Document:

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                                WARRANT AGREEMENT

                            Dated as of May 26, 2004

                                     Between

                             SYNTROLEUM CORPORATION

                                       and

                    AMERICAN STOCK TRANSFER AND TRUST COMPANY

                                as Warrant Agent

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                                TABLE OF CONTENTS

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                                          ARTICLE I
                           ISSUANCE, FORM, EXECUTION, DELIVERY AND
                            REGISTRATION OF WARRANT CERTIFICATES

Section 1.01   Issuance of Warrants ...................................................    1
Section 1.02   Form of Warrant Certificates ...........................................    1
Section 1.03   Execution of Warrant Certificates ......................................    2
Section 1.04   Authentication and Delivery ............................................    2
Section 1.05   Temporary Warrant Certificates .........................................    3
Section 1.06   Separation of Warrants and Shares ......................................    3
Section 1.07   Registration ...........................................................    3
Section 1.08   Registration of Transfers and Exchanges ................................    4
Section 1.09   Lost, Stolen, Destroyed, Defaced or Mutilated Warrant Certificates .....    6
Section 1.10   Offices for Exercise, etc ..............................................    7

                                         ARTICLE II
                      DURATION, EXERCISE OF WARRANTS AND EXERCISE PRICE

Section 2.01  Duration of Warrants ....................................................    7
Section 2.02  Exercise, Exercise Price, Settlement and Delivery. ......................    8
Section 2.03  Cancellation of Warrant Certificates. ...................................    9

                                         ARTICLE III
                                OTHER PROVISIONS RELATING TO
                                RIGHTS OF HOLDERS OF WARRANTS

Section 3.01  Enforcement of Rights. ..................................................    9

                                         ARTICLE IV
                              CERTAIN COVENANTS OF THE COMPANY

Section 4.01  Payment of Taxes. .......................................................   10
Section 4.02  Reservation of Shares. ..................................................   10
Section 4.03  Registration of Securities. .............................................   10

                                          ARTICLE V
                                         ADJUSTMENTS

Section 5.01  Adjustment of Exercise Price and Number of Shares Issuable ..............   11
Section 5.02  Fractional Interest. ....................................................   17
Section 5.03  When Adjustment Not Required. ...........................................   17
Section 5.04  Challenge to Good Faith Determination. ..................................   17
Section 5.05  Treasury Stock. .........................................................   18
Section 5.06  Notices to Warrant Holders. .............................................   18
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Section 5.07  Par Value of Shares of Common Stock .....................................   18

                                         ARTICLE VI
                                CONCERNING THE WARRANT AGENT

Section 6.01  Warrant Agent. ..........................................................   19
Section 6.02  Conditions of Warrant Agent's Obligations. ..............................   19
Section 6.03  Resignation and Appointment of Successor. ...............................   22

                                         ARTICLE VII
                                        MISCELLANEOUS

Section 7.01  Amendment. ..............................................................   24
Section 7.02  Notices and Demands to the Company and Warrant Agent. ...................   24
Section 7.03  Addresses for Notices to Parties and for Transmission of Documents. .....   24
Section 7.04  Notices to Holders ......................................................   25
Section 7.05  Applicable Law. .........................................................   25
Section 7.06  Obtaining of Governmental Approvals. ....................................   25
Section 7.07  Persons Having Rights Under Agreement. ..................................   25
Section 7.08  Headings. ...............................................................   25
Section 7.09  Counterparts. ...........................................................   25
Section 7.10  Inspection of Agreement. ................................................   25
Section 7.11  Successors. .............................................................   26

EXHIBIT A -   Form of Warrant Certificate

EXHIBIT B -   Certificate To Be Delivered upon Exchange or Registration of Transfer of
              Warrants
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                             INDEX OF DEFINED TERMS

Defined Term                                                           Section
------------                                                           -------

Act                                                                   Recitals
Additional Shares of Common Stock                                      5.01(f)
Agreement                                                             Recitals
Business Day                                                              2.01
Common Stock                                                          Recitals
Company                                                               Recitals
Convertible Securities                                                 5.01(e)
Current Market Value                                                   5.01(c)
Definitive Warrants                                                       1.02
Distribution                                                           5.01(f)
Effective Date                                                        Recitals
Election to Exercise                                                   2.02(b)
Excluded Shares                                                        5.01(e)
Exercisability Date                                                    2.02(a)
Exercise Date                                                          2.02(d)
Exercise Price                                                         2.02(a)
Expiration Date                                                           2.01
Fully Diluted Basis                                                    5.01(g)
Global Warrants                                                           1.02
Issuance Date                                                          5.01(e)
Majority Holders                                                          5.04
Market Value                                                           5.01(c)
Nasdaq                                                                 5.01(c)
Officers' Certificate                                              1.08(f)(ii)
Options                                                                5.01(e)
Registrar                                                                 1.07
Related Parties                                                        6.02(e)
SEC                                                                       4.03
Shares                                                                    1.01
Shelf Registration Statement                                              4.03
Underwriter                                                           Recitals
Warrant Agent                                                         Recitals
Warrant Agent Office                                                      1.10
Warrant Certificates                                                  Recitals
Warrant Exercise Office                                                2.02(b)
Warrant Register                                                          1.07
Warrants                                                              Recitals

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                                WARRANT AGREEMENT

     WARRANT AGREEMENT ("Agreement"), dated as of May 26, 2004 (the "Effective
Date") by Syntroleum Corporation, a Delaware corporation (together with any
successor thereto, the "Company"), and American Stock Transfer and Trust
Company, a New York corporation, as warrant agent (with any successor Warrant
Agent, the "Warrant Agent").

     WHEREAS, the Company has entered into an underwriting agreement dated May
21, 2004 with Jefferies & Company, Inc. (the "Underwriter") in which the Company
has agreed, among other things, to sell to the Underwriter in an initial public
offering under the Securities Act of 1933, as amended (the "Act"), units
consisting in the aggregate of (i) 5,916,000 shares of common stock, par value
$.01 per share, of the Company ("Common Stock") and (ii) 887,400 Warrants to
purchase an aggregate of 887,400 shares of Common Stock of the Company (the
"Warrants"), and the certificates evidencing the Warrants being hereinafter
referred to as "Warrant Certificates"), in each case subject to adjustment in
accordance with the terms hereof; and

     WHEREAS, the Warrants and the shares of Common Stock comprising part of the
units shall be separately transferable immediately; and

     WHEREAS, the Company desires the Warrant Agent to assist the Company as
warrant agent in connection with the issuance, exchange, cancellation,
replacement and exercise of the Warrants, and in this Agreement wishes to set
forth, among other things, the terms and conditions on which the Warrants may be
issued, exchanged, canceled, replaced and exercised;

     NOW, THEREFORE, the parties hereto agree as follows:

                                   ARTICLE I
                     ISSUANCE, FORM, EXECUTION, DELIVERY AND
                      REGISTRATION OF WARRANT CERTIFICATES

     Section 1.01  Issuance of Warrants. Each Warrant Certificate shall evidence
the number of Warrants specified therein, each Warrant evidenced thereby shall
represent the right, subject to the provisions contained herein and therein, to
purchase from the Company (and the Company shall issue and sell to such holder
of the Warrant) one fully paid and non-assessable share of the Company's Common
Stock (the shares of Common Stock purchasable upon exercise of a Warrant, as
adjusted from time to time, being hereinafter referred to as the "Shares" and,
where appropriate, such term shall also mean the other securities or property
purchasable and deliverable upon exercise of a Warrant as provided in Article V)
at the price specified herein and therein, in each case subject to adjustment as
provided herein and therein.

     Section 1.02  Form of Warrant Certificates. Warrant Certificates shall be
issued initially in the form of one or more permanent Global Warrants (the
"Global Warrants"), substantially in the form of Exhibit A hereto (including
footnote 1 thereto). The Warrant Certificates evidencing the Global Warrants to
be delivered pursuant to this Agreement shall be substantially in the form set
forth in Exhibit A attached hereto. Such Global Warrants shall represent such of
the outstanding Warrants as shall be specified therein and each shall provide
that it shall represent the aggregate amount of outstanding Warrants from time
to time endorsed thereon and that the

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aggregate amount of outstanding Warrants represented thereby may from time to
time be reduced or increased, as appropriate. Any endorsement of a Global
Warrant to reflect the amount of any increase or decrease in the amount of
outstanding Warrants represented thereby shall be made by the Warrant Agent and
Depositary (as identified below) in accordance with instructions given by the
holder thereof. The Depository Trust Company shall act as the Depositary with
respect to the Global Warrants until a successor shall be appointed by the
Company. Upon written request, a Warrant holder may receive from the Warrant
Agent definitive warrants ("Definitive Warrants") as set forth in Section 1.08
hereof. Definitive Warrants shall be substantially in the form set forth in
Exhibit A attached hereto.

     Section 1.03  Execution of Warrant Certificates. The Warrant Certificates
shall be executed on behalf of the Company by its chief executive officer, its
president or any vice president and attested by its secretary or an assistant
secretary. Such signatures may be the manual or facsimile signatures of the
present or any future such officers. Typographical and other minor errors or
defects in any such reproduction of the signature shall not affect the validity
or enforceability of any Warrant Certificate that has been duly countersigned
and delivered by the Warrant Agent.

     In case any officer of the Company who shall have signed any of the Warrant
Certificates shall cease to be such officer before the Warrant Certificate so
signed shall be countersigned and delivered by the Warrant Agent or disposed of
by the Company, such Warrant Certificate nevertheless may be countersigned and
delivered or disposed of as though the person who signed such Warrant
Certificate had not ceased to be such officer of the Company; and any Warrant
Certificate may be signed on behalf of the Company by such persons as, at the
actual date of the execution of such Warrant Certificate, shall be the proper
officers of the Company, although at the date of the execution and delivery of
this Agreement any such person was not such an officer.

     Section 1.04  Authentication and Delivery. Subject to the immediately
following paragraph, Warrant Certificates shall be authenticated by manual or
facsimile signature and dated the date of authentication by the Warrant Agent
and shall not be valid for any purpose unless so authenticated and dated. The
Warrant Certificates shall be numbered and shall be registered in the Warrant
Register (as defined in Section 1.07 hereof).

     Upon the receipt by the Warrant Agent of a written order of the Company,
which order shall be signed by its chief executive officer, its president or any
vice president and attested by its secretary or an assistant secretary, and
shall specify the amount of Warrants to be authenticated, whether the Warrants
are to be Global Warrants or Definitive Warrants, the date of such Warrants and
such other information as the Warrant Agent may reasonably request, without any
further action by the Company, the Warrant Agent is authorized, upon receipt
from the Company at any time and from time to time of the Warrant Certificates,
duly executed as provided in Section 1.03 hereof, to authenticate the Warrant
Certificates and deliver them. Such authentication shall be by a duly authorized
signatory of the Warrant Agent (although it shall not be necessary for the same
signatory to sign all Warrant Certificates).

     In case any authorized signatory of the Warrant Agent who shall have
authenticated any of the Warrant Certificates shall cease to be such authorized
signatory before the Warrant Certificate shall be disposed of by the Company,
such Warrant Certificate nevertheless may be

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delivered or disposed of as though the person who authenticated such Warrant
Certificate had not ceased to be such authorized signatory of the Warrant Agent;
and any Warrant Certificate may be authenticated on behalf of the Warrant Agent
by such persons as, at the actual time of authentication of such Warrant
Certificates, shall be the duly authorized signatories of the Warrant Agent,
although at the time of the execution and delivery of this Agreement any such
person is not such an authorized signatory.

     The Warrant Agent's authentication on all Warrant Certificates shall be in
substantially the form set forth in Exhibit A hereto.

     Section 1.05  Temporary Warrant Certificates. Pending the preparation of
definitive Warrant Certificates, the Company may execute, and, upon receipt of
an authentication order in accordance with Section 1.04 hereof, the Warrant
Agent shall authenticate and deliver, temporary Warrant Certificates, which are
printed, lithographed, typewritten or otherwise produced, substantially of the
tenor of the definitive Warrant Certificates in lieu of which they are issued
and with such appropriate insertions, omissions, substitutions and other
variations as the officers executing such Warrant Certificates may determine, as
evidenced by their execution of such Warrant Certificates.

     If temporary Warrant Certificates are issued, the Company will cause
definitive Warrant Certificates to be prepared without unreasonable delay. After
the preparation of definitive Warrant Certificates, the temporary Warrant
Certificates shall be exchangeable for definitive Warrant Certificates upon
surrender of the temporary Warrant Certificates at any office or agency
maintained by the Company for that purpose pursuant to Section 1.10 hereof.
Subject to the provisions of Section 4.01 hereof, such exchange shall be without
charge to the holder. Upon surrender for cancellation of any one or more
temporary Warrant Certificates, the Company shall execute, and, upon receipt of
an authentication order in accordance with Section 1.04 hereof, the Warrant
Agent shall authenticate and deliver in exchange therefor, one or more
definitive Warrant Certificates representing in the aggregate a like number of
Warrants. Until so exchanged, the holder of a temporary Warrant Certificate
shall in all respects be entitled to the same benefits under this Agreement as a
holder of a definitive Warrant Certificate.

     Section 1.06  Separation of Warrants and Shares. The Shares and Warrants
will be separately transferable immediately.

     Section 1.07  Registration. The Company will keep, at the office or agency
maintained by the Company for such purpose, a register or registers in which,
subject to such reasonable regulations as it may prescribe, the Company shall
provide for the registration of, and registration of transfer and exchange of,
Warrants as provided in this Article. Each person designated by the Company from
time to time as a person authorized to register the transfer and exchange of the
Warrants is hereinafter called, individually and collectively, the "Registrar."
The Company hereby initially appoints the Warrant Agent as Registrar. Upon
written notice to the Warrant Agent and any acting Registrar, the Company, in
its sole discretion, may appoint a successor Registrar for such purposes.

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     Section 1.08  Registration of Transfers and Exchanges.

          (a)  Transfer and Exchange of Definitive Warrants. When Definitive
Warrants are presented to the Warrant Agent with a request:

               (i)    to register the transfer of the Definitive Warrants; or

               (ii)   to exchange such Definitive Warrants for an equal number
of Definitive Warrants,

the Warrant Agent shall register the transfer or make the exchange as requested
if the requirements under this Warrant Agreement as set forth in this Section
1.08 hereof for such transactions are met; provided, however, that the
Definitive Warrants presented or surrendered for registration of transfer or
exchange shall be duly endorsed or accompanied by a written instruction of
transfer in form satisfactory to the Company and the Warrant Agent, duly
executed by the holder thereof or by his attorney, duly authorized in writing.

          (b)  Restrictions on Transfer of a Definitive Warrant for a Beneficial
Interest in a Global Warrant. A Definitive Warrant may not be transferred for a
beneficial interest in a Global Warrant except upon satisfaction of the
requirements set forth below. Upon receipt by the Warrant Agent of a Definitive
Warrant, duly endorsed or accompanied by appropriate instruments of transfer, in
form satisfactory to the Warrant Agent, together with written instructions
directing the Warrant Agent to make, or to direct the Depositary to make, an
endorsement on the Global Warrant to reflect an increase in the aggregate amount
of the Warrants represented by the Global Warrant, then the Warrant Agent shall
cancel such Definitive Warrant and cause, or direct the Depositary to cause, in
accordance with the standing instructions and procedures existing between the
Depositary and the Warrant Agent, the number of Warrants represented by the
Global Warrant to be increased accordingly. If no Global Warrant is then
outstanding, the Company shall issue and the Warrant Agent shall authenticate a
new Global Warrant in the appropriate amount.

          (c)  Transfer and Exchange of Global Warrants. The transfer and
exchange of Global Warrants or beneficial interests therein shall be effected
through the Depositary, in accordance with this Section 1.08 and the procedures
of the Depositary therefor.

          (d)  Transfer of a Beneficial Interest in a Global Warrant for a
Definitive Warrant.

               (i)    Any person having a beneficial interest in a Global
Warrant may upon request transfer such beneficial interest for a Definitive
Warrant. Upon receipt by the Warrant Agent of written instructions or such other
form of instructions as is customary for the Depositary from the Depositary or
its nominee on behalf of any person having a beneficial interest in a Global
Warrant and upon receipt by the Warrant Agent of a written order or such other
form of instructions as is customary for the Depositary or the person designated
by the Depositary as having such a beneficial interest containing registration
instructions then the Warrant Agent will cause, in accordance with the standing
instructions and procedures existing between the Depositary and the Warrant
Agent, the aggregate amount of the Global Warrant to be reduced and, following
such reduction, the Company will execute and, upon receipt of an

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authentication order in the form of an Officers' Certificate (as defined), the
Warrant Agent will authenticate and deliver to the transferee a Definitive
Warrant. If such beneficial interest is being transferred to the person
designated by the Depositary as being the beneficial owner, a certification from
such person to that effect (in substantially the form of Exhibit B hereto) may
be required.

               (ii)   Definitive Warrants issued in exchange for a beneficial
interest in a Global Warrant pursuant to this Section 1.08(d) shall be
registered in such names and in such authorized denominations as the Depositary,
pursuant to instructions from its direct or indirect participants or otherwise,
shall instruct the Warrant Agent in writing. The Warrant Agent shall deliver
such Definitive Warrants to the persons in whose names such Warrants are so
registered.

          (e)  Restrictions on Transfer and Exchange of Global Warrants.
Notwithstanding any other provisions of this Warrant Agreement (other than the
provisions set forth in subsection (h) of this Section 1.08), a Global Warrant
may not be transferred as a whole except by the Depositary to a nominee of the
Depositary or by a nominee of the Depositary to the Depositary or another
nominee of the Depositary or by the Depositary or any such nominee to a
successor Depositary or a nominee of such successor Depositary.

          (f)  Authentication of Definitive Warrants in Absence of Depositary.
If at any time:

               (i)    the Depositary for the Warrants notifies the Company that
the Depositary is unwilling or unable to continue as Depositary for the Global
Warrant and a successor Depositary for the Global Warrant is not appointed by
the Company within 90 days after delivery of such notice; or

               (ii)   the Company, at its sole discretion, notifies the Warrant
Agent in writing that it elects to cause the issuance of Definitive Warrants
under this Warrant Agreement,

then the Company will execute, and the Warrant Agent, upon receipt of an
officers' certificate signed by two officers of the Company (one of whom must be
the principal executive officer, principal financial officer or principal
accounting officer) (an "Officers' Certificate") requesting the authentication
and delivery of Definitive Warrants, will authenticate and deliver Definitive
Warrants, in an aggregate number equal to the aggregate number of warrants
represented by the Global Warrant, in exchange for such Global Warrant.

          (g)  Cancellation and/or Adjustment of a Global Warrant. At such time
as all beneficial interests in a Global Warrant have either been exchanged for
Definitive Warrants, redeemed, repurchased or canceled, such Global Warrant
shall be returned to or retained and cancelled by the Warrant Agent. At any time
prior to such cancellation, if any beneficial interest in a Global Warrant is
exchanged for Definitive Warrants, redeemed, repurchased or cancelled, the
number of Warrants represented by such Global Warrant shall be reduced and an
endorsement shall be made on such Global Warrant, by the Warrant Agent to
reflect such reduction.

          (h)  Obligations with Respect to Transfers and Exchanges of Definitive
 Warrants.

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               (i)    To permit registrations of transfers and exchanges, the
Company shall execute, at the Warrant Agent's request, Definitive Warrants and
Global Warrants. Furthermore, the Warrant Agent shall, upon receipt of an
authentication order in accordance with Section 1.04 hereof, authenticate
Definitive Warrants and Global Warrants.

               (ii)   All Definitive Warrants and Global Warrants issued upon
any registration, transfer or exchange of Definitive Warrants or Global Warrants
shall be the valid obligations of the Company, entitled to the same benefits
under this Warrant Agreement as the Definitive Warrants or Global Warrants
surrendered upon the registration of transfer or exchange.

               (iii)  Prior to due presentment for registration of transfer of
any Warrant, the Warrant Agent and the Company may deem and treat the person in
whose name any Warrant is registered as the absolute owner of such Warrant, and
neither the Warrant Agent nor the Company shall be affected by notice to the
contrary.

          (i)  Payment of Taxes. The Company will pay all documentary stamp
taxes attributable to the initial issuance of the Shares upon the exercise of
Warrants; provided, however, that the Company shall not be required to pay any
tax or taxes which may be payable in respect of any transfer involved in the
issue of any Warrant Certificates or any certificates for the Shares in a name
other than that of the registered holder of a Warrant Certificate surrendered
upon the exercise of a Warrant, and the Company shall not be required to issue
or deliver such Warrant Certificates unless or until the person or persons
requesting the issuance thereof shall have paid to the Company the amount of
such tax or shall have established to the satisfaction of the Company that such
tax has been paid.

     Section 1.09  Lost, Stolen, Destroyed, Defaced or Mutilated Warrant
Certificates. Upon receipt by the Company and the Warrant Agent (or any agent of
the Company or the Warrant Agent, if requested by the Company) of evidence
satisfactory to them of the loss, theft, destruction, defacement, or mutilation
of any Warrant Certificate and of indemnity reasonably satisfactory to them and,
in the case of mutilation or defacement, upon surrender thereof to the Warrant
Agent for cancellation, then, in the absence of notice to the Company or the
Warrant Agent that such Warrant Certificate has been acquired by a bona fide
purchaser or holder in due course, the Company shall execute, and, upon receipt
of an authentication order in accordance with Section 1.04 hereof, an authorized
signatory of the Warrant Agent shall manually authenticate and deliver, in
exchange for or in lieu of the lost, stolen, destroyed, defaced or mutilated
Warrant Certificate, a new Warrant Certificate representing a like number of
Warrants, bearing a number or other distinguishing symbol not contemporaneously
outstanding. Upon the issuance of any new Warrant Certificate under this
Section, the Company may require the payment from the holder of such Warrant
Certificate of a sum sufficient to cover any tax, stamp tax or other
governmental charge that may be imposed in relation thereto and any other
expenses (including the fees and expenses of the Warrant Agent and the
Registrar) in connection therewith. Every substitute Warrant Certificate
executed and delivered pursuant to this Section in lieu of any lost, stolen or
destroyed Warrant Certificate shall constitute an additional contractual
obligation of the Company, whether or not the lost, stolen or destroyed Warrant
Certificate shall be at any time enforceable by anyone, and shall be entitled to
the benefits of (but shall be subject to all the limitations of rights set forth
in) this Agreement equally and proportionately with any

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and all other Warrant Certificates duly executed and delivered hereunder. The
provisions of this Section 1.09 are exclusive with respect to the replacement of
lost, stolen, destroyed, defaced or mutilated Warrant Certificates and shall
preclude (to the extent lawful) any and all other rights or remedies
notwithstanding any law or statute existing or hereafter enacted to the contrary
with respect to the replacement of lost, stolen, destroyed, defaced or mutilated
Warrant Certificates.

     The Warrant Agent is hereby authorized to authenticate in accordance with
the provisions of this Agreement, and deliver the new Warrant Certificates
required pursuant to the provisions of this Section.

     Section 1.10  Offices for Exercise, etc. So long as any of the Warrants
remain outstanding, the Company will designate and maintain in New York City,
New York: (a) an office or agency where the Warrant Certificates may be
presented for exercise, (b) an office or agency where the Warrant Certificates
may be presented for registration of transfer and for exchange (including the
exchange of temporary Warrant Certificates for definitive Warrant Certificates
pursuant to Section 1.05 hereof), and (c) an office or agency where notices and
demands to or upon the Company in respect of the Warrants or of this Agreement
may be served. The Company may from time to time change or rescind such
designation, as it may deem desirable or expedient; provided, however, that an
office or agency shall at all times be maintained in New York City, New York, as
provided in the first sentence of this Section. In addition to such office or
offices or agency or agencies, the Company may from time to time designate and
maintain one or more additional offices or agencies within or outside of New
York, where Warrant Certificates may be presented for exercise or for
registration of transfer or for exchange, and the Company may from time to time
change or rescind such designation, as it may deem desirable or expedient. The
Company will give to the Warrant Agent written notice of the location of any
such office or agency and of any change of location thereof. The Company hereby
designates the Warrant Agent's office at 59 Maiden Lane in the Borough of
Manhattan, City of New York (the "Warrant Agent Office"), as the initial agency
maintained for each such purpose.

                                   ARTICLE II
                DURATION, EXERCISE OF WARRANTS AND EXERCISE PRICE

     Section 2.01  Duration of Warrants. Subject to the terms and conditions
established herein, the Warrants shall expire at 5:00 p.m., New York City, New
York time, on May 26, 2008 (the "Expiration Date"). Each Warrant may be
exercised on any Business Day (as defined below) on or after the Exercisability
Date (as defined below) and on or prior to the Expiration Date.

     Any Warrant not exercised on or prior to the Expiration Date relating to
such Warrant shall become void, and all rights of the holder under the Warrant
Certificate evidencing such Warrant and under this Agreement shall cease.

     "Business Day" shall mean any day on which (i) banks in New York City, New
York are open for business, (ii) the principal national securities exchange or
market on which the Common Stock is listed or admitted to trading is open for
business and (iii) the principal national

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securities exchange or market, if any, on which the Warrants are listed or
admitted to trading are open for business.

