Document:

Exhibit 10.1

Confidential
materials omitted and filed separately with the Securities and Exchange Commission.

Asterisks denote omissions.

COLLABORATION AGREEMENT

between

MEDIMMUNE, INC.

and

INFINITY PHARMACEUTICALS, INC.

dated as of August
25, 2006

COLLABORATION AGREEMENT

THIS COLLABORATION AGREEMENT dated as of the 25th day
of August, 2006 (the “Agreement”) is made between MedImmune, Inc., a
Delaware corporation having its principal place of business at One MedImmune Way, Gaithersburg, Maryland
20878 (“MedImmune”) and Infinity Pharmaceuticals, Inc., a
Delaware corporation having its principal office at 780 Memorial Drive,
Cambridge, Massachusetts 02139 (“Infinity”).

R E C I T A L S

WHEREAS, the
Parties wish to collaborate on the development and commercialization of the
Products (as defined herein);

NOW THEREFORE, in consideration of the premises and of
the covenants herein contained, the Parties hereto mutually agree as follows:

ARTICLE 1

DEFINITIONS

For
purposes of this Agreement, the terms defined in this Article shall have the
meanings specified below, whether used in their singular or plural form:

1.1.        “Active
Pharmaceutical Ingredient” or “API” means the
active ingredient in a drug responsible for its therapeutic effect including
isomer, ester, salt, hydrate, solvate, analog (i.e., one or a limited number of
individual atoms or functional groups have been added, deleted or replaced,
either with a different atom or with a different functional group, or any one
of a series of organic compounds with a similar general formula, possessing
similar chemical properties), conjugate, polymorph, prodrug, metabolic
precursor or metabolite of such active ingredient.

1.2.        “Affiliate” with respect to either
Party, means any corporation or other entity which controls, is
controlled by, or is under common control with that Party.  A corporation or other 

 

entity shall be regarded
as in control of another corporation or entity if it directly or indirectly
owns or controls more than fifty percent (50%) of the voting stock or other
ownership interest of the other corporation or entity, or if it possesses,
directly or indirectly, the power to direct or cause the direction of the
management and policies of the corporation or other entity or the power to
elect or appoint fifty percent (50%) or more of the members of the governing
body of the corporation or other entity.

1.3.          “Applicable
Percentage” means fifty percent (50%).

1.4.          “Business
Day” shall mean each day of the week excluding Saturday, Sunday and U.S.
Federal holidays.

1.5.          “Claims”
means all charges, complaints, actions, suits, proceedings, hearings,
investigations, claims, demands, judgments, orders, decrees, stipulations and
injunctions.  For the avoidance of doubt,
Claims shall include Infringement Claims and Product Liability Claims.

1.6.          “Collaboration Inventions”
means:

(a)           Inventions conceived and/or reduced
to practice during the Term by an employee of a Party or any of its Affiliates
and/or by a person or entity obligated to assign such an Invention to a Party
or any of its Affiliates which Invention is directed to the development,
manufacture, use or sale of an Active Pharmaceutical Ingredient of a Product; provided, however,
with respect to Products of a Project as to which a Party is an Opt-Out Party,
such Inventions are limited to those conceived and/or reduced to practice
during the Term and prior to one year after the Opt-Out Date for such
Project.  For the avoidance of doubt, for
purposes of the foregoing, Inventions that are “directed to” an API shall not
include general formulations and general manufacturing methodologies that are
conceived and reduced to practice outside of the course of performing
activities pursuant to a Research and Development Plan; and

 2
 

 

(b)           Inventions conceived and/or reduced to
practice during the Term by an employee of a Party or any of its Affiliates
and/or by a person obligated to assign such an Invention to a Party or any of
its Affiliates that is conceived and/or reduced to practice in the course of
performing activities pursuant to work conducted under a Research and
Development Plan.

1.7.          “Collaboration Know-How” means:

(a)           Know-How conceived and/or reduced to
practice and/or developed during the Term by an employee of a Party or any of
its Affiliates and/or by a person or entity obligated to assign Know-How to a
Party or any of its Affiliates which Know-How is directed to the development,
manufacture, use or sale of an Active Pharmaceutical Ingredient of a Product; provided, however,
with respect to Products of a Project as to which a Party is an Opt-Out Party,
such Know-How is limited to that conceived and/or reduced to practice and/or
developed during the Term and prior to one year after the Opt-Out Date for such
Project.  For the avoidance of doubt, for
purposes of the foregoing, Know-How that is “directed to” an API shall not
include general formulations and general manufacturing methodologies that are
conceived and reduced to practice outside of the course of performing
activities pursuant to a Research and Development Plan; and

(b)           Know-How conceived and/or reduced to
practice during the Term by an employee of a Party or any of its Affiliates
and/or by a person obligated to assign such Know-How to a Party or any of its
Affiliates that is conceived and/or reduced to practice in the course of
performing activities pursuant to work conducted under a Research and
Development Plan.

1.8.          “Collaboration
Patent Rights” means any Patent Rights that claim a Collaboration
Invention.

 3
 

 

1.9.          “Collaboration
Rights” means individually and collectively Collaboration Patent Rights,
Collaboration Know-How and Collaboration Inventions.

1.10.        “Combination
Product” means a product that contains one or more active components that
are not Products in addition to Product.

1.11.        “Development
Costs” with respect to
Product, on a Product-by-Product basis, means the reasonable costs incurred or
accrued by a Party with respect to work performed by a Party or its Affiliates
or a Third Party in accordance with a Research and Development Plan in connection
with research and development of Product, including [***] for the purpose of
submission of applications to obtain Regulatory Approvals for Product which
costs are limited to [***].  All cost
determinations made hereunder shall be made in accordance with GAAP.  As
part of creating the initial Research and Development Plans, the JDT will agree
on consistent policies governing direct and non-direct costs, including
allocation principles.

1.12.        “Diligent
Effort” means the carrying out of obligations specified in this Agreement
in a diligent, expeditious and sustained manner, consistent with the combined
interests of the Parties including the allocation of commercially reasonable
personnel and financial resources, but in no event less than that level of resources
that pharmaceutical and major biotechnology companies typically devote to their
own internally discovered products of similar market potential at a similar
stage in its development or product life, taking into account the following
factors to the extent reasonable and relevant: issues of safety and efficacy,
product profile, difficulty in developing or manufacturing the Product,
competitiveness of alternative Third Party products in the marketplace, the
patent or other proprietary position of the Product, the regulatory
requirements involved and the potential profitability of the Products marketed
or to be marketed.

 4
 

 

1.13.        “Disclosure
Schedule” means the disclosure schedule delivered by Infinity to MedImmune
dated as of the Effective Date.

1.14.        “Earnings”
means the positive or negative amount that is calculated on a
Product-by-Product basis by deducting Product Costs from Revenue.

1.15.        “Effective
Date” means the date first set forth above.

1.16.        “FDA”
means the United States Food and Drug Administration or any successor agency
with responsibilities comparable to those of the United States Food and Drug
Administration.

1.17.        “Field”
means all fields of use.

1.18.        “First
Commercial Sale” means the first sale of a Product for consumption by the
general public in a country.

1.19.        “Fully
Absorbed Cost of Goods” with respect to Product, on a Product-by-Product
basis, means:

(a)           To the extent that manufacturing of
Product or any component thereof is performed by the Selling Party itself, the
consolidated fully burdened cost incurred by the Selling Party in the
manufacture of Product, which costs are limited to: [***] as determined in
accordance with GAAP; and

(b)           To the extent that manufacturing of
Product or any component thereof is performed for the Selling Party by a Third Party or by the other Party,
amounts paid by the Selling Party to such Third Party or to the other Party in
connection with the manufacturing of Product or any component thereof.

1.20.        “GAAP”
means the then current United States generally accepted accounting principles,
consistently applied.

 5
 

 

1.21.        “Hsp90
Diagnostic” means a product or service for determining a person that is
susceptible to treatment with a Hsp90 Therapeutic and/or monitoring such
treatment and/or providing a prognosis of such treatment, in each case such
treatment being for the purpose of treating and/or preventing a disease,
disorder or condition.

1.22.        “Hsp90
Product” means an Hsp90 Diagnostic or an Hsp90 Therapeutic.

1.23.        “Hsp90
Therapeutic” means one or more molecules that primarily (i.e. the most
potent activity) target and modulate one or more of Heat Shock Protein 90
(Hsp90) [***] and compositions that contain such a molecule(s).  For the avoidance of doubt, the chemical
entities disclosed and/or claimed in the Patent Rights indicated in Exhibit Y
and IPI 504 (structure in Exhibit Z-1) are included as Hsp90 Therapeutics.

1.24.        “Hsp90
Project” means the research, development and commercialization of one or
more Hsp90 Products.

1.25.        “Hedgehog
Diagnostic” means a product or service for determining a person that is
susceptible to treatment with a Hedgehog Therapeutic and/or monitoring such
treatment and/or providing a prognosis of such treatment, in each case such
treatment being for the purpose of treating and/or preventing a disease,
disorder or condition.

1.26.        “Hedgehog
Product” means a Hedgehog Diagnostic or a Hedgehog Therapeutic.

1.27.        “Hedgehog
Therapeutic” means one or more molecules that primarily target (i.e. the
most potent activity) and modulate one or more member(s) of the Hedgehog
pathway and compositions that contain such a molecule(s).  For the avoidance of doubt, the chemical
entities disclosed and/or claimed in the Patent Rights indicated in Exhibit Y
[***] (structures in Exhibit Z-2)  are included as Hedgehog Therapeutics.

 6
 

 

1.28.        “Hedgehog
Project” means the research, development and commercialization of one or
more Hedgehog Products.

1.29.        “IND”
means an Investigational New Drug application filed with a Regulatory Authority
to obtain approval to conduct human clinical trials of a Product for an
Indication.

1.30.        “Indication”
means a type of cancer (tumor type) or a disease, disorder or a condition other
than a type of cancer.

1.31.        “Infinity
Existing Know-How” means any Know-How owned by or licensed to Infinity as
of the Effective Date which is directed to the development, manufacture, use or
sale of an Active Pharmaceutical Ingredient of a Product.  For the avoidance of doubt, for purposes of
the foregoing, Know-How that is “directed to” an API shall not include general
formulations and general manufacturing methodologies that are conceived and
reduced to practice outside of the course of performing activities pursuant to
a Research and Development Plan.

1.32.        “Infinity
Existing Patent Rights” means (i) any Patent Rights set forth on Exhibit Y,
(ii) any Patent Rights that may arise from the Inventions set forth in Exhibit
Y, and (iii) any Patent Rights owned by or licensed to Infinity as of the
Effective Date that claim an Active Pharmaceutical Ingredient of a Product or
the manufacture or use thereof.

1.33.        “Infinity
Existing Rights” means individually and collectively Infinity Existing
Patent Rights and Infinity Existing Know-How.

1.34.        “Infinity
General Invention” means any Invention, other than a Collaboration
Invention or MedImmune General Invention (i) owned by Infinity or any of its
Affiliates before or during the Term and/or (ii) licensed to Infinity or any of
its Affiliates before or during the Term, with the right in each case to grant
a sublicense hereunder in each case, which Invention is useful or necessary
with respect to the development, manufacture, use or sale of a Product; 

 7
 

 

provided,
however, with respect to Products
of a Project as to which Infinity is an Opt-Out Party, such Inventions that become
owned or licensed with respect to such Products during the Term are limited to
those that become owned or licensed during the Term and prior to one year after
the Opt-Out Date for such Project.

1.35.        “Infinity
General Patent Rights” means any Patent Rights, other than Collaboration
Patent Rights, Infinity Existing Patent Rights or MedImmune General Patent
Rights, that claim an Infinity General Invention.

1.36.        “Infinity
General Know-How” means any Know-How, other than Collaboration Know-How,
Infinity Existing Know-How or MedImmune General Know-How, (i) owned by Infinity
or its Affiliates before or during the Term or (ii) licensed to Infinity or any
of its Affiliates before or during the Term, with the right in each case to
grant a sublicense hereunder, in each case which
Know-How is useful or necessary with respect to the development, manufacture,
use or sale of a Product; provided,
however, with respect to Products
of a Project as to which Infinity is an Opt-Out Party, such Know-How that
becomes owned or licensed with respect to such Products during the Term is
limited to Know-How that becomes owned or licensed during the Term and prior to
one year after the Opt-Out Date for such Project.

1.37.        “Infinity
General Rights” means individually and collectively Infinity General Patent
Rights, Infinity General Know-How and Infinity General Inventions.

