,
and such [*****] shall not be deemed to constitute [*****].

     

    (g)           ZIOPHARM
shall promptly notify Intrexon in writing of any alleged, threatened, or actual
Infringement of which it becomes aware, and Intrexon shall promptly notify
ZIOPHARM in writing of any alleged, threatened, or actual [*****] of which it
becomes aware.

     

    ARTICLE
7

     

    Confidentiality

     

    7.1          Confidentiality.  Except
to the extent expressly authorized by this Agreement or otherwise agreed in
writing by the Parties, each Party agrees that it shall keep confidential and
shall not publish or otherwise disclose and shall not use for any purpose other
than as provided for in this Agreement any Confidential Information disclosed to
it by the other Party pursuant to this Agreement, except to the extent that the
receiving Party can demonstrate by competent evidence that specific Confidential
Information:

     

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

     

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

    
      
         

      

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

     

    (e)           was
independently discovered or developed by the receiving Party without the use of
Confidential Information belonging to the disclosing Party, as documented by the
receiving Party’s written records.

     

    The
foregoing non-use and non-disclosure obligation shall continue (i) indefinitely,
for all Confidential Information that qualifies as a trade secret under
applicable law; or (ii) for the Term of this Agreement and for [*****] years
thereafter, in all other cases.

     

    7.2          Authorized
Disclosure.  Notwithstanding the limitations in this Article 7,
either Party may disclose the Confidential Information belonging to the other
Party to the extent such disclosure is reasonably necessary in the following
instances:

     

    (a)           complying
with applicable laws or regulations or valid court orders, provided that the Party
making such disclosure provides the other Party with reasonable prior written
notice of such disclosure and makes a reasonable effort to obtain, or to assist
the other Party in obtaining, a protective order preventing or limiting the
disclosure and/or requiring that the terms and conditions of this Agreement be
used only for the purposes for which the law or regulation required, or for
which the order was issued;

     

    (b)           to
regulatory authorities in order to seek or obtain approval to conduct clinical
trials, or to gain regulatory approval, of ZIOPHARM Products or any products
being developed by Intrexon or its other licensees and/or channel partners,
provided that the Party making such disclosure (i) provides the other Party with
reasonable opportunity to review any such disclosure in advance and to suggest
redactions or other means of limiting the disclosure of such other Party’s
Confidential Information and (ii) does not unreasonably reject any such
suggestions;

     

    (c)           disclosure
to investors and potential investors, acquirers, or merger candidates who agree
to maintain the confidentiality of such information, provided that such disclosure
is used solely for the purpose of evaluating such investment, acquisition, or
merger (as the case may be);

     

    (d)           disclosure
on a need-to-know basis to Affiliates, licensees, sublicensees, employees,
consultants or agents (such as CROs and clinical investigators) who agree to be
bound by obligations of confidentiality and non-use at least equivalent in scope
to those set forth in this Article 7; and

     

    (e)           disclosure
of the terms of this Agreement by Intrexon to collaborators and other channel
partners who agree to be bound by obligations of confidentiality and non-use at
least equivalent in scope to those set forth in this Article
7.
 

    
      
         

      

      
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    7.3          Publicity.  The
Parties agree that the public announcement of the execution of this Agreement
shall be substantially in the form of the press release attached as Exhibit
B.

     

    7.4          Terms of the
Agreement.  Each Party shall treat the terms of this Agreement
as the Confidential Information of other Party, subject to the exceptions set
forth in Section 7.2.  Notwithstanding the foregoing, each Party
acknowledges that the other Party may be obligated to file a copy of this
Agreement with the SEC, either as of the Effective Date or at some point during
the Term.  Each Party shall be entitled to make such a required
filing, provided that it requests confidential treatment of certain commercial
terms and sensitive technical terms hereof to the extent such confidential
treatment is reasonably available to it.  In the event of any such
filing, the filing Party shall provide the other Party with a copy of the
Agreement marked to show provisions for which the filing Party intends to seek
confidential treatment and shall reasonably consider and incorporate the other
Party’s comments thereon to the extent consistent with the legal requirements
governing redaction of information from material agreements that must be
publicly filed.  The other Party shall promptly provide any such
comments.

     

    7.5          Proprietary
Information Audits.

     

    (a)           For
the purpose of confirming compliance with the Field-limited licenses granted in
Article 3 and the confidentiality obligations under Article 7, ZIOPHARM
acknowledges that Intrexon’s authorized representative(s), during regular
business hours may (i) examine and inspect ZIOPHARM’s facilities and (ii)
inspect all data and work products relating to this Agreement.  Any
examination or inspection hereunder shall require five (5) business days written
notice from Intrexon to ZIOPHARM.  ZIOPHARM will make itself and the
pertinent employees and/or agents available, on a reasonable basis, to Intrexon
for the aforementioned compliance review.

     

    (b)           In
view of the Intrexon Confidential Information, Intrexon Know-How, and Intrexon
Materials transferred to ZIOPHARM hereunder, Intrexon from time-to-time, but no
more than quarterly, may request that ZIOPHARM confirm the status of the
Intrexon Materials at Company (i.e. how much used, how much shipped, to whom and
any unused amounts destroyed (by whom, when) as well as any amounts returned to
Intrexon or destroyed).  Within ten (10) business days of ZIOPHARM’s
receipt of any such written request, ZIOPHARM shall provide the written report
to Intrexon.

     

    7.6          Intrexon
Commitment.  Intrexon shall use reasonable efforts to obtain an
agreement with its other licensees and channel partners to enable ZIOPHARM to
disclose confidential information of such licensees and channel partners to
regulatory authorities in order to seek or obtain approval to conduct clinical
trials, or to gain regulatory approval of, ZIOPHARM Products, in a manner
consistent with the provisions of Section 7.2(b).

     

    ARTICLE
8

     

    Representations
And Warranties

     

    8.1          Representations and Warranties of
ZIOPHARM.  ZIOPHARM hereby represents and warrants to Intrexon
that, as of the Effective Date:
 

    
      
         

      

      
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    (a)           Corporate
Power.  ZIOPHARM is duly organized and validly existing under
the laws of Delaware and has corporate full power and authority to enter into
this Agreement and to carry out the provisions hereof.

     

    (b)           Due
Authorization.  ZIOPHARM is duly authorized to execute and
deliver this Agreement and to perform its obligations hereunder, and the person
executing this Agreement on ZIOPHARM’s behalf has been duly authorized to do so
by all requisite corporate action.

     

    (c)           Binding
Agreement.  This Agreement is a legal and valid obligation
binding upon ZIOPHARM and enforceable in accordance with its terms, except as
such enforcement may be limited by applicable bankruptcy, insolvency,
reorganization, arrangement, moratorium or other similar laws affecting
creditors’ rights, and subject to general equity principles and to limitations
on availability of equitable relief, including specific
performance.  The execution, delivery and performance of this
Agreement by ZIOPHARM does not conflict with any agreement, instrument or
understanding, oral or written, to which it is a party or by which it may be
bound.  ZIOPHARM is aware of no action, suit or inquiry or
investigation instituted by any governmental agency which questions or threatens
the validity of this Agreement.

     

    8.2          Representations and Warranties of
Intrexon.  Intrexon hereby represents and warrants to ZIOPHARM
that, as of the Effective Date:

     

    (a)           Corporate
Power.  Intrexon is duly organized and validly existing under
the laws of Virginia and has full corporate power and authority to enter into
this Agreement and to carry out the provisions hereof.

     

    (b)           Due
Authorization.  Intrexon is duly authorized to execute and
deliver this Agreement and to perform its obligations hereunder, and the person
executing this Agreement on Intrexon’s behalf has been duly authorized to do so
by all requisite corporate action.

     

    (c)           Binding
Agreement.  This Agreement is a legal and valid obligation
binding upon Intrexon and enforceable in accordance with its terms, except as
such enforcement may be limited by applicable bankruptcy, insolvency,
reorganization, arrangement, moratorium or other similar laws affecting
creditors’ rights, and subject to general equity principles and to limitations
on availability of equitable relief, including specific
performance.  The execution, delivery and performance of this
Agreement by Intrexon does not conflict with any agreement, instrument or
understanding, oral or written, to which it is a party or by which it may be
bound.  Intrexon is aware of no action, suit or inquiry or
investigation instituted by any governmental agency which questions or threatens
the validity of this Agreement.

     

    (d)           Additional Intellectual Property
Representations.