     Section 2.02  Exercise, Exercise Price, Settlement and Delivery.

          (a)  Subject to the provisions of this Agreement, a holder of each
Warrant shall have the right to purchase from the Company on or after the
Effective Date (the "Exercisability Date") and on or prior to the Expiration
Date one fully paid, registered and non-assessable Share, at the purchase price
of $7.60 for each share purchased upon the exercise of the Warrants (the
"Exercise Price"), in each case subject to adjustment in accordance with Article
V hereof,.

          (b)  Warrants may be exercised on or after the Exercisability Date by
(i) surrendering at any office or agency maintained for that purpose by the
Company pursuant to Section 1.10 (each a "Warrant Exercise Office") the Warrant
Certificate evidencing such Warrants with the form of election to purchase
Shares set forth on the reverse side of the Warrant Certificate (the "Election
to Exercise") duly completed and signed by the registered holder or holders
thereof or by the duly appointed legal representative thereof or by a duly
authorized attorney, and (ii) paying in full the Exercise Price for each such
Warrant exercised and any other amounts required to be paid pursuant to Section
1.08(i) hereof. Each Warrant may be exercised only in whole.

          (c)  Simultaneously with the exercise of each Warrant, payment in full
of the Exercise Price shall be made in cash or by certified or official bank
check to be delivered to the office or agency where the Warrant Certificate is
being surrendered. No payment or adjustment shall be made on account of any
dividends on the Shares issued upon exercise of a Warrant.

          (d)  Upon such surrender of a Warrant Certificate and payment and
collection of the Exercise Price at any Warrant Exercise Office (other than any
Warrant Exercise Office that also is an office of the Warrant Agent), such
Warrant Certificate and payment shall be promptly delivered to the Warrant
Agent. The "Exercise Date" for a Warrant shall be the date when all of the items
referred to in the first sentence of paragraphs (b) and (c) of this Section 2.02
are received by the Warrant Agent at or prior to 2:00 p.m., New York City, New
York time, on a Business Day and the exercise of the Warrants will be effective
as of such Exercise Date. If any items referred to in the first sentence of
paragraphs (b) and (c) are received after 2:00 p.m., New York City, New York
time, on a Business Day, the exercise of the Warrants to which such item relates
will be effective on the next succeeding Business Day. Notwithstanding the
foregoing, in the case of an exercise of Warrants on the Expiration Date (as
defined in Section 2.01), if all of the items referred to in the first sentence
of paragraphs (b) and (c) are received by the Warrant Agent at or prior to 5:00
p.m., New York City, New York time, on such Expiration Date, the exercise of the
Warrants to which such items relate will be effective on the Expiration Date. If
all of the items referred to in the first sentence of paragraphs (b) and (c) are
received by the Warrant Agent after 5:00 p.m., New York City time, on such
Expiration Date, the exercise of the Warrants to which such items relate will
not be effective and shall be void.

          (e)  Upon the exercise of a Warrant in accordance with the terms
hereof, the receipt of a Warrant Certificate and payment of the Exercise Price,
the Warrant Agent shall: (i) cause an amount equal to the Exercise Price to be
paid to the Company by crediting the same to

                                       8

<PAGE>

the account designated by the Company in writing to the Warrant Agent for that
purpose; (ii) advise the Company immediately by telephone of the amount so
deposited to the Company's account and promptly confirm such telephonic advice
in writing and (iii) as soon as practicable, advise the Company in writing of
the number of Warrants (giving effect to Section 5.01(i) below) exercised in
accordance with the terms and conditions of this Agreement and the Warrant
Certificates, the instructions of each exercising holder of the Warrant
Certificates with respect to delivery of the Shares to which such holder is
entitled upon such exercise, and such other information as the Company shall
reasonably request.

          (f)  Subject to Section 5.02 hereof, as soon as practicable after the
exercise of any Warrant or Warrants in accordance with the terms hereof, the
Company shall issue or cause to be issued to or upon the written order of the
registered holder of the Warrant Certificate evidencing such exercised Warrant
or Warrants, a certificate or certificates evidencing the Shares to which such
holder is entitled, in fully registered form, registered in such name or names
as may be directed by such holder pursuant to the Election to Exercise, as set
forth on the reverse of the Warrant Certificate. The Warrant Agent shall have no
obligation to ascertain the number of Shares to be issued with respect to the
exercised Warrant or Warrants. Such certificate or certificates evidencing the
Shares shall be deemed to have been issued and any persons who are designated to
be named therein shall be deemed to have become the holder of record of such
Shares as of the close of business on the Exercise Date. After such exercise of
any Warrant or Warrants, the Company shall also issue or cause to be issued to
or upon the written order of the registered holder of such Warrant Certificate,
a new Warrant Certificate, countersigned by the Warrant Agent pursuant to the
Company's written instruction, evidencing the number of Warrants, if any,
remaining unexercised unless such Warrants shall have expired.

     Section 2.03  Cancellation of Warrant Certificates. In the event the
Company shall purchase or otherwise acquire Warrants, the Warrant Certificates
evidencing such Warrants may thereupon be delivered to the Warrant Agent, and if
so delivered, shall be canceled by it and retired. The Warrant Agent shall
cancel all Warrant Certificates properly surrendered for exchange, substitution,
transfer or exercise. The Warrant Agent shall account promptly to the Company
with respect to Warrants exercised and concurrently pay to the Company all
monies received by the Warrant Agent for the purchase of Warrant Shares through
the exercise of such Warrants.

                                  ARTICLE III
                          OTHER PROVISIONS RELATING TO
                          RIGHTS OF HOLDERS OF WARRANTS

     Section 3.01  Enforcement of Rights.

          (a)  Notwithstanding any of the provisions of this Agreement, any
holder of any Warrant Certificate, without the consent of the Warrant Agent, the
holder of any Shares or the holder of any other Warrant Certificate, may, in and
for his own behalf, enforce, and may institute and maintain any suit, action or
proceeding against the Company suitable to enforce, his right to exercise the
Warrant or Warrants evidenced by his Warrant Certificate in the manner provided
in such Warrant Certificate and in this Agreement.

                                       9

<PAGE>

          (b)  Neither the Warrants nor any Warrant Certificate shall entitle
the holders thereof to any of the rights of a holder of Shares, including,
without limitation, the right to vote or to receive any dividends or other
payments or to consent or to receive notice as stockholders in respect of the
meetings of stockholders or for the election of directors of the Company or to
share in the assets of the Company in the event of the liquidation, dissolution
or winding up of the Company's affairs or any other matter, or any rights
whatsoever as stockholders of the Company.

                                   ARTICLE IV
                        CERTAIN COVENANTS OF THE COMPANY

     Section 4.01  Payment of Taxes.The Company will pay all documentary stamp
taxes attributable to the initial issuance of Warrants and of the Shares upon
the exercise of Warrants or to the separation of the Warrants and Shares;
provided, however, that the Company shall not be required to pay any tax or
other governmental charge which may be payable in respect of any transfer or
exchange of any Warrant Certificates or any certificates for Shares in a name
other than the registered holder of a Warrant Certificate surrendered upon the
exercise of a Warrant. In any such case, no transfer or exchange shall be made
unless or until the person or persons requesting issuance thereof shall have
paid to the Company the amount of such tax or other governmental charge or shall
have established to the satisfaction of the Company that such tax or other
governmental charge has been paid or an exemption is available therefrom.

     Section 4.02  Issuance and Reservation of Shares.The Company shall take all
actions necessary to ensure that the shares of Common Stock issuable upon
exercise of the Warrants shall be duly authorized and, when issued upon exercise
or exchange of any Warrant in accordance with the terms hereof, shall be validly
issued, fully paid and non-assessable, free and clear of all taxes, liens,
charges and security interests and free and clear of all preemptive or similar
rights. There has been reserved and the Company shall at all times keep reserved
so long as the Warrants remain outstanding, out of its authorized Common Stock,
such number of shares of Common Stock as shall be subject to purchase under the
Warrants. On or before taking any action that would cause an adjustment pursuant
to the terms of the Warrants resulting in an increase in the number of shares of
Common Stock deliverable upon such conversion or exercise above the number
thereof previously authorized, reserved and available therefore, the Company
shall take all such action so required for compliance with this Section.

     Section 4.03  Registration of Securities.The Company agrees, for so long as
any Warrants continue to be outstanding, to use its best efforts to (i) maintain
the effectiveness of the Company's Registration Statement on Form S-3
(Registration No. 333-62290) (the "Shelf Registration Statement") and file any
and all post effective amendments to the Shelf Registration Statement necessary
to maintain such effectiveness, (ii) make all required filings under applicable
securities laws and regulations necessary to keep current the Shelf Registration
Statement, (iii) reserve capacity under the Shelf Registration Statement of a
sufficient number of shares of Common Stock to accommodate the exercise of all
outstanding Warrants, (iv) make all filings required under applicable federal
and state securities laws, as may be necessary to permit the issuance of
registered shares of Common Stock upon the exercise of the Warrants at any and
all times during the period the Warrants are exercisable and (v) take all
actions required to cause the exchange of Warrants for shares of Common Stock as
provided below in this Section 4.03 to

                                       10

<PAGE>

be exempt from the registration requirements of the Securities Act of 1933, as
amended, and state qualification requirements; provided, however, that the
Company shall not be obligated to file any general consent to service of process
or to qualify as a foreign corporation or as a dealer in securities in any
jurisdiction in which it is not so qualified or to subject itself to taxation in
respect of doing business in any jurisdiction in which it is not otherwise so
subject. If at any time the effectiveness of the Shelf Registration Statement
lapses or the Shelf Registration Statement is otherwise not available for the
issuance of shares of Common Stock upon the exercise of the Warrants, the
Company shall use its best efforts to prepare and file with the Securities and
Exchange Commission (the "SEC"), a registration statement and such other
documents as may be necessary and use its commercially reasonable efforts to
have such registration statement declared effective as promptly thereafter as
practical, in order to comply with the provisions of the Act so as to permit the
registered resale of the shares of Common Stock issuable upon exercise of the
Warrants. In the event that at the time a notice of exercise is delivered to the
Warrant Agent either (i) a registration statement covering issuance or resale of
the shares of Common Stock issuable upon exercise of the Warrants is not in
effect or (ii) the Shelf Registration Statement is not available or
qualifications under applicable state securities laws are not in effect for the
issuance of shares of Common Stock upon the exercise of the Warrants and such
purchase and the resale of Warrant Shares by the Warrantholders are not exempt
from the registration requirements of the Securities Act of 1933, as amended,
and such state qualification requirements, then, the Company shall, if requested
by the Warrantholder giving the notice of exercise, exchange the Warrants being
exercised for a number of shares of Common Stock equal to the whole number
nearest to (a) the number of shares of Common Stock issuable upon exercises of
such Warrants minus (b) the number of shares of Common Stock equal to the
quotient obtained by dividing (i) the product obtained by multiplying (A) the
Exercise Price by (B) the number of shares of Common Stock issuable upon
exercises of such Warrants by (ii) the Current Market Value. In the event that
the Shelf Registration Statement or another registration statement is not
effective and available or qualifications under applicable state securities laws
are not in effect for the issuance of shares of Common Stock upon the exercise
of the Warrants, a holder of a Warrant would not be permitted under applicable
securities laws to purchase shares of Common Stock upon exercise of the Warrants
unless such purchase or exchange is exempt from the registration requirements of
the Securities Act of 1933, as amended, and such state qualification
requirements, provided that the holders would be allowed to exchange Warrants
for shares of Common Stock as provided in Section 4.03.

                                   ARTICLE V
                                   ADJUSTMENTS

     Section 5.01  Adjustment of Exercise Price and Number of Shares Issuable.
The number and kind of Shares purchasable upon the exercise of Warrants and the
Exercise Price shall be subject to adjustment from time to time upon the
happening of certain events, as follows:

          (a)  Stock Splits, Combinations, etc. In case the Company after the
date hereof shall (A) make or pay a dividend or make a distribution in shares of
Common Stock on its Common Stock, (B) subdivide its outstanding shares of Common
Stock into a greater number of shares or (C) combine or reclassify its
outstanding shares of Common Stock into a smaller number of shares, the number
of Shares purchasable upon exercise of the Warrants immediately prior to such
action shall be adjusted so that the holder of any Warrant upon exercise of the

                                       11

<PAGE>

Warrants shall be entitled to receive the number of shares of Common Stock which
such holder would have owned or would have been entitled to receive immediately
following such action had the Warrants been exercised immediately prior thereto.
An adjustment made pursuant to this paragraph shall become effective on the day
immediately after the record date, except as provided in Section 5.03 below, in
the case of a dividend or distribution and shall become effective on the day
immediately after the effective date in the case of a subdivision or combination
or reclassification. Whenever the number of Shares purchasable upon the exercise
of a Warrant is adjusted as provided in this paragraph (a), the Exercise Price
shall be adjusted by multiplying such Exercise Price immediately prior to such
adjustment by a fraction, of which the numerator shall be the number of Shares
purchasable upon the exercise of the Warrants immediately prior to such
adjustment, and of which the denominator shall be the number of Shares so
purchasable immediately thereafter.

          (b)  In case the Company or any subsidiary of the Company after the
date hereof shall distribute to all holders of Common Stock any of its assets,
evidences of indebtedness, cash or securities (excluding any distributions
referred to in paragraph (a) and any dividend or distribution paid in cash out
of earned surplus of the Company) then in each such case the Exercise Price
shall be adjusted so that the same shall equal the price determined by
multiplying the Exercise Price in effect immediately prior to the record date of
such distribution by a fraction of which the numerator shall be the then Current
Market Value per share of the Common Stock (determined as provided in paragraph
(c) below) on the record date mentioned below less the then fair market value
(as reasonably determined in good faith by the Board of Directors of the
Company) of the portion of the assets, evidences of indebtedness, cash or
securities so distributed applicable to one share of Common Stock, and of which
the denominator shall be such Current Market Value per share of the Common
Stock. Such adjustment shall, except as provided in Section 5.03, become
effective on the day immediately after the record date for the determination of
stockholders entitled to receive such distribution.

          (c)  For the purposes of this Warrant Agreement, the Current Market
Value per share of Common Stock on any date shall be deemed to be the average of
the Market Value of the Common Stock for the 10 trading days before, and ending
not later than, the earlier of the date in question and the date before the
"`ex' date", with respect to the issuance or distribution requiring such
computation. For purposes of this paragraph (c), the term "`ex' date," when used
with respect to any issuance or distribution, means the first date on which the
Common Stock trades regular way on the Nasdaq Stock Market ("Nasdaq") (or, if
not listed or admitted to trading thereon, then on the principal national
securities exchange or automated quotation system on which the Common Stock is
listed or admitted to trading and if not listed or admitted to trading on any
national securities exchange or automated quotation system, as determined in
good faith by the Company's Board of Directors) without the right to receive
such issuance or distribution. "Market Value" on any trading day shall mean (i)
in the case of a security traded on the over-the-counter market and not on
Nasdaq nor on any national securities exchange, the per share last sale price of
the Common Stock on such trading day as reported by Nasdaq or an equivalent
generally accepted reporting service; (ii) in the case of a security traded on
Nasdaq or on a national securities exchange, the per share last sale price of
the Common Stock on such trading day on Nasdaq or on the principal stock
exchange on which it is listed, as the case may be or (iii) if neither clause
(i) or (ii) above is applicable, then the fair value thereof as determined in
good faith by the Company's Board of Directors. For purposes of clause (i)
above, if trading

                                       12

<PAGE>

in the Common Stock is not reported by Nasdaq, the bid price referred to in said
clause shall be the lowest bid price as reported in the "pink sheets" published
by National Quotation Bureau, Incorporated. The last sale price referred to in
clause (ii) above shall be the last reported sale price or, in case no such
reported sale takes place on such day, the average of the reported closing bid
and asked prices, in either case on Nasdaq or on the national securities
exchange on which the Common Stock is then listed.

          (d)  Reclassification, Combinations, Mergers, etc. In case of any
reclassification or change of outstanding shares of Common Stock (other than as
set forth in Section 5.01(a) above and other than a change in par value, or from
par value to no par value, or from no par value to par value, or in case of any
consolidation or merger of the Company with or into another corporation (other
than a merger in which the Company is the continuing corporation and which does
not result in any reclassification or change of the then outstanding shares of
Common Stock (other than a change in par value, or from par value to no par
value, or from no par value to par value or as a result of a subdivision or
combination)) or in case of any sale or conveyance to another corporation of all
or substantially all of the assets of the Company (computed on a consolidated
basis), then, as a condition of such reclassification, change, consolidation,
merger, sale or conveyance, the Company or such a successor or purchasing
corporation, as the case may be, shall forthwith make lawful and adequate
provision whereby the holder of such Warrant then outstanding shall have the
right thereafter to receive on exercise of such Warrant the kind and amount of
shares of stock and other securities and property receivable upon such
reclassification, change, consolidation, merger, sale or conveyance by a holder
of the number of shares of Common Stock issuable upon exercise of such Warrant
immediately prior to such reclassification, change, consolidation, merger, sale
or conveyance and enter into a supplemental warrant agreement so providing. Such
provisions shall include provision for adjustments which shall be as nearly
equivalent as may be practicable to the adjustments provided for in this Article
V. If the issuer of securities deliverable upon exercise of Warrants under the
supplemental warrant agreement is an affiliate of the surviving or transferee
corporation, that issuer shall join in the supplemental warrant agreement. The
above provisions of this paragraph (d) shall similarly apply to successive
reclassifications and changes of shares of Common Stock and to successive
consolidations, mergers, sales or conveyances.

     In case of any such reclassification, merger, consolidation or disposition
of assets, the successor or acquiring corporation (if other than the Company)
shall expressly assume the due and punctual observance and performance of each
and every covenant and condition of this Warrant Agreement to be performed and
observed by the Company and all the obligations and liabilities hereunder,
subject to such modifications as may be deemed appropriate (as determined by
resolution of the Board of Directors of the Company) in order to provide for
adjustments of shares of the Common Stock for which this Warrant is exercisable
which shall be as nearly equivalent as practicable to the adjustments provided
for in this Article V. The foregoing provisions of this Section 5.01(d) shall
similarly apply to successive reorganizations, reclassifications, mergers,
consolidations or disposition of assets.

     If, as a result of an adjustment made pursuant to this paragraph, the
holder of any Warrant thereafter exercised shall become entitled to receive
shares of two or more classes of capital stock of the Company, the Board of
Directors of the Company (whose determination shall be

                                       13

<PAGE>

conclusive) shall determine the allocation of the adjusted Exercise Price
between or among shares of such classes of capital stock.

          (e)  Issuance of Common Stock, Options or Convertible Securities. For
the purposes of this Warrant Agreement, "Additional Shares of Common Stock"
shall mean all shares of Common Stock issued or deemed to be issued by the
Company after the Effective Date, other than Excluded Shares (as defined below).

     In the event the Company shall, at any time or from time to time after the
Effective Date, issue, sell, distribute or otherwise grant in any manner
(including by assumption) shares of Common Stock or any rights to subscribe for
or to purchase, or any warrants or options for the purchase of, Common Stock or
any stock or securities convertible into or exchangeable for Common Stock (any
such rights, warrants or options being herein called "Options" and any such
convertible or exchangeable stock or securities being herein called "Convertible
Securities") or any Convertible Securities (other than upon exercise of any
Option), whether or not such Options or the rights to convert or exchange such
Convertible Securities are immediately exercisable, then the maximum number of
shares of Common Stock (as set forth in the instrument relating thereto without
regard to any provision contained therein for a subsequent adjustment of such
number) issuable upon the exercise and/or conversion of such Options or
Convertible Securities, shall be deemed to be Additional Shares of Common Stock.

     For purposes of this Warrant Agreement, the term "Issuance Date" shall mean
(i) with respect to Additional Shares of Common Stock deemed to have been issued
in connection with the issuance of an Option or Convertible Security, the date
such Option or Convertible Security is issued and (ii) in all other cases, the
actual date Additional Shares of Common Stock are issued.

     For the purposes of this Warrant Agreement, "Excluded Shares" shall mean:
(i) shares for which the consideration per share as determined pursuant to
paragraph (f) below would be equal to or more than the Current Market Value
determined on the day prior to the Issuance Date; (ii) shares for which the
consideration per share as determined pursuant to (f) below is equal to or
greater than the initial Exercise Price (appropriately adjusted to reflect stock
splits or combinations, stock dividends, reorganizations, consolidations and
similar changes); (iii) shares of Common Stock issuable upon the exercise of
Options or conversion or payment of Convertible Securities existing as of the
Effective Date; (iv) shares of Common Stock (appropriately adjusted to reflect
stock splits or combinations, stock dividends, reorganizations, consolidations
and similar changes) issued pursuant to (A) any stock incentive plan existing as
of the Effective Date or (B) any amendment thereto or any additional stock
incentive plan adopted by the stockholders of the Company after the Effective
Date; and (v) shares issued pursuant to the adjustment provisions of this
Section 5.01. The issuance of Excluded Shares shall not be an issuance of
Additional Shares of Common Stock, and shall not give rise to an adjustment or a
right to purchase the securities pursuant to paragraph (f) below.

     In any such case in which the Additional Shares of Common Stock are deemed
to be issued, no right to receive an adjustment or to purchase securities under
Section 5.01(f) below will accrue upon the subsequent issue of shares of Common
Stock upon the exercise and/or conversion or exchange of such Option or

                                       14

<PAGE>

Convertible Security unless such Option or Convertible Security shall have been
amended or modified prior to exercise or conversion or exchange so as to
increase the number of Additional Shares of Common Stock deemed to have been
issued thereunder or decrease the exercise and/or conversion or exchange price
payable thereunder to an amount less than Current Market Value as of the
Issuance Date thereof.

          (f)  If the price per share at which Common Stock is issued after the
Effective Date or Common Stock is issuable upon the exercise of Options or upon
the conversion or exchange of Convertible Securities issued after the Effective
Date, in either case other than Excluded Shares (determined by dividing (i) the
aggregate amount, if any, received or receivable by the Company as consideration
for the issuance, sale, distribution or granting of such Common Stock or Options
or any such Convertible Security, plus the minimum aggregate amount of
additional consideration, if any, payable to the Company upon the issuance of
Common Stock or the exercise of all such Options or upon conversion or exchange
of all such Convertible Securities, plus, in the case of Options to acquire
Convertible Securities, the minimum aggregate amount of additional
consideration, if any, payable upon the conversion or exchange of all such
Convertible Securities, by (ii) the total maximum number of shares of Common
Stock to be issued, sold, distributed or granted or issuable upon the exercise
of all such Options or upon the conversion or exchange of all such Convertible
Securities or upon the conversion or exchange of all Convertible Securities
issuable upon the exercise of all Options (as set forth in the instrument
relating thereto without regard to any provision contained therein for a
subsequent adjustment of such number)) shall be less than the Current Market
Value per share of Common Stock (determined pursuant to Section 5.01(c)) on the
Issuance Date of such Common Stock, Options or Convertible Securities then,
unless the Company offers to sell to each holder of Warrants, at the same price
and on the same terms offered to all other prospective buyers (provided that the
holders of Warrants shall not be required to buy any securities or other assets
in order to buy such Common Stock, Options or Convertible Securities, except in
the context of an offering of units of packaged securities), a number of shares
of Common Stock, Options or Convertible Securities that is equal to the product
of such holder's portion of the Common Stock then outstanding if immediately
prior thereto all the Warrants held by such holder had been exercised,
multiplied by the number of shares of Common Stock, Options or Convertible
Securities so issued, sold, distributed or granted:

               (i)    The Exercise Price shall be reduced to an amount equal to
the product obtained by multiplying (A) the Exercise Price in effect immediately
prior to such issuance or sale times (B) a fraction, (I) the numerator of which
shall be the sum of (x) the product of (1) the number of shares of Common Stock
outstanding (on a Fully Diluted Basis) immediately prior to such issuance or
sale times (2) the Current Market Value per share as of the date of such
issuance or sale plus (y) the consideration, if any, received or receivable by
the Company upon such issuance, sale, exercise, conversion or exchange
calculated in accordance with the procedures set forth above pursuant to this
paragraph (f), and (II) the denominator of which shall be the product of (x) the
number of shares of Common Stock outstanding (on a Fully Diluted Basis)
immediately after such issuance or sale times (y) such Current Market Value per
share; and

               (ii)   The number of Shares issuable upon exercise of such
Warrant shall be increased to the number of shares determined by multiplying (A)
the number of Shares issuable upon exercise of such Warrant immediately prior to
such issuance or sale by (B) a

                                       15

<PAGE>

fraction, (1) the numerator of which shall be the Exercise Price in effect
immediately prior to the adjustment in clause (i) of this paragraph (f), and (2)
the denominator of which shall be the Exercise Price in effect immediately after
such adjustment.

     "Fully Diluted Basis" means, with respect to the Common Stock at any time
of determination, the number of shares of Common Stock that would be issued and
outstanding at such time, assuming full conversion, exercise and exchange of all
issued and outstanding Convertible Securities and Options that shall be (or may
become) exchangeable for, or exercisable or convertible into, Common Stock,
including the Warrants.