1.38.        “Infringement
Claim” means a Claim by a Third Party that the making, using, offering for
sale, sale or importation of a Product infringes any Third Party intellectual
property right.

1.39.        “Invention”
means all ideas, data, writings, inventions, discoveries, improvements and
other technology, whether or not patentable or copyrightable.

 8

 

1.40.        “JCT”
means the Joint Commercialization Team of Section 6.2.

1.41.        “JDT”
means the Joint Development Team(s) of Article 3.

1.42.        “Know-How”
means data, information, know-how, compounds and reagents and the rights
thereto other than Patent Rights.

1.42A      “Litigation
Expenses” means court costs, reasonable fees of attorneys, accountants and
other experts or other expenses of litigation or other proceedings or of any
claim, default or assessment.

1.42B      “Loss(es)”
means all damages (including all incidental and consequential damages claimed
by Third Parties), deficiencies, defaults, assessments, dues, penalties, fines,
costs, amounts paid in settlement, liabilities, obligations, taxes, liens,
losses, lost profits claimed by Third Parties, expenses, costs and fees
(including without limitation interest, but excluding Litigation Expenses) and
includes all damages awardable pursuant to statute and treble damages.

1.43.        “Marketing
Expenses” means with respect
to a Product, on a Product-by-Product basis, the reasonable costs incurred or
accrued pursuant to a Marketing Plan by the Selling Party or reimbursed to the
Non-Selling Party pursuant to co-promotion under this Agreement, with respect
to pre-launch, launch, and post-launch advertising and other marketing activities
including, without limitation, expenses of patient programs such as those
involving compassionate use, indigents, uninsured and underinsured, training,
disease information and management, and compliance; expenses related to
Promotional Materials, space or time in various media, direct mail campaigns,
samples, advertising agency fees and other promotion activities; and phase IV
studies (whether or not required by a Regulatory Authority) which costs are
limited to: [***].  All cost
determinations made hereunder shall be made in accordance with GAAP.  Marketing Expenses do not include Selling
Expenses.  Marketing Expenses incurred by

 9
 

 

a Selling Party
with respect to a Product shall not materially exceed the aggregate expenses
associated with the marketing (defined in the same way as Marketing Expenses)
of similar products by Third Parties that are pharmaceutical or major
biotechnology companies.

1.44.        “Marketing
Plan” means the Marketing Plan of Section 6.2.

1.45.        “MedImmune
General Invention” means any Invention, other than a Collaboration
Invention or Infinity General Invention (i) owned by MedImmune or any of its
Affiliates before or during the Term and/or (ii) licensed to MedImmune or any
of its Affiliates before or during the Term, with the right in each case to
grant a sublicense hereunder, in each case, which Invention is useful or
necessary with respect to the development, manufacture, use or sale of a
Product; provided,  however, with respect to Products of a
Project as to which MedImmune is an Opt-Out Party, such Inventions that become
owned or licensed with respect to such Products during the Term are limited to
those that become owned or licensed during the Term and prior to one year after
the Opt-Out Date for such Project.

1.46.        “MedImmune
General Patent Rights” means any Patent Rights, other than Collaboration
Patent Rights and Infinity General Patent Rights, that claim a MedImmune
General Invention.

1.47.        “MedImmune
General Know-How” means any Know-How, other than Collaboration Know-How,
Infinity Existing Know-How and Infinity General Know-How, (i) owned by
MedImmune or its Affiliates before or during the Term or (ii) licensed to
MedImmune or any of its Affiliates before or during the Term, with the right in
each case to grant a sublicense hereunder, in each case which Know-How is useful or necessary with
respect to the development, manufacture, use or sale of a Product; provided,  however,
with respect to Products of a Project as to which MedImmune is an Opt-Out
Party, such Know-How that becomes owned 

 10
 

 

 or licensed with respect to such Products
during the Term is limited to Know-How that becomes owned or licensed during
the Term and prior to one year after the Opt-Out Date for such Project.

1.48.        “MedImmune
General Rights” means individually and collectively MedImmune General
Patent Rights, MedImmune General Know-How and MedImmune General Inventions.

1.49.        “Net
Sales” means with respect to Product and Royalty Bearing Product on a
Product-by-Product and Royalty Bearing Product by Royalty Bearing Product
basis, the gross sales accrued in a particular period for financial reporting
purposes of any and all Products and Royalty Bearing Product sold by a Selling
Party or its Affiliates to a Third Party and included in reported net sales
under GAAP after deducting for the following sales allowances and expenses
directly related to gross sales of the applicable Product or Royalty Bearing
Product, as determined by such Party under GAAP, if not previously deducted,
from the gross sales amount invoiced:

(a)           trade, quantity and/or cash
discounts, allowances or rebates, including promotional, service or similar
discounts or rebates and discounts or rebates to governmental or managed care
organizations, to the extent actually given or allowed;

(b)           credits or allowances with respect to
Products or Royalty Bearing Products by reason of rejection, defects, recalls
or returns, or chargebacks;

(c)           any tax, tariff, duty or government
charge (including any sales, value added, excise or similar tax or government
charge, but excluding any income tax) levied on the sale, transportation or
delivery of any Product or Royalty Bearing Product;

(d)           a reasonable allowance for bad debt;

(e)           any charges for freight, postage,
shipping or transportation, or for insurance (if and to the extent included in
the amount invoiced to the Third Party); and

 11
 

 

(f)            any administrative fees owed to
group purchasing organizations or managed care entities for sale of such
Products or Royalty Bearing Products.

The Selling Party
shall make periodic adjustments of the amounts described in (a) through (f) to
its initial accruals of such amounts applied in a prior calendar quarter to
reflect amounts actually incurred or taken by such Party; provided, however, that it shall use the
same accrual that it uses for its own financial accounting purposes, and that
it shall account for reserves and allowances for such Products or Royalty
Bearing Products in a manner consistent with its methods for establishing
reserves and allowances for other similar products.

(A)          In the event a Product or Royalty
Bearing Product is sold as part of a Combination Product and the Product or
Royalty Bearing Product, as well as each of the other clinically active
components included in the Combination Product (the “Other Products”), are sold
separately in the relevant country, the Net Sales from such Combination
Product, shall be the amount determined by multiplying the Net Sales of the
Combination Product, during the applicable reporting period, by the fraction,
A/A+B, where A is the average gross sales price of the Product or Royalty
Bearing Product when sold separately in finished form and B is the average
gross sales price of the Other Products when such Other Products are sold
separately in finished form, in each case during the applicable reporting
period or, if sales of both the Product or Royalty Bearing Product, and the
Other Products did not occur in such period, then in the most recent reporting
period in which sales of both occurred.

(B)           In the event a Product or Royalty
Bearing Product is sold as part of a Combination Product and average gross
sales price cannot be determined for such Product or Royalty Bearing Product
and all Other Product(s) included in the Combination Product, Net Sales, shall
be calculated by multiplying the Net Sales of the Combination Product by the 

 12
 

 

fraction C/(C+D) where C
is the standard Fully-Absorbed Cost of Goods of the Product or Royalty Bearing
Product and D is the standard fully-absorbed cost of the Other Products,
calculated in the same manner as Fully Absorbed Cost of Goods, in each case
during the applicable reporting period.

1.50.        “Opt-Out-Date”
has the meaning of Section 12.1.

1.51.        “Opt-Out-Party”
has the meaning set forth in Section 12.1.

1.52.        “Non-Selling
Party” means, on a Product-by-Product basis, on a country-by-country basis,
any Party who is not a Selling Party, provided that such Party is not an
Opt-Out Party with respect to the Project of which the Product is a member.

1.53.        “Patent
Rights” means United States and foreign patents, patent applications,
provisional patent applications, certificates of invention, applications for
certificates of invention, divisions, continuations, continuations-in-part,
non-provisional patent applications claiming priority benefit of a provisional
application, continued prosecution applications, national and regional stage counterparts, together with any
extensions, registrations, confirmations, reissues, re-examinations or renewals
of the above as well as supplementary protection certificates therefore, and
any other form of government-issued patent protection directed to the
inventions claimed in the foregoing.

1.54.        “Party”
means Infinity or MedImmune and collectively the “Parties”.

1.55.        “Phase
I Clinical Trial” means, as to a Product, the first controlled and lawful
study in humans of the safety of such Product, which is prospectively designed
to generate sufficient data (if successful) to commence a Phase II Clinical
Trial of such Product, as further exemplified in Federal Regulation 21 C.F.R.
312.21(a), or corresponding non-US applicable laws.

 13
 

 

1.56.        “Phase
II Clinical Trial” means, as to a Product, a controlled and lawful study in
humans of the safety, dose ranging and efficacy of such Product, which is
prospectively designed to generate sufficient data (if successful) to commence
a Pivotal Trial of such Product, as further exemplified in Federal Regulation
21 C.F.R. 312.21(b), or corresponding non-US applicable laws.

1.57.        “Pivotal
Trial” means, as to a Product, a controlled and lawful study in humans of
the clinical benefit of such Product, which is prospectively designed to
generate sufficient data (if successful) to support Regulatory Approval
(including Subpart H) of such pharmaceutical product or label expansion of such
pharmaceutical product, as further exemplified in Federal Regulation 21 C.F.R.
312.21(c).

1.58.        “Primary
Contact Person” has the meaning set forth in Section 2.7 hereof.

1.59.        “Product”
means an Hsp90 Product and/or Hedgehog Product.

1.60.        “Product
Costs” means on a Product-by-Product basis the aggregate of all expenses of
either Party (including accruals legitimately chargeable against profits) in
connection with the commercialization, manufacture and distribution of Product,
consisting of only the following:

[***].

1.60B      “Product
Liability Claim” means (i) a Claim by a Third Party that a Product has
resulted in personal injury or death or (ii) a medical monitoring Claim by a
Third Party (e.g., a Claim in anticipation of or intended to prevent or
forestall personal injury or death as the result of a Product).

1.61.        “Product Revenues”
means on a Product-by-Product basis any and all revenue received by the Selling
Party for Product (other than Net Sales) and/or rights to Product and/or under an agreement with
respect to Product (other than Net Sales), including, but not limited to, 

 14
 

 

(a) monies
received pursuant to a license(s) such as upfront fees, milestones, royalties,
monies received for marketing rights and/or distribution rights and (b) and
monies received as damages and/or in settlement of a legal action(s) with
respect to Product.

1.62.        “Project”
means Hedgehog Project and/or Hsp90 Project.

1.63.        “Promotional
Materials” means advertising, promotional, educational and communication
materials, in whatever form or medium, for marketing, advertising and promotion
of a Product for distribution to a Third Party (including without limitation
medical professionals) and to a Party’s sales force in accordance with the
terms of the Marketing Plan.

1.64.        “Recall
Expense” means the cost and expense calculated in accordance with GAAP for
recall or market withdrawal of Product required or requested by a governmental
authority having jurisdiction thereover or as a result of a decision of the
Selling Party, including, but not limited to, expenses incurred for replacement
of Product.

1.65.        “Regulatory
Approval(s)” means any and all approvals from regulatory authorities in any
country or region required lawfully to manufacture and market Product in any
such country or region, including without limitation any Product pricing and
reimbursement approvals where applicable.

1.66.        “Regulatory
Authority” means any national (e.g., the FDA), supra-national (e.g., the
EMEA) or other regulatory agency or governmental entity involved in the
granting of Regulatory Approval for, or in the regulation of human clinical
studies of, Product.

1.67.        “Research
and Development Plan” means for each Project each research and development
plan and amendments thereto that is approved by the JDT.

1.68.        “Revenue”
means on a Product-by-Product basis the aggregate of Net Sales and Product
Revenues.

 15
 

 

1.69.        “Royalty
Percentage” means on a Product-by-Product basis the following percentage
depending on the stage of development of each Product in the Project as of the
Opt-Out Date for the Project:

	
  Opt-Out Date

  	
   

  	
  Percentage

  
	
  i. Up to dosing of a patient in a Phase I Clinical
  Trial

  	
   

  	
  [***] Percent
  ([***]%)

  
	
  ii. After dosing of a patient in a Phase I Clinical
  Trial and up to dosing of a patient in a Phase II Clinical Trial

  	
   

  	
  [***] Percent
  ([***]%)

  
	
  iii. After dosing of a patient in a Phase II
  Clinical Trial up to dosing of a patient in a Pivotal Trial

  	
   

  	
  [***] Percent
  ([***]%)

  
	
  iv. After dosing of a patient in a Pivotal Trial up
  to filing for Regulatory Approval in the United States.

  	
   

  	
  [***] Percent
  ([***]%)

  
	
  v. After filing for Regulatory Approval in the
  United States and thereafter.