     

    (i)           Intrexon
possesses sufficient rights to enable Intrexon to grant all rights and licenses
it purports to grant to ZIOPHARM with respect to the Intrexon Patents under this
Agreement;
 

    
      
         

      

      
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    (ii)           The
Intrexon Patents existing as of the Effective Date constitute all of the Patents
Controlled by Intrexon as of such date that are necessary for the development,
manufacture or Commercialization of ZIOPHARM Products;

     

    (iii)          Intrexon
has not granted, and during the Term Intrexon will not grant, any right or
license, to any Third Party under the Intrexon IP that conflicts with the rights
or licenses granted or to be granted to ZIOPHARM hereunder;

     

    (iv)          There
is no pending litigation, and Intrexon has not received any written notice of
any claims or litigation, seeking to invalidate or otherwise challenge the
Intrexon Patents or Intrexon’s rights therein;

     

    (v)           To
Intrexon’s knowledge, [*****], the use of the Intrexon Materials in connection
with the Existing Cancer Programs as of the Effective Date and the conduct of
the Existing Cancer Programs as contemplated as of the Effective Date, does not
(A) infringe any claims of any Patents of any Third Party, or (b) misappropriate
any Information of any Third Party;

     

    (vi)          None
of the Intrexon Patents is subject to any pending re-examination, opposition,
interference or litigation proceedings;

     

    (vii)         All
of the Intrexon Patents have been filed and prosecuted in accordance with all
applicable laws and have been maintained, with all applicable fees with respect
thereto (to the extent such fees have come due) having been paid;

     

    (viii)        Intrexon
has entered into agreements with each of its current and former officers,
employees and consultants involved in research and development work, including
development of the Intrexon’s products and technology providing Intrexon, to the
extent permitted by law, with title and ownership to patents, patent
applications, trade secrets and inventions conceived, developed, reduced to
practice by such person, solely or jointly with other of such persons, during
the period of employment by Intrexon (except where the failure to have entered
into such an agreement would not have a material adverse effect on the rights
granted to ZIOPHARM herein), and Intrexon is not aware that any of its employees
or consultants is in material violation thereof;

     

    (ix)           To
Intrexon’s knowledge, there is no infringement, misappropriation or violation by
third parties of any Intrexon Channel Technology in the Field;

     

    (x)           There
is no pending or, to Intrexon’s knowledge, threatened action, suit, proceeding
or claim by others against Intrexon that Intrexon infringes, misappropriates or
otherwise violates any intellectual property or other proprietary rights of
others in connection with the use of the Intrexon Channel Technology, and
Intrexon has not received any written notice of such claim;

     

    (xi)           To
Intrexon’s knowledge, no employee of Intrexon is the subject of any claim or
proceeding involving a violation of any term of any employment contract, patent
disclosure agreement, invention assignment agreement, non-competition agreement,
non-solicitation agreement, non-disclosure agreement or any restrictive covenant
to or with a former employer (A) where the basis of such violation relates to
such employee’s employment with Intrexon or actions undertaken by the employee
while employed with Intrexon and (B) where such violation is relevant to the use
of the Intrexon Channel Technology in the Field;
 

    
      
         

      

      
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    (xii)          None
of the Intrexon Patents owned by Intrexon or its Affiliates, and, to Intrexon’s
knowledge, the Intrexon Patents licensed to Intrexon or its Affiliates, have
been adjudged invalid or unenforceable by a court of competent jurisdiction or
applicable government agency, in whole or in part, and there is no pending or,
to Intrexon’s knowledge, threatened action, suit, proceeding or claim by others
challenging the validity or scope of any such Intrexon Patents; and

     

    (xiii)         Except
as otherwise disclosed in writing to ZIOPHARM, Intrexon:  (A) is in
material compliance with all statutes, rules or regulations applicable to the
ownership, testing, development, manufacture, packaging, processing, use,
distribution, marketing, labeling, promotion, sale, offer for sale, storage,
import, export or disposal of any product that is under development,
manufactured or distributed by Intrexon in the Field (“Applicable Laws”); (B) has not
received any FDA Form 483, notice of adverse finding, warning letter, untitled
letter or other correspondence or notice from the United States Food and Drug
Administration (the “FDA”) or any other federal,
state, local or foreign governmental or regulatory authority alleging or
asserting material noncompliance with any Applicable Laws or any licenses,
certificates, approvals, clearances, authorizations, permits and supplements or
amendments thereto required by any such Applicable Laws (“Authorizations”), which would
not, individually or in the aggregate, result in a material adverse effect; (C)
possesses all material Authorizations necessary for the operation of its
business as described in the Field and such Authorizations are valid and in full
force and effect and Intrexon is not in material violation of any term of any
such Authorizations; and (D) since January 1, 2008, (1) has not received notice
of any claim, action, suit, proceeding, hearing, enforcement, investigation,
arbitration or other action from the FDA or any other federal, state, local or
foreign governmental or regulatory authority or third party alleging that any
product operation or activity is in material violation of any Applicable Laws or
Authorizations and has no knowledge that the FDA or any other federal, state,
local or foreign governmental or regulatory authority or third party is
considering any such claim, litigation, arbitration, action, suit investigation
or proceeding; (2) has not received notice that the FDA or any other federal,
state, local or foreign governmental or regulatory authority has taken, is
taking or intends to take action to limit, suspend, modify or revoke any
material Authorizations and has no knowledge that the FDA or any other federal,
state, local or foreign governmental or regulatory authority is considering such
action; (3) has filed, obtained, maintained or submitted all material reports,
documents, forms, notices, applications, records, claims, submissions and
supplements or amendments as required by any Applicable Laws or Authorizations
and that all such reports, documents, forms, notices, applications, records,
claims, submissions and supplements or amendments were materially complete and
correct on the date filed (or were corrected or supplemented by a subsequent
submission); and (4) has not, either voluntarily or involuntarily, initiated,
conducted, or issued or caused to be initiated, conducted or issued, any recall,
market withdrawal or replacement, safety alert, post sale warning, “dear doctor”
letter, or other notice or action relating to the alleged lack of safety or
efficacy of any product or any alleged product defect or violation and, to
Intrexon’s knowledge, no third party has initiated, conducted or intends to
initiate any such notice or action.  Except to the extent disclosed in
writing to ZIOPHARM, since January 1, 2008, Intrexon has not received any
notices or correspondence from the FDA or any other federal, state, local or
foreign governmental or regulatory authority requiring the termination,
suspension or material modification of any studies, tests or preclinical or
clinical trials conducted by or on behalf of Intrexon.
 

    
      
         

      

      
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    except,
in each of (ix) through (xiii), for any instances which would not, individually
or in the aggregate, result in a material adverse effect on the rights granted
to ZIOPHARM hereunder or Intrexon’s ability to perform its obligations
hereunder.

     

    8.3          Warranty
Disclaimer.  EXCEPT FOR THE EXPRESS WARRANTIES PROVIDED IN THIS
ARTICLE 8 OR IN THE EQUITY AGREEMENTS, EACH PARTY HEREBY DISCLAIMS ANY AND ALL
OTHER WARRANTIES, EITHER EXPRESS OR IMPLIED, INCLUDING WITHOUT LIMITATION ANY
WARRANTIES OF TITLE, MERCHANTABILITY, FITNESS FOR A PARTICULAR PURPOSE, OR
NONINFRINGEMENT OF THE INTELLECTUAL PROPERTY RIGHTS OF THIRD
PARTIES.

     

    ARTICLE
9

     

    Indemnification

     

    9.1          Indemnification by
Intrexon.  Intrexon agrees to indemnify, hold harmless, and
defend ZIOPHARM and its Affiliates and their respective directors, officers,
employees, and agents (collectively, the “ZIOPHARM Indemnitees”) from
and against any and all liabilities, damages, costs, expenses, or losses
(including reasonable legal expenses and attorneys’ fees) (collectively, “Losses”) resulting from any
claims, suits, actions, demands, or other proceedings brought by a Third Party
(collectively, “Claims”)
to the extent arising from (a) the gross negligence or willful misconduct of
Intrexon or any of its Affiliates, or their respective employees or agents, (b)
the use, handling, storage or transport of Intrexon Materials by or on behalf of
Intrexon or its Affiliates, licensees (other than ZIOPHARM) or sublicensees; or
(c) breach by Intrexon of any representation, warranty or covenant in this
Agreement.  Notwithstanding the foregoing, Intrexon shall not have any
obligation to indemnify the ZIOPHARM Indemnitees to the extent that a Claim
arises from (i) the gross negligence or willful misconduct of ZIOPHARM or any of
its Affiliates, licensees, or sublicensees, or their respective employees or
agents; or (ii) a breach by ZIOPHARM of a representation, warranty, or covenant
of this Agreement.