     Each holder of a Warrant may elect to buy all or any portion of the Common
Stock, Options or Convertible Securities offered pursuant to this subsection (f)
or may decline to purchase any such securities.

     Notwithstanding the provisions of this subsection (f), in no event will the
Exercise Price be decreased pursuant to any adjustment under this subsection (f)
to a price under $5.60 (appropriately adjusted to reflect stock splits or
combinations, stock dividends, reorganizations, consolidations and similar
changes), and in no event will the aggregate number of Shares issuable upon
exercise of the Warrants be increased pursuant to any adjustment under this
subsection (f) to a number over 1,204,328 (appropriately adjusted to reflect
stock splits or combinations, stock dividends, reorganizations, consolidations
and similar changes).

          (g)  Consideration Received. If any shares of Common Stock, Options or
Convertible Securities shall be issued, sold or distributed for a consideration
other than cash, the amount of the consideration other than cash received by the
Company in respect thereof shall be deemed to be the then fair market value of
such consideration (as determined in good faith by the Board of Directors of the
Company). If any Options shall be issued in connection with the issuance and
sale of other securities of the Company, together comprising one integral
transaction in which no specific consideration is allocated to such Options by
the parties thereto, such Options shall be deemed to have been issued without
consideration; provided, however, that if such Options have an exercise price
equal to or greater than the Current Market Value of the Common Stock on the
date of issuance of such Options, then such Options shall be deemed to have been
issued for consideration equal to such exercise price. For purposes of
determining the price per share of any Additional Shares of Common Stock, in the
event that shares of Common Stock, Options and Convertible Securities issued in
a single transaction or series of related transactions, the price per share
shall be determined on the basis of the aggregate consideration received and
shares issued or deemed to be issued in such transaction or series of related
transactions.

          (h)  Changes in Options and Convertible Securities. If the exercise
price provided for in any Options referred to in Section 5.01(f) above, the
additional consideration, if any, payable upon the conversion or exchange of any
Convertible Securities referred to in Section 5.01(f) above, or the rate at
which any Convertible Securities referred to in Section 5.01(f) above are
convertible into or exchangeable for Common Stock shall change at any time to a
price which is less than the Current Market Value thereof as of the Issuance
Date, then the adjustment provisions of Section 5.01(f) above would be
applicable.

          (i)  Statement of Warrants. Irrespective of any adjustment in the
number or kind of Shares issuable upon the exercise of the Warrants, Warrants
theretofore or thereafter

                                       16

<PAGE>

issued shall continue to express the same number and kind of shares as are
stated in the Warrants initially issuable pursuant to this Agreement.

          (j)  Expiration of Rights, Warrants or Options. Upon the expiration of
any Options or Convertible Securities, to the extent the Warrants shall not have
been exercised, the Exercise Price shall be adjusted to such amount as would
have been received by a Warrant holder had the adjustment in such Exercise Price
made upon the distribution of such Options or Convertible Securities been made
upon the basis of the distribution of only such number of Options or Convertible
Securities as were actually exercised or converted.

          (k)  No Nominal Adjustment. No adjustment in the number of Shares
purchasable pursuant to the Warrants or in the Exercise Price shall be required
unless such adjustment would require an increase or decrease of at least 1.0% of
the number of Shares then purchasable upon exercise of the Warrants or in the
Exercise Price; provided, however, that any adjustments which by reason of this
subsection (k) are not required to be made immediately shall be carried forward
and taken into account in any subsequent adjustment. All calculations under this
Section 5 shall be made to the nearest cent or to the nearest one-hundredth of a
share, as the case may be.

     Section 5.02  Fractional Interest. The Company shall not be required to
issue fractional shares of Common Stock on the exercise of Warrants. If more
than one Warrant shall be presented for exercise in full at the same time by the
same holder, the number of full shares of Common Stock which shall be issuable
upon such exercise shall be computed on the basis of the aggregate number of
shares of Common Stock acquirable on exercise of the Warrants so presented. If
any fraction of a share of Common Stock would, except for the provisions of this
Section, be issuable on the exercise of any Warrant (or specified portion
thereof), the Company shall direct the transfer agent for the Common Stock to
pay an amount in cash calculated to equal the then Current Market Value per
share (determined pursuant to Section 5.01(c)) multiplied by such fraction
computed to the nearest whole cent. Holders of Warrants, by their acceptances of
the Warrant Certificates, expressly waive any and all rights to receive any
fraction of a share of Common Stock or a stock certificate representing a
fraction of a share of Common Stock.

     Section 5.03  When Adjustment Not Required. If the Company shall take a
record of the holders of its Common Stock for the purpose of entitling them to
receive a dividend or distribution or subscription or purchase rights and shall,
thereafter and before the distribution to stockholders thereof, legally abandon
its plan to pay or deliver such dividend, distribution, subscription or purchase
rights, then thereafter no adjustment shall be required by reason of the taking
of such record and any such adjustment previously made in respect thereof shall
be rescinded and annulled.

     Section 5.04  Challenge to Good Faith Determination. Whenever the Board of
Directors of the Company shall be required to make a determination in good faith
of the fair value of any item under this Article V, such determination may be
challenged in good faith by holders holding a majority of the outstanding
Warrants (the "Majority Holders"), and any dispute shall be resolved by an
investment banking firm of national standing selected by the Company. The fee of
such investment banking firm shall be paid by the Company, unless such fair
market value as determined by the investment banking firm is more than 95% of
the fair market value determined

                                       17

<PAGE>

by the Board of Directors of the Company, in which case the challenging holders
shall be jointly and severally liable for such fee.

     Section 5.05  Treasury Stock. The sale or other disposition of any issued
shares of Common Stock owned or held by or for the account of the Company shall
be deemed an issuance thereof and a repurchase thereof and designation of such
shares as treasury stock shall be deemed to be a redemption thereof for the
purposes of this Agreement.

     Section 5.06  Notices to Warrant Holders. In connection with any adjustment
pursuant to this Article V, the Company shall (i) promptly after such
adjustment, cause to be filed with the Warrant Agent a certificate of an officer
of the Company setting forth the number of shares (or portion thereof) issuable
after such adjustment, upon exercise of a Warrant and the Exercise Price after
such adjustment, which certificate shall be conclusive evidence of the
correctness of the matters set forth therein, and (ii) promptly after such
adjustment cause to be given to each of the registered holders of the Warrant
Certificates at his address appearing on the Warrant Register written notice of
such adjustments by first-class mail, postage prepaid. The Warrant Agent shall
be entitled to conclusively rely on the above-referenced officer's certificate
and shall be under no duty or responsibility with respect to any such
certificate, except to exhibit the same from time to time to any holder desiring
an inspection thereof during normal business hours upon reasonable notice. The
Warrant Agent shall not at any time be under any duty or responsibility to any
holder to determine whether any facts exist that may require any adjustment of
the number of Shares issuable on exercise of the Warrants or the Exercise Price,
or with respect to the nature or extent of any such adjustment when made, or
with respect to the method employed in making such adjustment or the validity or
value (or the kind or amount) of any Shares which may be issuable on exercise of
the Warrants. The Warrant Agent shall not be responsible for any failure of the
Company to make any cash payment or to issue, transfer or deliver any shares of
Common Stock or stock certificates or other common stock or property upon the
exercise of any Warrant.

     The Company shall, in addition, promptly notify the holders of the Warrants
of any determination of its Board of Directors that any actions affecting its
Common Stock will not require an adjustment to the number of Shares for which a
Warrant is exercisable, and shall specify in such notice the reasons for such
determination. In the event that the Majority holders shall challenge any of the
calculations set forth in such notice within 20 days after the Company's
delivery thereof, the Company shall retain a firm of independent certified
public accountants or law firm of national standing selected by the Company to
prepare and execute a certificate verifying that no adjustment is required. The
Company shall promptly cause a signed copy of any certificate prepared pursuant
to this Section 5.06 to be delivered to each holder at his address appearing in
the Warrant Register. The Company shall keep at its office or agency designated
pursuant to Section 1.10 copies of all such certificates and cause the same to
be available for inspection at said office during normal business hours upon
reasonable notice by any holder or any prospective purchaser of a Warrant
designated by a holder thereof.

     Section 5.07  Par Value of Shares of Common Stock. Before taking any action
which would cause an adjustment effectively reducing the portion of the Exercise
Price allocable to each Share below the then par value per share of the Common
Stock issuable upon exercise of the Warrants, the Company will take any
corporate action which may, in the opinion of its

                                       18

<PAGE>

counsel, be necessary in order that the Company may validly and legally issue
fully paid and nonassessable Common Stock upon exercise of the Warrants.

                                   ARTICLE VI
                          CONCERNING THE WARRANT AGENT

     Section 6.01  Warrant Agent. The Company hereby appoints American Stock
Transfer and Trust Company as warrant agent (and in all capacities in this
Agreement, the "Warrant Agent") of the Company in respect of the Warrants and
the Warrant Certificates upon the terms and subject to the conditions herein and
in the Warrant Certificates set forth; and American Stock Transfer and Trust
Company hereby accepts such appointment. The Warrant Agent shall have the powers
and authority specifically granted to and conferred upon it in the Warrant
Certificates and hereby and such further powers and authority to act on behalf
of the Company as the Company may hereafter grant to or confer upon it and it
shall accept in writing. All of the terms and provisions with respect to such
powers and authority contained in the Warrant Certificates are subject to and
governed by the terms and provisions hereof.

     Section 6.02  Conditions of Warrant Agent's Obligations. The Warrant Agent
accepts its obligations herein set forth upon the terms and conditions hereof
and in the Warrant Certificates, including the following, to all of which the
Company agrees and to all of which the rights hereunder of the holders from time
to time of the Warrant Certificates shall be subject:

          (a)  The Warrant Agent shall be entitled to compensation to be agreed
upon with the Company in writing for all services rendered by it and the Company
agrees promptly to pay such compensation and to reimburse the Warrant Agent for
its reasonable out-of-pocket expenses (including reasonable fees and expenses of
counsel) incurred without gross negligence or willful misconduct on its part in
connection with the services rendered by it hereunder. The Company also agrees
to indemnify the Warrant Agent, each successor Warrant Agent, and their
respective directors, officers, affiliates, agents and employees for, and to
hold it and its directors, officers, affiliates, agents and employees harmless
against, any loss, liability or expense of any nature whatsoever (including,
without limitation, fees and expenses of counsel) incurred without gross
negligence or willful misconduct on the part of the Warrant Agent or successor
Warrant Agent, arising out of or in connection with its acting as such Warrant
Agent hereunder and its exercise or failure to exercise of its rights and
performance of its obligations hereunder. The obligations of the Company under
this Section 6.02 shall survive the exercise and the expiration of the Warrant
Certificates and the resignation and removal of the Warrant Agent.

          (b)  In acting under this Agreement and in connection with the Warrant
Certificates, the Warrant Agent is acting solely as agent of the Company and
does not assume any obligation or relationship of agency or trust for or with
any of the owners or holders of the Warrant Certificates.

          (c)  The Warrant Agent may consult with counsel and any advice or
written opinion of such counsel shall be full and complete authorization and
protection in respect of any action taken, suffered or omitted by it hereunder
in good faith and in accordance with such advice or opinion.

                                       19

<PAGE>

          (d)  The Warrant Agent shall be fully protected and shall incur no
liability for or in respect of any action taken or omitted to be taken or thing
suffered by it in reliance upon any Warrant Certificate, notice, direction,
consent, certificate, affidavit, opinion of counsel, instruction, statement or
other paper or document reasonably believed by it, in the absence of bad faith,
to be genuine and to have been presented or signed by the proper parties.

          (e)  The Warrant Agent, and its officers, directors, affiliates and
employees ("Related Parties"), may become the owners of, or acquire any interest
in, Warrant Certificates, shares or other obligations of the Company with the
same rights that it or they would have it if were not the Warrant Agent
hereunder and, to the extent permitted by applicable law, it or they may engage
or be interested in any financial or other transaction with the Company and may
act on, or as depositary, trustee or agent for, any committee or body of holders
of shares or other obligations of the Company as freely as if it were not the
Warrant Agent hereunder. Nothing in this Agreement shall be deemed to prevent
the Warrant Agent or such Related Parties from acting in any other capacity for
the Company.

          (f)  The Warrant Agent shall not be under any liability for interest
on, and shall not be required to invest, any monies at any time received by it
pursuant to any of the provisions of this Agreement or of the Warrant
Certificates.

          (g)  The Warrant Agent shall not be under any responsibility in
respect of the validity of this Agreement (or any term or provision hereof) or
the execution and delivery hereof (except the due execution and delivery hereof
by the Warrant Agent) or in respect of the validity or execution of any Warrant
Certificate (except its authentication thereof).

          (h)  The recitals and other statements contained herein and in the
Warrant Certificates (except as to the Warrant Agent's authentication thereon)
shall be taken as the statements of the Company and the Warrant Agent assumes no
responsibility for the correctness of the same. The Warrant Agent does not make
any representation as to the validity or sufficiency of this Agreement or the
Warrant Certificates, except for its due execution and delivery of this
Agreement; provided, however, that the Warrant Agent shall not be relieved of
its duty to authenticate the Warrant Certificates as authorized by this
Agreement. The Warrant Agent shall not be accountable for the use or application
by the Company of the proceeds of the exercise of any Warrant.

          (i)  Before the Warrant Agent acts or refrains from acting with
respect to any matter contemplated by this Warrant Agreement, it may require:

               (1) an Officers' Certificate stating that, in the opinion of the
          signers, all conditions precedent, if any, provided for in this
          Warrant Agreement relating to the proposed action have been complied
          with; and

               (2) if reasonably necessary in the sole judgment of the Warrant
          Agent, an opinion of counsel for the Company stating that, in the
          opinion of such counsel, all such conditions precedent have been
          complied with.

     Each Officers' Certificate or, if requested, an opinion of counsel with
respect to compliance with a condition or covenant provided for in this Warrant
Agreement shall include:

                                       20

<PAGE>

               (1) a statement that the person making such certificate or
          opinion has read such covenant or condition;

               (2) a brief statement as to the nature and scope of the
          examination or investigation upon which the statements or opinions
          contained in such certificate or opinion are based;

               (3) a statement that, in the opinion of such person, he or she
          has made such examination or investigation as is necessary to enable
          him or her to express an informed opinion as to whether or not such
          covenant or condition has been complied with; and

               (4) a statement as to whether or not, in the opinion of such
          person, such condition or covenant has been complied with.

          (j)  The Warrant Agent shall be obligated to perform such duties as
are herein and in the Warrant Certificates specifically set forth and no implied
duties or obligations shall be read into this Agreement or the Warrant
Certificates against the Warrant Agent. The Warrant Agent shall not be
accountable or under any duty or responsibility for the use by the Company of
any of the Warrant Certificates authenticated by the Warrant Agent and delivered
by it to the Company pursuant to this Agreement. The Warrant Agent shall have no
duty or responsibility in case of any default by the Company in the performance
of its covenants or agreements contained in the Warrant Certificates or in the
case of the receipt of any written demand from a holder of a Warrant Certificate
with respect to such default, including, without limiting the generality of the
foregoing, any duty or responsibility to initiate or attempt to initiate any
proceedings at law or otherwise or, except as provided in Section 7.02 hereof,
to make any demand upon the Company. The Warrant Agent shall not be obligated to
perform any duty to the extent prohibited by law.

          (k)  Unless otherwise specifically provided herein, any order,
certificate, notice, request, direction or other communication from the Company
made or given under any provision of this Agreement shall be sufficient if
signed by its chief executive officer, its president, its treasurer, its
controller or any vice president or its secretary or any assistant secretary.

          (l)  The Warrant Agent shall have no responsibility in respect of any
adjustment pursuant to Article V hereof.

          (m)  The Company agrees that it will perform, execute, acknowledge and
deliver, or cause to be performed, executed, acknowledged and delivered, all
such further and other acts, instruments and assurances as may reasonably be
required by the Warrant Agent for the carrying out or performing by the Warrant
Agent of the provisions of this Agreement.

          (n)  The Warrant Agent is hereby authorized and directed to accept
written instructions with respect to the performance of its duties hereunder
from any one of the chief executive officer, the president, the treasurer, the
controller, any vice president or the secretary of the Company or any other
officer or official of the Company reasonably believed to be authorized to give
such instructions and to apply to such officers or officials for advice or
instructions in connection with its duties, and it shall not be liable for any
action taken or

                                       21

<PAGE>

suffered to be taken by it in good faith in accordance with instructions with
respect to any matter arising in connection with the Warrant Agent's duties and
obligations arising under this Agreement. Such application by the Warrant Agent
for written instructions from the Company may, at the option of the Warrant
Agent, set forth in writing any action proposed to be taken or omitted by the
Warrant Agent with respect to its duties or obligations under this Agreement and
the date on or after which such action shall be taken and the Warrant Agent
shall not be liable for any action taken or omitted in accordance with a
proposal included in any such application on or after the date specified therein
(which date shall be not less than 10 Business Days after the Company receives
such application unless the Company consents to a shorter period), provided that
(i) such application includes a statement to the effect that it is being made
pursuant to this paragraph (n) and that unless objected to prior to such date
specified in the application, the Warrant Agent will not be liable for any such
action or omission to the extent set forth in such application and (ii) prior to
taking or omitting any such action, the Warrant Agent has not received written
instructions objecting to such proposed action or omission.

          (o)  Whenever in the performance of its duties under this Agreement
the Warrant Agent shall deem it necessary or desirable that any fact or matter
be proved or established by the Company prior to taking or suffering any action
hereunder, such fact or matter (unless other evidence in respect thereof be
herein specifically prescribed) may be deemed to be conclusively proved and
established by a certificate signed by any one of the chief executive officer,
the president, the treasurer, the controller, any vice president or the
secretary of the Company or any other officer or official of the Company
reasonably believed to be authorized to give such instructions and delivered to
the Warrant Agent; and such certificate shall be full authorization to the
Warrant Agent for any action taken or suffered in good faith by it under the
provisions of this Agreement in reliance upon such certificate.

          (p)  The Warrant Agent shall not be required to risk or expend its own
 funds in the performance of its obligations and duties hereunder.

     Section 6.03  Resignation and Appointment of Successor.

          (a)  The Company agrees, for the benefit of the holders from time to
time of the Warrant Certificates, that there shall at all times be a Warrant
Agent hereunder.

          (b)  The Warrant Agent may at any time resign as Warrant Agent by
giving written notice to the Company of such intention on its part, specifying
the date on which its desired resignation shall become effective, provided that
such date shall be at least 30 days after the date on which such notice is given
unless the Company agrees to accept less notice. Upon receiving such notice of
resignation, the Company shall promptly appoint a successor Warrant Agent,
qualified as provided in Section 6.03(d) hereof, by written instrument in
duplicate signed on behalf of the Company, one copy of which shall be delivered
to the resigning Warrant Agent and one copy to the successor Warrant Agent. As
provided in Section 6.03(d) hereof, such resignation shall become effective upon
the earlier of (x) the acceptance of the appointment by the successor Warrant
Agent or (y) 30 days after receipt by the Company of notice of such resignation.
The Company may, at any time and for any reason, and shall, upon any event set
forth in the next succeeding sentence, remove the Warrant Agent and appoint a
successor Warrant Agent by written instrument in duplicate, specifying such
removal and the date on

                                       22

<PAGE>

which it is intended to become effective, signed on behalf of the Company, one
copy of which shall be delivered to the Warrant Agent being removed and one copy
to the successor Warrant Agent. The Warrant Agent shall be removed as aforesaid
if it shall become incapable of acting, or shall be adjudged as bankrupt or
insolvent, or a receiver of the Warrant Agent or of its property shall be
appointed, or any public officer shall take charge or control of it or of its
property or affairs for the purpose of rehabilitation, conservation or
liquidation. Any removal of the Warrant Agent and any appointment of a successor
Warrant Agent shall become effective upon acceptance of appointment by the
successor Warrant Agent as provided in Section 6.03(d). As soon as practicable
after appointment of the successor Warrant Agent, the Company shall cause
written notice of the change in the Warrant Agent to be given to each of the
registered holders of the Warrants in the manner provided for in Section 7.04
hereof

          (c)  Upon resignation or removal of the Warrant Agent, if the Company
shall fail to appoint a successor Warrant Agent within a period of 30 days after
receipt of such notice of resignation or removal, then the holder of any Warrant
Certificate or the Warrant Agent may apply to a court of competent jurisdiction
for the appointment of a successor to the Warrant Agent. Pending appointment of
a successor to the Warrant Agent, either by the Company or by such a court, the
duties of the Warrant Agent shall be carried out by the Company.

          (d)  Any successor Warrant Agent, whether appointed by the Company or
by a court, shall be a bank or trust company in good standing, incorporated
under the laws of the United States of America or any State thereof and having,
at the time of its appointment, a combined capital surplus of at least $50
million. Such successor Warrant Agent shall execute and deliver to its
predecessor and to the Company an instrument accepting such appointment
hereunder and all the provisions of this Agreement, and thereupon such successor
Warrant Agent, without any further act, deed or conveyance, shall become vested
with all the rights, powers, duties and obligations of its predecessor
hereunder, with like effect as if originally named as Warrant Agent hereunder,
and such predecessor shall thereupon become obligated to (i) transfer and
deliver, and such successor Warrant Agent shall be entitled to receive, all
securities, records or other property on deposit with or held by such
predecessor as Warrant Agent hereunder and (ii) upon payment of the amounts then
due it pursuant to Section 6.02(a) hereof, pay over, and such successor Warrant
Agent shall be entitled to receive, all monies deposited with or held by any
predecessor Warrant Agent hereunder.

          (e)  Any corporation or bank into which the Warrant Agent hereunder
may be merged or converted, or any corporation or bank with which the Warrant
Agent may be consolidated, or any corporation or bank resulting from any merger,
conversion or consolidation to which the Warrant Agent shall be a party, or any
corporation or bank to which the Warrant Agent shall sell or otherwise transfer
all or substantially all of its corporate trust business, shall be the successor
to the Warrant Agent under this Agreement (provided that such corporation or
bank shall be qualified as aforesaid) without the execution or filing of any
document or any further act on the part of any of the parties hereto.

          (f)  No Warrant Agent under this Warrant Agreement shall be personally
liable for any action or omission of any successor Warrant Agent or of the
Company.

                                       23

<PAGE>

                                  ARTICLE VII
                                  MISCELLANEOUS

     Section 7.01  Amendment. This Agreement and the terms of the Warrants may
be amended by the Company and the Warrant Agent, without the consent of the
holder of any Warrant Certificate, for the purpose of curing any ambiguity, or
of curing, correcting or supplementing any defective or inconsistent provision
contained herein or therein or, subject to the provisions of the second
paragraph of this Section 7.01, in any other manner which the Company may deem
necessary or desirable and which shall not adversely affect in any material
respect the interests of the holders of the Warrant Certificates.

         The Company and the Warrant Agent may modify this Agreement and the
terms of the Warrants with the consent of not less than a majority in number of
the then outstanding Warrants for the purpose of adding any provision to or
changing in any manner or eliminating any of the provisions of this Agreement or
modifying in any manner the rights of the holders of the outstanding Warrants;
provided, however, that no such modification that increases or decreases the
Exercise Price, decreases the number of shares purchasable upon exercise of the
Warrants, reduces the period of time during which the Warrants are exercisable
hereunder, otherwise materially and adversely affects the exercise rights of the
holders of the Warrants, reduces the percentage required for modification, or
effects any change to this Section 7.01 may be made with respect to an
outstanding Warrant without the consent of the holder of such Warrant.

         Any modification or amendment made in accordance with this Agreement
will be conclusive and binding on all present and future holders of Warrant
Certificates whether or not they have consented to such modification or
amendment or waiver and whether or not notation of such modification or
amendment is made upon such Warrant Certificates. Any instrument given by or on
behalf of any holder of a Warrant Certificate in connection with any consent to
any modification or amendment will be conclusive and binding on all subsequent
holders of such Warrant Certificate.

     Section 7.02  Notices and Demands to the Company and Warrant Agent. If the
Warrant Agent shall receive any notice or demand addressed to the Company by the
holder of a Warrant Certificate pursuant to the provisions hereof or of the
Warrant Certificates, the Warrant Agent shall promptly forward such notice or
demand to the Company.

     Section 7.03  Addresses for Notices to Parties and for Transmission of
Documents. All notices hereunder to the parties hereto shall be deemed to have
been given when sent by certified or registered mail, postage prepaid, or by
telex or telecopy, confirmed by first class mail, postage prepaid, addressed to
any party hereto as follows:

     To the Company:          Syntroleum Corporation
                              4322 South 49th West Avenue
                              Tulsa, Oklahoma 74107
                              Attention: Chief Executive Officer

     To the Warrant Agent:    American Stock Transfer and Trust Company
                              59 Maiden Lane

                                       24

<PAGE>

                              New York, New York 10038
                              Attention: Corporate Trust Department

or at any other address of which either of the foregoing shall have notified the
other in writing.

     Section 7.04  Notices to Holders. Notices to holders of Warrants shall be
mailed to such holders at the addresses of such holders as they appear in the
Warrant Register. Any such notice shall be sufficiently given if sent by
first-class mail, postage prepaid.