  	
   

  	
  [***] Percent
  ([***]%)

  

 

1.70.        “Royalty
Bearing Product” means a Product of a Project as to which Project a Party
has exercised Opt-Out rights under Article 12.

1.71.        “Selling
Expenses” means with respect
to a Product, on a Product-by-Product basis, the reasonable costs incurred or
accrued by the Selling Party with respect to the selling of the Product in the
Territory which costs are limited to: [***]. 
All cost determinations made hereunder shall be made in accordance with
GAAP.  Selling Expenses incurred by a
Selling Party with respect to a Product shall not materially exceed the
aggregate expenses associated with the selling (defined in the same way as
Selling Expenses) of similar products by Third Parties that are pharmaceutical
or major biotechnology companies.

1.72.        “Selling
Party” means, with respect to a given Product in a country, (i) MedImmune
and its Affiliates unless MedImmune becomes an Opt-Out-Party, in which case, if
Infinity at such time is a Non-Selling Party, Infinity may become the Selling
Party or (ii) Infinity and its 

 16
 

 

Affiliates, if
Infinity becomes the Selling Party for such Product in such country under
Section 5.4.

1.73.        “Sublicensee”
means any person or entity (other than a contract distributor having no right
to promote, market or sell the Product) that receives from a Selling Party a
permitted sublicense to promote, market, or sell the Product.

1.74.        “Term”
has the meaning set forth in Section 14.1.

1.75.        “Territory”
means the world.

1.76.        “Third
Party” means any entity other than Infinity or MedImmune and their
respective Affiliates.

1.77.        “Valid
Claim” means an issued claim of an unexpired patent, included within
Collaboration Patent Rights and/or Infinity Existing Patent Rights and/or
patents licensed to a Selling Party under this Agreement which has not been
abandoned with no rights remaining, disclaimed, held permanently revoked, or
held invalid or unenforceable by a court of competent jurisdiction or
administrative agency in an unappealed or unappealable decision, and which has
not been admitted to be invalid or unenforceable through reissue or disclaimer
or otherwise.

1.78.        “Worldwide
Net Sales” means (i) aggregate Net Sales by the Selling Party and its
Affiliates and (ii) aggregate net sales (calculated in the same manner as Net
Sales) by Sublicensees of the Selling Party and its Affiliates and any further
sublicensees.

ARTICLE 2

RESEARCH AND
DEVELOPMENT COSTS

2.1           For each Project, MedImmune and
Infinity, shall prepare a rolling research and development plan for the earlier
of a three-year period or through projected Product approval which shall
describe the research and development activities for the applicable Project,
including 

 17
 

 

without limitation
research, pre-clinical studies, toxicology, formulation activities,
manufacturing development, scale up of production process, and clinical trials
as appropriate for the stage of research and development which shall be updated
annually.  The research and development
plan shall also include a summary of the estimated costs expected to be
incurred under the research and development plan during the covered period and
a description of, and budget for, all activities proposed for such period under
the research and development plan.  In
addition, the research and development plan shall specify the responsibilities
and work to be performed by each Party, identify the number of personnel to be
used by each Party in performing activities in connection with the research and
development plan, as well as activities to be performed by Third Parties.

2.2           For each Project, MedImmune and
Infinity each agree that it shall cause the JDT to approve a Research and
Development Plan for each calendar year that includes a level of efforts,
resources and monies sufficient to research, develop and manufacture Product
and to seek Regulatory Approval of Product in at least the United States,
Europe and Japan.  The initial rolling
three-year Research and Development Plan for each Project shall be prepared and
approved within thirty (30) days of the Effective Date and shall be consistent
with the plan separately provided by Infinity to MedImmune on August 22, 2006.

2.3           (a)           The
research and development plan prepared by the Parties (except for the initial
Research and Development Plan), shall be submitted to the JDT for approval by
no later than June 30 of the calendar year preceding the three (3) calendar
years covered therein.  The research and
development plan approved by the JDT in amended or unamended form for a Project
shall be the Research and Development Plan for the Project.  The Research and Development Plan shall
always be a rolling three year plan and the Research and Development

 18
 

 

Plan shall be updated or
amended at least annually by no later than August 1st of
each year preceding the year for which the update is being made.

(b)           Notwithstanding Section 2.3(a), the
Research and Development Plans approved by the JDT after the initial Research
and Development Plan with respect to the periods covered by the initial
Research and Development Plan shall be consistent with the initial Research and
Development Plan unless a change is required thereto as a result of a clinical
hold, unavailability of clinical supply of Product and/or material events
affecting the initial Research and Development Plan, in which case the Research
and Development Plan for such period and the corresponding expenditures by the
Parties thereunder will be adjusted accordingly by agreement of the JDT.

2.4           In a calendar year, unless approved
in writing by the Parties, neither Party shall incur or enter into contracts to
incur Development Costs that exceed [***] percent ([***]%) of the amount of the
budget allocated to such Party for such calendar year under a Research and
Development Plan.

2.5           Each Party shall report to the other
Party through the JDT, the Development Costs actually incurred by each Party in
a calendar quarter within twenty (20) calendar days after the end of the
applicable calendar quarter.  The JDT
shall determine the aggregate Development Costs for the applicable calendar
quarter and determine the amount of Development Costs that should have been
allocated to MedImmune based on the Applicable Percentage, and the Development
Costs that should have been allocated to Infinity based on the Applicable
Percentage.  The JDT shall report such
calculation to both Parties within ten (10) Business Days after receiving the
reports thereby communicating its determination as to Development Costs
owed.  To the extent that a Party has
incurred Development Costs in excess of the Development 

 19
 

 

Costs that should have
been incurred by such Party based on the Applicable Percentage, within (30)
days, the other Party shall pay to such Party such excess so that each Party
bears the Applicable Percentage of such aggregate Development Costs for such
calendar quarter.

2.6           Each Party shall keep and shall cause
each of its Affiliates and their contractors to keep full and accurate records
and books of account containing all particulars that may be necessary for the
purpose of calculating Development Costs to be charged to the other Party
pursuant to this Agreement.  Such books
of account shall be kept by a Party at its places of business and, with all
necessary supporting data shall, for the three (3) years next following the end
of the calendar year to which each shall pertain be open for inspection by
auditors, which may be the other Party’s internal audit team or an independent
certified accounting firm selected by the other Party and reasonably acceptable
to the Party whose books are being inspected upon reasonable notice during
normal business hours at the other Party’s expense for the sole purpose of
verifying Development Costs in compliance with this Agreement, but in no event
more than once each calendar year.  All
information and data offered shall be used only for the purpose of verifying
Development Costs.  In the event that
such inspection shall indicate that in any calendar year the charges for
Development Costs were overstated by at least five percent (5%), then the Party
whose books are being inspected shall pay the cost of the inspection.  All underpayments and overpayments revealed
by such audit are immediately due and payable. 
Upon the expiration of three (3) years after a calendar year, the
Development Costs reported by a Party for such period shall be binding on both
Parties, except to the extent that inspection during such period indicated an
overpayment or underpayment.

2.7           MedImmune and Infinity shall each
designate an initial primary contact person (“Primary Contact Person”)
who shall be responsible for the interactions between the Parties

 20
 

 

related to this
Agreement.  The Primary Contact Persons
shall attempt to promptly resolve any disputes that arise under a Project and,
if they are unable to do so, such dispute shall be referred to the JDT.  Each Party may change its Primary Contact
Person upon written notice to the other Party. 
Each Party’s Primary Contact Person may also serve as one of its
representatives on the JDT.  The Primary
Contact Person for each Party shall designate for each Project one or more
employees of such Party as members of a project team(s), who shall meet as
often as needed to coordinate the work of the Parties under the applicable
Research and Development Plan.

2.8           Know-How
Transfers.

(a)           Infinity
shall transfer to MedImmune Infinity Existing Know-How, Collaboration Know-How
and Infinity General Know-How, as applicable, as requested by MedImmune to the
extent the same is necessary or useful to enable MedImmune to perform its
obligations and exercise its rights under this Agreement.

(b)           MedImmune
shall transfer to Infinity MedImmune General Know-How and Collaboration
Know-How, as applicable, as requested by Infinity to the extent the same is
necessary or useful to enable Infinity to perform its obligations and exercise
its rights under this Agreement.

ARTICLE 3

JOINT DEVELOPMENT TEAM

3.1           (a)           Until the Opt-Out-Date for a Project,
each Project shall be managed and directed by a committee initially composed of
six (6) members (which may be adjusted by the JDT, as long as there is an even
number of members), with MedImmune appointing one-half of the members and
Infinity one-half of the members (the “JDT”).  MedImmune and Infinity may 

 21
 

 

also appoint such
non-voting ex-officio members of the JDT as each Party may deem appropriate,
provided that any such ex-officio member that is not an employee signs an
appropriate confidentiality agreement.

(b)           The JDT shall meet
at least once each calendar quarter in person or by telephone or by video
conference.  A quorum for the conduct of
business at any meeting of the JDT shall consist of at least one representative
of MedImmune and at least one Infinity representative.  Each of Infinity and MedImmune, shall have
one vote, and subject to Section 3.1(d) all decisions shall be reached by a
unanimous vote.  The Parties shall cause
the JDT to review and vote on each submitted research and development plan.  The JDT has the authority to approve Research
and Development Plans.

(c)           The JDT shall review
each approved Research and Development Plan at least once each year or at the
request of any member, and shall decide whether or not to amend the Research
and Development Plan, as the case may be.

(d)           If there is a tie
vote in the JDT, or if the JDT is unable to resolve a dispute referred to the
JDT, Infinity and MedImmune agree to exert all reasonable efforts to arrive at
a mutually acceptable resolution, including a meeting between their CEO’s or a
person designated by a CEO.  In the event
that there is a tie vote or dispute as to a Project that is not resolved by the
respective CEOs or their designees within thirty (30) days after submission to
the CEOs, then such shall be resolved by binding arbitration in accordance with
Exhibit A.

(e)           The JDT shall be
responsible for providing advice with respect to and generally supervising
research and development pursuant to all Research and Development Plans and for
deciding disputes between the Parties with respect to work to be performed
under any Research and Development Plan. 
It is specifically understood, however, that the day-to-day

 22
 

 

management of the
activities allocated to either Party under any Research and Development Plan
shall be managed by such Party rather than the JDT.

(f)            The JDT shall keep accurate minutes
of its deliberations which shall record all proposed decisions and all actions
recommended or taken.  The Parties shall
alternate responsibility for the preparation of the draft minutes on an annual
basis.  Draft minutes shall be sent to
all members of the JDT within fifteen (15) days after each meeting and shall be
approved, if appropriate, or amended and approved as amended within thirty (30)
days by a quorum of the JDT.  All records
of the JDT shall at all times be available to both Infinity and MedImmune.

(g)           With respect to a Project, the JDT
shall cease to have voting authority as to all Products of a Project upon
Regulatory Approval for the first Product of such Project.  Thereafter, the JDT shall continue to exist
as a sub-committee of the JCT, reporting to and advising the JCT with respect
to development matters.  If either Party
becomes an Opt-Out Party with respect to a Project, the JDT with respect to
such Project shall cease to exist.

(h)           The chairperson of the JDT shall have
the following roles and responsibilities: (a) to call meetings of the JDT, send
notice of each such meeting and designate the time, date and place of each such
meeting; (b) to convene or poll the members of the JDT by other permitted
means; (c) to establish the agenda for each meeting of the JDT, subject to the
right of any member of the JDT to add additional agenda items at any meeting;
(d) to prepare comments to the draft minutes prepared by the secretary of the
JDT and communicate with the secretary to finalize the draft minutes prior to
circulation to all members of the JDT; and (e) to execute, along with the
secretary of the JDT, the final minutes of the meetings of the JDT.  The chairperson shall alternate each calendar
year between a member appointed by Infinity and a 

 23
 

 

member appointed by
MedImmune, with a member appointed by Infinity being the first chairperson for each JDT, and serving until the end of calendar year 2007.

(i)            Each Party shall provide the JDT
with quarterly written reports regarding the status of the activities for the
Project.

(j)            Each Party shall be responsible for
all travel and related costs and expenses for its members, designees and
non-JDT invitees to attend meetings of, and otherwise participate in, the JDT.

(k)           If a JDT member cannot attend a
particular JDT meeting, such member may send a designate authorized to make
decisions.

ARTICLE 4

RESEARCH, DEVELOPMENT AND
REGULATORY

4.1           With respect to a Project each Party
that has not become an Opt-Out Party agrees to perform the work assigned to
that Party under a Research and Development Plan for that Project.  All such work will be conducted, in a
professional manner and at a level of quality appropriate to major
biotechnology companies.