     

    9.2          Indemnification by
ZIOPHARM.  ZIOPHARM agrees to indemnify, hold harmless, and
defend Intrexon, its Affiliates and Third Security, and their respective
directors, officers, employees, and agents (and any Third Parties which have
licensed to Intrexon intellectual property rights within Intrexon IP on or prior
to the Effective Date, to the extent required by the relevant upstream license
agreement) (collectively, the “Intrexon Indemnitees”) from
and against any Losses resulting from Claims, to the extent arising from any of
the following:  (a) the gross negligence or willful misconduct of
ZIOPHARM or any of its Affiliates or their respective employees or agents; (b)
the use, handling, storage, or transport of Intrexon Materials by or on behalf
of ZIOPHARM or its Affiliates, licensees, or sublicensees; (c) breach by
ZIOPHARM or any representation, warranty or covenant in this Agreement; or (d)
the design, development, manufacture, regulatory approval, handling, storage,
transport, distribution, sale or other disposition of any ZIOPHARM Product by or
on behalf of ZIOPHARM or its Affiliates, licensees, or
sublicensees.  Notwithstanding the foregoing, ZIOPHARM shall not have
any obligation to indemnify the Intrexon Indemnitees to the extent that a Claim
arises from (i) the gross negligence or willful misconduct of Intrexon or any of
its Affiliates, or their respective employees or agents; or (ii) a breach by
Intrexon of a representation, warranty, or covenant of this
Agreement.

     

    
      
         

      

      
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    9.3          Product Liability
Claims.  Notwithstanding the provisions of Section 9.2, any
Losses arising out of any Third Party claim, suit, action, proceeding, liability
or obligation involving any actual or alleged death or bodily injury arising out
of or resulting from the development, manufacture or commercialization of any
ZIOPHARM Products for use or sale in the Field, to the extent that such Losses
exceed the amount (if any) covered by the applicable Party’s product liability
insurance (“Excess Product
Liability Costs”), shall be paid by [*****], except to the extent such
Losses arise out of any Third-Party Claim based on the gross negligence or
willful misconduct of a Party, its Affiliates, its or its Affiliates’
Sublicensees, or any of the respective officers, directors, employees and agents
of each of the foregoing entities, in the performance of obligations or exercise
of rights under this Agreement.

     

    9.4          Control of
Defense.  As a condition precedent to any indemnification
obligations hereunder, any entity entitled to indemnification under this Article
9 shall give written notice to the indemnifying Party of any Claims that may be
subject to indemnification, promptly after learning of such Claim.  If
such Claim falls within the scope of the indemnification obligations of this
Article 9, then the indemnifying Party shall assume the defense of such Claim
with counsel reasonably satisfactory to the indemnified Party.  The
indemnified Party shall cooperate with the indemnifying Party in such
defense.  The indemnified Party may, at its option and expense, be
represented by counsel of its choice in any action or proceeding with respect to
such Claim.  The indemnifying Party shall not be liable for any
litigation costs or expenses incurred by the indemnified Party without the
indemnifying Party’s written consent, such consent not to be unreasonably
withheld.  The indemnifying Party shall not settle any such Claim if
such settlement (a) does not fully and unconditionally release the indemnified
Party from all liability relating thereto or (b) adversely impacts the exercise
of the rights granted to the indemnified Party under this Agreement, unless the
indemnified Party otherwise agrees in writing.

     

    9.5          Insurance.  During
the term of this Agreement, ZIOPHARM shall maintain in effect and good standing
a product liability insurance policy issued by a reputable insurance company in
amounts considered standard for the industry.  At Intrexon’s
reasonable request, ZIOPHARM shall provide Intrexon with all details regarding
such policy, including without limitation copies of the applicable liability
insurance contracts.  ZIOPHARM shall use reasonable efforts
to  include Intrexon as an additional insured on any such
policy.

     

    ARTICLE
10

     

    Term;
Termination

     

    10.1        Term.  The term of
this Agreement shall commence upon the Effective Date and shall continue until
terminated pursuant to Section 10.2 or 10.3.

    
      
         

      

      
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    10.2        Termination
for Material Breach; Termination Under Section 4.5(b)

     

    (a)           Either
Party shall have the right to terminate this Agreement upon written notice to
the other Party if the other Party commits any material breach of this Agreement
that such breaching Party fails to cure within sixty (60) days following written
notice from the nonbreaching Party specifying such breach.

     

    (b)           Intrexon
shall have the right to terminate this Agreement under the circumstances set
forth in Section 4.5(b) upon written notice to ZIOPHARM, such termination to
become effective sixty (60) days following such written notice unless ZIOPHARM
remedies the circumstances giving rise to such termination within such sixty
(60) day period.

     

    (c)          
Intrexon shall have the right to terminate this Agreement under the
circumstances set forth in Section 12.8 upon written notice to ZIOPHARM, such
termination to become effective immediately upon such written
notice.

     

    (d)           Notwithstanding
the foregoing, during the twenty-four (24) month period commencing on the
Effective Date, neither Party shall have the right to terminate this Agreement
under Section 10.2(a) based on the failure of the other Party to use Diligent
Efforts or to comply with any other diligence obligations hereunder (including
Section 4.5), nor shall Intrexon have the right to terminate this Agreement
under Section 4.5(b).

     

    10.3        Termination by
ZIOPHARM.  ZIOPHARM shall have the right to voluntarily
terminate this Agreement in its entirety upon ninety (90) days written notice to
Intrexon at any time, provided that such notice may not be given during the
twenty four (24) month period commencing on the Effective Date.

     

    10.4        Effect of
Termination.  In the event of termination of this Agreement
pursuant to Section 10.2 or Section 10.3, the following shall
apply:

     

    (a)         Retained
Products.  ZIOPHARM shall be permitted to continue the
development and commercialization of any ZIOPHARM Product that, at the time of
termination, satisfies at least one of the following criteria (a “Retained
Product”):

     

    (i)           
is being Commercialized by ZIOPHARM,

     

    (ii)           has
received regulatory approval,

     

    (iii)          is
a subject of an application for regulatory approval in the Field that is pending
before the applicable regulatory authority, or

     

    (iv)         is
the subject of at least

     

    (A) an
ongoing Phase 2 clinical trial in the Field (in the case of a termination by
Intrexon due to a ZIOPHARM uncured breach pursuant to Section 10.2(a) or a
termination by ZIOPHARM pursuant to Section 10.3), or

    
      
         

      

      
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    (B) an
ongoing Phase 1 clinical trial in the Field (in the case of a termination by
ZIOPHARM due to an Intrexon uncured breach pursuant to Section 10.2(a) or a
termination by Intrexon pursuant to Section 10.2(b) or 10.2(c)).

     

    Such
right to continue development and commercialization shall be subject to
ZIOPHARM’s full compliance with the payment provisions in Article 5 and all
other provisions of this Agreement that survive termination.

     

    (b)           Termination of
Licenses.  Except as necessary for ZIOPHARM to continue to
develop and commercialize the Retained Products as permitted by Section 10.4(a),
all rights and licenses granted by Intrexon to ZIOPHARM under this Agreement
shall terminate and shall revert to Intrexon without further action by either
Intrexon or ZIOPHARM.  ZIOPHARM’s license with respect to Retained
Products shall be exclusive or non-exclusive, as the case may be, on the same
terms as set forth in Section 3.1.

     

    (c)           Reverted
Products.  All ZIOPHARM Products other than the Retained
Products shall be referred to herein as the “Reverted
Products.”  ZIOPHARM shall immediately cease, and shall cause
its Affiliates and, if applicable, (sub)licensees to immediately cease, all
development and commercialization of the Reverted Products, and ZIOPHARM shall
not use or practice, nor shall it cause or permit any of its Affiliates or, if
applicable, (sub)licensees to use or practice, directly or indirectly, any
Intrexon IP with respect to the Reverted Products.  ZIOPHARM shall
immediately discontinue making any representation regarding its status as a
licensee or channel partner of Intrexon with respect to the Reverted
Products.

     

    (d)           Intrexon
Materials.  ZIOPHARM shall promptly return, or at Intrexon’s
request, destroy, any Intrexon Materials in ZIOPHARM’s possession or control at
the time of termination, or other than any Intrexon Materials necessary for the
continued development and commercialization of the Retained
Products.

     

    (e)           Licenses to
Intrexon.  ZIOPHARM is automatically deemed to grant to
Intrexon a worldwide, fully paid, royalty-free, exclusive (even as to ZIOPHARM
and its Affiliates), irrevocable, license (with full rights to sublicense) under
the ZIOPHARM Termination IP, to make, have made, import, use, offer for sale and
sell Reverted Products and to use the Intrexon Channel Technology, the Intrexon
Materials, and/or the Intrexon IP in the Field, subject to any exclusive rights
held by ZIOPHARM in Reverted Products pursuant to Section
10.4(c).  ZIOPHARM shall also take such actions and execute such other
instruments and documents as may be necessary to document such license to
Intrexon.