     Section 7.05  APPLICABLE LAW. THE VALIDITY, INTERPRETATION AND PERFORMANCE
OF THIS AGREEMENT AND EACH WARRANT CERTIFICATE ISSUED HEREUNDER AND OF THE
RESPECTIVE TERMS AND PROVISIONS THEREOF SHALL BE GOVERNED BY THE LAWS OF THE
STATE OF NEW YORK, WITHOUT GIVING EFFECT TO THE CONFLICT OF LAWS PROVISIONS
THEREOF.

     Section 7.06  Obtaining of Governmental Approvals. The Company will from
time to time take all action required to be taken by it which may be necessary
to obtain and keep effective any and all permits, consents and approvals of
governmental agencies and authorities and securities acts filings under United
States Federal and State laws, and the rules and regulations of all stock
exchanges on which the Warrants are listed which may be or become requisite in
connection with the issuance, sale, transfer, and delivery of the Warrant
Certificates, the exercise of the Warrants or the issuance, sale, transfer and
delivery of the shares issued upon exercise of the Warrants.

     Section 7.07  Persons Having Rights Under Agreement. Nothing in this
Agreement expressed or implied and nothing that may be inferred from any of the
provisions hereof is intended, or shall be construed, to confer upon, or give
to, any person or corporation other than the Company, the Warrant Agent and the
holders of the Warrant Certificates any right, remedy or claim under or by
reason of this Agreement or of any covenant, condition, stipulation, promise or
agreement hereof; and all covenants, conditions, stipulations, promises and
agreements in this Agreement contained shall be for the sole and exclusive
benefit of the Company and the Warrant Agent and their successors and of the
holders of the Warrant Certificates.

     Section 7.08  Headings. The descriptive headings of the several Articles
and Sections of this Agreement are inserted for convenience only and shall not
control or affect the meaning or construction of any of the provisions hereof.

     Section 7.09  Counterparts. This Agreement may be executed in any number of
counterparts, each of which so executed shall be deemed to be an original; but
such counterparts shall together constitute but one and the same instrument.

     Section 7.10  Inspection of Agreement. A copy of this Agreement shall be
available at all reasonable times at the principal corporate trust office of the
Warrant Agent, for inspection by the holder of any Warrant Certificate. The
Warrant Agent may require such holder to submit his Warrant Certificate for
inspection by it.

                                       25

<PAGE>

     Section 7.11  Successors. All the covenants and provisions of this
Agreement by or for the benefit of the Company or the Warrant Agent shall bind
and inure to the benefit of their respective successors and assigns hereunder.

                                       26

<PAGE>

     IN WITNESS WHEREOF, this Agreement has been duly executed by the parties
hereto as of the day and year first above written.

                                               SYNTROLEUM CORPORATION

                                               By: _____________________________
                                               Name: ___________________________
                                               Title: __________________________

                                               AMERICAN STOCK TRANSFER
                                               AND TRUST COMPANY,
                                               as Warrant Agent

                                               By: _____________________________
                                               Name: ___________________________
                                               Title: __________________________

                                       27

<PAGE>

                                                                       EXHIBIT A
                          [FORM OF WARRANT CERTIFICATE]

                                     [FACE]

     [Unless and until it is exchanged in whole or in part for Warrants in
certificated form, this Warrant may not be transferred except as a whole by the
Depositary to a nominee of the Depositary or by a nominee of the Depositary to
the Depositary or another nominee of the Depositary or by the Depositary or any
such nominee to a successor Depositary or a nominee of such successor
Depositary. Unless this certificate is presented by an authorized representative
of The Depository Trust Company, a New York corporation ("DTC"), to the issuer
or its agent for registration of transfer, exchange or payment, and any
certificate issued is registered in the name of Cede & Co. or such other name as
requested by an authorized representative of DTC (and any payment is made to
Cede & Co. or such other entity as is requested by an authorized representative
of DTC), ANY TRANSFER, PLEDGE OR OTHER USE HEREOF FOR VALUE OR OTHERWISE BY OR
TO ANY PERSON IS WRONGFUL inasmuch as the registered owner hereof, Cede & Co.,
has an interest herein./1/

                                                                       CUSIP#[_]

No. [_]                                                             [_] Warrants

                               WARRANT CERTIFICATE

                             SYNTROLEUM CORPORATION

     This Warrant Certificate certifies that [ ], or registered assigns, is the
registered holder of [ ] Warrants (the "Warrants") to purchase shares of Common
Stock, par value $.01 per share (the "Common Stock"), of Syntroleum Corporation
a Delaware corporation (the "Company"). Each Warrant entitles the holder to
purchase from the Company at any time on or after May 26, 2004 until 5:00 p.m.,
New York City, New York time, on May 26, 2008 (the "Expiration Date"),
___________ fully paid and non-assessable shares of Common Stock (a "Share", or,
if adjusted, the "Shares", which may also include any other securities or
property purchasable upon exercise of a Warrant, such adjustment and inclusion
each as provided in the Warrant Agreement) at the exercise price (the "Exercise
Price") of $7.60 per Share upon surrender of this Warrant Certificate and
payment of the Exercise Price at any office or agency maintained for that
purpose by the Company (the "Warrant Agent Office"), subject to the conditions
set forth herein and in the Warrant Agreement.

     The Exercise Price shall be payable by cash, certified check or official
bank check or by such other means as is acceptable to the Company in the lawful
currency of the United States of America which as of the time of payment is
legal tender for payment of public or private debts. The Company has initially
designated the Warrant Agent's office in New York City, New York, as the initial
Warrant Agent Office. The number of Shares issuable upon exercise of the
Warrants ("Exercise Rate") is subject to adjustment upon the occurrence of
certain events set forth in the Warrant Agreement.

----------

/1/ This paragraph is to be included only if the Warrant is in global form.

                                       A-1

<PAGE>

     Any Warrants not exercised on or prior to 5:00 p.m., New York City, New
York time, on May 26, 2008 shall thereafter be void.

     Reference is hereby made to the further provisions on the reverse hereof
which provisions shall for all purposes have the same effect as though fully set
forth at this place. Capitalized terms used in this Warrant Certificate but not
defined herein shall have the meanings ascribed thereto in the Warrant
Agreement.

     This Warrant Certificate shall not be valid unless authenticated by the
Warrant Agent, as such term is used in the Warrant Agreement.

     THIS WARRANT CERTIFICATE SHALL BE CONSTRUED IN ACCORDANCE WITH THE LAWS OF
THE STATE OF NEW YORK WITHOUT GIVING EFFECT TO THE CONFLICT OF LAWS PROVISIONS
THEREOF.

     WITNESS the facsimile seal of the Company and facsimile signatures of its
duly authorized officers.

Dated:  ___________                            SYNTROLEUM CORPORATION

                                               By: _____________________________
                                               Name: ___________________________
                                               Title: __________________________

[Seal]

Attest:

By: _____________________________
Name: ___________________________
Title: __________________________
Certificate of Authentication:

This is one of the Warrants referred to in the within mentioned Warrant
Agreement:

_____________________________
      as Warrant Agent

By: _________________________
      Authorized Signatory

                                       A-2

<PAGE>

                          [FORM OF WARRANT CERTIFICATE]

                                    [REVERSE]

                             SYNTROLEUM CORPORATION

     The Warrants evidenced by this Warrant Certificate are part of a duly
authorized issue of Warrants, each of which represents the right to purchase at
any time on or after May 26, 2004, until 5:00 p.m., New York City, New York
time, on May 26, 2008, ____ shares of Common Stock of the Company, subject to
adjustment as set forth in the Warrant Agreement. The Warrants are issued
pursuant to a Warrant Agreement dated as of May 26, 2004 (the "Warrant
Agreement"), duly executed and delivered by the Company to American Stock
Transfer and Trust Company, a New York corporation, as Warrant Agent (the
"Warrant Agent"), which Warrant Agreement is hereby incorporated by reference in
and made a part of this instrument and is hereby referred to for a description
of the rights, limitation of rights, obligations, duties and immunities
thereunder of the Warrant Agent, the Company and the holders (the words
"holders" or "holder" meaning the registered holders or registered holder) of
the Warrants. Warrants may be exercised by (1) surrendering at any Warrant Agent
Office this Warrant Certificate with the form of Election to Exercise set forth
hereon duly completed and executed and (ii) paying in full the Exercise Price
for each such Warrant exercised and any other amounts required to be paid
pursuant to the Warrant Agreement.

     If all of the items referred to in the last sentence of the preceding
paragraph are received by the Warrant Agent at or prior to 2:00 p.m., New York
City, New York time, on a Business Day, the exercise of the Warrant to which
such items relate will be effective on such Business Day. If any items referred
to in the last sentence of the preceding paragraph are received after 2:00 p.m.,
New York City, New York time, on a Business Day, the exercise of the Warrants to
which such item relates will be deemed to be effective on the next succeeding
Business Day. Notwithstanding the foregoing, in the case of an exercise of
Warrants on the Expiration Date, if all of the items referred to in the last
sentence of the preceding paragraph are received by the Warrant Agent at or
prior to 5:00 p.m., New York City, New York time, on such Expiration Date, the
exercise of the Warrants to which such items relate will be effective on the
Expiration Date.

     Subject to the terms of the Warrant Agreement, as soon as practicable after
the exercise of any Warrant or Warrants, the Company shall issue or cause to be
issued to or upon the written order of the registered holder of this Warrant
Certificate pursuant to the Election to Exercise, as set forth on the reverse of
this warrant Certificate, a certificate or certificates evidencing the Share.
Such certificate or certificates evidencing the Share or Shares shall be deemed
to have been issued and any persons who are designated to be named therein shall
be deemed to have become the holder of record of such Share or Shares as of the
close of business on the date upon which the exercise of this Warrant was deemed
to be effective as provided in the preceding paragraph.

     The Company will not be required to issue fractional shares of Common Stock
upon exercise of the Warrants or distribute Share certificates that evidence
fractional shares of Common Stock. In lieu of fractional shares of Common Stock,
there shall be paid to the

                                       A-3

<PAGE>

registered holder of this Warrant Certificate at the time such Warrant
Certificate is exercised an amount in cash equal to the same fraction of the
Current Market Value per share as determined in accordance with the Warrant
Agreement.

     Warrant Certificates, when surrendered at any office or agency maintained
by the Company for that purpose by the registered holder thereof in person or by
legal representative or attorney duly authorized in writing, may be exchanged
for a new Warrant Certificate or new Warrant Certificates evidencing in the
aggregate a like number of Warrants, in the manner and subject to the
limitations provided in the Warrant Agreement, without charge except for any tax
or other governmental charge imposed in connection therewith.

     Upon due presentment for registration of transfer of this Warrant
Certificate at any office or agency maintained by the Company for that purpose,
a new Warrant Certificate evidencing in the aggregate a like number of Warrants
shall be issued to the transferee in exchange for this Warrant Certificate,
subject to the limitations provided in the Warrant Agreement, without charge
except for any tax or other governmental charge imposed in connection therewith.

     The Company and the Warrant Agent may deem and treat the registered holder
hereof as the absolute owner of this Warrant Certificate (notwithstanding any
notation of ownership or other writing hereon made by anyone) for the purpose of
any exercise hereof and for all other purposes, and neither the Company nor the
Warrant Agent shall be affected by any notice to the contrary.

     The term "Business Day" shall mean any day on which (i) banks in New York
City, New York are open for business, (ii) the principal national securities
exchange or market on which the Common Stock is listed or admitted to trading is
open for business and (iii) the principal national securities exchange or market
on which the Warrants are listed or admitted to trading are open for business.

                                       A-4

<PAGE>

                         (FORM OF ELECTION TO EXERCISE)

         (To be executed upon exercise of Warrants on the Exercise Date)

     The undersigned hereby irrevocably elects to exercise _______ of the
Warrants represented by this Warrant Certificate and purchase the whole number
of Shares issuable upon the exercise of such Warrants and herewith tenders
payment for such Shares in the amount of $__________ in cash or by certified or
official bank check, in accordance with the terms hereof The undersigned
requests that a certificate representing such Shares be registered in the name
of _______________________________ whose address is _____________________ and
that such certificate be delivered to _______________________________ whose
address is _________________________________. Any cash payments to be paid in
lieu of a fractional Share should be made to ____________________________ whose
address is _______________________ and the check representing payment thereof
should be delivered to _______________________ whose address is
____________________.

Dated: ___________________

Name of holder of Warrant Certificate:                 ________________________
                                                              (Please Print)

Tax Identification or Social Security Number:          ________________________

Address:                                               ________________________

Signature:                                             ________________________

                                                       ________________________

Note: The above signature must correspond with the name as written upon the face
of this Warrant Certificate in every particular, without alteration or
enlargement or any change whatever.

Dated: ___________________

                                       A-1

<PAGE>

                              [FORM OF ASSIGNMENT]

For value received ___________________________ hereby sells, assigns and
transfers unto ____________________________the within Warrant Certificate,
together with all right, title and interest therein, and does hereby irrevocably
constitute and appoint attorney, to transfer said Warrant Certificate on the
books of the within-named Company, with full power of substitution in the
premises.

Dated: ______________________

Signature: __________________

Note: The above signature must correspond with the name as written upon the face
of this Warrant Certificate in every particular, without alteration or
enlargement or any change whatever.

                                      A-1

<PAGE>

                SCHEDULE OF EXCHANGES OF CERTIFICATED WARRANTS/2/

The following exchanges of a part of this Global Warrant for certificated
Warrants have been made:

<TABLE>
<CAPTION>
-------------------------------------------------------------------------------------------------------------
Date of      Amount of decrease in     Amount of increase in    Number of Warrants     Signature of
Exchange     Number of Warrants of     Number of Warrants of    of this Global         authorized officer of
             this Global Warrant       this Global Warrant      Warrant following      Warrant Agent
                                                                such decrease (or
                                                                increase)
-------------------------------------------------------------------------------------------------------------
<S>           <C>                         <C>                   <C>                      <C>
</TABLE>

--------
/2/ This is to be included only if the Warrant is in global form.

                                      A-1

<PAGE>

                    CERTIFICATE TO BE DELIVERED UPON EXCHANGE
                     OR REGISTRATION OF TRANSFER OF WARRANTS

Re:  Warrants to Purchase Common Stock (the "Warrants") of Syntroleum
     Corporation.

This Certificate relates to _________ Warrants held in* book-entry or*
___________ certificated form by ____________ (the "Transferor").

The Transferor: *

     [_] has requested the Warrant Agent by written order to deliver in exchange
         for its beneficial interest in the Global Warrant held by the
         Depositary a Warrant or Warrants in definitive, registered form of
         authorized denominations and an aggregate number equal to its
         beneficial interest in such Global Warrant (or the portion thereof
         indicated above); or

     [_] has requested the Warrant Agent by written order to exchange or
         register the transfer of a Warrant or Warrants.

         In connection with such request and in respect of each such Warrant,
the Transferor does hereby certify that the Transferor is familiar with the
Warrant Agreement relating to the above captioned Warrants and the restrictions
on transfers thereof as provided in such Warrant Agreement, and that the
transfer of this Warrant does not require registration under the Securities Act
of 1933, as amended (the "Act").

                                                     [INSERT NAME OF TRANSFEROR]

 Date:                                               By: _______________________

*Check applicable box.

                                      B-1Collaborative Research, Development and License Agreement,  September 24, 1997

 Exhibit 10.12 
  

			
	 	 	Certain confidential information contained in this document, marked by brackets and asterisks, has been omitted pursuant to a request for confidential treatment pursuant to 17 C.F.R
§§ 200.80(b)(4) and 200.83 and Rule 406 under the Securities Act of 1933, as amended, and has been filed separately with the Securities and Exchange Commission.

  
 COLLABORATIVE RESEARCH, DEVELOPMENT 
 AND
LICENSE AGREEMENT 
  
 by and
among 
  
 ACADIA PHARMACEUTICALS
INC., 
  
 VISION
PHARMACEUTICALS L.P. 
  
 and 

 
 ALLERGAN, INC. 
  

 TABLE OF CONTENTS 
  

							
	 	  	 	  	 	  	PAGE

			
	1.	  	DEFINITIONS	  	1
			
	2.	  	COLLABORATION SCOPE AND GOVERNANCE	  	8
				
	 	  	2.1	  	 Scope Of The Collaboration
	  	8
	 	  	2.2	  	 Research Management Committee
	  	8
	 	  	2.3	  	 Research Management Committee Functions And Powers
	  	9
	 	  	2.4	  	 Information And Reports
	  	9
	 	  	2.5	  	 RMC Dispute Resolution
	  	9
			
	3.	  	TECHNOLOGY TRANSFER; TARGET IDENTIFICATION AND COMPOUND
SCREENING	  	10
				
	 	  	3.1	  	 Transfer of ACADIA Technology
	  	10
	 	  	3.2	  	 Transfer of Allergan Technology
	  	10
	 	  	3.3	  	 Identification of Targets
	  	10
	 	  	3.4	  	 Assay Development and Screening to Identify Active Compounds
	  	10
			
	4.	  	TARGET AND COMPOUND SELECTION AND DEVELOPMENT	  	11
				
	 	  	4.1	  	 Allergan Substitution of Test Targets
	  	11
	 	  	4.2	  	 Allergan Designation of Licensed Targets; Replacement of Test Targets
	  	11
	 	  	4.3	  	 Allergan Option to License Program Targets
	  	12
	 	  	4.4	  	 Designation of Targets During Renewal Period
	  	13
	 	  	4.5	  	 Designation of Development Candidates
	  	13
	 	  	4.6	  	 Selection of ACADIA Designated Uses
	  	14
	 	  	4.7	  	 Substitution and Addition of ACADIA Designated Uses
	  	14
	 	  	4.8	  	 ACADIA Research Project
	  	15
	 	  	4.9	  	 Excluded Targets
	  	15
			
	5.	  	LICENSE GRANTS; LIMITED EXCLUSIVITY	  	16
				
	 	  	5.1	  	 License Grants
	  	16
	 	  	5.2	  	 Diligence Obligations
	  	18
	 	  	5.3	  	 Limited Exclusivity
	  	19
			
	6.	  	FEES AND PAYMENTS	  	19
				
	 	  	6.1	  	 Research Funding
	  	19
	 	  	6.2	  	 Equity Investment
	  	20
	 	  	6.3	  	 Milestone Payments
	  	20
	 	  	6.4	  	 Royalties
	  	22
			
	7.	  	PAYMENT; RECORDS; AUDITS	  	23
				
	 	  	7.1	  	 Payment; Reports
	  	23
	 	  	7.2	  	 Exchange Rate; Manner and Place of Payment
	  	23

  

 i. 

 TABLE OF CONTENTS 
 (CONTINUED) 
  

							
	 	  	 	  	 	  	PAGE

	 	  	7.3	  	 Late Payments
	  	23
	 	  	7.4	  	 Records and Audits
	  	23
	 	  	7.5	  	 Withholding of Taxes
	  	24
	 	  	7.6	  	 Prohibited Payments
	  	24
			
	8.	  	INTELLECTUAL PROPERTY	  	24
				
	 	  	8.1	  	 Ownership Of Technology
	  	24
	 	  	8.2	  	 Patent Prosecution
	  	24
	 	  	8.3	  	 Cooperation of the Parties
	  	25
	 	  	8.4	  	 Infringement by Third Parties
	  	25
	 	  	8.5	  	 Infringement of Third Party Rights
	  	26
	 	  	8.6	  	 Trademarks
	  	26
			
	9.	  	REPRESENTATIONS AND WARRANTIES	  	26
				
	 	  	9.1	  	 Representations And Warranties
	  	26
	 	  	9.2	  	 ACADIA Representations and Warranties
	  	27
	 	  	9.3	  	 Allergan Representations and Warranties
	  	28
	 	  	9.4	  	 Disclaimer Concerning Technology
	  	28
			
	10.	  	CONFIDENTIALITY; PUBLICATION	  	28
				
	 	  	10.1	  	 Confidentiality
	  	28
	 	  	10.2	  	 Exceptions
	  	28
	 	  	10.3	  	 Terms of Agreement
	  	29
	 	  	10.4	  	 Authorized Disclosure
	  	29
	 	  	10.5	  	 Publications
	  	30
			
	11.	  	TERM AND TERMINATION	  	30
				
	 	  	11.1	  	 Term Of The Agreement
	  	30
	 	  	11.2	  	 Termination by Mutual Agreement
	  	30
	 	  	11.3	  	 Termination For Cause
	  	30
	 	  	11.4	  	 Accrued Rights, Surviving Obligations
	  	31
			
	12.	  	INDEMNITY	  	31
				
	 	  	12.1	  	 Indemnification
	  	31
	 	  	12.2	  	 Control Of Defense
	  	31
	 	  	12.3	  	 Insurance
	  	32
			
	13.	  	GOVERNING LAW; DISPUTE RESOLUTION	  	32
				
	 	  	13.1	  	 Governing Law
	  	32
	 	  	13.2	  	 Legal Compliance
	  	32
	 	  	13.3	  	 Dispute Resolution
	  	32
	 	  	13.4	  	 Jurisdiction And Venue
	  	32

  

 ii. 

 TABLE OF CONTENTS 
 (CONTINUED) 
  

							
	 	  	 	  	 	  	PAGE

			
	14.	  	GENERAL PROVISIONS	  	32
				
	 	  	14.1	  	 Notices
	  	32
	 	  	14.2	  	 Force Majeure
	  	33
	 	  	14.3	  	 Entirety Of Agreement
	  	34
	 	  	14.4	  	 Non-Waiver
	  	34
	 	  	14.5	  	 Disclaimer Of Agency
	  	34
	 	  	14.6	  	 Severability
	  	34
	 	  	14.7	  	 Affiliates; Assignment
	  	34
	 	  	14.8	  	 Allergan Right of Negotiation
	  	34
	 	  	14.9	  	 Allergan’s Rights Upon Change in Control of ACADIA
	  	35
	 	  	14.10	  	 Headings
	  	35
	 	  	14.11	  	 Limitation Of Liability
	  	35
	 	  	14.12	  	 Counterparts
	  	36
	 	  	14.13	  	 Public Disclosure
	  	36
	 	  	14.14	  	 Guarantee
	  	36

  

 iii. 

 COLLABORATIVE RESEARCH, DEVELOPMENT 
 AND LICENSE AGREEMENT 
  
 THIS COLLABORATIVE RESEARCH, DEVELOPMENT AND LICENSE AGREEMENT (the “Agreement”)
is entered into as of September 24, 1997 (the “Effective Date”) by and between ACADIA PHARMACEUTICALS INC. (previously known as Receptor Technologies, Inc.), a Delaware corporation (“ACADIA”)
with offices at 276 East Allen, Winooski, VT 05404, VISION PHARMACEUTICALS L.P., a Texas limited partnership (“Allergan”), with offices at 2525 Dupont Drive, Irvine, CA 92623 and
ALLERGAN, INC., a Delaware corporation, solely as guarantor of the performance under this Agreement by Vision Pharmaceuticals L.P. 
  
 RECITALS 
  
 WHEREAS, ACADIA is the owner or licensee of, and has (subject to the Novo Nordisk Rights set forth in
Exhibit A) all right, title and interest in, or the right to use and grant licenses in accordance with this Agreement with respect to, certain technologies, including, but not limited to, screening technology for the discovery of compounds that may
be useful as therapeutic and prophylactic drugs; 
  
 WHEREAS, Allergan is engaged in the research, development, marketing, manufacture and distribution of therapeutic and prophylactic products; 
  
 WHEREAS, ACADIA and
Allergan desire to enter into a collaborative relationship to, among other things, identify receptor-selective compounds with respect to certain targets, develop receptor arrays and probes specific for G-protein coupled and other receptors and
facilitate the establishment of drug discovery programs; and 
  
 WHEREAS, concurrently herewith Allergan and ACADIA are entering into a stock purchase agreement under which Allergan will purchase $6 million in ACADIA Series C Preferred Stock on the terms
and subject to the conditions set forth therein. 
  
 NOW, THEREFORE, in consideration of the foregoing and the covenants and premises contained in this Agreement, the parties agree as follows: 
  

	1.	DEFINITIONS 

  
 As used herein, the following terms shall have the following meanings: 
  
 “ACADIA Assays” shall have the meaning ascribed in Section 3.4. 
  
 “ACADIA Compound Libraries” shall mean all compounds or sets
of compounds owned or controlled by ACADIA to the extent ACADIA is entitled to utilize such compounds or sets of compounds in the Collaboration and reasonably able to provide such compounds or sets of compounds to Allergan for use in connection with
the Collaboration. 
  

 1. 

 “ACADIA Designated Use” shall mean: (a) with respect to [...***...]
receptors, use with respect to the treatment or prevention of neuropsychiatric disorders (including but not limited to psychoses, bipolar disease, depression and obsessive-compulsive disorder) or the therapeutic use designated by ACADIA which has
become effective pursuant to Section 4.7; (b) with respect to [...***...] receptors, use with respect to the treatment or prevention of [...***...] or the therapeutic use designated by ACADIA which has become effective
pursuant to Section 4.7; and (c) with respect to a Test Target or Program Target, the therapeutic use of such Test Target or Program Target designated by ACADIA which has become effective pursuant to Section 4.6 or 4.7. 
  