4.2           Each Party shall prepare a written
report prior to a scheduled meeting of the JDT with respect to the work
performed by such Party under a Research and Development Plan and deliver such
report to the JDT prior to the scheduled meeting.

4.3           In preparing a research and
development plan and subsequent approval thereof by the JDT or JCT pursuant to
this Agreement, work thereunder shall be assigned to a Party based upon the
respective Parties ability to perform such activity.  Subject to the preceding sentence, the Parties
contemplate that Infinity will have primary responsibility for activities
involving 

 24
 

 

expertise in
development of small molecules such as lead identification and optimization,
medicinal chemistry, preclinical development, early translational clinical development
through initial evidence of safety and efficacy in humans, process chemistry
and development and manufacturing scale-up, and that MedImmune shall have
primary responsibility for pivotal clinical trials, for obtaining worldwide
Regulatory Approval and for commercialization.

4.4           (a)           Infinity
will file,
own and maintain the INDs with respect to a given Product until the earlier of
the end of a Phase II Clinical Trial meeting with the FDA or immediately prior
to the initiation of the first Pivotal Trial in any country with respect to
such Product.  At the earlier of the end
of a Phase II Clinical Trial meeting with the FDA or immediately prior to
initiation of the first Pivotal Trial for a given Product in any country
Infinity will transfer all INDs with respect to such Product to MedImmune in
all countries in which MedImmune is the Selling Party and thereafter the
Selling Party in a country will file, own and maintain all INDs and Regulatory
Approvals for such Product in such country. 
The owner of the IND in the United States shall be responsible
for the global product safety database for tracking safety issues with respect
to the Product.

(b)           The owner
of the IND shall within the time permitted under applicable regulations, file
or cause to be filed with the FDA and any other applicable Regulatory
Authority, all notices, assignments, documents or other materials required by
the laws of the Territory to be filed in connection with such Product.  The owner of the IND shall be responsible for
developing Product labeling, package inserts, imprinting and packaging data as
appropriate, for the Product.  The owner
of the IND shall be responsible for all regulatory compliance activities with
respect to such Product.  The other Party
shall provide any information and assistance reasonably requested by the owner
of the IND for any regulatory filing, Product

 25
 

 

labeling development, and all regulatory compliance activities with respect
to such Product.  The other Party agrees
that time is of the essence with regard to these matters and will take all
steps necessary to respond to the owner of the IND in a timely manner.  The owner of the IND agrees that, to the
extent reasonably possible given such time constraints, prior to the Opt-Out
Date for a Project, the other Party shall have a reasonable opportunity
to review and comment upon regulatory filings and all substantive
correspondence to or from the FDA or comparable Regulatory Authorities with
respect to such Products of such Project and that the owner of the IND shall
consider such comments in determining its activities with respect to
interactions with the FDA and comparable Regulatory Authorities.  The Selling Party and the Non-Selling Party
with respect to a Product shall have the right to attend meetings with Regulatory
Authorities with respect to such Product, however, the Party that is not the
owner of the IND shall participate in such meetings only as an observer.

(c)           On a country-by-country basis, the
Selling Party shall have responsibility (subject to any responsibility provided
to Infinity in any co-promotion agreement entered into pursuant to Section
6.4), to respond to questions and inquiries relating to the Product raised by
health care professionals and customers and shall, if so requested by the
Non-Selling Party, provide the Non-Selling Party with details of such questions
and inquiries received and responses given. 
The Selling Party will establish and implement effective procedures and
mechanisms for responding to such questions and inquiries.

(d)           On a country-by-country basis, the
Selling Party shall assume all responsibility (subject to any responsibility
provided to Infinity in any co-promotion agreement entered into pursuant to
Section 6.4) for all correspondence and communication with physicians and other
health care professionals relating to the Product.  The Selling Party shall keep such 

 26
 

 

records and make
such reports as shall be reasonably necessary to document such communications
in compliance with all applicable regulatory requirements and shall, if so
requested by the Non-Selling Party, make available to the Non-Selling Party
such records and reports.  The
Non-Selling Party shall refer all such questions regarding the Products to the
Selling Party in a timely manner.

(e)           Each Party shall promptly upon the
Effective Date of this Agreement and thereafter at all times during the Term
promptly disclose to the other Party all significant information of which it
becomes aware, which it can legally disclose and which it reasonably believes
will have a material commercial impact on the detailing, promotion, marketing
and sale of the Product in accordance with this Agreement.

(f)            The
owner of the IND shall have full responsibility for completing and filing the
annual report and all other required reports in the Territory for the Product.

(g)           Effective
upon filing of an IND for a Product, the owner of the IND shall be responsible
for reporting adverse experiences and reactions with respect to the Product in
conformance with all applicable laws, rules and regulations.  Each
of Infinity and MedImmune shall send to the other, throughout such period,
copies of all such adverse experience or reaction reports, with all “Serious”
and “Unexpected” adverse experiences (and relevant government reporting forms)
sent to the other Party no later than five (5) calendar days of such Party’s
receipt, and all adverse experiences or reactions other than “Serious” or “Unexpected”
adverse experiences (and relevant government reporting forms) sent to the other
party no later than 30 calendar days after such Party’s receipt.  MedImmune and Infinity will develop
pharmacovigilance procedures to comply with applicable regulations and orders
of Regulatory Authorities.

 27

 

(h)           Notwithstanding
anything else in this Section 4.4 to the contrary, during the period that the
JDT has decision making authority for a Project, the actions of the owner of
the IND pursuant to this Section 4.4 shall be consistent with the decisions of
the JDT and the Research and Development Plan.

4.5           The
Selling Party of a Product in the United States will be responsible for
manufacturing or having manufactured such Product for worldwide use.  In the event that both Parties and/or their
Affiliates are Selling Parties of a given Product in the Territory, the Parties
shall establish a supply and quality agreement for such Product which shall
provide for the equitable allocation of Product among countries in the
Territory and other commercially reasonable terms.  If the Selling Party of a Product in the
United States fails to meet its supply responsibilities, the Selling Party for
such Product in any other country shall have the right to manufacture and have
manufactured such Product for use and sale in such other country.

ARTICLE 5

LICENSES AND NON-COMPETE

5.1           (a)           For each Project, Infinity hereby
grants to MedImmune, a worldwide and, subject to Section 5.4, sublicensable
right and license that is co-exclusive with Infinity under the Infinity General
Rights, Infinity Existing Rights and Collaboration Rights to make, have made,
use, sell, offer to sell and import Product in the Field in accordance with the
terms and conditions of this Agreement, and such license shall automatically
terminate (i) for all Products of a Project as to which MedImmune becomes an
Opt-Out Party effective as of the Opt-Out Date and (ii) in each country for
each Product as to which MedImmune becomes the Non-Selling Party except for a
non-exclusive license to make and have made Products in any country of the
world for sale 

 28
 

 

in
a country where MedImmune is the Selling Party. 
On a Project-by-Project basis, if MedImmune has not become an Opt-Out
Party, Infinity agrees not to exercise any or grant any rights or licenses
under any of the rights and licenses retained by Infinity under this Section
5.1(a) with respect to Product in any country of the Territory, except to the
extent useful or necessary to perform its obligations or exercise its rights
under this Agreement (including under any co-promotion agreement entered into
pursuant to Section 6.4.) or to make and have made such Product in any country
of the world for sale in a country where Infinity is the Selling Party.

(b)           For
each Product in each country as to which Infinity is the Selling Party,
MedImmune agrees to grant and hereby grants to Infinity a sublicensable right
and license under Collaboration Rights and MedImmune General Rights that is
co-exclusive with MedImmune to (i) make and have made such Product in any
country of the world for sale in such countries, and (ii) use, sell, offer to
sell and import such Products in such countries in the Field, in accordance
with the terms and conditions of this Agreement, and such license shall
automatically terminate for a Project (and for each Product in the Project) as
to which Infinity becomes an Opt-Out Party effective as of the Opt-Out
Date.  On a Project-by-Project basis, if
Infinity has not become an Opt-Out Party, MedImmune agrees not to exercise any
or grant any rights or licenses under any of the rights and licenses retained
by MedImmune under this Section 5.1(b) with respect to a Product in any country
of the Territory, as to which Infinity is the Selling Party, except to the
extent useful or necessary to perform its obligations or exercise its rights
under this Agreement including the rights and licenses granted to MedImmune
under Section 5.1.

(c)           Any license granted under this
Section 5.1 that is a sublicense shall be in accordance with the terms of the
license agreement under which the sublicense is granted.

 29
 

 

5.2           (a)           For
each Project, MedImmune hereby grants to Infinity a co-exclusive worldwide
right and license under the MedImmune General Rights and Collaboration Rights
to make, have made, use and import Product of said Project in the Field, but
only to the extent useful or necessary to perform Infinity’s obligations or
exercise its rights under a Research and Development Plan, which license shall
automatically terminate for a Project (and for each Product in the Project) as
to which Infinity becomes an Opt-Out Party effective as of the Opt-Out
Date.  On a Project-by-Project basis, if
Infinity has not become an Opt-Out Party, MedImmune agrees not to exercise any
or grant any rights or licenses under any of the rights and licenses retained
by MedImmune under this Section 5.2(a) to develop, market or sell a Product in
any country of the Territory, except to the extent useful or necessary to
perform its obligations or exercise its rights under this Agreement including
the rights and licenses granted to MedImmune under Section 5.1.

(b)           Any license granted under this
Section 5.2 that is a sublicense shall be in accordance with the terms of the
license agreement under which the sublicense is granted.

5.3           [Purposely Omitted]

5.4           (a)
          Either Party is free to grant
sublicenses to its Affiliates with respect to the licenses granted to it by the
other Party hereunder; provided, however, that such Party shall remain
liable for all of its obligations hereunder and shall ensure that its
Affiliates comply with all obligations of such Party hereunder.

(b)           In
the event that MedImmune decides to grant a (sub)license to any Third Party
with respect to sales of a Product in the United States or in one or more
countries outside of the United States and at such time Infinity is a
Non-Selling Party with respect to such Product in the United States or such
other countries, as the case may be, MedImmune shall provide

 30
 

 

written
notice to Infinity of such decision.  In
the event that Infinity desires to become a Selling Party for such Products in
the United States or in such other countries, Infinity shall provide written
notice thereof to MedImmune within thirty (30) days after receipt of such
notice.  The Parties thereafter shall
discuss in good faith the ability of Infinity at such time to market and sell
such Product in the United States or such one or more countries, as the case
may be, in a manner that protects the profit interests of both Parties.  If the Parties do not reach agreement as to
such issue, then Infinity shall have the right to submit such issue to
arbitration pursuant to Exhibit A.

(c)           If Infinity does not provide
MedImmune the notice of Section 5.4(b) or if Infinity does not submit the issue
to arbitration within ten (10) days after notice that MedImmune does not agree
with Infinity becoming the Selling Party or if in the arbitration it is
determined that Infinity does not have such capabilities of Section 5.4(b),
then MedImmune shall have the right to (sub)license such Products in such
countries to a Third Party, subject to Infinity’s consent as to the entity who
will be the Sublicensee which consent shall not be unreasonably withheld or
delayed.

(d)           If MedImmune agrees that Infinity
should be the Selling Party for such Products in the United States or such
other countries or if it is determined in an arbitration that Infinity has the
qualifications of Section 5.4(b) for becoming the Selling Party for such
Products in the United States or such other countries, as the case may be, then
with respect thereto, Infinity shall become the Selling Party (with the right
to sublicense commercialization rights with the consent of MedImmune, such
consent not to be unreasonably withheld) and MedImmune the Non-Selling Party.

 31
 

 

(e)           For Europe, if MedImmune proposes to
grant a (sub)license for a plurality of countries in Europe, then Infinity’s
rights under this Section 5.4 (except Section 5.4(a)) shall require that
Infinity meets the qualifications to become a Selling Party for all of such
countries.

(f)            If
Infinity becomes the Selling Party in any country, MedImmune will, transfer all
Promotional Materials, customer lists and other information in its possession
related to the promotion of the applicable Product in such country to Infinity
and perform such services as Infinity may reasonably request with the goal of
effecting a smooth transition of the promotion duties previously performed by
MedImmune.  The Parties shall equally
share the expense thereof.

(g)           If Infinity becomes the Selling Party
in a country for a Product, to the extent legally permitted, MedImmune shall,
with respect to the applicable Product in such country, transfer to Infinity
any and all INDs, Regulatory Approvals, regulatory filings and price approvals.