     

    (f)           Regulatory
Filings.  ZIOPHARM shall promptly assign to Intrexon, and will
provide full copies of, all regulatory approvals and regulatory filings that
relate specifically and solely to Reverted Products.  ZIOPHARM shall
also take such actions and execute such other instruments, assignments and
documents as may be necessary to effect the transfer of rights thereunder to
Intrexon.  To the extent that there exist any regulatory approvals and
regulatory filings that relate both to Reverted Products and other products,
ZIOPHARM shall provide copies of the portions of such regulatory filings that
relate to Reverted Products and shall reasonably cooperate to assist Intrexon in
obtaining the benefits of such regulatory approvals with respect to the Reverted
Products.

    
      
         

      

      
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    (g)          Data
Disclosure.  ZIOPHARM shall provide to Intrexon copies of the
relevant portions of all material reports and data, including clinical and
non-clinical data and reports, obtained or generated by or on behalf of ZIOPHARM
or its Affiliates to the extent that they relate to Reverted Products, within
sixty (60) days of such termination unless otherwise agreed, and Intrexon shall
have the right to use any such Information in developing and commercializing
Reverted Products and to license any Third Parties to do so.

     

    (h)          Third-Party
Licenses.  At Intrexon’s request, ZIOPHARM shall promptly
provide to Intrexon copies of all Third-Party agreements under which ZIOPHARM or
its Affiliates obtained a license under Patents claiming inventions or know-how
specific to or used or incorporated into the development, manufacture and/or
commercialization of the Reverted Products.  At Intrexon’s request,
ZIOPHARM shall promptly:  (x) with respect to such Third Party
licenses relating solely to the applicable Reverted Products, immediately assign
(or cause to be assigned), such agreements to Intrexon, and (y) with respect to
all other Third Party licenses, at ZIOPHARM’s option either assign the agreement
or grant (or cause to be granted) to Intrexon a sublicense thereunder of a scope
equivalent to that described in Section 10.4(e), provided ZIOPHARM has the
ability to assign such agreement to Intrexon or grant a sublicense to Intrexon
thereunder.  In any case, thereafter Intrexon shall be fully
responsible for all obligations due for its actions under the Third Party
agreements.  Notwithstanding the above, if Intrexon does not wish to
assume any financial or other obligations associated with a particular
assignment or sublicense, then Intrexon shall so notify ZIOPHARM and ZIOPHARM
shall not make such assignment or grant such sublicense (or cause it to be made
or granted).

     

    (i)           Remaining
Materials.  At the request of Intrexon, ZIOPHARM shall transfer
to Intrexon, all quantities of Reverted Product (including API or
work-in-process) in the possession of ZIOPHARM or its
Affiliates.  ZIOPHARM shall transfer to Intrexon all such quantities
of Reverted Products without charge, except that Intrexon shall pay the
reasonable costs of shipping.

     

    (j)           Third Party
Vendors.  At Intrexon’s request, ZIOPHARM shall promptly
provide to Intrexon copies of all agreements between ZIOPHARM or its Affiliates
and Third Party suppliers, vendors, or distributors that relate to the supply,
sale, or distribution of Reverted Products in the Territory.  At
Intrexon’s request, ZIOPHARM shall promptly:  (x) with respect to such
Third Party agreements relating solely to the applicable Reverted Products,
immediately assign (or cause to be assigned), such agreements to Intrexon, and
(y) with respect to all other such Third Party agreements, ZIOPHARM shall
reasonably cooperate to assist Intrexon in obtaining the benefits of such
agreements.  ZIOPHARM shall be liable for any costs associated with
assigning a Third Party agreement to Intrexon or otherwise obtaining the
benefits of such agreement for Intrexon, to the extent such costs are directly
related to ZIOPHARM’s breach.  For the avoidance of doubt, Intrexon
shall have no obligation to assume any of ZIOPHARM’s obligations under any Third
Party agreement.

     

    (k)         Commercialization.  Intrexon
shall have the right to develop and commercialize the Reverted Products itself
or with one or more Third Parties, and shall have the right, without obligation
to ZIOPHARM, to take any such actions in connection with such activities as
Intrexon (or its designee), at its discretion, deems
appropriate.

    
      
         

      

      
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    (l)           Confidential
Information.  Each Party shall promptly return, or at the other
Party’s request destroy, any Confidential Information of the other Party in such
Party’s possession or control at the time of termination; provided, however,
that each Party shall be permitted to retain (i) a single copy of each item of
Confidential Information of the other Party in its confidential legal files for
the sole purpose of monitoring and enforcing its compliance with Article 7, (ii)
Confidential Information of the other Party that is maintained as archive copies
on the recipient Party’s disaster recovery and/or information technology backup
systems, or (iii) Confidential Information of the other Party necessary to
exercise such Party’s rights in Retained Products (in the case of ZIOPHARM) or
Reverted Products (in the case of Intrexon). The recipient of Confidential
Information shall continue to be bound by the terms and conditions of this
Agreement with respect to any such Confidential Information retained in
accordance with this Section 10.4(l).

     

    10.5        Surviving
Obligations.  Termination or expiration of this Agreement shall
not affect any rights of either Party arising out of any event or occurrence
prior to termination, including, without limitation, any obligation of ZIOPHARM
to pay any amount which became due and payable under the terms and conditions of
this Agreement prior to expiration or such termination.  The following
portions of this Agreement shall survive termination or expiration of this
Agreement:  Sections 5.5, 5.7, 6.1, 6.2 (with subsection (c) surviving
only to the extent relating to Intrexon Patents that are relevant to Retained
Products that, to Intrexon’s knowledge, are being developed or commercialized at
such time, if any), 10.4, and 10.5; Articles 7, 9, 11, and 12; and any relevant
definitions in Article 1.

     

    ARTICLE
11

     

    Dispute
Resolution

     

    11.1        Disputes.  It is the
objective of the Parties to establish procedures to facilitate the resolution of
disputes arising under this Agreement in an expedient manner by mutual
cooperation and without resort to litigation.  In the event of any
disputes, controversies or differences which may arise between the Parties out
of or in relation to or in connection with this Agreement (other than disputes
arising from a Committee), including, without limitation, any alleged failure to
perform, or breach, of this Agreement, or any issue relating to the
interpretation or application of this Agreement, then upon the request of either
Party by written notice, the Parties agree to meet and discuss in good faith a
possible resolution thereof, which good faith efforts shall include at least one
in-person meeting between the Executive Officers of each Party.  If
the matter is not resolved within thirty (30) days following the written request
for discussions, either Party may then invoke the provisions of Section
11.2.  For the avoidance of doubt, any disputes, controversies or
differences arising from a Committee pursuant to Article 2 shall be resolved
solely in accordance with Section 2.4.

    
      
         

      

      
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    11.2        Arbitration.  Any
dispute, controversy, difference or claim which may arise between the Parties
and not from a Committee, out of or in relation to or in connection with this
Agreement (including, without limitation, arising out of or relating to the
validity, construction, interpretation, enforceability, breach, performance,
application or termination of this Agreement) that is not resolved pursuant to
Section 11.1 shall, subject to Section 11.10, be settled by binding “baseball
arbitration” as follows.  Either Party, following the end of the
thirty (30) day period referenced in Section 11.1, may refer such issue to
arbitration by submitting a written notice of such request to the other
Party.  Promptly following receipt of such notice, the Parties shall
meet and discuss in good faith and seek to agree on an arbitrator to resolve the
issue, which arbitrator shall be neutral and independent of both Parties and all
of their respective Affiliates, shall have significant experience and expertise
in licensing and partnering agreements in the pharmaceutical and biotechnology
industries, and shall have some experience in mediating or arbitrating issues
relating to such agreements.  If the Parties cannot agree on a single
arbitrator within fifteen (15) days of request by a Party for arbitration, then
each Party shall select an arbitrator meeting the foregoing criteria and the two
(2) arbitrators so selected shall select a third arbitrator meeting the
foregoing criteria.  Within fifteen (15) days after an arbitrator(s)
is selected (in the case of the three-person panel, when the third arbitrator is
selected), each Party will deliver to both the arbitrator(s) and the other Party
a detailed written proposal setting forth its proposed terms for the resolution
for the matter at issue (the “Proposed Terms” of the Party)
and a memorandum (the “Support
Memorandum”) in support thereof.  The Parties will also provide
the arbitrator(s) a copy of this Agreement, as it may be amended at such
time.  Within fifteen (15) days after receipt of the other Party’s
Proposed Terms and Support Memorandum, each Party may submit to the
arbitrator(s) (with a copy to the other Party) a response to the other Party’s
Support Memorandum.  Neither Party may have any other communications
(either written or oral) with the arbitrator(s) other than for the sole purpose
of engaging the arbitrator or as expressly permitted in this Section 11.2;
provided that, the arbitrator(s) may convene a hearing if the arbitrator(s) so
chooses to ask questions of the Parties and hear oral argument and discussion
regarding each Party’s Proposed Terms.  Within sixty (60) days after
the arbitrator’s appointment, the arbitrator(s) will select one of the two
Proposed Terms (without modification) provided by the Parties that he or she
believes is most consistent with the intention underlying and agreed principles
set forth in this Agreement.  The decision of the arbitrator(s) shall
be final, binding, and unappealable.  For clarity, the arbitrator(s)
must select as the only method to resolve the matter at issue one of the two
sets of Proposed Terms, and may not combine elements of both Proposed Terms or
award any other relief or take any other action.