 “ACADIA Development Candidate” shall mean a Development
Candidate selected as a drug candidate by ACADIA for research and development in the ACADIA Field in a manner consistent with ACADIA’s internal standards applicable to potential drug development candidates generally (but in any event at least
consistent with industry standards applicable to potential drug candidates with similar commercial potential) and otherwise in accordance with the terms of this Agreement. 
  
 “ACADIA Field” shall mean (a) with respect to [...***...] receptors, use with respect to the
treatment or prevention of neuropsychiatric disorders (including but not limited to psychoses, bipolar disease, depression and obsessive-compulsive disorder) or the therapeutic use designated by ACADIA which has become effective pursuant to Section
4.7; (b) with respect to [...***...] receptors, use with respect to the treatment or prevention of [...***...] or the therapeutic use designated by ACADIA which has become effective pursuant to Section 4.7; and (c) with
respect to a Test Target or Program Target, the therapeutic use of such Test Target or Program Target designated by ACADIA which has become effective pursuant to Section 4.6 or 4.7. 
  
 “ACADIA Know-How” shall mean, to the extent useful for purposes of the Collaboration, tangible or
intangible know-how, trade secrets, inventions, including the ACADIA Assays (whether or not patentable), data, preclinical and clinical results, physical, chemical or biological material, and other information that (a) ACADIA owns, controls or to
which it has a license (with the right to sublicense) on the Effective Date or (b) is independently developed by ACADIA during the Research Term, and, in each case, any replication or any part of such information or material. This definition
includes, without limitation, know-how included in the Core Technology. 
  
 “ACADIA Option” shall have the meaning ascribed in Section 5.1(b)(iii). 
  
 “ACADIA Patents” shall mean, to the extent useful for purposes of the Collaboration, all foreign and domestic: (a) patents issued or
existing as of the Effective Date or during the Research Term, which ACADIA owns or controls or to which ACADIA has a license (with the right to sublicense); (b) patents issuing from patent applications that are pending as of the Effective Date or
during the Research Term (including provisionals, divisionals, continuations and continuations-in-part of such applications), which ACADIA owns or controls or to which ACADIA has a license (with the right to sublicense); and (c) substitutions,
extensions, reissues, renewals and inventors certificates relating to the foregoing patents, which ACADIA owns or 

  

 ***Certain confidential information on this page has been omitted and filed separately with the
Commission. 
 Confidential treatment has been requested with respect to the omitted portions. 
  
 2. 

 
controls or to which ACADIA has a license (with the right to sublicense). ACADIA Patents existing as of the Effective Date include the patents and patent
applications are listed in Exhibit C attached hereto. This definition includes, without limitation, patents and patent applications included in the Core Technology. 
  
 “ACADIA Product” shall mean a pharmaceutical product containing an ACADIA Development Candidate, including
all formulations, line extensions and modes of administration thereof, developed by ACADIA pursuant to an ACADIA Research Project as to which ACADIA has exercised the ACADIA Option pursuant to Section 5.1(b)(iii), which product has received
Regulatory Approval for commercial marketing and sale for use in the ACADIA Field. 
  
 “ACADIA Research Project” shall have the meaning ascribed in Section 4.8. 
  
 “ACADIA Technology” shall mean the ACADIA Patents and the ACADIA Know-How. 
  
 “Active Compound” shall mean any chemical compound provided by Allergan or ACADIA or obtained from a Third
Party for screening during and screened as part of the Collaboration which chemical compound demonstrates activity against one or more Licensed Targets, Test Targets or Program Targets in the ACADIA Assays. 
  
 “Affiliate” shall mean any company or entity controlled by,
controlling, or under common control with a party hereto and shall include any company fifty percent (50%) or more of whose voting stock or participating profit interest is owned or controlled, directly or indirectly, by a party, and any company
which owns or controls, directly or indirectly, fifty percent (50%) or more of the voting stock of a party. 
  
 “Allergan Compound Libraries” shall mean all compounds or sets of compounds owned or controlled by Allergan to the extent Allergan is
entitled to utilize such compounds or sets of compounds in the Collaboration and reasonably able to provide such compounds or sets of compounds to ACADIA for use in connection with the Collaboration. 
  
 “Allergan Core Technology” shall mean all Allergan
Technology existing as of the Effective Date, including but not limited to all in-vitro and in-vivo animal models, pre-existing Allergan compounds and reference compounds, structure-activity relationships derived from and relating to such compounds
and any data or information relating to any of the foregoing. 
  
 “Allergan Development Candidate” shall mean a Development Candidate selected as a drug candidate by Allergan for research and development in the Allergan Field in a manner consistent with Allergan’s internal standards
applicable to potential drug development candidates generally (but in any event at least consistent with industry standards applicable to potential drug candidates with similar commercial potential) and otherwise in accordance with the terms of this
Agreement. 
  
 “Allergan Field” shall mean
all therapeutic, prophylactic and diagnostic uses. 
  
 “Allergan Know-How” shall mean, to the extent useful for purposes of the Collaboration, tangible or intangible know-how, trade secrets, inventions (whether or not 

  

 3. 

 
patentable), data, preclinical and clinical results, physical, chemical or biological material, and other information that (a) Allergan or its Affiliates
owns, controls or to which it has a license (with the right to sublicense) on the Effective Date or (b) is independently developed by Allergan or its Affiliates during the Research Term, and, in each case, any replication or any part of such
information or material. 
  
 “Allergan Patents”
shall mean, to the extent useful for purposes of the Collaboration, all foreign and domestic: (a) patents issued or existing as of the Effective Date or during the Research Term which Allergan or its Affiliates owns or controls or to which Allergan
or its Affiliates has a license (with the right to sublicense); and (b) patents issuing from patent applications that are pending as of the Effective Date or during the Research Term (including provisionals, divisionals, continuations and
continuations-in-part of such applications) which Allergan or its Affiliate owns or controls or to which Allergan or its Affiliates has a license (with the right to sublicense); and (c) substitutions, extensions, reissues, renewals and inventors
certificates relating to the foregoing patents, which Allergan or its Affiliates owns or controls or to which Allergan or its Affiliates has a license (with the right to sublicense). 
  
 “Allergan Product” shall mean a pharmaceutical product containing an Allergan Development Candidate, which
product has received Regulatory Approval for commercial marketing and sale for use in the Allergan Field, and including all formulations, line extensions and modes of administration thereof. 
  
 “Allergan Technology” shall mean the Allergan Patents and
Allergan Know-How. 
  
 “Collaboration” shall mean
the programs of collaborative research and development for the discovery, selection, synthesis, investigation, and preclinical and clinical development of drugs that are biologically active against one or more of the Licensed Targets, Test Targets
or Program Targets, as described in Articles 2, 3 and 4. 
  
 “Collaboration Know-How” shall mean any and all tangible or intangible know-how, trade secrets, inventions (whether or not patentable), data, preclinical and clinical results, physical, chemical or biological material, and
other information that is (a) useful for purposes of the Collaboration and/or that relates to Active Compounds or Derivative Compounds, and (b) that is in any way derived from or developed pursuant to activities undertaken by either party (or its
consultants or collaborators) in the conduct of the Collaboration, and, in each case, any replication or any part of such information or material. 
  
 “Collaboration Patents” shall mean all foreign and domestic patents (including substitutions, extensions, reissues, renewals and
inventors certificates relating thereto) that issue from patent applications (including provisionals, divisionals, continuations and continuations-in-part of such applications) that claim inventions in the Collaboration Know-How and that are filed
by or on behalf of one or both of the parties hereto. 
  
 “Collaboration Technology” shall mean the Collaboration Patents and the Collaboration Know-How. 
  

 4. 

 “Confidential Information” shall mean all information, inventions, know-how or data
disclosed by a party to the other pursuant to this Agreement including, without limitation, manufacturing, marketing, financial, personnel, scientific and other business information and plans, and the material terms of this Agreement, whether in
oral, written, graphic or electronic form. 
  
 “Core
Technology” shall mean patents and know-how developed by ACADIA during the term of this Agreement either as a result of its work pursuant to the Research Plan or otherwise which describe, are primarily related to, or are improvements of,
the ACADIA Assays and/or ACADIA’s gene-to-screen technologies. 
  
 “Derivative Compound” shall mean a compound that is [...***...], or isomer of an Active Compound made under an [...***...] program, or a chemical synthesis program based on [...***...]
relationships. 
  
 “Development Candidate”
shall mean an Active Compound (and each of its Derivative Compounds) which has demonstrated activity in applicable animal models and has met basic toxicology, pharmacokinetics, chemistry and pharmacology requirements typically used to support a
decision to move into initial human testing. 
  
 “Excluded
Targets” shall mean receptor targets (other than the Licensed Targets and Test Targets designated by Allergan as of the Effective Date) which meet one of the following criteria: (a) the receptor target has been selected by a Third Party,
alone or in conjunction with ACADIA, as a licensed target for research and development pursuant to a written agreement between ACADIA and such Third Party prior to receipt by ACADIA of notice of selection by Allergan of such receptor target as a
Test Target or a Program Target and such Third Party has entered into a bona fide collaboration and/or license agreement with ACADIA involving payments to ACADIA and diligence obligations by such Third Party; (b) the receptor target
has been selected by ACADIA as a receptor target for development by ACADIA as part of an ACADIA internal research program prior to receipt by ACADIA of notice of selection by Allergan of such receptor target as a Test Target or a Program Target so
long as such ACADIA internal development program is commercially reasonable in light of the potential product opportunities with respect to such target (and ACADIA continues to expend resources on the diligent pursuit of compounds/products active
against such target), and in light of resources then reasonably available to ACADIA; (c) the receptor target has become, prior to receipt by ACADIA of notice of selection by Allergan of such receptor target as a Test Target or a Program Target, the
subject of active negotiations between ACADIA and a Third Party with the objective of entering into an agreement as described in clause (a) above or ACADIA is spending substantial funds in an effort to enter into such negotiations with a Third
Party; or (d) the receptor target was already being considered by ACADIA, prior to receipt by ACADIA of notice of selection by Allergan of such receptor target as a Test Target or a Program Target, for an internal ACADIA research program as
evidenced by expenditure of substantial resources and commercially reasonable efforts by ACADIA in light of the potential product opportunities with respect to such target. Notwithstanding the foregoing, a target shall only be an Excluded
Target to the extent that a Third Party or internal ACADIA development program (as described in clauses (a) through (d) above) would conflict with the proposed Allergan use of such target. 
  

 ***Certain confidential information on this page has been omitted and filed separately with the
Commission. 
 Confidential treatment has been requested with respect to the omitted portions. 
  
 5. 

 “First Commercial Sale” of an Allergan Product, ACADIA Product or Independent Product
shall mean the first sale for use or consumption of such Allergan Product, ACADIA Product or Independent Product in a country after Regulatory Approval has been granted by the governing health regulatory authority of such country. Sale to an
Affiliate or sublicensee shall not constitute a First Commercial Sale unless the Affiliate or sublicensee is the end user of the Allergan Product, ACADIA Product or Independent Product. 
  
 “FTE” shall mean full-time equivalent scientific personnel. 
  
 “Gene Family” shall mean a collection of genes
[...***...]. 
  
 “IND” shall mean an
Investigational New Drug Application filed with the United States Food and Drug Administration, or the equivalent application or filing necessary to commence human clinical trials in another country, as applicable. 
  
 “Independent Product” shall mean any pharmaceutical product
containing an Active Compound or Derivative Compound developed by ACADIA pursuant to the ACADIA Research Project as to which Allergan has exercised its Participation Right pursuant to Section 5.1(a)(iii) below. 
  
 “Licensed Targets” shall mean alpha adrenergic receptors,
prostanoid receptors and Test Targets and Program Targets as to which Allergan has exercised its option to license pursuant to Section 4.2 and Section 4.3, respectively, including, as to each of the foregoing, all receptor subtypes. 
  
 “Major Market” shall mean the United States of
America, the European Union or Japan. 
  
 “NDA”
shall mean a New Drug Application filed with the United States Food and Drug Administration, or the equivalent community application filed in the European Union, or the equivalent application filed as a national application in Japan. 
  
 “Net Sales” shall mean, with respect to any Allergan
Product, ACADIA Product or Independent Product that has received Regulatory Approval, the amount billed by a party or its Affiliate or sublicensee to a Third Party which is not an Affiliate or sublicensee of the selling party (unless such Affiliate
or sublicensee is the end user of such product, in which case the amount billed therefor shall be deemed to be the amount that would be billed to a Third Party in an arm’s length transaction) for sales of such Allergan Product, ACADIA
Product or Independent Product to Third Parties less the following items, as allocable to such Allergan Product, ACADIA Product or Independent Product: (i) trade discounts, credits or allowances, (ii) credits or allowances additionally granted upon
returns, rejections or recalls (except where any such recall arises out of a party’s or its Affiliate’s or sublicensee’s gross negligence, willful misconduct or fraud), (iii) freight, shipping and insurance charges, (iv) taxes, duties
or other governmental tariffs (other than income taxes) and (v) government mandated rebates. 
  

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 6. 

 “Novo Nordisk Rights” shall mean the limited rights of Novo Nordisk A/S in ACADIA
Technology and the Collaboration Technology set forth in Exhibit A hereto. 
  
 “Participation Right” shall have the meaning ascribed in Section 5.1(a)(iii). 
  
 “Program Target” shall mean any novel gene and/or receptor, including all receptor subtypes, discovered as part of the Collaboration
pursuant to the Research Plan, which could result from (i) identification of novel receptors by Allergan using ACADIA blots or ACADIA-designed degenerate oligo probes/primers, (ii) demonstration of previously identified orphan receptors in
Allergan-owned tissue of interest using ACADIA blots or ACADIA-designed degenerate oligo probes/primers or (iii) demonstration using Receptor Selection and Amplification Technology (R-SATTM) that an Allergan-owned or -controlled compound has activity at an orphan receptor.

  
 “Program Target Availability Period” shall
mean, with respect to a Program Target, the [...***...] following the date of notice of discovery of such Program Target in accordance with Section 4.3. 
  
 “Regulatory Approval” shall mean any and all approvals (including price and reimbursement approvals),
licenses, registrations, or authorizations of the European Union or any country, federal, state or local regulatory agency, department, bureau or other government entity that is necessary for the manufacture, use, storage, import, transport and/or
sale of an Allergan Product, ACADIA Product or Independent Product in such jurisdiction. 
  
 “Research Management Committee” or “RMC” shall mean the committee formed pursuant to Section 2.2. 
  
 “Research Plan” shall mean the plan for conducting the research under the Collaboration, as amended from
time to time by the RMC. The Research Plan agreed upon by the parties hereto is attached to this Agreement as Exhibit B. Any amendments or revisions to the Research Plan shall be in writing and shall require unanimous approval of the RMC.

  
 “Research Term” shall mean the three (3)
years following the Effective Date and one additional two (2) year renewal period at the request of Allergan, subject to (with respect to such renewal period) agreement by the parties following good faith negotiations on research funding to be paid
to ACADIA by Allergan. 
  
 “Royalty Term” shall
mean, in the case of any Allergan Product, ACADIA Product or Independent Product, in any country, the period of time commencing on the First Commercial Sale and ending upon the later of (a) ten (10) years from the date of First Commercial Sale in
such country, or (b) the expiration of the last to expire of the Allergan Patents, ACADIA Patents or Collaboration Patents covering such Allergan Product, ACADIA Product or Independent Product in such country. 
  
 “Stock Purchase Agreement” shall have the meaning ascribed
in Section 6.2. 
  
 “Term of the Agreement” shall
have the meaning ascribed in Section 11.1. 
  

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 7. 

 “Test Target” shall mean, initially, each of the three (3) receptors listed on Exhibit D
hereto, including all receptor subtypes, and any substitute(s) or replacement(s) for such receptor(s) as designated under Sections 4.1 and 4.2, respectively, which substitute(s) and/or replacement(s) are not Excluded Target(s); provided, however,
that at no time shall there be more than three (3) Test Targets. 
  
 “Test Target Availability Period” shall mean, with respect to any of the initial Test Targets listed on Exhibit D hereto, the [...***...] following the Effective Date, and, with respect to any substitute(s) or
replacement(s) for such Test Target(s) as designated under Sections 4.1 and 4.2, respectively, the [...***...] period following the date of such replacement or substitution in accordance with Sections 4.1 and 4.2, as the case may be.

  
 “Third Party” shall mean any entity other
than Allergan or ACADIA or an Affiliate of Allergan or ACADIA. 
  

	2.	COLLABORATION SCOPE AND GOVERNANCE 

  
 2.1 Scope Of The Collaboration. The parties hereby agree to establish and conduct, during the Research Term, a
collaborative research program in accordance with the Research Plan and the terms of this Agreement. The initial Research Plan for conducting such research program is attached hereto as Exhibit B. Pursuant to the Collaboration, the parties will
collaborate in (a) identifying receptor-selective adrenergic and prostanoid lead compounds, (b) identifying receptor-selective lead compounds with respect to other receptor targets, (c) facilitating the development of gene to screen discovery
capabilities by developing receptor arrays and probes specific for G-protein coupled and other receptors, (d) identifying candidate receptors and markers for [...***...], (e) establishing ACADIA drug discovery programs which leverage
certain results of the Collaboration for the benefit of both parties and directed at ACADIA Designated Uses, and (f) conducting such other activities as are unanimously approved by the RMC. 
  
 2.2 Research Management Committee. Promptly after the Effective
Date, the parties will form a Research Management Committee (“RMC”) comprised of three (3) representatives of each of ACADIA and Allergan. One member of the RMC shall be selected to act as the chairperson of the RMC, with each chairperson
acting for a term of [...***...]. The chairperson shall be selected alternately by Allergan and ACADIA, and Allergan shall designate the first chairperson. The RMC shall determine the specific goals for the Collaboration, shall manage
the ongoing research conducted under the Collaboration, and shall monitor the progress and results of such work. All decisions of the RMC shall be unanimous. The RMC shall meet on a quarterly basis or at such other frequency as the RMC agrees. The
parties shall agree upon the time and place of meetings. Within [...***...] after each meeting, the RMC chairperson will provide the parties with a written report describing, in reasonable detail, the status of the Collaboration, a
summary of the results and progress to date, the issues requiring resolution, and the agreed resolution of previously reported issues. A reasonable number of additional representatives of a party may attend meetings of the RMC in a non-voting
capacity. 
  

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 8. 

 2.3 Research Management Committee Functions And Powers. The RMC shall encourage and
facilitate ongoing cooperation between the parties, establish, update, review and approve the Research Plan and other plans for accomplishing the Collaboration goals, allocate tasks and coordinate activities required to perform the Collaboration,
monitor progress of the Collaboration and the parties’ diligence in carrying out their responsibilities thereunder, oversee the conduct of all patent matters, and carry out the other duties and responsibilities described for it in this
Agreement. The RMC shall also be responsible for developing and approving an annual research budget for activities to be performed by the parties pursuant to the Research Plan for [...***...] of the Research Term (including any renewal
or extension thereof). Such budget shall set forth the research funding to be provided by Allergan to ACADIA pursuant to Section 6.1, which shall be determined based on the number of FTEs required for ACADIA to perform its activities under the
Research Plan given the projected costs per activity set forth in Exhibit E hereto. 
  
 In addition, the RMC shall maintain and, on a regular basis, update and provide to the parties a list or lists of the following: Licensed Targets, Test Targets (including the dates upon which each became a Test
Target), Program Targets (including the date of discovery of each such Program Target), ACADIA Designated Uses, Active Compounds, Allergan Development Candidates, ACADIA Development Candidates, the number of Excluded Targets in any given Gene Family
and a list of the Excluded Targets falling within clauses (b) and (d) of that definition. With respect to Excluded Targets falling within clauses (a) and/or (c) of such definition, Allergan shall have the right to inquire of ACADIA as to the
availability of any target which Allergan may be considering for selection as a Test Target and as to which Allergan intends to commit internal research funding. In the event of such inquiry, ACADIA shall respond promptly to Allergan (and in any
event no later than [...***...] following receipt of such inquiry) as to whether such receptor would then be deemed an Excluded Target. 
  
 2.4 Information And Reports. Except as otherwise provided in this Agreement, the parties will make available and disclose to one another all
results of the work conducted pursuant to the Collaboration prior to and in preparation for RMC meetings, in the form and format to be designated by the RMC. 
  
 2.5 RMC Dispute Resolution. If the RMC is unable to decide or resolve an issue unanimously, the issue shall be referred to the Chief
Scientific Officer of ACADIA and the Corporate Vice President, Science and Technology of Allergan. Such officers of the parties will meet promptly thereafter and shall negotiate in good faith to resolve such issue. If they cannot resolve the issue
within [...***...] of commencing such negotiations, the issue shall be resolved as provided in Section 13.3. 
  

	3.	TECHNOLOGY TRANSFER; TARGET IDENTIFICATION AND COMPOUND SCREENING

  
 3.1 Transfer of ACADIA
Technology. Commencing promptly after the Effective Date and from time to time thereafter, ACADIA will disclose to Allergan such of the ACADIA Patents and ACADIA Know-How as is reasonably necessary to enable Allergan to perform its Collaboration
activities hereunder in accordance with the Research Plan and otherwise to exercise fully the licenses granted to Allergan hereunder. During the Term of the Agreement, 

  

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 9. 

 
ACADIA will provide Allergan with reasonable technical assistance relating to the use of such ACADIA Know-How and the practice of such ACADIA Patents, solely
to the extent permitted under the licenses granted to Allergan herein. In the event that ACADIA provides any materials to Allergan pursuant to the Research Plan, the parties will enter into a Materials Transfer Agreement in the form attached hereto
as Exhibit H with respect to such materials. 
  
 3.2
Transfer of Allergan Technology. Commencing promptly after the Effective Date and from time to time thereafter, Allergan shall disclose to ACADIA such of the Allergan Know-How and Allergan Patents as is reasonably necessary to enable ACADIA to
perform its Collaboration activities hereunder in accordance with the Research Plan and otherwise to exercise fully the licenses granted to ACADIA hereunder. During the Collaboration, Allergan will provide ACADIA with reasonable technical assistance
relating to the use of such Allergan Know-How and the practice of the Allergan Patents, solely to the extent permitted under the license granted to ACADIA herein. In the event that Allergan provides any materials to ACADIA pursuant to the Research
Plan, the parties will enter into a Materials Transfer Agreement in the form attached hereto as Exhibit H with respect to such materials. 
  
 3.3 Identification of Targets. During the Research Term, the parties shall collaborate in accordance with the Research Plan to perform
research to identify receptor targets with the potential to become Licensed Targets, Test Targets or Program Targets. The parties shall report the results of such research promptly to the RMC. 
  
 3.4 Assay Development and Screening to Identify Active
Compounds. 
  
 (a) Upon
selection by Allergan of a receptor target as a Licensed Target, Test Target or Program Target, ACADIA shall use reasonable efforts in accordance with the Research Plan and the RMC approved research budget to develop cell-based assays upon each such
Licensed Target, Test Target or Program Target (collectively, the “ACADIA Assays”). It is understood that as of the Effective Date, ACADIA has already developed certain assays based on the [...***...]. All such ACADIA Assays
will be optimized for efficient screening of compounds to determine activity, target specificity and dose response of compounds in order to identify Active Compounds. Allergan shall cooperate with ACADIA as reasonable in developing such ACADIA
Assays. 
  
 (b) During the Research
Term, Allergan and ACADIA will make the Allergan Compound Libraries and the ACADIA Compound Libraries, respectively, available for screening in the ACADIA Assays, as directed by the RMC consistent with the applicable Research Plan. In addition, the
RMC may agree to obtain from Third Parties rights to screen compounds owned or controlled by such parties; provided, however, that if there would be any amounts payable to such Third Party for screening such compounds, no such Third Party compounds
will be screened without the consent of both parties, such consent not to be unreasonably withheld. ACADIA shall use reasonable efforts to conduct the screening in the appropriate ACADIA Assays of all compounds made available by Allergan, ACADIA and
Third Parties or selected for screening by the RMC, in accordance with the Research Plan. The primary goal of the screening is to determine the activity of such selected compounds against specific receptors to identify Active Compounds. Promptly
after completing the screening of a batch of compounds under this 

  

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Section 3.4(b) in the appropriate ACADIA Assays, ACADIA will provide to the RMC the results of such screening. The RMC will review such ACADIA Assay results
promptly after receipt, will determine which of the screened compounds meet the requirements established by the RMC for identification as Active Compounds, and will add any such Active Compounds to the list maintained by the RMC pursuant to Section
2.3. 
  