(h)           If Infinity becomes the Selling Party
in the United States for all Products of a Project, Infinity shall assume
MedImmune’s right to cast the deciding vote and appoint the Chairman of the
Joint Commercialization Team for such Project pursuant to Section 6.2.

5.5           (a)           Neither
Party shall, and each Party shall ensure that its Affiliates shall not,
develop, market or sell a Product except in accordance with the terms and
conditions of this Agreement.

(b)           If a Party becomes an Opt-Out Party
with respect to a Project, then the obligations of Section 5.5(a) with respect
to Products of such Project shall terminate two (2) years after the Opt-Out
Date for such Project other than those that (i) embody or use Collaboration
Rights or Infinity Existing Rights or (ii) contain an Active Pharmaceutical 

 32
 

 

Ingredient for a
Product that was researched and/or developed prior to the applicable Opt-Out
Date.

(c)           If either Party or any of its
Affiliates signs a definitive agreement with respect to a merger or acquisition
by operation of which such Party or its Affiliate would (i) acquire a Product
or (ii) be acquired by or merge with a Third Party who has a Product (a Product
described in clause (i) or (ii), an “Acquired Product”), then such Party
or its Affiliate (or the relevant entity with the Acquired Product) shall have
six (6) months from the signing date of such definitive agreement to either
receive the consent of the other Party to develop and commercialize the
Acquired Product or divest itself of such Acquired Product and, during such six
(6) month period, the development, marketing, and/or sale of such Acquired
Product shall not be in violation of this Section 5.5.  Such divestiture may occur by either (1) an
outright sale or assignment of all rights in the Acquired Product to a Third
Party or (2) an exclusive outlicense of all rights with respect to the Acquired
Product with no further role or influence of the applicable Party or its
Affiliates with respect to the Acquired Product.

5.6           With respect to the Products and
countries as to which the Selling Party is permitted to grant a (sub)license
under Section 5.4, the Selling Party may grant exclusive or non-exclusive
(sub)licenses (including the right to grant further sublicenses) under some or
all of the rights and licenses granted to the Selling Party under this
Agreement.  If a permitted (sub)license
is granted (i) the Selling Party shall
not license or sublicense rights relating to Products for consideration other
than monetary consideration, and (ii) there shall be a separate JDT and
JCT for such Product(s) and the permitted Sublicensee at the request of the
licensing Party shall become a member thereof in lieu of the licensing Party; provided, however,
that the licensing 

 33
 

 

Party shall remain liable
for all of its obligations hereunder and shall ensure that the permitted
Sublicensee complies with all obligations of the licensing Party hereunder.

5.7.          (a)           During
the Term, if a Party (the “Licensee Party”) proposes or desires to enter
into an agreement with a Third Party to obtain a license to any Patent Rights,
Invention or Know-How and such license includes a license with respect to
Product, the Licensee Party must first obtain the consent of the other Party
(the “Sublicensee Party”), which consent may be contingent upon the
right to grant a sublicense, as provided below. 
In the event consent is given, the Licensee Party shall use reasonable
efforts to obtain the right, in such license agreement, to grant the
Sublicensee Party a sublicense under such license for the sole purpose of
performing under this Agreement and will not be authorized to take the license
if conditions of the Sublicensee Party’s consent have not been met.  After entering into any such agreement, the
Licensee Party shall provide the Sublicensee Party with a written description
of the technology licensed thereunder, including a list of any Patent Rights to
be licensed thereunder, and a copy of such agreement.  If the Licensee Party has the right to grant
the sublicense, the Sublicensee Party shall notify the Licensee Party, in
writing, within thirty (30) days if it desires to be sublicensed under such
agreement.  Upon such written notice, the
Sublicensee Party shall be sublicensed thereunder for the sole purpose of
performing under this Agreement.  The
Sublicensee Party’s delivery of the foregoing notice shall be deemed to
indicate its agreement to all obligations required of a sublicensee under such
agreement; provided, that to the
extent the license agreement contains additional requirements to grant a
sublicense, the Sublicensee Party shall comply with those.

 34
 

 

(b)           Notwithstanding
5.7(a), in the event that a license under any Patent Rights is necessary in
order for the Selling Party in a given country to sell, offer to sell, or
import an existing Product (i.e., one that has already been developed under
this Agreement) in such country without infringing a claim of such Patent
Right, the Selling Party may obtain such a license in such country with the
consent of the Non-Selling Party, such consent not to be unreasonably withheld.

(c)           For the avoidance of doubt, with the
exception of payments described in Section 6.10(c), the royalties and other
fees paid by either Party pursuant to any license agreement entered into
pursuant to this Section 5.7 with respect to Product shall be Product Costs or
Development Costs, as applicable.

5.8           All
rights and licenses granted under or pursuant to any section of this Agreement
are, and shall otherwise be deemed to be, for purposes of Section 365(n) of the
U.S. Bankruptcy Code, licenses of rights to “intellectual property” as defined
under Section 101(35A) of the U.S. Bankruptcy Code.  The Parties shall retain and may fully
exercise all of their respective rights and elections under the U.S. Bankruptcy
Code.  Each Party agrees that the other
Party, to the extent that it is a licensee of such rights under this Agreement,
shall retain and may fully exercise all of its rights and elections under the
U.S. Bankruptcy Code, and that upon commencement of a bankruptcy proceeding by
or against one Party under the U.S. Bankruptcy Code, the other Party shall be
entitled to a complete duplicate of or complete access to (as such other Party
deems appropriate), any such intellectual property and all embodiments of such
intellectual property, provided that such other Party continues to fulfill its
obligations as specified herein in full. 
Such intellectual property and all embodiments thereof shall be promptly
delivered to the other Party (i) upon any such commencement of a bankruptcy
proceeding upon written request therefor by 

 35
 

 

the other Party, unless the Party subject to such bankruptcy proceeding
elects to continue to perform all of its obligations under this Agreement or
(ii) if not delivered under (i) above, upon the rejection of this Agreement by
or on behalf of the Party subject to such bankruptcy proceeding, upon written
request therefor by the other Party.  The
foregoing is without prejudice to any rights that either Party may have arising
under the U.S. Bankruptcy Code or other applicable law.

5.9           In the
event the making, having made, use, offer for sale, sale or import of any
Product by either Party consistent with the provisions of this Agreement would
infringe during the Term a claim of Patent Rights that is owned by or licensed
to the other Party and which Patent Rights are not covered by the grant in this
Article 5, the other Party hereby covenants not to sue the first Party
and/or its Affiliates and/or its Sublicensees under such Patent Rights, so long
as, in the case of a license to such Patent Rights, this covenant not to sue is
consistent with the terms of such license, solely for the first Party and/or
its Affiliates and Sublicensees to develop, commercialize, make, have made,
use, sell, offer for sale or import such Product(s) in the Territory pursuant
to this Agreement, provided that the first Party is not then in breach of any
material obligation under this Agreement.

ARTICLE 6

MARKETING AND
SALES OF PRODUCT

6.1           The
Selling Party for a Product shall use Diligent Effort to make, have made, use,
offer for sale, sell, import and otherwise commercialize Products for which
Regulatory Approvals are obtained, consistent with any co-promotion activities
performed by Infinity.  The Selling Party
shall not sell or distribute Products at a discount or without consideration in
return

 36
 

 

for concessions or considerations received in transactions involving
products or services other than Products.

6.2           Joint
Commercialization Team.

(a)           For
each Project, prior to the Opt-Out-Date, the marketing and selling of Product
in the Territory shall be overseen by a committee initially composed of four
members (which may be adjusted by the JCT from time-to-time as long as there
remains an even number of members), with MedImmune appointing one-half of the
members and Infinity one-half of the members (the “JCT”), with a member
appointed by MedImmune being Chairman of the JCT. MedImmune and Infinity may
also appoint such non-voting ex-officio members of the JCT as each Party may
deem appropriate provided that any such ex-officio member that is not an employee
signs an appropriate confidentiality agreement.

(b)           The
JCT shall meet at the call of the Chairman, but not less than once each
calendar quarter of each year, at the offices of the Chairman or such other place designated by the
Chairman.  A quorum for the conduct of
business at any meeting of the JCT shall consist of at least one representative
of MedImmune and at least one Infinity representative.  Infinity and MedImmune shall each have one
vote and all decisions shall be by unanimous vote subject to Section 6.2(h).

(c)           By
no later than June 30 of each year, commencing with the year in which an
application for Regulatory Approval for Product is submitted, the Selling Party
shall submit to the JCT a proposed Marketing Plan for sales and marketing of Product
which is to be sold by the Selling Party in the Territory.  The Parties will agree to a reasonable
timetable for the submission of the Marketing Plan for the year in which an
initial application for Regulatory Approval is anticipated.  Each Marketing Plan shall include the
following:  (i) a budget, including an
estimate 

 37
 

 

of
Selling Expenses, Marketing Expenses and other expenses for the Product; (ii) a
price range for sales of Product; (iii) an outline of marketing and detail
strategies and tactics; (iv) Phase IV studies, if any, for Product; and (v) any
other information reasonably requested by a member of the JCT that is within
the possession of the Selling Party.  To
the extent that costs associated with items of Product Costs (including each
element of Marketing Expenses and Selling Expenses) are attributable to both
Products and products of the Parties (and their Affiliates) which are not
Products, the costs shall be allocated equitably.

(d)           The
JCT shall discuss such Marketing Plan, including any proposed amendments and/or
additions thereto, and shall decide upon a final Marketing Plan by the end of
the calendar quarter following the quarter in which the plan is submitted.  The final Marketing Plan for Product approved
by the JCT is the Marketing Plan for the following year.  Once approved, a Marketing Plan for a year
can only be amended by a decision of the JCT.

(e)           In
addition to approval of the Marketing Plan, the JCT shall direct, discuss,
review and monitor marketing of Product in accordance with the Marketing Plan,
discuss future planning for the marketing of Product and coordinate and
implement any required recall of Product. 
It is specifically understood, however, that the day-to-day management
of marketing and sales activities and the implementation of the Marketing Plan
shall be managed by the Selling Party rather than the JCT.

(f)            The
JCT for a Project shall come into existence no later than the dosing of a
patient in the first Pivotal Trial for the first Product of the Project.  Upon Regulatory Approval of the first Product
of a Project, the JCT shall also take over the oversight function of the JDT
with respect to the applicable Project.

 38
 

 

(g)           In
a calendar year, unless approved by the JCT, neither Party shall incur or enter
into contracts to incur Marketing Expenses and Selling Expenses that exceed
[***] percent ([***]%) of the amount of the budget allocated to such Party for
such calendar year under a Marketing Plan.

(h)           If
the JCT fails to reach agreement as to any matter, the Parties agree to exert
all reasonable efforts to arrive at a mutually acceptable resolution, including
a meeting between the CEO of MedImmune and the CEO of Infinity or their
designees.  In the event that there is a
vote or dispute that is within the authority of the JCT is not resolved by the
respective CEOs or their designees within thirty (30) days after submission to
the CEOs, then the Selling Party shall have the right to cast the deciding vote
with respect thereto.

6.3           (a)           During the Term, the Selling Party shall
manage and implement the marketing effort for Product pursuant to the Marketing
Plan.  The Selling Party shall keep the
Non-Selling Party advised of general market, economic and regulatory
developments that may affect the sale of Product in the Territory.

(b)           Product shall be sold under one or
more trademarks selected by the JCT.  The
Selling Party for a given Product in a given country shall be the owner of the
trademark for such Product in such country and shall be responsible for the
filing, prosecution and maintenance of such trademark(s) in such country and
shall use such trademark(s) in a manner consistent with the Marketing
Plan.  As permitted by applicable law,
all labeling, packaging and written and electronic materials (including all
advertising and Promotional Materials) associated with the Product shall
indicate that the Product was jointly developed by Infinity and MedImmune and
the Parties will grant each other any licenses to their respective trademarks
necessary to comply with the foregoing requirement.  To the extent permitted by applicable law,
such labeling, 

 39
 

 

packaging and
written and electronic materials shall give equal prominence to the logos of
the Parties.