     

    11.3        Governing Law.  This
Agreement shall be governed by and construed under the substantive laws of the
State of New York, excluding any conflicts or choice of law rule or principle
that might otherwise refer construction or interpretation of this Agreement to
the substantive law of another jurisdiction.

     

    11.4        Award.  Any award to
be paid by one Party to the other Party as determined by the arbitrator(s) as
set forth above under Section 11.2 shall be promptly paid in United States
dollars free of any tax, deduction or offset; and any costs, fees or taxes
incident to enforcing the award shall, to the maximum extent permitted by law,
be charged against the losing Party.  Each Party agrees to abide by
the award rendered in any arbitration conducted pursuant to this Article 11, and
agrees that, subject to the United States Federal Arbitration Act, 9 U.S.C. §§
1-16, judgment may be entered upon the final award in any United States District
Court located in New York and that other courts may award full faith and credit
to such judgment in order to enforce such award.  The award shall
include interest from the date of any damages incurred for breach of the
Agreement, and from the date of the award until paid in full, at a rate fixed by
the arbitrator(s).  With respect to money damages, nothing contained
herein shall be construed to permit the arbitrator(s) or any court or any other
forum to award consequential, incidental, special, punitive or exemplary
damages.  By entering into this agreement to arbitrate, the Parties
expressly waive any claim for consequential, incidental, special, punitive or
exemplary damages.  The only damages recoverable under this Agreement
are direct compensatory damages.

    
      
         

      

      
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    11.5        Costs.  Each Party
shall bear its own legal fees.  The arbitrator(s) shall assess his or
her costs, fees and expenses against the Party losing the
arbitration.

     

    11.6        Injunctive
Relief.  Nothing in this Article 11 will preclude either Party
from seeking equitable relief or interim or provisional relief from a court of
competent jurisdiction, including a temporary restraining order, preliminary
injunction or other interim equitable relief, concerning a dispute either prior
to or during any arbitration if necessary to protect the interests of such Party
or to preserve the status quo pending the arbitration
proceeding.  Specifically, the Parties agree that a material breach by
either Party of its obligations in 3.4 of this Agreement may cause irreparable
harm to the other Party, for which damages may not be an adequate
remedy.  Therefore, in addition to its rights and remedies otherwise
available at law, including, without limitation, the recovery of damages for
breach of this Agreement, upon an adequate showing of material breach of such
Section 3.4, and without further proof of irreparable harm other than this
acknowledgement, such non-breaching Party shall be entitled to seek (a)
immediate equitable relief, specifically including, but not limited to, both
interim and permanent restraining orders and injunctions, and (b) such other and
further equitable relief as the court may deem proper under the
circumstances.  For the avoidance of doubt, nothing in this Section
11.6 shall otherwise limit a breaching Party’s opportunity to cure a material
breach as permitted in accordance with Section 10.2.

     

    11.7        Confidentiality.  The
arbitration proceeding shall be confidential and the arbitrator(s) shall issue
appropriate protective orders to safeguard each Party’s Confidential
Information.  Except as required by law, no Party shall make (or
instruct the arbitrator(s) to make) any public announcement with respect to the
proceedings or decision of the arbitrator(s) without prior written consent of
the other Party.  The existence of any dispute submitted to
arbitration, and the award, shall be kept in confidence by the Parties and the
arbitrator(s), except as required in connection with the enforcement of such
award or as otherwise required by applicable law.

     

    11.8        Survivability.  Any
duty to arbitrate under this Agreement shall remain in effect and be enforceable
after termination of this Agreement for any reason.

     

    11.9        Jurisdiction.  For
the purposes of this Article 11, the Parties acknowledge their diversity and
agree to accept the jurisdiction of any United States District Court located in
New York for the purposes of enforcing or appealing any awards entered pursuant
to this Article 11 and for enforcing the agreements reflected in this Article 11
and agree not to commence any action, suit or proceeding related thereto except
in such courts.

     

    11.10     Patent
Disputes.  Notwithstanding any other provisions of this Article
11, and subject to the provisions of Section 6.2, any dispute, controversy or
claim relating to the scope, validity, enforceability or infringement of any
Intrexon Patents shall be submitted to a court of competent jurisdiction in the
country in which such Patent was filed or granted.

    
      
         

      

      
        33

        
          

        

      

      
         

      

    

     

    ARTICLE
12

     

    General
Provisions

     

    12.1        Use of Name.  No
right, express or implied, is granted by this Agreement to either Party to use
in any manner the name of the other or any other trade name or trademark of the
other in connection with the performance of this Agreement.

     

    12.2        LIMITATION OF
LIABILITY.  NEITHER PARTY SHALL BE LIABLE TO THE OTHER FOR ANY
SPECIAL, CONSEQUENTIAL, INCIDENTAL, PUNITIVE, OR INDIRECT DAMAGES ARISING FROM
OR RELATING TO ANY BREACH OF THIS AGREEMENT, REGARDLESS OF ANY NOTICE OF THE
POSSIBILITY OF SUCH DAMAGES.  NOTWITHSTANDING THE FOREGOING, NOTHING
IN THIS PARAGRAPH IS INTENDED TO LIMIT OR RESTRICT THE INDEMNIFICATION RIGHTS OR
OBLIGATIONS OF ANY PARTY UNDER ARTICLE 9, OR DAMAGES AVAILABLE FOR BREACHES OF
THE OBLIGATIONS SET FORTH IN ARTICLE 7.

     

    12.3        Independent
Parties.  The Parties are not employees or legal
representatives of the other Party for any purpose.  Neither Party
shall have the authority to enter into any contracts in the name of or on behalf
of the other Party.  This Agreement shall not constitute, create, or
in any way be interpreted as a joint venture, partnership, or business
organization of any kind.

     

    12.4        Notice.  All
notices, including notices of address change, required or permitted to be given
under this Agreement shall be in writing and deemed to have been given when
delivered if personally delivered or sent by facsimile (provided that the party
providing such notice promptly confirms receipt of such transmission with the
other party by telephone), on the business day after dispatch if sent by a
nationally-recognized overnight courier and on the third business day following
the date of mailing if sent by certified mail, postage prepaid, return receipt
requested. All such communications shall be sent to the address or facsimile
number set forth below (or any updated addresses or facsimile number
communicated to the other Party in writing):

     

    
      
        	
                If
      to Intrexon:

              	
                Intrexon
      Corporation

                20358
      Seneca Meadows Parkway

                Germantown,
      MD  20876

                Attention:  Legal
      Department

                Fax:  (301)
      556-9902

              
	 
      	 
      
	
                with
      a copy to:

              	
                Cooley
      LLP

                3175
      Hanover St.

                Palo
      Alto, CA  94304

                Attention:  Robert
      Jones

                Fax:  (650)
      849-7400

              

      

    

    
      
         

      

      
        34

        
          

        

      

      
         

      

    

    

    
      
        	
                If
      to ZIOPHARM:

              	
                ZIOPHARM
      Oncology, Inc.

                One
      First Avenue

                Parris
      Building, 34

                Navy
      Yard Plaza

                Boston,
      MA 02129

                Attention:  Chief
      Executive Officer

                Fax:  (617)
      241-2855

              
	 
      	 
      
	
                with
      a copy to:

              	
                WilmerHale

                60
      State Street

                Boston,
      MA  02109

                Attention:  Stuart
      Falber

                Fax:  (617)
      526-5000

              

      

    

     

    12.5        Severability.  In
the event any provision of this Agreement is held to be invalid or
unenforceable, the valid or enforceable portion thereof and the remaining
provisions of this Agreement will remain in full force and effect.