	4.	TARGET AND COMPOUND SELECTION AND DEVELOPMENT 

  
 4.1 Allergan Substitution of Test Targets. At any time during
the Test Target Availability Period for a given Test Target (but in any case prior to the expiration of the Research Term), Allergan may, by written notice to ACADIA and the RMC, propose to substitute a new receptor target owned or controlled by
ACADIA or owned or controlled by Allergan or otherwise available for research and development under this Agreement, which new receptor target is not an Excluded Target, in such Test Target’s place. Such notice to the RMC of any such
substitution shall identify in reasonable detail the new Test Target and the existing Test Target for which such new Test Target is to substitute and shall include the date of substitution. ACADIA shall have [...***...] following
receipt of notice from Allergan to provide written notice to Allergan and the RMC that such proposed substitute is an Excluded Target. If ACADIA does not provide such notice within such [...***...] period, then such proposed new Test
Target shall be substituted in such existing Test Target’s place, and the information with respect to such new Test Target shall be recorded by the RMC on the lists maintained pursuant to Section 2.3. If ACADIA gives such notice within such
[...***...] period, then any dispute as to whether such proposed substitute is an Excluded Target shall be resolved in accordance with the procedures set forth in Section 2.5. 
  
 4.2 Allergan Designation of Licensed Targets; Replacement of Test
Targets. 
  
 (a) At any time
during the Test Target Availability Period for a given Test Target, Allergan may, at its option, designate such Test Target as a Licensed Target by written notice to ACADIA and the RMC. Such notice to the RMC of any such designation shall identify
the Test Target and include the date of designation, which information shall be recorded by the RMC on the lists maintained pursuant to Section 2.3, and Allergan shall deliver within a reasonable period thereafter a written development plan for
conducting research and development with respect to such target. Each such development plan shall be prepared by Allergan consistent with reasonable professional standards and practices in the industry as applicable to such target. 
  
 (b) Upon or following any exercise by Allergan
of its option to designate a Test Target as a Licensed Target pursuant to this section (but in any case prior to the expiration of the Research Term), Allergan may select a new receptor target owned or controlled by ACADIA or owned or controlled by
Allergan or otherwise available for research and development under this Agreement as a proposed replacement Test Target, which replacement Test Target is not an Excluded Target, to fill the vacancy left by such option exercise; provided,
however, that such replacement Test Target shall be subject to paragraph (c) below. Allergan shall provide ACADIA and the RMC with prompt written notice of any such replacement (including the date thereof). ACADIA shall have [...***...]
following receipt of notice 

  

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 11. 

 
from Allergan to provide written notice to Allergan and the RMC that such proposed replacement is an Excluded Target. If ACADIA does not provide such notice
within such [...***...] period, then, subject to Section 4.2(c), such proposed replacement shall be included as a Test Target, and the information with respect to such replacement Test Target shall be recorded by the RMC on the lists
maintained pursuant to Section 2.3. If ACADIA gives such notice within such [...***...] period, then any dispute as to whether such proposed replacement is an Excluded Target shall be resolved in accordance with the procedures set forth
in Section 2.5. 
  
 (c)
Notwithstanding the provisions of Section 4.2, a target designated as a replacement by Allergan pursuant to Section 4.2(b) shall not be deemed a Test Target for purposes of this Agreement prior to the approval by the RMC, not to be unreasonably
withheld, of the development plan submitted with respect to the prior Test Target which has been designated as a Licensed Target by Allergan pursuant to Section 4.2(a). Within [...***...] after receipt by the RMC of such a development
plan, the RMC shall either approve such plan or provide written revisions to such plan necessary for such approval. 
  
 (d) During the Test Target Availability Period for a given Test Target, ACADIA shall not grant any license or other rights
to use ACADIA Technology in connection with or otherwise with respect to such Test Target to any Third Party or any Affiliate of ACADIA. In the event that Allergan does not exercise its option to designate a Test Target as a Licensed Target prior to
the expiration of the Test Target Availability Period with respect to such Test Target, following such expiration, ACADIA shall be free to develop or grant licenses or other rights with respect to such Test Target to a Third Party or any Affiliate
of ACADIA, subject to the limitations set forth in Section 5.3; provided, however, that ACADIA’s rights with respect to any Test Target which is or becomes included in the meaning of Allergan Technology shall be solely as is expressly
set forth in Section 5.1(b), subject to the terms of this Agreement. 
  
 4.3 Allergan Option to License Program Targets. 
  
 (a) Subject Section 4.3(b) below, the parties shall promptly notify the RMC of the discovery of any Program Target (including the date of such discovery), which information shall be recorded by the RMC
on the lists maintained pursuant to Section 2.3. Within [...***...] after receipt by Allergan of any such notification of discovery of a Program Target, Allergan shall notify the RMC as to whether Allergan desires to pursue research and
development activities with respect to such Program Target as part of the Collaboration. If Allergan so notifies the RMC that it desires to pursue such research and development, Allergan shall commit resources with respect to such Program Target
consistent with Exhibit E (subject to Section 4.3(b)). If Allergan does not so notify the RMC that it desires to pursue such research and development, then such target shall not be deemed a Program Target for purposes of this Agreement. 

 
 During the Program Target Availability Period for any such Program Target,
Allergan shall have an [...***...] option to designate a Program Target as a Licensed Target subject to ACADIA’s rights under Sections 4.8 and 5.1(b) below; provided that such option may be exercised by Allergan, in its sole
discretion, at any time during the Program Target Availability Period upon written notice to ACADIA and the RMC and that during the 

  

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Program Target Availability Period for a given Program Target, ACADIA shall not grant any license or other rights to use ACADIA Technology in connection with
or otherwise with respect to such Program Target to any Third Party or any Affiliate of ACADIA. In the event that Allergan does not exercise such option prior to the expiration of the Program Target Availability Period with respect to a given
Program Target, following such expiration, ACADIA shall be free to develop or grant licenses or other rights with respect to such Program Target to a Third Party or any Affiliate of ACADIA, subject to the limitations set forth in this Agreement.

  
 (b) When the RMC is notified
that a Program Target has been discovered, ACADIA shall have [...***...] following the RMC’s receipt of such notice to provide written notice to Allergan and the RMC that such Program Target is an Excluded Target. If ACADIA does
not provide such notice within such [...***...] period, then such Program Target shall be subject to Article 5 and the other provisions of this Agreement, and the information with respect to such Program Target shall be recorded by the
RMC on the lists maintained pursuant to Section 2.3. If ACADIA gives such notice within such [...***...] period, then any dispute as to whether such Program Target is an Excluded Target shall be resolved in accordance with the
procedures set forth in Section 2.5. If such Program Target is an Excluded Target, then: (i) such Program Target shall not be subject to Article 5 and the other provisions of this Agreement; (ii) ACADIA’s rights to use the Allergan Technology
pursuant to Article 5 below with respect to such Program Target shall terminate, effective immediately; and (iii) Allergan shall be free to use such Program Target, as well as any Collaboration Technology in any manner or for any purpose in
connection with such Program Target, without any obligation to ACADIA, including but not limited to any milestone or royalty obligations. 
  
 4.4 Designation of Targets During Renewal Period. During any renewal periods of the Research Term, Allergan shall have the right to continue
to designate, substitute and replace Licensed Targets, Test Targets and Program Targets subject to the terms of this Agreement; provided, however, that the total number of Licensed Targets, Test Targets and Program Targets taken together as a
whole that are the subject of this Agreement during such renewal period shall not exceed the total number of Licensed Targets, Test Targets and Program Targets taken together as a whole on the date of expiration of the initial [...***...]
period of the Research Term. 
  
 4.5 Designation of
Development Candidates. Allergan and ACADIA shall each designate their own Development Candidates in accordance with the licenses granted hereunder and otherwise in accordance with the terms of this Agreement. Allergan and ACADIA agree that each
of them cannot develop an Active Compound or a Derivative Compound without designating such compound as a Development Candidate. Notwithstanding any other provision of this Agreement, however, (i) Allergan shall not be permitted to designate as an
Allergan Development Compound an Active Compound [...***...] that has been previously designated by ACADIA as an ACADIA Development Compound and (ii) ACADIA shall not be permitted to designate as an ACADIA Development Compound an Active
Compound [...***...] that has been previously designated by Allergan as an Allergan Development Compound. 
  

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 13. 

 4.6 Selection of ACADIA Designated Uses. At any time following designation by Allergan of a
Test Target, Program Target or Licensed Target pursuant to this Agreement, ACADIA shall, by written notice to Allergan and the RMC, designate the ACADIA Designated Use for such Test Target, Program Target or Licensed Target. Such notice of any such
designation shall specify the ACADIA Designated Use in reasonable detail and shall include the date of designation. Allergan shall have [...***...] following receipt of notice from ACADIA to provide written notice to ACADIA and the RMC
that Allergan is then pursuing (either itself or with a Third Party) or intends to pursue the development of such proposed ACADIA Designated Use itself. If Allergan does not provide such notice within such [...***...] period, then such
proposed ACADIA Designated Use shall become effective, and the information with respect to such ACADIA Designated Use shall be recorded by the RMC on the lists maintained pursuant to Section 2.3. If Allergan gives such notice within such
[...***...] period, then any dispute as to such proposed ACADIA Designated Use shall be resolved in accordance with the procedures set forth in Section 2.5. 
  
 4.7 Substitution and Addition of ACADIA Designated Uses. 
  
 (a) Once an ACADIA Designated Use has become
effective for a given Test Target or Program Target in accordance with Section 4.6, and at any time after the Effective Date with respect to an ACADIA Designated Use for a Licensed Target, ACADIA may thereafter at any time during the Term of the
Agreement, by written notice to Allergan and the RMC, propose to substitute a new ACADIA Designated Use therefor. Such notice to the RMC of any such substitution shall specify in reasonable detail the proposed new ACADIA Designated Use and shall
include the date of substitution. Allergan shall have [...***...] following receipt of notice from ACADIA to provide written notice to ACADIA and the RMC that Allergan is then pursuing (either itself or with a Third Party) or intends to
pursue the development of such proposed substitute ACADIA Designated Use itself. If Allergan does not provide such notice within such [...***...] period, then such new ACADIA Designated Use shall become effective, the information with
respect to such substitute ACADIA Designated Use shall be recorded by the RMC on the lists maintained pursuant to Section 2.3 and the use with respect to which such new ACADIA Designated Use has been substituted shall no longer be deemed an ACADIA
Designated Use or be included within the ACADIA Field for purposes of this Agreement. If Allergan gives such notice within such [...***...] period, then any dispute as to such proposed ACADIA Designated Use shall be resolved in
accordance with the procedures set forth in Section 2.5. 
  
 (b) ACADIA may at any time during the Term of the Agreement, by written notice to Allergan and the RMC, propose to add an additional ACADIA Designated Use for an ACADIA Research Project upon the
occurrence of any of the following events with respect to such ACADIA Research Project: (i) a Participation Right (as defined below) has been exercised; (ii) a Participation Right has not been exercised after delivery of a ACADIA Notice (as defined
below); or (iii) the initial [...***...] research period for such ACADIA Research Project ends without delivery of an ACADIA Notice and ACADIA subsequently (A) delivers an ACADIA Notice with respect to such ACADIA Research Project and
(B) notwithstanding Section 5.1(a)(iii) below, gives Allergan an additional [...***...] period from Allergan’s receipt 

  

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 14. 

 
of such ACADIA Notice to exercise its Participation Right with respect to such ACADIA Research Project. Such written notice by ACADIA to Allergan and the RMC
of any such addition shall specify in reasonable detail the proposed new ACADIA Designated Use and shall include the date of such addition. Allergan shall have [...***...] following receipt of notice from ACADIA to provide written
notice to ACADIA and the RMC that Allergan is then pursuing (either itself or with a Third Party) or intends to pursue the development of such proposed additional ACADIA Designated Use itself. If Allergan does not provide such notice within such
[...***...] period, then such ACADIA Designated Use shall become effective, and the information with respect to such substitute ACADIA Designated Use shall be recorded by the RMC on the lists maintained pursuant to Section 2.3. If
Allergan gives such notice within such [...***...] period, then any dispute as to such proposed ACADIA Designated Use shall be resolved in accordance with the procedures set forth in Section 2.5. 
  
 4.8 ACADIA Research Project. During the Research Term, ACADIA
shall conduct research on Licensed Targets, Test Targets and Program Targets in the ACADIA Field (the “ACADIA Research Project”). ACADIA shall promptly notify the RMC upon the commencement of each R-Tech Research Project. Within a
reasonable period after the commencement of the ACADIA Research Project, ACADIA shall submit for each ACADIA Research Project to the RMC for review and approval the tests and results of such tests necessary to conclude that ACADIA has demonstrated
proof of concept for both efficacy and safety in animal models (the “Proof of Concept Plan”), and thereafter shall submit written reports to the RMC on a regular basis (and in any event no less than once per calendar quarter) updating the
RMC on the status of each ACADIA Research Project and describing in reasonable detail any development plans with respect to the results of each ACADIA Research Project. Within [...***...] after receipt from ACADIA of a Proof of Concept
Plan, the RMC shall either approve such Proof of Concept Plan or provide written revisions to such Proof of Concept Plan necessary for such approval. Once approved by the RMC, such Proof of Concept Plan becomes a “Proof of Concept.” ACADIA
shall thereafter promptly notify the RMC during the course of each ACADIA Research Project of ACADIA’s successful achievement of the Proof of Concept for each ACADIA Research Project (an “ACADIA Notice”). 
  
 4.9 Excluded Targets. ACADIA hereby warrants that, as of the
Effective Date, all Excluded Targets falling under clauses (b) and (d) of that definition are listed in Exhibit F attached hereto. ACADIA further covenants that it will promptly notify the RMC and Allergan of any additional Excluded Targets
following the Effective Date which fall within clauses (b) and/or (d) of that definition. Any notice delivered by ACADIA pursuant to Sections 4.1 or 4.2 above with respect to an Excluded Target shall be deemed to be a representation by ACADIA that
such notice is correct. Any notice delivered by Allergan pursuant to Sections 4.6 or 4.7 above with respect to Allergan’s pursuit (either by itself or with a Third Party) or intended pursuit of the development of such proposed substitute ACADIA
Designated Use itself shall be deemed to be a representation by Allergan that such notice is correct. 
  

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 15. 

	5.	LICENSE GRANTS; LIMITED EXCLUSIVITY 

  
 5.1 License Grants. 
  

(a) Grant by ACADIA. ACADIA hereby grants to Allergan the following license rights: 
  
 (i) During the Research Term, ACADIA grants to
Allergan an exclusive (except as to the Novo Nordisk Rights and as to ACADIA’s rights expressly set forth in this Agreement), worldwide, royalty-free license, without the right to sublicense, under the ACADIA Technology and ACADIA’s
interest in the Collaboration Technology to use the ACADIA Technology in conjunction with the Test Targets and the Program Targets for drug discovery purposes for use in the Allergan Field and otherwise to carry out the activities contemplated by
the Research Plan; provided, however, that such license will continue in effect following the expiration of the Research Term for the duration of any Test Target Availability Period or Program Target Availability Period on a target-by-target
basis only for so long as Allergan is continuing to use commercially reasonable efforts to research such Test Targets and Program Targets; and 
  
 (ii) ACADIA grants to Allergan an exclusive (except as to the Novo Nordisk Rights and as to ACADIA’s rights expressly
set forth in this Agreement), worldwide, royalty-bearing license, with the right to sublicense, under the ACADIA Technology and ACADIA’s interest in the Collaboration Technology to use the ACADIA Technology in conjunction with the Licensed
Targets for drug discovery purposes and to discover, develop, make, have made, use, sell, offer to sell, have sold and import Allergan Development Candidates and Allergan Products in the Allergan Field but excluding the ACADIA Designated Uses;
provided, however, that, following the expiration of the Research Term, including any extensions or renewals thereof, such license under the ACADIA Technology shall remain exclusive as to each Licensed Target, on a target-by-target basis,
only for so long as Allergan is continuing to use commercially reasonable efforts to pursue research, development, marketing and/or sale of an Allergan Development Candidate or Allergan Product that is biologically active against such Licensed
Target; and 
  
 (iii) ACADIA hereby
grants to Allergan an exclusive and non-transferable option to obtain an exclusive (except as to the Novo Nordisk Rights and as to ACADIA’s rights expressly set forth in this Agreement), worldwide, royalty-bearing license, with the right to
sublicense, under the ACADIA Technology and ACADIA’s interest in the Collaboration Technology to discover, develop, make, have made, use, sell, offer to sell, have sold and import Independent Products with respect to each ACADIA Research
Project (the “Participation Right”); provided, however, that any license obtained by Allergan upon exercise of a Participation Right pursuant to this Section 5.3(a)(iii) shall remain exclusive, only for so long as Allergan is
continuing to use commercially reasonable efforts to pursue research, development, marketing and/or sale of a Development Candidate or an Independent Product based on such ACADIA Research Project. The Participation Right with respect to a given
Active Compound under a given ACADIA Research Project for which Allergan has received an ACADIA Notice shall be exercisable by written notice to ACADIA and otherwise upon the terms 

  

 16. 

 
of this subsection (a), at any time prior to the earlier to occur of: (A) [...***...] following Allergan’s receipt of such ACADIA Notice,
or (B) the date that is [...***...] after the date of commencement of the applicable Research Project. In consideration of such license, within [...***...] following exercise of the Participation Right, Allergan shall pay
to ACADIA a one-time license fee of either (X) [...***...] if such exercise is made following receipt of an ACADIA Notice pursuant to clause (A) above or (Y) [...***...] if such exercise is made pursuant to clause (B)
above, and shall reimburse ACADIA for [...***...] of all documented research costs incurred by ACADIA in connection with the ACADIA Research Project plus [...***...] per annum. In addition, Allergan shall make milestone and
royalty payments to ACADIA with respect to such Independent Product in accordance with Sections 6.3 and 6.4, respectively. 
  
 Notwithstanding the foregoing, in the event that Allergan has not, prior to the earlier of the dates described in subsections (a)(iii)(A) and (B) above, exercised a
Participation Right with respect to such R-Tech Research Project, then ACADIA may exercise the ACADIA Option described in subsection (b)(iii) below with respect to such ACADIA Research Project. 
  
 (b) Grant by Allergan. Allergan hereby
grants to ACADIA the following license rights: 
  
 (i) During the Research Term, Allergan grants to ACADIA a nonexclusive, worldwide, royalty-free license, without the right to sublicense, under the Allergan Technology and Allergan’s interest in the Collaboration
Technology, to use the Test Targets and the Program Targets for drug discovery purposes for use in the ACADIA Field and otherwise to carry out the activities contemplated by the Research Plan; 
  
 (ii) Allergan grants to ACADIA an exclusive,
worldwide, royalty-free license, without the right to sublicense, under the Allergan Technology and Allergan’s interest in the Collaboration Technology, subject to the terms of this Agreement, solely to the extent necessary or appropriate to
carry out ACADIA Research Projects pursuant to this Agreement; and 
  
 (iii) Provided that an Allergan Participation Right has expired unexercised or been declined in writing by Allergan with respect to an ACADIA Research Project, then Allergan grants to ACADIA an option to
obtain an exclusive, worldwide, royalty-bearing license, with the right to sublicense, under the Allergan Technology and Allergan’s interest in the Collaboration Technology to discover, develop, make, have made, use, sell, offer to sell, have
sold and import ACADIA Products based on such ACADIA Research Project solely within the ACADIA Field (the “ACADIA Option”); provided, however, that in no event shall ACADIA have any right or license to disclose or sublicense to any
Third Party any Allergan Core Technology without Allergan’s prior written consent; and, provided further, that such license under the Allergan Technology shall remain exclusive as to each Active Compound, on a compound-by-compound basis,
only for so long as ACADIA is continuing to use commercially reasonable efforts to pursue research, development, marketing and/or sale of an ACADIA Development Candidate or ACADIA Product with respect to such Active Compound or a Derivative
Compounds thereof. The ACADIA Option with respect to a given Active Compound 

  

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 17. 

 
shall be exercisable, by written notice to Allergan and otherwise upon the terms of this subsection (iii), at any time prior to the date that is
[...***...] following expiration of the Participation Right or, if earlier, written notification by Allergan to ACADIA of its decision not to exercise the Participation Right with respect to such Active Compound. In consideration of
such license, ACADIA shall make milestone and royalty payments to Allergan in accordance with Sections 6.3 and 6.4, respectively. 
  
 (iv) If, following exercise of the ACADIA Option with respect to a specific compound under development and in connection
with human clinical testing thereof, ACADIA identifies a potential therapeutic use for such compound which is (A) unanticipated at the time that human clinical testing is initiated, (B) outside of the ACADIA Field and (C) not competitive with any
Allergan Products or any other products then being sold by Allergan or which Allergan is then pursuing or intends to pursue (as shown by documentation generated prior to ACADIA identifying such use) (the “Additional Therapeutic Use”), then
ACADIA shall so notify Allergan in writing. Allergan shall thereupon have [...***...] following receipt of such written notice to provide written notice to ACADIA that such Additional Therapeutic Use does not meet the provisions set
forth in clauses (A), (B) or (C) above. If Allergan gives such notice within such [...***...] period, then any dispute as to whether such Additional Therapeutic Use meets the provisions set forth in clauses (A), (B) and (C) above shall
be resolved in accordance with the procedures set forth in Section 2.5. If Allergan does not provide such notice within such [...***...] period, then, subject to the provisions of this Section 5.1(b)(iv), Allergan shall grant to ACADIA
an exclusive, worldwide, royalty-bearing license, with the right to sublicense, under the Allergan Technology and Allergan’s interest in the Collaboration Technology to develop, make, have made, use, sell, offer to sell, have sold and import
ACADIA Products based on such compound solely with respect to such Additional Therapeutic Use. 
  
 The license granted under this Section 5.1(b)(iv) shall remain exclusive only for so long as ACADIA is continuing to use commercially reasonable efforts to pursue development, marketing and/or sale of such ACADIA
Development Candidate with respect to such Additional Therapeutic Use. In consideration of such license, the practice of the license granted pursuant to this Section 5.1(b)(iv) with respect to such ACADIA Development Candidate shall be subject to
the milestone and royalty provisions of Sections 6.3 and 6.4, respectively, and the diligence obligations under Section 5.2 below. 
  
 5.2 Diligence Obligations. Allergan shall use commercially reasonable efforts to select and pursue research, development, marketing and/or
sale of an Allergan Development Candidate with respect to each Licensed Target prior to the end of the Research Term. ACADIA shall use commercially reasonable efforts to select and pursue research, development, marketing and/or sale of an ACADIA
Development Candidate with respect to each target within the ACADIA Field prior to the end of the Research Term. Such commercial reasonableness shall include consideration of all Collaboration activities being conducted by a party hereunder.

  
 5.3 Limited Exclusivity. ACADIA hereby warrants
that, notwithstanding any other provision of this Agreement, during the Research Term (including any renewals or extensions thereof), it will neither (a) use the ACADIA Technology for the research, discovery, development 

  

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 18. 

 
or commercialization of drugs for the treatment of [...***...], nor (b) enter into any agreement with a Third Party a primary purpose of which
is to use the ACADIA Technology to conduct research, discovery, development or commercialization of compounds for the treatment or prevention of [...***...] diseases, nor (c) enter into an agreement with a Third Party which has the
effect of so increasing the number of Excluded Targets as to substantially decrease the value of this Collaboration to Allergan by excluding a significant proportion of the genes in any given Gene Family. Subject to the foregoing, nothing contained
in this Agreement shall be construed (i) to prevent ACADIA from pursuing research or collaborative activities alone or with Third Parties with respect to any receptor targets not designated as Licensed Targets, Program Targets or Test Targets or
(ii) to grant Allergan rights to use ACADIA Technology with respect to any receptor target not designated as a Licensed Target, Program Target or Test Target. Upon the Effective Date (and thereafter from time to time as targets are designated as
Test Targets and/or Program Targets), ACADIA shall immediately discontinue marketing and selling, directly or indirectly, kits used to screen Licensed Targets, Test Targets and/or Program Targets and shall discontinue all other activities with Third
Parties with respect to screening such Licensed Targets, Test Targets and/or Program Targets; provided, however, that ACADIA may sell such kits and may continue such screening activities upon the express prior written approval of Allergan.

  

	6.	FEES AND PAYMENTS 

  
 6.1 Research Funding. During the Research Term, Allergan agrees to pay ACADIA, on a quarterly basis in advance, payable no later than
[...***...] of the quarter, research funding payments to be used by ACADIA to pursue the activities set forth in the Research Plan. Such funding shall be in such amounts as are set forth in the Research Plan, provided that such Plan
shall initially provide for at least the following amounts: (a) a total of [...***...] during [...***...] of the Research Term; (b) a total of [...***...] during [...***...] of the Research Term;
(c) a total of [...***...] during [...***...] of the Research Term; and (d) for any renewal or extension [...***...], the amount of support provided by Allergan in the immediately preceding [...***...]
increased or decreased by a factor which reflects changes in the Pharmaceutical Manufacturers’ Producer Price Index for the United States as reported as of the date that is [...***...] prior to the anniversary of the Effective
Date in each applicable subsequent year when compared to the comparable statistic for the date that is [...***...] prior to the anniversary of the Effective Date in the preceding year. The parties hereby acknowledge that the amount of
research funding will need to increase, subject to the approval of the RMC, as the number of Licensed Targets, Test Targets and Program Targets increases. It is intended that, as determined by the RMC, Allergan will provide sufficient additional
research funding to ACADIA during the Research Term (and any renewal or extension thereof) to support the number of FTEs required to pursue the activities set forth in the Research Plan in accordance with Exhibit E hereto, as such plan is developed
and approved by the RMC, in accordance with the annual research budget developed and approved by the RMC as described in Section 2.3. The first and last quarter payments shall be prorated, with the first quarter payment due [...***...]
after the Effective Date. 
  