6.4           If Infinity is not an Opt-Out Party
with respect to a Product, Infinity has the right to participate with MedImmune
in up to 35% of the promotional efforts of such Product in the United States; provided, however, that
Infinity shall provide written notice to MedImmune of its intention to
co-promote under this Section 6.4 no later than six (6) months before the
projected filing date of the first NDA for such Product.  In the event that Infinity exercises its
co-promotion right, the Parties shall execute a co-promotion agreement within
three (3) months thereafter, which (a) allocates detailing, MSL, training,
access to promotional materials and other co-promotion responsibilities between
the Parties in accordance with the above co-promotion percentage, based on
qualitative criteria such as geography, physician type, prescribing volume and
institution type, provides commercially reasonable performance standards for
the conduct of the details, and (b) grants Infinity any necessary licenses
under Collaboration Rights and MedImmune General Rights.  In the event the Parties fail to agree on the
terms and conditions of the co-promotion agreement within such timeframe, then
either Party may submit such issue to arbitration under Exhibit A.

6.5           (a)           Within sixty (60) days after the end
of each calendar quarter of each year, the Selling Party shall provide the
Non-Selling Party with a separate report of the Earnings for Product (either
positive or negative) for the calendar quarter. 
Within sixty (60) days after the end of each year, the Selling Party shall
provide the Non-Selling Party with a separate report of Earnings for Product
(either positive or negative) in the Territory for the calendar year.  Each calendar quarter and year report shall
contain the following information, itemized by Product and by country for items
(i) through (v) below:

 40
 

 

(i)            Quantity of Product sold by the
Selling Party;

(ii)           Total amount invoiced for Product;

(iii)          Calculation of Net Sales;

(iv)          Calculation of Revenues:

(v)           A separate calculation for each of
items (i) to (xi) of Section 1.60 (Product Costs) to be deducted from Earnings;

(vi)          Calculation of amount due to or to be
paid by the Non-Selling Party under Sections 6.6 or 6.7, as the case may be.

(b)           The
Selling Party shall provide the Non-Selling Party with a preliminary report
within ten (10) days after the end of each calendar quarter as to actual
positive or negative Earnings for the first two months of the applicable
calendar quarter and estimated positive or negative Earnings for the last month
of the applicable calendar quarter.

6.6           (a)           For each calendar quarter in which
the Earnings for Product are positive, the Selling Party shall pay to the
Non-Selling Party the Applicable Percentage of such positive Earnings within
thirty (30) days after the end of the applicable calendar quarter.

(b)           For
each calendar quarter in which the Earnings for a Product are negative, the
Non-Selling Party shall pay to the Selling Party the Applicable Percentage of
such negative Earnings within thirty (30) days after the Non-Selling Party
receives the report under Section 6.5 that includes such negative Earnings.

6.7           Within
thirty (30) days of the end of each calendar year, the Selling Party shall
separately determine Earnings for each Product for the calendar year and the
Non-Selling Party shall receive or pay the Applicable Percentage of the
Earnings therefore for the applicable year, adjusted for the aggregate of the
amounts received and/or paid by the Non-Selling Party under 

 41
 

 

Section
6.6 for the calendar quarters of the appropriate year.  Any payment due from the Selling Party shall
be made within thirty (30) days of the end of the applicable calendar
year.  Any payment due to the Selling
Party shall be made within thirty (30) days after the Non-Selling Party
receives the yearly report under Section 6.5.

6.8           The
Selling Party shall keep, and shall cause each of its Affiliates and
Sublicensees to keep accurate books of account containing all particulars that
may be necessary for the purpose of calculating Earnings and all payments
payable to or by the Non-Selling Party in the Territory for Product in the
Territory.  Such books of account shall
be kept at their principal place of business and,
with all necessary supporting data shall, for the three (3) years next
following the end of the calendar year to which each shall pertain be open for
inspection by an independent certified accounting firm selected by the
Non-Selling Party and reasonably acceptable to the Selling Party upon
reasonable notice during normal business hours at the Non-Selling Party’s
expense for the sole purpose of verifying payments under Article 6 of this
Agreement, but in no event more than once in each year.  All information and data offered shall be
used only for the purpose of verifying payments.  In the event that such inspection shall
indicate that in any year the payments which should have been paid by the
Selling Party are at least five percent (5%) greater than those which were
actually paid by the Selling Party, or that, in the case of negative Earnings,
the amounts that were paid by the Non-Selling Party to the Selling Party are at
least five percent (5%)  more than those
that should have been paid by the Non-Selling Party, then the Selling Party
shall pay the cost of such inspection. 
All underpayments and overpayments are immediately due and payable.  Upon the expiration of three (3) years after
a calendar year, the calculation of payments under this Article 6, shall be 

 42
 

 

binding
on both Parties except to the extent that inspection during such period
indicated an overpayment or underpayment.

6.9           For any
given calendar quarter, if any portion of Net Sales, Revenues or Product Costs
would be otherwise determined in currency other than U.S. dollars then, for the
purposes of calculating payments due under this Article 6, or under Article 13
that portion of Net Sales, Revenues or Product Costs attributable to each type
of such currency will be converted to U.S. dollars in the following manner:

(a)           Net
Sales, Revenues or Product Costs will be determined in its original currency
for each of the three (3) months during the calendar quarter; then

(b)           the Net
Sales, Revenues or Product Costs values for each month as calculated under
Section 6.9(a) will be separately converted into U.S. dollars based on the
average rate of exchange for that month (based on daily noon buying rates for
cable transfers in New York City certified for customs purposes by the Federal
Reserve Bank of New York, available on the website for the Board of Governors
of the Federal Reserve System (or any successor entity)); and then

(c)           the portion
of Net Sales, Revenues or Product Costs attributable to that currency for that
calendar quarter will be the sum of the three (3) monthly values calculated
under Section 6.9(b).

6.10         (a)           The Selling Party shall pay the cost
and expense of insurance premiums for the Non-Selling Party with respect to
Product in the applicable countries of the Territory,  which payments shall be included as Product
Costs.

(b)           Except as
provided in Section 6.10(c), the Selling Party shall be responsible for paying
all royalties owed to a Third Party for Product either for its own account 

 43
 

 

or for
the Non-Selling Party’s account, as applicable (provided that the Non-Selling
Party has notified the Selling Party in writing of the payments due to any such
Third Party), which payments shall be included as Product Costs.

(c)           In the
event that [***], Infinity [***] under the terms and conditions of this
Agreement.  If [***], Medimmune
[***].  In either event [***].

6.11         (a)           If
any governmental authority having jurisdiction requires or reasonably requests
recall of Product due to a defect in the manufacture, processing, packaging or
labeling of Product or for any other reason whatsoever, the Selling Party shall
immediately notify the Non-Selling Party and the JCT.

(b)           Prior to commencing
any recall, the Selling Party shall review with the JCT the proposed manner in
which the recall is to be carried out.

(c)           The Selling Party
shall carry out the recall in as expeditious a manner as possible and in such a
way as to cause the least disruption to the sales of the Product and to
preserve the goodwill and reputation attached to the Product and to the names
of the Selling Party and the Non-Selling Party.

(d)           The
Selling Party agrees that appropriate records and procedures will be maintained
to permit a recall of Product.

(e)           The
Parties shall equally share any and all Recall Expense of Product incurred
pursuant to this Section 6.11 or that is incurred for recall of Product
authorized by the JCT, in each case with respect to Product sold prior to the
Opt-Out Date for a Project of such Product, and thereafter such Recall Expense
shall be at the cost and expense of the Selling Party.

 44

 

6.12         In
the event that a Party does not make payments to the other Party that are due
under this Agreement, such other Party shall have the right to set-off and
deduct such unpaid amounts from amounts payable to the owing Party.

ARTICLE 7

PAYMENTS BY MEDIMMUNE

7.1         MedImmune shall pay Infinity seventy
million dollars ($70,000,000).  Such
payment shall be made in two tranches of thirty-five million dollars each, with
the first tranche to be paid within thirty (30) days after the Effective Date
and the second tranche to be paid by wire transfer on (and not before) January
5, 2007.

7.2         Subject to the last sentence of this
Section 7.2, MedImmune shall pay the following amounts within thirty (30) days
of each achievement of the following events in connection with one or more
Hedgehog Therapeutics as to which MedImmune is not an Opt-Out Party and which
has been developed pursuant to an approved Research and Development Plan:

(a)(i) [***] dollars
($[***]);

(a)(ii) [***] dollars
($[***]);

(a)(iii) [***] dollars
($[***]); and,

(a) (iv) [***] dollars
($[***])

(b)(i)       [***] dollars ($[***]);

(b)(ii) [***] dollars
($[***]);

(b)(iii) [***] dollars
($[***]); and,

(b)(iv) [***] dollars
($[***])

 45
 

 

Each
of the payments of Section 7.2(a) and (b) is due thirty (30) days after achieving
the milestone and is due once for each of the milestones.

In
no event shall the aggregate of payments under this Section 7.2 exceed [***]
dollars ($[***]).

7.3           Subject to the last sentence of this
Section 7.3, MedImmune shall pay the following amounts within thirty (30) days
of each achievement of the following events in connection with one or more
Hsp90 Therapeutics as to which MedImmune is not an Opt-Out Party and which has
been developed pursuant to an approved Research and Development Plan.

(a)(i)
[***] dollars ($[***]);

(a)(ii) [***] dollars
($[***]);

(a)(iii) [***] dollars
($[***]); and,

(a) (iv) [***] dollars
($[***])

(b)(i)       [***] dollars ($[***]);

(b)(ii) [***] dollars
($[***]) ;

(b)(iii) [***] dollars
($[***]); and,

(b)(iv) [***] dollars
($[***])

Each
of the payments of Section 7.3(a) and (b) is due thirty (30) days after
achieving the milestone and is due once for each of the milestones.

In
no event shall the aggregate of payments under this Section 7.3 exceed [***]
dollars ($[***]).

7.4           Subject to the last sentence of this
Section 7.4.  MedImmune shall pay
Infinity the following amounts:

(a)           [***] dollars [***] dollars
($[***]).  

 46
 

 

(b)           [***] dollars [***] dollars ($[***]).

Worldwide
Net Sales of Hsp 90 Products with different APIs and Worldwide Net Sales of
distinct Hsp 90 Products shall not be aggregated for the purpose of this
Section 7.4.

Each
of the payments under each of Sections 7.4(a) and (b) is a one-time payment and
shall be paid within thirty (30) days after the end of the applicable calendar
year.  The aggregate of payments under
this Section 7.4 shall not exceed $[***].

7.5           Subject to the last sentence of this
Section 7.5.  MedImmune shall pay
Infinity the following amounts:

(a)           [***] dollars [***] dollars ($[***]).

(b)           [***] dollars [***] dollars ($[***]).

Worldwide
Net Sales of Hedgehog Products with different APIs and Worldwide Net Sales of
distinct Hedgehog Products shall not be aggregated for the purposes of this
Section 7.5.

Each
of the payments under each of Sections 7.5(a) and (b) is a one-time payment and
shall be paid within thirty (30) days after the end of the applicable calendar
year.  The aggregate of payments under
this Section 7.5 shall not exceed $[***].

7.6           For the purposes of this Article 7, a
Product that contains the same API as another Product only in a different
formulation shall not be considered a “distinct” Product unless the difference
in formulations results in two Products with commercially material different
product profiles such as two formulations that provide for different routes of
administration, and such two formulations if used for the same Indication,
significantly expands the patient population for such Indication as compared to
a single formulation.

 47
 

 

ARTICLE 8

INTELLECTUAL PROPERTY RIGHTS

8.1           (a)           All
right, title and interest in all Infinity General Rights and all Infinity
Existing Rights shall be owned by Infinity and shall be subject to the licenses
granted to MedImmune under Article 5 hereof. 
Infinity shall promptly disclose, if
requested and reasonably useful, to MedImmune any Infinity General Patent
Rights licensed to MedImmune promptly after filing thereof.

(b)           All right, title and
interest in all MedImmune General Rights shall be owned by MedImmune and shall
be subject to the license granted to Infinity under Article 5 hereof.  MedImmune shall
promptly disclose, if requested and reasonably useful,  to Infinity any MedImmune General Patent Rights licensed to Infinity promptly
after filing thereof.

(c)           Infinity and
MedImmune shall each own an undivided one-half interest in Collaboration
Rights.  The Parties shall sign and
execute all papers and take any actions reasonably required to perfect the
one-half ownership interest of each Party in and to Collaboration Rights.  Each Party
shall promptly disclose to the other Party any Collaboration Invention promptly
after it is conceived, reduced to practice or developed.

(d)           Neither Party shall (i) use, exploit,
license or grant rights to Collaboration Rights except in connection with
development and commercialization of the Products in the Field pursuant to this
Agreement and otherwise in accordance with the terms and conditions of this
Agreement, including Sections 5.4 and 5.6 or (ii) except to the extent
permitted by this Agreement enforce Collaboration Rights without the express
written permission of the other Party and only pursuant to an agreement that
defines the rights and obligations of the Parties.