     

    12.6        Waiver.  Any waiver
(express or implied) by either Party of any breach of this Agreement shall not
constitute a waiver of any other or subsequent breach.

     

    12.7        Entire Agreement;
Amendment.  This Agreement and the exhibits attached hereto
constitute the entire, final, complete and exclusive agreement between the
Parties and supersede all previous agreements or representations, written or
oral, with respect to the subject matter of this Agreement (including any prior
confidentiality agreement between the Parties).  All information of
Intrexon or ZIOPHARM to be kept confidential by the other Party under any prior
confidentiality agreement, as of the Effective Date, shall be maintained as
Confidential Information by such other Party under the obligations set forth in
Article 7 of this Agreement.  This Agreement may not be modified or
amended except in a writing signed by a duly authorized representative of each
Party.

     

    12.8        Nonassignability; Binding on
Successors.  Any attempted assignment of the rights or
delegation of the obligations under this Agreement shall be void without the
prior written consent of the nonassigning or nondelegating Party; provided,
however, that either Party  may assign its rights or delegate its
obligations under this Agreement without such consent (a) to an Affiliate of
such Party or (b) to its successor in interest in connection with any merger,
acquisition, consolidation, corporate reorganization, or similar transaction, or
sale of all or substantially all of its assets, provided that such assignee
agrees in writing to assume and be bound by the assignor’s obligations under
this Agreement.  This Agreement shall be binding upon, and inure to
the benefit of, the successors, executors, heirs, representatives,
administrators and permitted assigns of the Parties
hereto.  Notwithstanding the foregoing, in the event that either Party
assigns this Agreement to its successor in interest by way of merger,
acquisition, or sale of all or substantially all of its assets (whether this
Agreement is actually assigned or is assumed by such successor in interest or
its affiliate by operation of law (e.g., in the context of a reverse triangular
merger)), (a) the intellectual property rights of such successor in interest or
any of its affiliates shall be automatically excluded from the rights licensed
to the other Party under this Agreement, and (b) such successor in interest may
elect by written notice to have the restrictions set forth in Section 3.4 not
apply to the activities of such successor in interest (but, for purposes of
clarity, such restriction shall in any event continue to apply to the applicable
Party and all other Affiliates of such Party not related to such successor in
interest).  In the event that a successor in interest to ZIOPHARM
elects to have the restrictions set forth in Section 3.4 not apply to the
activities of such successor in interest, Intrexon shall have the termination
right set forth in Section 10.2(c).

    
      
         

      

      
        35

        
          

        

      

      
         

      

    

     

    12.9        Force
Majeure.  Neither Party shall be liable to the other for its
failure to perform any of its obligations under this Agreement, except for
payment obligations, during any period in which such performance is delayed
because rendered impracticable or impossible due to circumstances beyond its
reasonable control, including without limitation earthquakes, governmental
regulation, fire, flood, labor difficulties, civil disorder, acts of terrorism
and acts of God, provided that the Party experiencing the delay promptly
notifies the other Party of the delay.

     

    12.10     No Other
Licenses.  Neither Party grants to the other Party any rights
or licenses in or to any intellectual property, whether by implication,
estoppel, or otherwise, except to the extent expressly provided for under this
Agreement.

     

    12.11     Legal
Compliance.  The Parties shall review in good faith and
cooperate in taking such actions to ensure compliance of this Agreement with all
applicable laws.

     

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

     

    [Remainder
of page intentionally left blank.]

    
      
         

      

      
        36

        
          

        

      

      
         

      

    

    In Witness
Whereof, the Parties hereto have duly executed this Exclusive Channel
Partner Agreement.

     

    
      
        	
                Intrexon
      Corporation

              	
                Ziopharm
      Oncology, Inc.

              
	 
      	 
      
	
                By:

              	
                /s/ Randal J. Kirk

              	 
      	
                By:

              	
                /S/ Jonathan Lewis

              
	 
      	 
      	 
      	 
      	 
      
	
                Name: 

              	
                Randal J. Kirk

              	 
      	
                Name: 

              	
                Jonathan Lewis

              
	 
      	 
      	 
      	 
      	 
      
	
                Title:

              	
                Chief Executive Officer

              	 
      	
                Title:

              	
                Chief Executive
  Officer

              

      

    

    
      
         

      

      
        37

        
          

        

      

      
         

      

    

    EXHIBIT
A

     

    Financial
Terms for Calculating Allowable Expenses

     

    As used
herein, the term “operating unit” shall mean the smallest operating unit in
which an operating profit and loss statement is prepared for management
accounting purposes in the applicable Party’s normal accounting procedures,
consistently applied within and across its operating units.  To the
extent certain cost or expense items below are incurred with respect to multiple
products and some of such products are not ZIOPHARM Products, then such cost or
expense items shall be allocated on a pro rata basis based upon net
sales of each respective product by the applicable operating unit during the
most recent quarter.

     

    1.           Cost
of Goods Sold

     

    “Cost of Goods Sold” means all Manufacturing
Costs that are directly and reasonably attributable to manufacturing of ZIOPHARM
Product for commercial sale in the countries where such ZIOPHARM Product has
been launched.

     

    1.1          “Manufacturing Costs” means,
with respect to ZIOPHARM Products, the FTE costs (under a reasonable accounting
mechanism to be agreed upon by the Parties and out-of-pocket costs of a Party or
any of its Affiliates incurred in manufacturing such ZIOPHARM Products,
including costs and expenses incurred in connection with (1) the development or
validation of any manufacturing process, formulations or delivery systems, or
improvements to the foregoing; (2) manufacturing scale-up; (3) in-process
testing, stability testing and release testing; (4) quality assurance/quality
control development; (5) internal and Third Party costs and expenses incurred in
connection with qualification and validation of Third Party contract
manufacturers, including scale up, process and equipment validation, and initial
manufacturing licenses, approvals and inspections; (6) packaging development and
final packaging and labeling; (7) shipping configurations and shipping studies;
and (8) overseeing the conduct of any of the
foregoing.  “Manufacturing Costs” shall further include:

     

    (a)           to
the extent that any such ZIOPHARM Product is Manufactured by a Third Party
manufacturer, the out-of-pocket costs incurred by such Party or any of its
Affiliates to the Third Party for the manufacture and supply (including
packaging and labeling) thereof, and any reasonable out-of-pocket costs and
direct labor costs incurred by such Party or any of its Affiliates in managing
or overseeing the Third Party relationship determined in accordance with the
books and records of such Party or its Affiliates maintained in accordance with
US GAAP; and

     

    (b)           to
the extent that any such ZIOPHARM Product is manufactured by such Party or any
of its Affiliates, direct material and direct labor costs attributable to such
ZIOPHARM Product, as well as reasonably allocable overhead expenses, determined
in accordance with the books and records of such Party or its Affiliates
maintained in accordance with US GAAP.

    
      
         

      

      
        
        

        
          

        

      

      
         

      

    

     

    2.           Marketing
Expenses.

     

    “Marketing Expenses” means the
sum of Selling Expenses, Marketing Management Expenses, Market and Consumer
Research Expenses, Advertising Expenses, Trade Promotion Expenses, and Consumer
Promotion Expenses, each of which is specified below, in each case to the extent
directly and reasonably attributable to the sale, promotion or marketing of the
applicable ZIOPHARM Products in the countries where such ZIOPHARM Product has
been launched.

     

    2.1           “Selling Expenses” shall mean
all reasonable costs and expenses directly associated with the efforts of field
sales representatives with respect to ZIOPHARM Products in the
Territory.  The costs of detailing sales calls shall be allocated
based on field force time at an accounting charge rate reasonably and
consistently applied within and across its operating units and which is no less
favorable to the ZIOPHARM Products than the internal charge rate used by
ZIOPHARM for its own internal cost accounting purposes for products other than
ZIOPHARM Products (excluding internal profit margins and markups).

     

    2.2           “Marketing Management Expenses”
means all reasonable product management and sales promotion management
compensation (including customary bonuses and benefits but excluding stock-based
compensation) and departmental expenses, including product related public
relations, relationships with opinion leaders and professional societies, health
care economics studies, contract pricing and administration, market information
systems, governmental affairs activities for reimbursement, formulary acceptance
and other activities directly related to the ZIOPHARM Products in the Territory,
management and administration of managed care and national accounts and other
activities associated with developing overall sales and marketing strategies and
planning for ZIOPHARM Products in the Territory.