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 6.2 Equity Investment. Pursuant to the terms of the Stock Purchase Agreement between the
parties entered into concurrently herewith (the “Stock Purchase Agreement”), Allergan shall purchase from ACADIA, and ACADIA shall sell and issue, 1,000,000 shares of ACADIA Series C Preferred Stock, at a purchase price of $6.00 per share.
The parties hereby acknowledge and agree that, pursuant to the Stock Purchase Agreement, Allergan shall have the right to elect one (1) director to the Board of Directors of ACADIA, effective as of the Effective Date. 
  
 6.3 Milestone Payments. The appropriate party shall pay to the
other the following milestones, as applicable: 
  
 (a) Allergan will pay to ACADIA the milestone payments in the amounts listed below for the first Allergan Development Candidate developed for the treatment or prevention of [...***...] disorders that is
biologically active against a given Licensed Target as demonstrated in the course of the Collaboration, within [...***...] after notice of the occurrence of the following events, provided that Allergan shall be required to pay each such
milestone only once for each Licensed Target and in no event shall Allergan be required to pay more than [...***...] pursuant to this Section 6.3(a) for each Licensed Target: 
  

			
	 MILESTONE EVENT

	  	 AMOUNT OF PAYMENT

	(1) Designation of an Allergan Development Candidate	  	[...***...]
		
	(2) Filing of IND for an Allergan Development Candidate	  	[...***...]
		
	(3) Initiation of the first pivotal (e.g., Phase III) trial for an Allergan Development Candidate in [...***...]	  	[...***...]
		
	(4) First filing of an NDA on an Allergan Development Candidate in [...***...]	  	[...***...]
		
	(5) First Regulatory Approval of an Allergan Development Candidate in [...***...]	  	[...***...]

  
 (b) Allergan will pay to ACADIA the milestone payments in the amounts listed below for the first Allergan Development Candidate developed for any indication in the Allergan Field other than the treatment and prevention of
[...***...] diseases and disorders that is biologically active against a given Licensed Target as demonstrated in the course of the Collaboration, within [...***...] after notice of the occurrence of the following events,
provided that Allergan shall be required to pay each such milestone only once for each Licensed Target and in no event shall Allergan be required to pay more than [...***...] pursuant to this Section 6.3(b) for each Licensed Target:

  

			
	 MILESTONE EVENT

	  	 AMOUNT OF PAYMENT

  

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 20. 

			
	(1) Designation of an Allergan Development Candidate	  	[...***...]
		
	(2) Filing of IND for an Allergan Development Candidate	  	[...***...]
		
	(3) Initiation of Phase II trials for an Allergan Development Candidate in [...***...]	  	[...***...]
		
	(4) Initiation of the first pivotal (e.g., Phase III) trial for an Allergan Development Candidate in [...***...]	  	[...***...]
		
	(5) First filing of an NDA on an Allergan Development Candidate in [...***...]	  	[...***...]
		
	(6) First Regulatory Approval of an Allergan Development Candidate in [...***...]	  	[...***...]

  
 (c) ACADIA will pay to Allergan the milestone payments in the amounts listed below for the first ACADIA Development Candidate developed for each ACADIA Designated Use in the ACADIA Field that is biologically active against a
given Licensed Target, Test Target and/or Program Target as demonstrated in the course of the Collaboration, within [...***...] after notice of the occurrence of the following events, provided that ACADIA shall be required to pay each
such milestone only once for each such Licensed Target, Test Target and Program Target and in no event shall ACADIA be required to pay more than [...***...] pursuant to this Section 6.3(c) for each Licensed Target, Test Target and
Program Target: 
  

			
	 MILESTONE EVENT

	  	 AMOUNT OF PAYMENT

	(1) Designation of an ACADIA Development Candidate	  	[...***...]
		
	(2) Filing of IND for an ACADIA Development Candidate	  	[...***...]
		
	(3) Initiation of Phase II trials for an ACADIA Development Candidate in [...***...]	  	[...***...]
		
	(4) Initiation of the first pivotal (e.g., Phase III) trial for an ACADIA Development Candidate in [...***...]	  	[...***...]
		
	(5) First filing of an NDA on an ACADIA Development Candidate in [...***...]	  	[...***...]
		
	(6) First Regulatory Approval of an ACADIA Development Candidate in [...***...]	  	[...***...]

  
 (d) It is the intent of the parties that each party shall be obligated to pay each milestone payment in subsections (a), (b) and (c) above only once even if multiple compounds 

  

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 21. 

 that are biologically active against a particular target are developed for one or more specified
indications. 
  
 (e)
[...***...] of each milestone payment made by Allergan pursuant to subsections (a) and (b) above shall be creditable against royalties owed on Net Sales of such Allergan Product or Independent Product, as the case may be, pursuant to
Section 6.4, provided that in no event shall ACADIA receive less than [...***...] of the royalties otherwise due to it for such Allergan Product or Independent Product in any given quarter (but such excess creditable amounts may be
applied to subsequent royalty payments, again subject to a maximum [...***...] reduction) in any quarterly payment. 
  
 (f) [...***...] of each milestone payment made by ACADIA pursuant to subsection (c) above shall be creditable
against royalties owed on Net Sales of such ACADIA Product pursuant to Section 6.4, provided that in no event shall Allergan receive less than [...***...] of the royalties otherwise due to it for such ACADIA Product in any given quarter
(but such excess creditable amounts may be applied to subsequent royalty payments, again subject to a maximum [...***...] reduction) in any quarterly payment. 
  
 6.4 Royalties. 
  
 (a) Allergan Royalty Payments to ACADIA. Allergan shall pay to ACADIA the following royalties on Net Sales: (i)
[...***...] of Net Sales of Allergan Products; and (ii) in the event of exercise of the Participation Right, [...***...] of Net Sales of Independent Products. 
  
 (b) ACADIA Royalty Payments to Allergan. In the event of exercise of the ACADIA Option,
ACADIA shall pay to Allergan a royalty of [...***...] of Net Sales of ACADIA Products. 
  
 (c) Royalty Term. Royalties for sales of any Allergan Product, Independent Product or ACADIA Product in a given
country shall be paid for a period equal to the Royalty Term for such product in such country. 
  
 (d) Credit for Third Party Royalties. In the event that a party obligated to pay royalties under this Agreement must
make royalty payments under a license from a Third Party in respect of any patents that are necessary to develop, make, have made, use, sell, have sold or import an Allergan Product, Independent Product or ACADIA Product, as applicable, then such
party may reduce the royalty otherwise owing on Net Sales of such product by [...***...] of the royalty payments made under such Third Party license; provided, however, that the royalty otherwise payable under the
applicable provision of this Agreement during any quarter shall not be reduced by more than [...***...]. 

  

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 22. 

	7.	PAYMENT; RECORDS; AUDITS. 

  

7.1 Payment; Reports. Royalty payments and reports for the sale of Allergan Products, Independent Products and ACADIA Products shall be
calculated and reported for each calendar quarter. All royalty payments due to a party under this Agreement shall be paid within [...***...] of the end of each calendar quarter, unless otherwise specifically provided herein. Each
payment of royalties shall be accompanied by a report of Net Sales of Allergan Products, Independent Products and ACADIA Products, as applicable, in sufficient detail to permit confirmation of the accuracy of the royalty payment made, including,
without limitation, the number of Allergan Products, Independent Products and ACADIA Products sold, the gross sales and Net Sales of Allergan Products, Independent Products and ACADIA Products, the royalties, in U.S. dollars, payable, the method
used to calculate the royalty and the exchange rates used. 
  
 7.2 Exchange Rate; Manner and Place of Payment. All payments hereunder shall be payable in U.S. dollars. With respect to each quarter, for countries other than the United States, whenever conversion of payments from any
foreign currency shall be required, such conversion shall be made at the rate of exchange reported in The Wall Street Journal either on a daily basis or on the last business day of the applicable quarter, at the payor’s option consistently
applied. All payments owed under this Agreement shall be made by wire transfer to a bank and account designated in writing by the payee, unless otherwise specified by such payee. 
  
 7.3 Late Payments. In the event that any payment, including royalty, milestone and research payments, due
hereunder is not made when due, the payment shall accrue interest from the date due at the rate of [...***...]; provided, however, that in no event shall such rate exceed the maximum legal annual interest rate. The payment of
such interest shall not limit a party from exercising any other rights it may have as a consequence of the lateness of any payment. 
  
 7.4 Records and Audits. During the Royalty Term and for a period of [...***...] thereafter, each party shall keep complete and
accurate records pertaining to the development and sale or other disposition of Allergan Products, Independent Products and ACADIA Products, as applicable, in sufficient detail to permit the other party to confirm the accuracy of all payments due
hereunder. Each party shall have the right to cause an independent, certified public accountant reasonably acceptable to the other to audit such records to confirm Net Sales and royalty and other payments for a period covering not more than the
preceding [...***...]. Such audits may be exercised during normal business hours once a year upon at least [...***...] prior written notice to the other party. Prompt adjustments shall be made by the parties to reflect the
results of such audit. The party causing such audit shall bear the full cost of such audit unless such audit discloses a variance of more than five percent (5%) from the amount of the Net Sales or royalties or other payments due under this
Agreement. In such case, the audited party shall bear the full cost of such audit. 
  
 7.5 Withholding of Taxes. Any withholding of taxes levied by tax authorities on the payments hereunder shall be borne by the party receiving the payment and deducted by the party 
  

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 making the payment from the sums otherwise payable by it hereunder for payment to the proper tax authorities on behalf of
the party receiving the payment. The party making the payment agrees to cooperate with the party receiving the payment in the event that the receiving party claims exemption from such withholding or seeks credits or deductions under any double
taxation or similar treaty or agreement from time to time in force, such cooperation to consist of providing receipts of payment of such withheld tax or other documents reasonably available to the party making the payment. 
  
 7.6 Prohibited Payments. Notwithstanding any other provision of
this Agreement, if a party is prevented from paying any such royalty by virtue of the statutes, laws, codes or governmental regulations of the country from which the payment is to be made, then such royalty may be paid by depositing funds in the
currency in which accrued to the other party’s account in a bank acceptable to such other party in the country whose currency is involved. 
  

	8.	INTELLECTUAL PROPERTY 

  
 8.1 Ownership Of Technology. Inventorship with respect to inventions made pursuant to work carried out under the Collaboration shall be
determined in accordance with United States rules of inventorship. Except as provided below, each party shall own solely all inventions made solely by its employees and agents, and the parties shall own jointly all inventions jointly made hereunder.
Allergan acknowledges that ACADIA shall own the Core Technology exclusively, subject to Allergan’s rights (other than ownership rights) set forth in this Agreement. 
  
 8.2 Patent Prosecution. 
  
 (a) It is the intention of the parties to secure broad patent protection for discoveries and
inventions made in connection with the Collaboration. Allergan shall be responsible for the filing, prosecution and maintenance of all Allergan Patents and all patent applications and patents covering any inventions owned solely by Allergan under
Section 8.1 at Allergan’s sole expense. ACADIA shall be responsible for the filing, prosecution and maintenance of all ACADIA Patents and all patent applications and patents covering any inventions owned solely by ACADIA under Section 8.1 at
ACADIA’s sole expense. Each party shall consider in good faith the requests and suggestions of the other party with respect to strategies for filing and prosecuting such patent applications. The inventing party shall keep the other party
informed of progress with regard to the filing, prosecution, maintenance, enforcement and defense of patents applications and patents subject to this Section 8.2(a). 
  
 (b) In the case of patent applications and patents owned jointly by the parties under Section
8.1, Allergan shall be responsible for, and shall initially bear the expense of, the preparation, filing, prosecution, and maintenance of any such patent applications and patents, provided that Allergan shall be entitled to reimbursement by ACADIA
of [...***...] of such expenses. Allergan shall consult with ACADIA as to the preparation, filing, prosecution, and maintenance of such jointly owned patent applications and patents reasonably prior to any deadline or action with the
U.S. Patent & Trademark Office or any foreign patent office, and shall furnish to ACADIA copies of all relevant documents reasonably in advance of such 

  

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consultation. In the event that Allergan desires to abandon any such patent application or patent, or if Allergan later declines responsibility for any such
patent application or patent, Allergan shall provide reasonable prior written notice to ACADIA of such intention to abandon or decline responsibility, and ACADIA shall have the right, at its expense, to prepare, file, prosecute, and maintain such
patent application or patent. 
  
 8.3 Cooperation of the
Parties. Each party agrees to cooperate fully in the preparation, filing, and prosecution of any patent rights under this Agreement. Such cooperation includes, but is not limited to: 
  
 (a) executing all papers and instruments, or requiring its employees or agents, to execute
such papers and instruments, so as to effectuate the ownership of patent rights set forth in Section 8.1 above and to enable the other party to apply for and to prosecute patent applications in any country; and 
  
 (b) promptly informing the other party of any
matters coming to such party’s attention that may affect the preparation, filing, or prosecution of any such patent applications. 
  
 8.4 Infringement by Third Parties. ACADIA and Allergan shall promptly notify the other in writing of any alleged or threatened infringement
of any patent included in the Allergan Patents, ACADIA Patents or Collaboration Patents of which they become aware. Both parties shall use their best efforts in cooperating with each other to terminate such infringement without litigation. Allergan
shall have the first right to bring and control any action or proceeding with respect to infringement of a patent included in the Allergan Patents or any other patent covering inventions owned either solely by Allergan or jointly by the parties at
its own expense and by counsel of its own choice, and ACADIA shall have the right, at its own expense, to be represented in any action involving any patent covering inventions owned jointly by the parties by counsel of its own choice. If Allergan
fails to bring an action or proceeding with respect to a patent covering inventions owned jointly by the parties within: (i) [...***...] following the notice of alleged infringement or (ii) [...***...] before the time
limit, if any, set forth in the appropriate laws and regulations for the filing of such actions, whichever comes first, ACADIA shall have the right to bring and control any such action at its own expense and by counsel of its own choice, and
Allergan shall have the right, at its own expense, to be represented in any such action by counsel of its own choice. ACADIA shall have the first right to bring and control any action or proceeding with respect to infringement of a patent included
in the ACADIA Patents or any other patent covering inventions owned solely by ACADIA at its own expense and by counsel of its own choice, and Allergan shall have the right, at its own expense, to be represented in any action involving any patent
covering inventions owned solely by ACADIA, other than an ACADIA Patent, by counsel of its own choice. If ACADIA fails to bring an action or proceeding with respect to a patent, other than an ACADIA Patent, covering inventions owned solely by ACADIA
within (i) [...***...] following the notice of alleged infringement or (ii) [...***...] before the time limit, if any, set forth in the appropriate laws and regulations for the filing of such actions, whichever comes first,
Allergan shall have the right to bring and control any such action at its own expense and by counsel of its own choice, and ACADIA shall have the right, at its own expense, to be represented in any such action by counsel 

  

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of its own choice. In the event a party brings an infringement action, the other party shall cooperate fully, including if required to bring such action, the
furnishing of a power of attorney. Neither party shall have the right to settle any patent infringement litigation under this Section 8.4 in a manner that diminishes the rights or interests of the other party without the consent of such other party.
Except as otherwise agreed to by the parties as part of a cost sharing arrangement, any recovery realized as a result of such litigation, after reimbursement of any litigation expenses of Allergan and ACADIA, shall belong to the party who brought
the action and shall be treated as Net Sales for purposes of the royalty provisions of this Agreement. 
  
 8.5 Infringement of Third Party Rights. Each party shall promptly notify the other in writing of any allegation by a Third Party that the
activity of either of the parties infringes or may infringe the intellectual property rights of such Third Party. Allergan shall have the first right to control any defense of any such claim involving alleged infringement of Third Party rights by
Allergan’s activities at its own expense and by counsel of its own choice, and ACADIA shall have the right, at its own expense, to be represented in any such action by counsel of its own choice. If Allergan fails to proceed in a timely fashion
with regard to such defense, ACADIA shall have the right to control any such defense of such claim at its own expense and by counsel of its own choice, and Allergan shall have the right, at its own expense, to be represented in any such action by
counsel of its own choice. 
  
 ACADIA shall have the first right
to control any defense of any such claim involving alleged infringement of Third Party rights by ACADIA’s activities at its own expense and by counsel of its own choice, and Allergan shall have the right, at its own expense, to be represented
in any such action by counsel of its own choice. If ACADIA fails to proceed in a timely fashion with regard to such defense, Allergan shall have the right to control any such defense of such claim at its own expense and by counsel of its own choice,
and ACADIA shall have the right, at its own expense, to be represented in any such action by counsel of its own choice. Neither party shall have the right to settle any patent infringement litigation under this Section 8.5 in a manner that
diminishes the rights or interests of the other party without the consent of such other party. 
  
 8.6 Trademarks. Each party shall obtain, own and enforce its own trademarks with respect to its own activities. 
  

	9.	REPRESENTATIONS AND WARRANTIES 

  
 9.1 Representations And Warranties. Each party represents to the other that: 
  
 (a) Corporate and Partnership Power. It
is duly organized and validly existing under the laws of its state of incorporation or formation, and has full corporate or partnership power and authority to enter into this Agreement and to carry out the provisions hereof. 
  
 (b) Due Authorization. It is
duly authorized to execute and deliver this Agreement and to perform its obligations hereunder, and the person or persons executing this Agreement on its behalf has been duly authorized to do so by all requisite corporate or partnership action.

  

 26. 

 (c) Binding Agreement. This Agreement is legally binding upon it,
enforceable in accordance with its terms. The execution, delivery and performance of this Agreement by it 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, nor
violate any material law or regulation of any court, governmental body or administrative or other agency having jurisdiction over it. 
  
 (d) Grant of Rights; Maintenance of Agreements. It has not, and will not during the term of this Agreement, grant any
right to any third party which would conflict with the rights granted to the other party hereunder. It has (or will have at the time performance is due) maintained and will maintain and keep in full force and effect all agreements (including license
agreements) and filings (including patent filings) necessary to perform its obligations hereunder. 
  
 (e) Validity. It is aware of no action, suit or inquiry or investigation instituted by or before any court or
governmental agency which questions or threatens the validity of this Agreement or of any Allergan Patents and ACADIA Patents. 
  
 (f) Third Party Rights. It is aware of no Third Party patent right which would be infringed by its conduct of the
Collaboration or commercialization of products as contemplated hereby. 
  
 9.2 ACADIA Representations and Warranties. ACADIA represents and warrants that: 
  
 (a) ACADIA owns or holds licenses to the ACADIA Patents and ACADIA Know-How and has sufficient rights and power to grant the
licenses to Allergan which it purports to grant herein. 
  
 (b) ACADIA has no knowledge of any outstanding and unresolved claim or accusation that any compounds or products manufactured, used or sold by ACADIA and licensed hereunder or any methods or process
practiced by ACADIA, including the ACADIA Assays, infringes or may infringe any third party patent(s); and 
  
 (c) ACADIA has not conducted, or has not commissioned the conducting of, any formal or informal infringement or validity
studies regarding any patent or patent application included in the ACADIA Patents listed on Exhibit C that it has not fully disclosed in writing to Allergan prior to the Effective Date. 
  
 9.3 Allergan Representations and Warranties. Allergan represents and warrants that: 
  
 (a) Allergan owns or holds licenses to the
Allergan Patents and Allergan Know-How and has sufficient rights and power to grant the licenses to ACADIA which it purports to grant herein. 
  

 27. 

 (b) Allergan has no knowledge of any outstanding and unresolved claim or
accusation that any compounds or products manufactured, used or sold by Allergan and licensed hereunder or any methods or process practiced by Allergan infringes or may infringe any third party patent(s); and 
  
 (c) Allergan has not conducted, or has not
commissioned the conducting of, any formal or informal infringement or validity studies regarding any patent or patent application included in the Allergan Patents that it has not fully disclosed in writing to ACADIA prior to the Effective Date.

  
 9.4 Disclaimer Concerning Technology. EXCEPT AS
SET FORTH IN SECTIONS 9.1(f), 9.2 AND 9.3 ABOVE, THE TECHNOLOGY AND INTELLECTUAL PROPERTY RIGHTS PROVIDED BY EACH PARTY HEREUNDER IS PROVIDED “AS IS” AND EACH PARTY EXPRESSLY DISCLAIMS ANY AND ALL WARRANTIES OF ANY KIND, EXPRESS OR
IMPLIED, INCLUDING WITHOUT LIMITATION THE WARRANTIES OF DESIGN, MERCHANTABILITY, FITNESS FOR A PARTICULAR PURPOSE, NONINFRINGEMENT OF THE INTELLECTUAL PROPERTY RIGHTS OF THIRD PARTIES, OR ARISING FROM A COURSE OF DEALING, USAGE OR TRADE PRACTICES,
IN ALL CASES WITH RESPECT THERETO. Without limiting the generality of the foregoing, each party expressly does not warrant (i) the success of any study or test commenced under the Collaboration or (ii) the safety or usefulness for any purpose of the
technology it provides hereunder. 
  

	10.	CONFIDENTIALITY; PUBLICATION 

  
 10.1 Confidentiality. Except to the extent expressly authorized by this Agreement or otherwise agreed in
writing by the parties, the parties agree that, during the Royalty Term and for [...***...] thereafter, the receiving party shall keep confidential and shall not publish or otherwise disclose and shall not use for any purpose other than
as expressly provided for in this Agreement any Confidential Information furnished to it by the other party pursuant to this Agreement. Each party may use such Confidential Information only to the extent required to accomplish the purposes of this
Agreement. Each party will use at least the same standard of care as it uses to protect proprietary or confidential information of its own to ensure that its employees, agents, consultants and other representatives do not disclose or make any
unauthorized use of the Confidential Information. Each party will promptly notify the other upon discovery of any unauthorized use or disclosure of the Confidential Information. 
  
 10.2 Exceptions. Confidential Information shall not include any information which the receiving party can
prove by competent evidence: 
  
 (a) is now, or hereafter becomes, through no act or failure to act on the part of the receiving party, generally known or available; 
  
 (b) is known by the receiving party at the time of receiving such information, as evidenced by its records; 
  

 ***Certain confidential information on this page has been omitted and filed separately with the
Commission. 
 Confidential treatment has been requested with respect to the omitted portions. 
  
 28. 

 (c) is hereafter furnished to the receiving party by a Third Party, as a
matter of right and without restriction on disclosure; 
  
 (d) is independently developed by the receiving party without the aid, application or use of Confidential Information of the disclosing party; or 
  
 (e) is the subject of a written permission to disclose provided by the disclosing party.

  
 10.3 Terms of Agreement. The parties agree that
this Agreement and the terms hereof will be considered Confidential Information of both parties. Notwithstanding the foregoing, either party may disclose such terms as are required to be disclosed under strictures of confidentiality to bona fide
potential sublicensees or as otherwise required pursuant to applicable law. 
  
 10.4 Authorized Disclosure. Each party may disclose Confidential Information belonging to the other party to the extent such disclosure is reasonably necessary in the following instances: 
  
 (a) filing or prosecuting patents relating to
the Collaboration; 
  
 (b)
regulatory filings; 
  
 (c)
prosecuting or defending litigation; 
  
 (d) complying with applicable court orders or governmental regulations; 
  
 (e) conducting pre-clinical or clinical trials of Active Compounds, Derivative Compounds, Allergan Development Candidates or
ACADIA Development Candidates; and 
  
 (f) disclosure to Affiliates, sublicensees, employees, consultants, agents or other Third Parties in connection with due diligence or similar investigations by such Third Parties, in each case who agree to be bound by similar
terms of confidentiality and non-use at least equivalent in scope to those set forth in this Article 10. 
  
 Notwithstanding the foregoing, in the event a party is required to make a disclosure of the other party’s Confidential Information pursuant to this Section 10.4, it will, except where impracticable, give
reasonable advance notice to the other party of such disclosure and use efforts to secure confidential treatment of such information at least as diligent as such party would use to protect its own confidential information, but in no event less than
reasonable efforts. In any event, the parties agree to take all reasonable action to avoid disclosure of Confidential Information hereunder. The parties will consult with each other on the provisions of this Agreement to be redacted in any filings
made by the parties with the Securities and Exchange Commission or as otherwise required by law. 
  

 29. 

 10.5 Publications. Each party to this Agreement recognizes that the publication of papers
regarding results of and other information regarding the Collaboration, including oral presentations and abstracts, may be beneficial to both parties provided such publications are subject to reasonable controls to protect Confidential Information.
In particular, it is the intent of the parties to maintain the confidentiality of any Confidential Information included in any foreign patent application until such foreign patent application has been published. Accordingly, the RMC shall have the
right to review and approve any paper proposed for publication by a party, including oral presentations and abstracts, which utilizes data generated from the Collaboration and/or includes Confidential Information of the other party. Before any such
paper is submitted for publication, the party proposing publication shall deliver a complete copy to the RMC at least [...***...] prior to submitting the paper to a publisher. The RMC shall review any such paper and give its comments to
the publishing party within [...***...] of the delivery of such paper to the RMC. With respect to oral presentation materials and abstracts, the RMC shall make reasonable efforts to expedite review of such materials and abstracts, and
shall return such items as soon as practicable to the publishing party with appropriate comments, if any, but in no event later than [...***...] from the date of delivery to the RMC. The publishing party shall comply with the RMC’s
request to delete references to the other party’s Confidential Information in any such paper and agrees to withhold publication of same for an additional [...***...] in order to permit the parties to obtain patent protection, if
either of the parties deems it necessary, in accordance with the terms of this Agreement. 
  