 48
 

 

8.2           (a)           Infinity
will be responsible for filing, prosecuting and maintaining patent protection
for the Infinity Existing Patent Rights; provided
that Infinity agrees to consult with MedImmune regarding the patent filing,
prosecution and maintenance decisions with respect to Infinity Existing Patent
Rights, to furnish to MedImmune copies of all material documents relevant to
the filing, prosecution and maintenance in sufficient time to allow for review
by MedImmune, and to consider in good faith any and all comments by MedImmune
prior to taking any action to implement such decisions; and provided  further
that, if Infinity intends not to file or to abandon any such Infinity Existing
Patent Right, then Infinity will provide written notice of such intention to
MedImmune within sufficient time for MedImmune to undertake such filing or
maintenance and MedImmune will thereafter have the right, but not the
obligation, at its sole expense, to pursue such Infinity Existing Patent Right
in Infinity’s name.  MedImmune shall pay
one-half of the cost and expense incurred after the Effective Date for filing,
prosecuting and maintaining such patent protection (but not including those
costs paid entirely by Infinity as provided in Section 8.5); provided, however,
if MedImmune becomes an Opt-Out Party for a Project as of the applicable
Opt-Out Date, MedImmune shall not be responsible for such cost and expenses of
Infinity Existing Patent Rights with respect to such Project.

(b)           Each Party shall have the exclusive
right to file, prosecute and maintain, in its sole discretion and at its sole
expense, any and all of its General Patent Rights.

(c)           MedImmune shall have primary
responsibility for the filing, prosecution and maintenance of any Collaboration
Patent Right.  MedImmune shall not
abandon or not prosecute or not maintain any such Collaboration Patent Right in
any country without the consent of Infinity. 
MedImmune and Infinity shall reach joint agreement as to the strategy
for 

 49
 

 

filing, prosecuting and maintaining such Collaboration
Patent Rights.  Each of MedImmune and
Infinity shall pay one-half of the cost and expense thereof.

8.3           Infinity and MedImmune shall each
promptly notify the other in writing of any alleged or threatened infringement
with respect to a Product of the Patent Rights owned by or licensed to the
Selling Party of such Product, of which they become aware.  To the extent that neither Party is an
Opt-Out Party with respect to such Product, the Parties shall mutually agree
whether to take any action to obtain a discontinuance of such infringement or
to bring suit against the Third Party infringer and if one of the Parties is an
Opt-Out Party with respect to such Product, such decision shall be made by the
Selling Party.  If the Parties do not
reach such mutual agreement, then either Party may submit such issue to arbitration
under Exhibit A.  If a suit is brought,
the Selling Party shall bring such suit (the “Enforcing Party”).  To the extent requested by the Enforcing
Party, the other Party shall join such suit as a party thereto but in such case
shall not be permitted to engage its own counsel unless it does so at its own
expense.  In no event shall the Enforcing
Party enter into any settlement which admits or concedes that any Patent Rights
owned by the other Party or Collaboration Patent Rights is invalid or unenforceable
without the prior written consent of the other Party.  The Parties will reasonably cooperate with
each other in any such suit or action. 
The Parties shall keep each other reasonably informed of all material
developments in connection with any such claim, suit or proceeding.  The Enforcing Party shall collect any damages
obtained in such suit or pursuant to a settlement thereof and such amount shall
be included in Product Revenues.  With
respect to any such suit that is brought prior to a Party becoming an Opt-Out
Party with respect to the Product of such suit, each Party shall bear one-half
of the cost and expense thereof incurred in 

 50
 

 

accordance with this
Section 8.3, with each Party paying the other Party its share thereof within
thirty (30) days of invoice therefor.

8.4           In the event of the institution of
any suit by a Third Party for patent infringement involving the use, sale,
distribution or marketing of any Product in the Territory the cost, expense,
liability and defense of such suit shall be in accordance with the
indemnification provisions of Article 11.

8.5           In the event of [***], Infinity shall have primary responsibility for
managing such proceedings, at its sole expense. 
Infinity will consult with MedImmune regarding all material decisions
during such proceedings and will consider in good faith any and all comments by
MedImmune prior to taking any action to implement such decisions.

8.6           Notwithstanding Section 8.4, in the
event of any suit by a Third Party for patent infringement involving the use,
sale, distribution, or marketing of any Product in the Territory asserting
infringement of any of the patents (or any patents issuing from the
applications) listed in the Disclosure Schedule, Infinity shall defend such
action at its sole expense in accordance with Article 11.   In accordance with Article 11, Infinity shall
assume full responsibility for the payment of any award for damages, or any
amount due pursuant to any settlement entered into with the Third Party and,
for the avoidance of doubt, such payment shall not be included in Product
Costs.  Infinity shall not enter into any
settlement of any such suit that is adverse to the interests of MedImmune in
such Product.

 51
 

 

ARTICLE 9

CONFIDENTIALITY

9.1           Confidential Information.

(a)           In connection with the performance of
their respective obligations under this Agreement, each Party (the “Disclosing Party”) shall disclose
certain confidential information to the other Party (the “Recipient”), (the “Confidential Information”).  With respect to Collaboration Rights that are
Confidential Information each Party is both a Disclosing Party and a
Recipient.  Confidential Information
disclosed in writing shall be marked “confidential” or with a similar legend
indicating its proprietary nature. 
During the Term and for a period of five (5) years thereafter, the
Recipient shall maintain all Confidential Information of the Disclosing Party
in strict confidence, except that the Recipient may disclose or permit the
disclosure of any such Confidential Information to its directors, officers,
employees, consultants and advisors who are obligated to maintain the
confidential nature of such Confidential Information.  In addition, the Recipient may use or
disclose Confidential Information of the Disclosing Party solely in exercising
its rights and licenses granted hereunder or to fulfill its obligations and/or
duties hereunder provided that such disclosure is made to a person or entity
who is obligated to confidentiality and non-use obligations similar to those of
this Section 9.1 and subject to Section 9.1(c) in prosecuting or defending
litigation, complying with applicable governmental regulations and/or
submitting information to tax or other governmental authorities.

(b)           The obligations of confidentiality
and non-use set forth above shall not apply to the extent that the Recipient
can demonstrate that Confidential Information: 
(i) was in the public domain prior to the time of its disclosure under
this Agreement; (ii) entered the public domain after the time of its disclosure
under this Agreement other than through acts or omissions of the 

 52
 

 

Recipient; (iii) is or
was disclosed to the Recipient at any time, whether prior to or after the time
of its disclosure under this Agreement, by a Third Party having no fiduciary
relationship with the Disclosing Party and having no obligation of
confidentiality with respect to such Confidential Information; (iv) is
independently developed by the Recipient without access to Confidential
Information of the Disclosing Party as evidenced by written records; or (v) was
known by Recipient at the time of receipt from Disclosing Party as documented
by Recipient’s records.

(c)           In addition, the Recipient may
disclose Confidential Information of the Disclosing Party to the extent
necessary to comply with applicable laws and regulations, or with a court or
administrative order, provided that the Disclosing Party receives prior written
notice of such disclosure, to the extent reasonably possible, and that the
Recipient takes all reasonable and lawful actions to obtain confidential
treatment for such disclosure and, to the extent possible, to minimize the
extent of such disclosure.

(d)           Notwithstanding the obligations in
Section 9.1(a), a Party may disclose
Confidential Information of the other Party, if such disclosure:

(i)            is made to governmental
or other regulatory agencies in order to obtain Collaboration Patent Rights or
to exercise rights or perform obligations under this Agreement to gain or
maintain approval (A) to conduct clinical trials with respect to Products or
(B) to market Products, but such disclosure may be only to the extent
reasonably necessary to obtain such Patent Rights or authorizations; or

(ii)           is disclosed to
Affiliates, Sublicensees, agents, consultants, or other Third Parties for the
development or commercialization of Product(s) in accordance with this
Agreement, or in connection with an assignment of this 

 53
 

 

Agreement,
or a permitted licensing transaction related to Product(s) or loan, financing
or investment or acquisition, merger, consolidation or similar transaction (or
for such entities to determine their interest in performing such activities),
in each case on the condition that any Third Parties to whom such disclosures
are made agree to be bound by confidentiality and non-use obligations
substantially similar to those contained in this Agreement.

(iii)          consists entirely of Confidential Information previously approved
by Disclosing Party for disclosure by the Recipient.

9.2           Publicity; Attribution; Terms of
this Agreement; Non-Use of Names.

(a)           Except
as required by judicial order or applicable law or regulation or as set forth
below, neither Party shall make any public announcement concerning this
Agreement without the prior written consent of the other Party which consent
shall not be unreasonably withheld or delayed. 
The Party preparing any such public announcement shall provide the other
Party with a draft thereof at least five full Business Days prior to the date
on which such Party would like to make the public announcement.  Notwithstanding the foregoing, the Parties
shall be entitled to issue a press release to announce the execution of this
Agreement as approved by the Parties. 
Neither Party shall use the name, trademark, trade name or logo of the
other Party or its employees in any publicity or news release relating to this
Agreement or its subject matter, without the prior express written permission
of the other Party.

(b)           Notwithstanding
the terms of this Article 9, either Party shall be permitted to disclose
the existence and terms of this Agreement to the extent required, in the
reasonable opinion of such Party’s legal counsel, to comply with applicable
laws, rules or regulations, including without limitation the rules and
regulations promulgated by the United States 

 54
 

 

Securities
and Exchange Commission or any other governmental agency.  Notwithstanding the foregoing, before
disclosing this Agreement or any of the terms hereof pursuant to this Section
9.2(b), the Parties will consult with one another on the terms of this
Agreement for which confidential treatment will be sought in making any such
disclosure.  If a Party wishes to
disclose this Agreement or any of the terms hereof in accordance with this
Section 9.2(b), such Party agrees, at its own expense, to seek confidential
treatment of the portions of this Agreement or such terms as may be reasonably
requested by the other Party, provided that the disclosing Party shall always
be entitled to comply with legal requirements, including without limitation the
requirements of the SEC.

(c)           Either
Party may also disclose the existence and terms of this Agreement in confidence
to its attorneys and advisors, and to potential acquirors (and their respective
professional advisors), in connection with a potential merger, acquisition or
reorganization and to existing and potential investors or lenders of such
Party, as a part of their due diligence investigations, or to potential
permitted sublicensees of Product or to permitted assignees in each case under
an agreement to keep the terms of this Agreement confidential under terms of
confidentiality and non-use substantially similar to the terms contained in
this Agreement and to use such confidential information solely for the purpose
permitted pursuant to this Section 9.2(c).

9.3           Each Party recognizes the mutual
interest in obtaining valid patent protection. 
Consequently, a Party or any of its Affiliates, or any of its or their
respective employees, consultants or collaborators wishing to make a
publication (including any oral disclosure made without obligation of confidentiality)
relating to work performed as part of a Project (the “Publishing Party”)
shall transmit to the other Party (the “Reviewing Party”) a copy of the
proposed publication at least thirty (30) days prior to submission for
publication.  The Reviewing 

 55
 

 

Party shall have
the right to (a) request a delay in publication or presentation in order to
protect patentable information, (b) propose modifications to the publication
for patent reasons or (c) request that the information be maintained as a trade
secret.

If
the Reviewing Party requests a delay as described in clause (a) above, the
Publishing Party shall delay submission or presentation of the publication for
a period of ninety (90) days to enable patent applications protecting each
Party’s rights in such information to be filed. 
Upon the expiration of forty-five (45) days from transmission of such
proposed disclosures to the Reviewing Party, the Publishing Party shall be free
to proceed with the written publication or the oral presentation, respectively,
unless the Reviewing Party has requested the delay described above.

To the extent
possible in the reasonable exercise of its discretion, the Publishing Party
shall incorporate all modifications proposed under clause (b) above.  If the subject of a request made under clause
(c) above cannot be otherwise protected without unreasonable expense to the
Reviewing Party, such information shall be omitted from the publication.  Confidential Information of a Party shall not
be included in a publication without the written consent of such Party.

ARTICLE 10

REPRESENTATIONS AND WARRANTIES

10.1         Each Party represents and warrants to
the other that it has the legal right and power to enter into this Agreement,
and to fully perform its obligations hereunder, and that it has not made nor
will it make any commitments to others in conflict with or in derogation of
such rights or this Agreement.