     

    2.3           “Market and Consumer Research
Expenses” means all reasonable compensation (including customary bonuses
and benefits but excluding stock-based compensation) and departmental expenses
for market and consumer research personnel and payments to Third Parties related
to and to the extent use for conducting and monitoring professional and consumer
appraisals of existing, new or proposed ZIOPHARM Products in the Territory such
as market share services (e.g., IMS data), special research testing and focus
groups.

     

    2.4           “Advertising Expenses” shall
mean all reasonable costs reasonably incurred for the advertising and promotion
of ZIOPHARM Products in the Territory.

     

    2.5           “Trade Promotion Expenses”
means the actual and reasonable allowances given to retailers, brokers,
distributors, hospital buying groups, etc. for purchasing, promoting, and
distribution of ZIOPHARM Products in the Territory.  This shall
include purchasing, advertising, new distribution, and display allowances as
well as free goods, wholesale allowances and reasonable field sales samples (at
the out of pocket cost).

     

    2.6           “Consumer Promotion Expenses”
means all reasonable expenses associated with programs to promote ZIOPHARM
Products directly to the end user in the Territory.  This category
shall include expenses associated with promoting products directly to the
professional community such as professional samples, professional literature,
promotional material costs, patient aids and detailing aids.

    
      
         

      

      
        
        

        
          

        

      

      
         

      

    

     

    3.           Distribution
Expenses.

     

    “Distribution Expenses” means the reasonable
costs, excluding overhead, incurred by ZIOPHARM that are directly and reasonably
allocable to the distribution of a ZIOPHARM Product with respect to a particular
country where such ZIOPHARM Product has been launched, excluding any costs
included as a deduction in calculating Net Sales.

     

    4.           Additional
Commercialization Expenses.

     

    “Additional Commercialization
Expenses” means the sum of Regulatory and Related Costs, Third Party
Blocking IP Costs, Patent and Trademark Costs, Product Liability Costs, and
Additional Approved Expenses, each of which is specified below, in each case to
the extent directly and reasonably attributable to the commercialization of the
applicable ZIOPHARM Products.

     

    4.1           “Regulatory and Related Costs”
means all reasonable costs and expenses associated with the preparation and
filing of marketing and pricing approval applications, and the maintenance of
marketing approvals, for ZIOPHARM Products, including (i) fees paid to
regulatory authorities directly related to NDAs and Marketing Approvals in the
Field, (ii) costs of any regulatory interactions with respect to ZIOPHARM
Products, (iii) costs incurred in securing reimbursement approvals from public
and private payers, and (iv) costs to establish and maintain a global safety
database.

     

    4.2           [*****].

     

    4.3           “Patent and Trademark Costs”
means all reasonable costs and expenses incurred by ZIOPHARM or its Affiliates
in connection with (i) the preparation, filing, prosecution, maintenance and
enforcement of ZIOPHARM Program Patents, and (ii) establishing, maintaining and
enforcing the Patents and trademarks for ZIOPHARM Products in the
Territory.

     

    4.4           “Product Liability Costs” means
the reasonable costs associated with (i) any recall in the Territory, including
the cost of any investigations or corrective actions, (ii) any Excess Product
Liability Costs, and (iii) product liability insurance premiums for policies
covering the development, manufacture or Commercialization of ZIOPHARM Products
(as described in Section 9.5).

     

    4.5           “Additional Approved Expenses”
means any additional costs and/or expenses that are incurred in connection with
the commercialization of ZIOPHARM Products and that are approved in advance, in
writing, by the Intrexon representatives on the CC.

     

    5.           Post-Launch
Product R&D Expenses.

     

    “Post-Launch Product R&D
Expenses” means the reasonable costs, excluding administrative expenses
and costs that are included within Costs of Goods Sold, of Phase 4 clinical
trials and ongoing product support (including manufacturing and quality
assurance technical support, and laboratory and clinical efforts directed toward
the further understanding of product safety and efficacy) and medical affairs
(including regulatory support necessary for product maintenance), in each case
that are (a) specifically attributable to a ZIOPHARM Product in the countries of
the Territory where such ZIOPHARM Product has been launched and (b) approved by
both Parties in writing.

    
      
         

      

      
        
        

        
          

        

      

      
         

      

    

     

    6.           No
Duplication.  No item of cost shall be duplicated in any of the
categories comprising Allowable Expenses or in the deductions permitted under
Net Sales or Sublicensing Revenue.

    
      
         

      

      
        
        

        
          

        

      

      
         

      

    

    EXHIBIT
B

     

    Press
Release

    

    
      
        	
                

              	
                

              

      

    

    

    ZIOPHARM
Oncology and Intrexon Announce Worldwide Partnership for

    Synthetic
Biology DNA-based Oncology Therapeutics

    

    RJ
Kirk, CEO and Chairman of Intrexon, to Join ZIOPHARM Board of
Directors

    

    NEW YORK, NY and GERMANTOWN, MD
(January 6, 2011) – ZIOPHARM Oncology, Inc. (Nasdaq: ZIOP), a small
molecule late-stage oncology drug development company, and Intrexon Corporation,
a next generation synthetic biology company, announced today a global exclusive
channel partnership in oncology where ZIOPHARM will develop and commercialize
DNA-based therapeutics using Intrexon’s UltraVector® Technology. Under the
partnership, ZIOPHARM will utilize Intrexon’s advanced transgene engineering
platform for the controlled and precise cellular production of anti-cancer
effectors. ZIOPHARM will have rights to Intrexon’s entire human in vivo effector platform
within the field of oncology which includes two lead clinical-stage product
candidates, one which is in an advanced phase I study and another which will be
the subject of an Investigational New Drug (“IND”) filing during the first half
of 2011. Ziopharm and Intrexon will host a conference call and audio webcast
today, Thursday, January 6th at 5:00
p.m. ET to discuss the global exclusive channel partnership.

    

    Intrexon
employs its modular genetic engineering platform in the areas of therapeutics,
protein production, industrial, and agriculture products. The exclusive channel
partnership between Intrexon and ZIOPHARM has been established specifically for
the field of human oncologic therapeutics. Under the partnership, Intrexon
remains responsible for technology discovery efforts and managing the patent
estate as well as for certain aspects of manufacturing. ZIOPHARM will be
responsible for conducting preclinical and clinical development of candidates,
as well as for other aspects of manufacturing and the commercialization of the
candidates.

    

    Intrexon’s
core synthetic biology technology is designed to create Better DNATM at
industrial scale, enabling unprecedented control over the function and output of
living cells by providing external control over in vivo activation and
regulation of potent effectors. This platform, called UltraVector®, provides
speed, flexibility, consistency and precision to the design, production and
testing of rationally designed complex transgenes and their encoded genetic
circuits.  These qualities allow an iterative and rational approach to
transgene design, which can be continually engineered until their performance is
optimized. Through
this process, Intrexon is able to overcome the challenges inherent in current
therapeutic strategies, including recombinant protein therapies and constitutive
gene therapies, thereby enhancing capabilities, improving safety and lowering
cost for human therapeutics. The lead oncology product candidate developed using
Intrexon’s technologies is currently in Phase Ib clinical study for metastatic
melanoma. ZIOPHARM expects to submit an Investigational New Drug (IND)
application with U.S. Food and Drug Administration for a second oncology product
candidate in the first half of this year.

    
      
         

      

      
        
        

        
          

        

      

      
         

      

    

    

    “Controllable,
scalable synthetic biology, the tightly regulated delivery of therapeutic
proteins from within the body, is an aspirational and disruptive technology
which Intrexon has brought from scientific theory to medical application,” said
Jonathan Lewis, M.D., Ph.D., Chief Executive Officer and Chief Medical Officer
of ZIOPHARM. “As the sole channel partner for in vivo therapeutic
candidates for human oncology, ZIOPHARM plans to leverage this technology for
next-generation products targeting key pathways used by cancers to grow and
metastasize.  Intrexon has developed a technology that is uniquely
flexible, scalable and controllable, adding significantly to our small molecule
drug development capabilities and our ability to translate science to the
patient using our world-class global team.”

    

    “We are
very pleased to collaborate with ZIOPHARM, which, under the leadership of
Jonathan Lewis, is building an industry leading oncology company with a
strategic vision regarding cancer medicine. ZIOPHARM’s oncology expertise,
development capabilities, as well as its excellent reputation within the
oncology community make ZIOPHARM an exceptional investment for Intrexon and
ideal partner to rapidly achieve the full therapeutic benefit and commercial
potential of Intrexon’s disruptive technologies,” stated RJ Kirk, Intrexon’s
Chairman and CEO. “This collaboration leverages the capabilities and strengths
of each partner and has the potential to create significant value for
shareholders.”