	11.	TERM AND TERMINATION 

  
 11.1 Term Of The Agreement. The term of the collaborative activities of the parties pursuant to the
Collaboration shall commence on the Effective Date and continue until expiration of the Research Term, unless earlier terminated pursuant to Section 11.2, 11.3 or 14.9 or extended by mutual agreement of the parties. The term of this Agreement (the
“Term of the Agreement”) shall commence on the Effective Date and continue until six (6) months after the expiration of the last Royalty Term for any Allergan Product, Independent Product or ACADIA Product, unless earlier terminated
pursuant to Section 11.2, 11.3 or 14.9 or extended upon terms mutually agreeable to both parties. 
  
 11.2 Termination by Mutual Agreement. The parties may at any time terminate this Agreement by written agreement executed by both Allergan
and ACADIA. 
  
 11.3 Termination For Cause. Each
party shall have the right to terminate this Agreement upon [...***...] prior written notice to the other upon the occurrence of any of the following: 
  
 (a) Upon or after the bankruptcy, insolvency, dissolution or winding up of the other party
(other than a dissolution or winding up for the purpose of reconstruction or amalgamation); or 
  

 ***Certain confidential information on this page has been omitted and filed separately with the
Commission. 
 Confidential treatment has been requested with respect to the omitted portions. 
  
 30. 

 (b) Upon or after the breach of any material provision of this Agreement by
the other party if the breaching party has not cured such breach within the [...***...] period following written notice of termination by the non-breaching party. 
  
 All licenses granted to the non-breaching party under Section 5.1 of this Agreement shall survive such
termination for so long as such non-breaching party is not in breach of its obligations to the other party under this Agreement. 
  
 11.4 Accrued Rights, Surviving Obligations. Expiration or termination of this Agreement shall not affect any rights or obligations of either
party accruing prior to such expiration or termination. The terms of Sections 4.2(a), 4.6, 4.7, 7.4, 8.1, 10.1, 10.2, 10.3, 10.4, 11.3, 11.4, 12, 13 and 14 of this Agreement shall survive expiration or termination of this Agreement. In addition, the
provisions of Sections 5.1 (subject to Sections 6.3 and 6.4) shall survive expiration or termination of this Agreement with respect to each Licensed Target, Test Target, Program Target and ACADIA Development Candidate for which ACADIA has exercised
an ACADIA Option in accordance with Section 5.1(b)(iii) above, so long as such party, as applicable, continues to comply with the diligence standards set forth in this Agreement with respect to such Target or Development Candidate, as applicable.
Promptly after termination of this Agreement each party (other than a non-breaching party that retains a license as described in Section 11.3) shall return or dispose of any technology or know-how of the other in the accordance with the instructions
of the other, including without limitation any compounds, assays or other biological or chemical materials. 
  

	12.	INDEMNITY 

  
 12.1 Indemnification. Each party hereby agrees to save, defend and hold the other party and its directors, officers, employees, and agents
harmless from and against any and all claims, suits, actions, demands, liabilities, expenses and/or loss, including reasonable legal expense and attorneys’ fees (collectively, “Claims”) for damage to persons or property resulting
directly or indirectly from actions in connection with the Collaboration by the indemnifying party, its Affiliates, agents or sublicensees, but only to the extent such Claims result from the gross negligence or willful misconduct of the indemnifying
party or its Affiliates, agents or sublicensees and do not result from the negligence of the party seeking indemnification. 
  
 12.2 Control Of Defense. Any entity entitled to indemnification under this Section 12 shall give notice to the indemnifying party of any
Claims that may be subject to indemnification, promptly after learning of such Claim, and the indemnifying party shall assume the defense of such Claims with counsel reasonably satisfactory to the indemnified party. If such defense is assumed by the
indemnifying party with counsel so selected, the indemnifying party will not be subject to any liability for any settlement of such Claims made by the indemnified party without its consent (but such consent will not be unreasonably withheld or
delayed), and will not be obligated to pay the fees and expenses of any separate counsel retained by the indemnified party with respect to such Claims. 
  
 12.3 Insurance. ACADIA, at its own expense, shall maintain product liability insurance in amount consistent with industry standards during
the Term of the Agreement 

  

 ***Certain confidential information on this page has been omitted and filed separately with the
Commission. 
 Confidential treatment has been requested with respect to the omitted portions. 
  
 31. 

 
and shall name Vision Pharmaceuticals L.P. as an additional insured with respect to this policy. ACADIA shall provide a certificate of insurance evidencing
such coverage. 
  
 Allergan, at its own expense, shall maintain
product liability insurance (or self-insure) in amount consistent with industry standards during the Term of the Agreement and shall name ACADIA as an additional insured with respect to such insurance. Allergan shall provide a certificate of
insurance (or evidence of self-insurance) evidencing such coverage. 
  

	13.	GOVERNING LAW; DISPUTE RESOLUTION 

  
 13.1 Governing Law. This Agreement shall be governed by the
laws of the State of California as such laws are applied to contracts entered into or to be performed entirely within such state. 
  
 13.2 Legal Compliance. Within [...***...] of the date hereof, the parties shall review in good faith and cooperate in taking
such actions to ensure compliance of this Agreement with all applicable laws. 
  
 13.3 Dispute Resolution. Except as provided in Section 2.5, in the event of any dispute, the parties shall refer such dispute to the CEO of ACADIA and the CEO of Allergan for attempted resolution by good
faith negotiations within [...***...] after such referral is made. During such period of good faith negotiations, any applicable time periods under this Agreement shall be tolled. In the event such executives are unable to resolve such
dispute within such [...***...] period, the parties shall submit their dispute to binding arbitration before a retired California Superior Court Judge at J.A.M.S./Endispute located in Orange, California, such arbitration to be conducted
pursuant to the J.A.M.S./Endispute procedure rules for commercial disputes then in effect. The award of the arbitrator shall include an award of reasonable attorneys’ fees and costs to the prevailing party. 
  
 13.4 Jurisdiction And Venue. Except as provided in Section 2.5
or 13.3 above, any claim or controversy arising out of or related to this Agreement or any breach hereof shall be adjudicated in the state and federal courts having jurisdiction over disputes arising in the State of California, and the parties
hereby consent to the jurisdiction and venue of such court. 
  

	14.	GENERAL PROVISIONS 

  
 14.1 Notices. All notices required or permitted to be given under this Agreement shall be in writing and shall be mailed by registered or
certified mail, Federal Express or DHL, addressed to the signatory to whom such notice is required or permitted to be given and transmitted by facsimile to the number indicated below. All notices shall be deemed to have been given when mailed, as
evidenced by the postmark at the point of mailing, or faxed. 
  

 ***Certain confidential information on this page has been omitted and filed separately with the
Commission. 
 Confidential treatment has been requested with respect to the omitted portions. 
  
 32. 

 All notices to Allergan shall be addressed as follows: 
  
 Allergan, Inc. 
 2525 Dupont Drive 
 Irvine, CA 92623

 Attn: Corporate Vice President, Science and Technology 
 Fax: (714) 246-6987 
  
 with a
copy to: 
  
 Allergan, Inc. 
 2525 Dupont Drive 
 Irvine, CA 92623

 Attn: Allergan General Counsel 
 Fax: (714) 246-4774 
  
 and to: 
  
 Cooley Godward LLP 
 4365 Executive Drive, Suite 1100 
 San Diego,
CA 92121 
 Attn: Thomas A. Coll, Esq. 
 Fax: (619) 550-6013 
  
 All notices to ACADIA shall be
addressed as follows: 
  
 ACADIA Pharmaceuticals Inc. 

3911 Sorrento Valley Blvd. 
 San Diego, CA
92121 
 Attn: Mark R. Brann 
 Fax: (619) 558-2872 
  
 with a copy to: 
  
 Hale and Dorr LLP 
 60 State Street 
 Boston, MA 02109 

Attn: Susan W. Murley, Esq. 
 Fax: (617)
526-5000 
  
 Any party may, by written notice to the other,
designate a new address or fax number to which notices to the party giving the notice shall thereafter be mailed or faxed. 
  
 14.2 Force Majeure. No party shall be liable for any delay or failure of performance (other than payment obligations) to the extent such
delay or failure is caused by circumstances beyond its reasonable control and that by the exercise of due diligence it is unable to prevent, provided that the party claiming excuse uses its best efforts to overcome the same. 
  

 33. 

 14.3 Entirety Of Agreement. This Agreement embodies the entire, final and complete
agreement and understanding between the parties and replaces and supersedes all prior discussions and agreements between them with respect to its subject matter. No modification or waiver of any terms or conditions hereof shall be effective unless
made in writing and signed by a duly authorized officer of each party. 
  
 14.4 Non-Waiver. The failure of a party in any one or more instances to insist upon strict performance of any of the terms and conditions of this Agreement shall not constitute a waiver or relinquishment, to any extent, of the
right to assert or rely upon any such terms or conditions on any future occasion. 
  
 14.5 Disclaimer Of Agency. Neither party is, or will be deemed to be, the legal representative or agent of the other, nor shall either party have the right or authority to assume, create, or incur any
third party liability or obligation of any kind, express or implied, against or in the name of or on behalf of another except as expressly set forth in this Agreement. 
  
 14.6 Severability. If a court of competent jurisdiction declares any provision of this Agreement invalid or
unenforceable, or if any government or other agency having jurisdiction over either ACADIA or Allergan deems any provision to be contrary to any laws, then that provision shall be severed and the remainder of the Agreement shall continue in full
force and effect. To the extent possible, the parties shall revise such invalidated provision in a manner that will render such provision valid without impairing the parties’ original intent. 
  
 14.7 Affiliates; Assignment. Except as otherwise provided
herein, neither party may assign its rights or delegate its duties under this Agreement without the prior written consent of the other party, not to be unreasonably withheld. Notwithstanding the foregoing, but subject to Sections 14.8 and 14.9, each
party may assign this Agreement to any of its Affiliates, to a special purpose corporation or similar entity at least fifty percent (50%) of the outstanding shares of any class or series of stock of which is owned by such party or to any purchaser
of all or substantially all of the assets or stock of its business unit to which this Agreement relates (by merger, consolidation or otherwise) in a manner such that the assignor will remain liable and responsible for the performance and observance
of all its duties and obligations hereunder without the consent of the other party; provided that, in the event of such transaction, intellectual property rights of the acquiring party (other than a party to this Agreement) shall not be included in
the technology licensed hereunder. This Agreement shall be binding upon the successors and permitted assigns of the parties. Any attempted delegation or assignment not in accordance with this Section 14.7 shall be of no force or effect. 

 
 14.8 Allergan Right of Negotiation. In the event that ACADIA
becomes interested in accepting an offer to, is willing to consider offers to, or a Third Party makes an offer to, purchase or acquire more than fifty percent (50%) of the outstanding voting securities or voting control of ACADIA or the surviving
entity, whether by merger, consolidation, reorganization, tender offer or other means, or all or substantially all the assets of ACADIA as a whole or relating to the subject matter of the Collaboration, ACADIA shall provide Allergan with prompt
written notice thereof, and Allergan shall thereupon have a right of negotiation to acquire ACADIA, and ACADIA and Allergan shall negotiate in good faith regarding the material terms of such a 

  

 34. 

 
transaction. In any event, the parties shall have no further obligation to negotiate in good faith after [... ***...] following Allergan’s
receipt of such notice. Nothing in this Section 14.8 shall limit the right of ACADIA to negotiate with Third Parties during [...***...] period. 
  
 14.9 Allergan’s Rights Upon Change in Control of ACADIA. In the event of a change in control (as defined below) of ACADIA during the
Research Term, ACADIA shall give prior notice to Allergan thereof, and Allergan shall have the right, exercisable for a period of thirty (30) days following written notice to Allergan of such change in control, to terminate this Agreement. Prior to
the end of the 30-day period following a change in control of ACADIA, Allergan shall provide written notice of its election either to terminate or not to terminate this Agreement. In the event that Allergan elects to terminate this Agreement
following such change in control, then notwithstanding any contrary provision of this Agreement, the licenses granted to Allergan pursuant to Section 5.1 shall continue in full force and effect and shall be exclusive even as to ACADIA (or the
surviving entity following such change in control), and ACADIA shall, promptly following such election by Allergan, transfer and disclose to Allergan all ACADIA Know-How as is reasonably necessary to enable Allergan to fully exercise its rights
under this Section 14.9. In addition, effective upon termination by Allergan of this Agreement following a change in control, ACADIA hereby grants to Allergan, for a period ending on the later of (x) the end of Research Term or any extension or
renewal agreed to by Allergan and ACADIA prior to termination by Allergan or (y) as long as Allergan continues to use commercially reasonable efforts to pursue research, development, marketing and/or sale of at least one compound in the Allergan
Field, (a) an exclusive (even as to ACADIA or the surviving entity), worldwide, fully paid license, with the right to sublicense, under the ACADIA Technology and ACADIA’s interest in the Collaboration Technology to the fullest extent necessary
to permit Allergan alone to conduct all activities of either party contemplated by Sections 3.3, 3.4 and 4.8, and (b) an exclusive (even as to ACADIA or the surviving entity), worldwide, royalty-bearing license with the right to sublicense under the
ACADIA Technology and ACADIA’s interest in the Collaboration Technology to discover, develop, make, have made, use, sell, offer to sell, have sold and import pharmaceutical products in the ACADIA Field (subject to Allergan’s obligations to
pay ACADIA or the surviving entity the milestones and royalties set forth in Sections 6.3(b) and 6.4(a)(i), respectively). For purposes of this Section 14.9, “change in control” shall mean any transaction or series of related transactions
in which a Third Party acquires or becomes the beneficial owner of (i) more than 50% of the outstanding voting securities or voting control of ACADIA or the surviving entity, whether by merger, consolidation, reorganization, tender offer or other
means, or (ii) all or substantially all the assets of ACADIA as a whole or relating to the subject matter of the Collaboration. 
  
 14.10 Headings. The headings contained in this Agreement are inserted for reference only and shall not be deemed a part of the text hereof.

  
 14.11 Limitation Of Liability. NO
PARTY SHALL BE LIABLE TO ANOTHER FOR INDIRECT, INCIDENTAL, CONSEQUENTIAL, SPECIAL
OR EXEMPLARY DAMAGES, INCLUDING BUT NOT LIMITED TO LOST PROFITS, ARISING
FROM OR RELATING TO ANY BREACH OF THIS AGREEMENT, REGARDLESS OF 

  

 ***Certain confidential information on this page has been omitted and filed separately with the
Commission. 
 Confidential treatment has been requested with respect to the omitted portions. 
  
 35. 

 
ANY NOTICE OF THE POSSIBILITY OF SUCH
DAMAGES. Nothing in this Section is intended to limit or restrict the indemnification rights or obligations of any party. 
  
 14.12 Counterparts. This Agreement may be executed in one or more counterparts, each of which shall be an original and all of which shall
constitute together the same document. 
  
 14.13 Public
Disclosure. Except for such disclosure as is deemed necessary, in the reasonable judgment of a party, to comply with applicable laws or regulations, no public announcement, news release, public statement or publication relating to the existence
of this Agreement, or the terms hereof, will be made without the other party’s prior written approval, which approval shall not be unreasonably withheld. The parties agree that they will use reasonable efforts to coordinate the initial
announcement or press release relating to the existence of this Agreement in the form attached as Exhibit G, so that such initial announcement or press release by each is made contemporaneously. 
  
 14.14 Guarantee. Allergan, Inc. guarantees the performance of
each obligation of Vision Pharmaceuticals L.P. under this Agreement, whether or not Allergan, Inc. has received any notice which is to be provided to Vision Pharmaceuticals L.P. pursuant to this Agreement. Allergan, Inc. confirms the authority of
Vision Pharmaceuticals L.P. to enter into and perform this Agreement. 
  

 36. 

 IN WITNESS WHEREOF, the parties hereto
have duly executed this Agreement. 
  

									
	ACADIA PHARMACEUTICALS INC.	 	 	 	 VISION PHARMACEUTICALS L.P.,
 A Texas limited partnership, dba Allergan,
 by Allergan General, Inc.,
 its general partner

					
	By:	 	 /s/ MARK R. BRANN
	 	 	 	By:	 	 /s/ LESTER J. KAPLAN

	 	 	
	 	 	 	 	 	

					
	Name:	 	 Mark R. Brann
	 	 	 	Name:	 	 Lester J. Kaplan

					
	Title:	 	 President & Chief Scientific Officer
	 	 	 	Title:	 	 President

			
	Guarantee of performance by:	 	 	 	 
			
	ALLERGAN, INC.	 	 	 	 
					
	By:	 	 /s/ WILLIAM C. SHEPHERD
	 	 	 	 	 	 
	 	 	
	 	 	 	 	 	 
					
	Name:	 	 William C. Shepherd
	 	 	 	 	 	 
					
	Title:	 	 Chairman, President and Chief Executive Officer
	 	 	 	 	 	 

  

 37. 

 EXHIBIT A 
  

Novo Nordisk Rights 
  
 “Novo Nordisk Rights” means for purposes of this Exhibit A a worldwide, non-transferable, non-assignable, non-exclusive license granted
by ACADIA to Novo Nordisk A/S (“Novo Nordisk”) (i) to use the Patents (defined below) and related technology in Novo Nordisk’s identification of products with biological activity, excluding services and research reagents
(“Licensee’s Products”) and (ii) to manufacture, sell or use Licensee’s Products. The license described in clause (i) is sublicensable only to Affiliates of Novo Nordisk without any further right to sublicense, and the license
described in (ii) is sublicensable to any person or entity without any further right to sublicense. 
  
 “Patents” means for purposes of this Exhibit A the following U.S. patents and/or patent applications, patents to be issued pursuant
thereto, all divisions, continuations, continuations-in-part, reissues, substitutes, extensions, re-examinations and all foreign (including international and national) counterparts thereof: 
  
 Applications: 
  
 [...***...] 
  

 ***Certain confidential information on this page has been omitted and filed separately with the
Commission. 
 Confidential treatment has been requested with respect to the omitted portions. 
  
 . 

 EXHIBIT B 
  

Research Plan 
  
 [...***...] 
  

 ***Certain confidential information on this page has been omitted and filed separately with the
Commission. 
 Confidential treatment has been requested with respect to the omitted portions. 
  
 . 

 [...***...] 
  

 ***Certain confidential information on this page has been omitted and filed separately with the
Commission. 
 Confidential treatment has been requested with respect to the omitted portions. 
  
 . 

 EXHIBIT C 
  

ACADIA Patents 
  
 [...***...] 
  

 ***Certain confidential information on this page has been omitted and filed separately with the
Commission. 
 Confidential treatment has been requested with respect to the omitted portions. 
  
 . 

 EXHIBIT D 
  

Test Targets 
  
 [...***...] 
  

 ***Certain confidential information on this page has been omitted and filed separately with the
Commission. 
 Confidential treatment has been requested with respect to the omitted portions. 
  
 . 

 EXHIBIT E 
  

Projected Costs Per Activity 
  
 [...***...] 
  

 ***Certain confidential information on this page has been omitted and filed separately with the
Commission. 
 Confidential treatment has been requested with respect to the omitted portions. 
  
 . 

 EXHIBIT F 
  

Excluded Targets 
  
 [...***...] 
  

 ***Certain confidential information on this page has been omitted and filed separately with the
Commission. 
 Confidential treatment has been requested with respect to the omitted portions. 
  
 . 

 EXHIBIT G 
  

Form of Press Release 
  

					
	 	  	 	  	 ALLERGAN

	 	  	 	  	 2525 Dupont Drive

	 	  	 	  	 Irvine, CA 92612-

	 	  	 	  	 1599

	 	  	 	  	 (714) 752-4500

	 News Release
	  	 	  	 www.allergan.com

	 	  	 	  	 
	 For Immediate Release
	  	Contacts:	  	Allergan, Inc.
	 	  	 	  	Jeff D’Eliscu
	 	  	 	  	(714) 246-4636 (office)
	 	  	 	  	(714) 675-9475 (home)
			
	 	  	 	  	ACADIA Pharmaceuticals
	 	  	 	  	Michael K. Dunn, Ph.D.
	 	  	 	  	(619) 558-2871 (office)
	 	  	 	  	(619) 558-2872 (fax)

  
 ALLERGAN AND ACADIA
PHARMACEUTICALS ESTABLISH A 
 RESEARCH COLLABORATION 
  
 Drug Discovery Efforts to Focus on Novel Receptor Targets 
  
 Irvine, California, and San Diego, California, September 24, 1997 - Allergan, Inc. (NYSE:
AGN) and ACADIA Pharmaceuticals (formerly Receptor Technologies) announced today that they will work jointly and exclusively on discovery efforts on five potential drug targets, including the prostanoid and alpha adrenergic receptors. 
  
 Allergan will have exclusive development and commercialization rights to all therapeutic
uses, with the exception that ACADIA will retain development rights to at least one therapeutic indication for each target. Additionally, the companies will identify novel receptors in tissues associated with areas of therapeutic interest to
Allergan. Allergan will make a $6 million equity investment in ACADIA resulting in a 12.5 percent ownership position, on a fully diluted basis. ACADIA will receive research funding for three years, as well as milestone payments up to $12.5 million
for the first product developed for each receptor target. Upon commercialization, Allergan will pay ACADIA royalties on product sales. 
  
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 “We are very pleased with the productive relationship we have developed with ACADIA and the significant progress we have made together,” commented Lester J.
Kaplan, Ph.D., Allergan Corporate Vice President of Science and Technology. “Over the past three years, Allergan and ACADIA have worked together to develop and implement a functional high-throughput screening technology with six types of alpha
adrenergic receptors and have also worked with ACADIA to develop and utilize their basic enabling technology for our prostaglandin assets. As a result, we have successfully identified and characterized potent receptor-selective compounds with
reduced side effects that may be useful in therapeutic areas such as glaucoma, anesthesia, analgesia, muscle spasticity and neuroprotection. The expansion of our collaboration will allow us to continue to build upon the success we have enjoyed to
date.” 
  
 “For the past several years, ACADIA and Allergan have
collaborated using ACADIA’s proprietary Receptor Selection and Amplification Technology (R-SATTM) for functional assay of recombinant targets. R-SATTM enables the sensitive, quantitative, and rapid analysis of receptor activity, which makes the technology a powerful tool to measure the effects of
potential drug candidates and other bioactive compounds,” stated Mark R. Brann, Ph.D., founder, President, and Chief Scientific Officer of ACADIA. “This agreement validates our technology and highlights the spectacular success of our
collaboration. R-SATTM is now a proven drug
discovery technology. R-SATTM gives us the tools
for sorting through the massive numbers of genes and compounds that have been identified through genomics and combinatorial chemistry. With Allergan, we will now aggressively put these tools to practice in several drug discovery programs.”

  
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 Any of the above statements that refer to Allergan’s estimated or anticipated future results are forward-looking and reflect Allergan’s current analysis of
existing trends and information. Actual results may differ from current expectations based on a number of factors affecting Allergan’s businesses, including competitive conditions and certain market conditions; the timing and uncertainty of
results of both research and regulatory processes; and performance. These forward-looking statements represent Allergan’s judgment only as of the date of this press release, and actual results could differ materially. As a result, the reader is
cautioned not to rely on these forward-looking statements. Allergan disclaims, however, any intent or obligation to update these forward-looking statements. 
  
 Additional information concerning these factors can be found in press releases as well as in Allergan’s public periodic filings with the Securities and Exchange
Commission, including the discussion under the heading “Certain Factors and Trends Affecting Business” in Allergan’s 1996 Form 10-K. Copies of Allergan press releases and additional information about Allergan are available on the
World Wide Web at www.allergan.com, or you can contact the Allergan Investor Relations Department by calling 714-246-4636. Further information about ACADIA Pharmaceuticals can be found at www.acadia-pharm.com, or by calling Corporate
Headquarters at 619-558-2871. 
  
 ACADIA Pharmaceuticals is a biotechnology
company engaged in development and use of high-throughput solutions for drug discovery. Founded in 1993 by Dr. Brann, the company has developed a platform of proprietary breakthrough technologies for the functional characterization of genes encoding
potential drug targets. The company is currently pursuing drug discovery alliances with other major pharmaceutical firms, as well as with biotechnology companies with expertise in genomics and combinatorial chemistry. ACADIA also continues to
develop and expand its technology platform and is pursuing in-house discovery efforts on novel targets. Corporate headquarters are located in San Diego, California; research facilities are maintained in both San Diego and Copenhagen, Denmark.

  
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 Allergan, Inc., headquartered in Irvine, California, is a technology-driven, global health care company focused on specialty pharmaceutical products for specific disease
areas that deliver value to customers, satisfy unmet medical needs and improve patients’ lives. 
  
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