    

    Under
terms of the agreement:

    
      	
               
      

            	
              ·

            	
              Intrexon
      will purchase 2,422,542 shares of ZIOPHARM ‘s common stock (representing
      5% of ZIOPHARM’s currently outstanding shares) in a private placement for
      a total purchase price of $11,464,438, or $4.7324 per share, which is the
      trailing 10-day volume-weighted average price per share of ZIOPHARM’s
      common stock;

            

    

    
      	
               
      

            	
              ·

            	
              ZIOPHARM
      will simultaneously issue to Intrexon for no additional consideration an
      additional 3,631,391 shares  of its common stock, representing
      7.495% of ZIOPHARM’s currently outstanding shares; ZIOPHARM has agreed to
      issue to Intrexon additional shares of its common stock for no additional
      consideration, representing an additional 7.495% under certain conditions
      upon dosing of the first patient in a ZIOPHARM-conducted U.S. Phase II
      clinical trial of a product candidate created, produced or developed by
      ZIOPHARM using Intrexon technology;

            

    

    
      	
               
      

            	
              ·

            	
              Intrexon
      has agreed to purchase up to $50 million in conjunction with securities
      offerings that may be conducted by ZIOPHARM in the future, subject to
      certain conditions and limitations;

            

    

    
      	
               
      

            	
              ·

            	
              Subject
      to certain expense allocations, ZIOPHARM will pay Intrexon 50% of the
      cumulative net quarterly profits derived from the sale of products
      developed from the channel
partnership.

            

    

    
      
         

      

      
        
        

        
          

        

      

      
         

      

    

    

    Pursuant
to the agreement, Mr. Kirk has agreed to join the ZIOPHARM board of directors.
In addition to his responsibilities at Intrexon, Mr. Kirk has served, since
March 1999, as Senior Managing Director and Chief Executive Officer of Third
Security, LLC, an investment management firm founded by Mr. Kirk. Additionally,
Mr. Kirk founded and became Chairman of the Board of New River Pharmaceuticals
Inc. in 1996, and was President and Chief Executive Officer between October 2001
and April 2007. New River was acquired by Shire plc in 2007.  Mr. Kirk
also currently serves as a member of the Board of Directors of Halozyme
Therapeutics, Inc. (Nasdaq: HALO), and as Chairman of the Board for Clinical
Data, Inc. (Nasdaq: CLDA). Previously, Mr. Kirk served as a member of the Board
of Directors of Scios, Inc. (acquired by Johnson & Johnson) between February
2000 and May 2002. Mr. Kirk served on the Board of Visitors of Radford
University from July 2003 to June 2009, was Rector of the Board from September
2006 to September 2008, and has served on the Board of Directors of the Radford
University Foundation, Inc. since September 1998. He has served on the Board of
Visitors of the University of Virginia and Affiliated Schools since July 2009,
on the Virginia Advisory Council on Revenue Estimates since July 2006, on the
Governor’s Economic Development and Jobs Creation Commission since April 2010,
and served as a member of the Board of Directors of the Virginia University
Research Partnership from July 2007 to November 2010. Mr. Kirk received a B.A.
in Business from Radford University and a J.D. from the University of
Virginia.

    

    Regarding
Mr. Kirk’s appointment, Dr. Lewis added: “RJ is a visionary and a winner with a
long record of success and value creation in the life sciences. His addition to
the ZIOPHARM Board of Directors will be invaluable, and we look forward to his
many contributions in this role.”

    

    Griffin
Securities, Inc. acted as an advisor to Intrexon on this
transaction.

    

    Conference
Call and Webcast January 6, 2011 at 5pm ET

    

    ZIOPHARM
and Intrexon will host a conference call and live audio webcast on January 6,
2011 at 5:00pm ET to discuss their global exclusive channel partnership. The
call can be accessed by dialing (877) 375-9144 (U.S. and Canada) or (253)
237-1150 (international).  The passcode for the conference call is
‘ZIOPHARM.’ To access the live audio webcast, or the subsequent archived
recording, visit the "Investors - Events & Presentations" section of the
ZIOPHARM website at www.ziopharm.com. The webcast will be
recorded and available for replay on the company's website for two (2)
weeks.

    

    About
ZIOPHARM Oncology, Inc.:

    

    ZIOPHARM
Oncology is a biopharmaceutical company engaged in the development and
commercialization of a diverse portfolio of cancer drugs. The Company is
currently focused on three clinical programs.

    
      
         

      

      
        
        

        
          

        

      

      
         

      

    

    

    Palifosfamide
(ZymafosTM or
ZIO-201) is a novel DNA cross-linker in class with bendamustine, ifosfamide, and
cyclophosphamide. ZIOPHARM is currently enrolling patients in a randomized,
double-blinded, placebo-controlled Phase III trial with palifosfamide
administered intravenously for the treatment of metastatic soft tissue sarcoma
in the front-line setting.  The Company is also currently conducting a
Phase I intravenous study of palifosfamide in combination with standard of care
addressing small cell lung cancer and expects to initiate an additional study
with drug in the oral form treating solid tumors.

    

    Darinaparsin
(ZinaparTM or
ZIO-101) is a novel mitochondrial-targeted agent (organic arsenic) being
developed intravenously for the treatment of peripheral T-cell lymphoma with a
pivotal study expected to begin in late 2011. An oral form is in a Phase I trial
in solid tumors.

    

    Indibulin
(ZybulinTM or
ZIO-301) is a novel, oral tubulin binding agent that is expected to have several
potential benefits including oral dosing, application in multi-drug resistant
tumors, no neuropathy and minimal overall toxicity. It is currently being
studied in Phase I/II in metastatic breast cancer.

    

    ZIOPHARM's
operations are located in Boston, MA with an executive office in New York City.
Further information about ZIOPHARM may be found at www.ziopharm.com.

    

    ZIOP-G

    

    About
Intrexon Corporation:

    

    Intrexon
Corporation is a privately held synthetic biology company that employs modular
DNA control systems to enhance capabilities, improve safety and lower cost in
human therapeutics, protein production, industrial products and agricultural
biotechnology. The company’s advanced transgene engineering platform enables
Better DNATM by combining breakthroughs in DNA control systems with corresponding
advancements in modular transgene design, assembly and optimization. The company
is currently using these advanced capabilities to undertake foremost challenges
across the spectrum for biological applications. More information about the
company is available at www.DNA.com.

    
      
         

      

      
        
        

        
          

        

      

      
         

      

    

    

    Forward-Looking
Safe Harbor Statement:

    This
press release contains forward-looking statements for ZIOPHARM Oncology, Inc.
that involve risks and uncertainties that could cause ZIOPHARM Oncology’s actual
results to differ materially from the anticipated results and expectations
expressed in these forward-looking statements. These statements are based on
current expectations, forecasts and assumptions that are subject to risks and
uncertainties, which could cause actual outcomes and results to differ
materially from these statements. Among other things, there can be no assurance
that any of ZIOPHARM Oncology’s development efforts relating to its product
candidates will be successful, or such product candidates will be successfully
commercialized. Other risks that affect forward-looking information contained in
this press release include the possibility of being unable to obtain regulatory
approval of ZIOPHARM Oncology’s product candidates, the risk that the results of
clinical trials may not support ZIOPHARM Oncology’s claims, the risk that
pre-clinical or clinical trials will proceed on schedules that are consistent
with ZIOPHARM Oncology’s current expectations or at all, risks related to
ZIOPHARM Oncology’s ability to protect its intellectual property and its
reliance on third parties to develop its product candidates, risks related to
the sufficiency of existing capital reserves to fund continued operations for a
particular amount of time and uncertainties regarding ZIOPHARM Oncology’s
ability to obtain additional financing to support its operations thereafter, as
well as other risks regarding ZIOPHARM Oncology’s that are discussed under the
heading "Risk Factors" in ZIOPHARM Oncology’s filings with the United States
Securities and Exchange Commission. Forward-looking statements can be identified
by the use of words such as "may," "will," "intend," " should," "could," "can,"
"would," "expect," "believe," "estimate," " predict," "potential," "plan," "is
designed to," "target" and similar expressions. ZIOPHARM Oncology assumes no
obligation to update these forward-looking statements, except as required by
law.

     

    Contacts:

    

    For
ZIOPHARM:

    Tyler
Cook

    ZIOPHARM
Oncology, Inc.

    617-259-1982

    tcook@ziopharm.com

    

    Media:

    David
Pitts

    Argot
Partners

    212-600-1902

    david@argotpartners.com

    

    For
Intrexon:

    Robert
Beech

    Intrexon
Corporation

    Phone:
301.556.9812

    rbeech@intrexon.com

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