 56
 

 

10.2         As of the Effective Date, Infinity
represents and warrants to MedImmune that, except as set forth on the
Disclosure Schedule:

(a)           it has the right to grant the rights
and licenses granted to MedImmune under this Agreement and such licenses have
been validly granted;

(b)           it
has provided MedImmune with all material information in Infinity’s possession
and control that, to Infinity’s knowledge, concerns Patent Rights of Third
Parties that are related to the use, manufacture, development or
commercialization of Product.  To the
knowledge of Infinity, other than as disclosed to MedImmune during their due
diligence investigation, and other than as outlined in the Disclosure
Schedule: (i) it has not received from a Third Party, nor has any actual
knowledge that any Third Party intends to assert any claim that the practice of
the Infinity Existing Patent Rights or use of the Infinity Existing Know-How
infringes the intellectual property rights of a Third Party and (ii) there are no granted Patent Rights or pending Patent
Rights (if issued) that would be infringed by manufacture, use, sale, offer to
sell or import of a Product that is being researched or developed by Infinity
as of the Effective Date;

(c)           it has not previously assigned,
transferred, conveyed or otherwise encumbered its right, title and interest
with respect to Product or in the Infinity Existing Patent Rights, or the
Infinity Existing Know-How, in a manner that conflicts and/or is inconsistent
with the rights granted to MedImmune under this Agreement;

(d)           to Infinity’s knowledge, there are no
legal claims, judgments or settlements against or owed by Infinity or pending
or threatened legal claims or litigation, in each case relating to Product or
the Infinity Existing Patent Rights or Infinity Existing Know-How;

(e)           to Infinity’s knowledge, all
necessary consents, approvals and authorizations of all government authorities
and other persons required to be obtained by Infinity 

 57
 

 

as of
the Effective Date in connection with the execution, delivery and performance
of this Agreement have been obtained including but not limited to consent from
Discovery Partners International, Inc.;

(f)            the Patent Rights listed in Exhibit
Y (i.e., the Infinity Existing Patent rights) constitute all Patent Rights
controlled by Infinity that directly relate to the research, development, and
commercialization of a Product, and Infinity owns all right, title and interest
in and to the Patent Rights of Exhibit Y.   For the avoidance of doubt,
for purposes of the foregoing, Patent Rights that are “directly related to” the
research, development and commercialization of a Product shall not include
general formulations and general manufacturing methodologies; and

(g)           it has provided MedImmune with all
material information known to Infinity with respect to work performed by or on
behalf of Infinity with respect to research and development of Product
including all efficacy, safety and toxicity data and to the knowledge of
Infinity such information is accurate in all material respects.

10.3         As of the Effective Date, MedImmune
represents and warrants to Infinity that:

(a)           it has the right to grant the rights
and licenses granted by MedImmune under this Agreement and such licenses have
been validly granted; and

(b)           neither MedImmune nor its Affiliates control any Patent Rights,
Inventions, or Know-How that directly relate to the
research, development, and commercialization of a Product, with “directly
relate to” having the same meaning as “directly related to” in Section 10.2(f).

10.4         EXCEPT AS OTHERWISE EXPRESSLY PROVIDED
IN THIS AGREEMENT, NEITHER INFINITY NOR MEDIMMUNE MAKES ANY WARRANTY, EXPRESS
OR IMPLIED, WITH RESPECT TO THE QUALITY OF ANY KNOW-HOW OR PATENT 

 58
 

 

RIGHTS OR OTHER
SUBJECT MATTER OF THIS AGREEMENT AND EACH PARTY HEREBY DISCLAIMS WARRANTIES OF
MERCHANTABILITY AND FITNESS FOR A PARTICULAR PURPOSE AND ANY WARRANTY OR
REPRESENTATION REGARDING CLINICAL EFFECTIVENESS OF THE PRODUCT MANUFACTURED OR
THAT ANY PATENT IS VALID OR THAT ANY PATENT APPLICATION WILL BE GRANTED OR THAT
PRODUCT OR MANUFACTURE, SALE OR USE THEREOF DOES NOT INFRINGE PATENTS OWNED BY
A THIRD PARTY.

10.5         Limitation of Liability.  Except with respect to an obligation of
either Party to indemnify the other hereunder, neither Party shall be liable to
the other for consequential, incidental, indirect or punitive damages arising
from the performance or nonperformance of such Party under this Agreement
whether such claim is based on contract, tort (including negligence) or
otherwise, even if an authorized representative of such Party is advised of the
possibility or likelihood of same.

ARTICLE 11

INDEMNITY

11.1         Allocation of Liability for Third
Party Claims

(a)           Except as provided in Section
11.1(d), with respect to each Project, and the Products thereof, each Party
shall bear fifty percent (50%) of all Losses and Litigation Expenses incurred
by or awarded against (i) either Party, (ii) the Affiliates of either Party, or
(iii) the respective directors, officers, employees, shareholders,
representatives, and agents of the Parties and their Affiliates (such entities
and persons described in clauses (ii) and (iii), collectively, “Agents”)
arising from Claims of Third Parties to the extent such Claims result from
activities under this Agreement prior to the first Opt-Out Date for such
Project of either Party or its Agents

 59
 

 

or
their permitted (sub)licensees, regardless of whether such Claim is brought
before or after such Opt-Out Date, except to the extent such Losses and
Litigation Expenses result from a Claim described in Section 11.1(c), in which
case, to such extent Section 11.1(c) shall apply.

(b)           Except as provided in Section
11.1(d), with respect to each Project and the Products thereof, the Selling
Party shall bear one hundred percent (100%) of all Losses and Litigation
Expenses incurred by or awarded against either Party or their respective Agents
arising from Claims of Third Parties to the extent such Claims result from
activities under this Agreement following the first Opt-Out Date for such
Project by the Selling Party or its Agents or their permitted (sub)licensees, except to the extent such
Losses and Litigation Expenses result from a Claim described in Section
11.1(c), in which case, to such extent Section 11.1(c) shall apply.

(c)           Except as provided in Section
11.1(d), each Party shall bear one hundred percent (100%) of all Losses and
Litigation Expenses incurred by or awarded against either Party or their
respective Agents arising from Claims of Third Parties to the extent such
Claims result from:

(i)            such Party’s or its Agents’
intentional and material misrepresentation of a Product or its characteristics
not in accordance with the labeling thereof;

(ii)           such Party’s material breach of any
warranty or representation made by it under this Agreement; or

(iii)                               such
Party’s or its Agents’ intentional misconduct.

(d)           Notwithstanding Sections 11.1(a),
11.1(b), and 11.1(c), Infinity shall bear one hundred percent (100%) of all
Losses and Litigation Expenses incurred by or awarded against either Party or
their respective Agents to the extent arising from Claims of Third Parties that
any 

 60
 

 

Patent
Right listed in the Disclosure Schedule is infringed by the making, using,
offering for sale, sale or importation of a Product.

11.2         Control of Third Party Claims.

(a)           (i)            With
respect to a Claim described in Section 11.1(a), the Parties shall meet to
discuss which Party shall assume and control the defense of such Claim.  If the Parties cannot come to an agreement
within ten (10) days of such meeting, MedImmune shall assume the defense of
such Claim.

(ii)           Notwithstanding clause (i) above,
with respect to a Product Liability Claim or Infringement Claim described in
Section 11.1(a), the Parties shall meet to discuss which Party shall assume the
defense of such Claim.  If the Parties
cannot come to an agreement within ten (10) days of such meeting, the Selling
Party shall assume the defense of such Claim.

(b)           Notwithstanding Section 11.2(a), to
the extent any Party has been allocated 100% of the Losses and Litigation
Expenses with respect to a Claim pursuant to Section 11.1, such Party shall
assume and control the defense of such Claim.

(c)           Notwithstanding Sections 11.2(a) and
11.2(b), to the extent Losses resulting from a Claim are likely to be
apportioned between the Parties in accordance with Sections 11.1, the Party who
is likely to be apportioned more Losses and Litigation Expenses shall assume
and control the defense of the Claim.

(d)           The Party who assumes defense of a
Claim pursuant to the foregoing shall be the “Controlling Party” and the
other Party shall be the “Assisting Party.”

 61
 

 

 

11.3         Indemnification
Procedure for Unshared Claims.

(a)           This Section 11.3 shall apply with
respect to Claims for which one Party has been allocated 100% of the Losses and
Litigation Expenses pursuant to Section 11.1 (each, an “Unshared Claim”).  For purposes of this Section 11.3, the
Controlling Party shall be referred to as the “Indemnifying Party” and
the Assisting Party shall be referred to as the “Indemnified Party.”

(b)           The Indemnified Party will promptly
inform the Indemnifying Party in writing of any Unshared Claim of which it
becomes aware, and the Indemnifying Party shall assume the defense thereof with
counsel mutually satisfactory to the Parties; provided, however, that the
Indemnified Party shall have the right to retain its own counsel, with the fees
and expenses paid to be considered a Loss or Litigation Expense, as applicable,
to be allocated in accordance with Section 11.1 only if representation of such
Indemnified Party by the counsel retained by the Indemnifying Party would be
inappropriate due to actual or potential conflicting interests between the
Indemnified Party and any other party represented by such counsel provided, however,
the Indemnifying Party shall control the defense thereof.  The Indemnified Party’s failure to deliver
written notice to the Indemnifying Party within a reasonable amount of time of
the commencement against it or its Agents or receipt by it or its Agents of any
Unshared Claim, to the extent materially prejudicial to the ability of the
Indemnifying Party to defend such Unshared Claim, shall relieve the
Indemnifying Party of any liability to the Indemnified Party with respect
thereto under Section 11.1.

(c)           The Indemnified Party agrees to
render such assistance and cooperation as may reasonably be requested by the
Indemnifying Party for the defense or disposition of all such 

 62
 

 

Unshared Claims.  Any and all reasonable costs incurred by the
Indemnified Party in such assistance or cooperation as aforesaid shall be
considered a Loss or Litigation Expense, as applicable, to be allocated in
accordance with Section 11.1.

(d)           Any settlement of an Unshared Claim
by the Indemnifying Party that would admit liability on the part of the
Indemnified Party or its Agents, or that would involve any relief other than
the payment of money damages, shall be subject to the prior written approval of
both Parties, such approval not to be unreasonably withheld or delayed.

(e)           The Indemnified Party shall not (i)
compromise or settle any Unshared Claim without prior written approval from the
Indemnifying Party, which approval the Indemnifying Party may grant or withhold
in its sole discretion, or (ii) make any statement or admission to any Third
Party with respect to the Indemnifying Party’s liability or the availability of
the compensation from the Indemnifying Party under this Agreement with respect
to an Unshared Claim without the prior written approval from the Indemnifying
Party, which approval the Indemnifying Party may grant or withhold in its sole
discretion, unless, otherwise prescribed by an applicable law or regulation or
a court order, or (iii) make any statement or admission as to liability with
respect to an Unshared Claim.

(f)            To the extent that, in connection
with the defense of an Unshared Claim, an Indemnified Party incurs Litigation
Expenses that are permitted by this Section 11.3, the Indemnifying Party shall
reimburse the Indemnified Party for such Litigation Expenses on an ongoing
basis within thirty (30) days of invoice therefor.

 63
 

 

 

11.4         Indemnification Procedure for Shared
Claims.

(a)           This Section 11.4 shall apply with
respect to Claims for which both Parties have been allocated some of the Losses
and Litigation Expenses pursuant to Section 11.1 (each, a “Shared Claim”).

(b)           Each Party will promptly inform the
other Party in writing of any Shared Claim of which it becomes aware.  The failure of a Party to deliver written
notice to the other Party within a reasonable amount of time of the
commencement against it or its Agents or receipt by it or its Agents of any
Shared Claim, to the extent materially prejudicial to the ability of the
Parties to defend such Shared Claim, shall relieve such Party of any liability
to the Party that failed to give prompt notice with respect thereto under
Section 11.1.

(c)           The Controlling Party shall promptly
assume the defense of a Shared Claim with counsel mutually satisfactory to the
Parties; provided, however, that the Assisting Party shall
have the right to retain its own counsel, and the fees and expenses therefor
shall be considered a Loss or Litigation Expense, as applicable, to be
allocated in accordance with Section 11.1 if representation of the Assisting
Party by the counsel retained by the Controlling Party would be inappropriate
due to actual or potential conflicting interests between the Assisting Party
and any other party represented by such counsel.

(d)           The Assisting Party agrees to render
such assistance and cooperation as may reasonably be requested by the
Controlling Party for the defense or disposition of any Shared Claim.  Any and all reasonable costs incurred by
Assisting Party in such assistance or 

 64
 

 

cooperation as aforesaid
shall be considered a Loss or Litigation Expense, as applicable, to be
allocated in accordance with Section 11.1.

(e)           The Controlling Party shall consult
with the Assisting Party on all material aspects of the defense, including
without limitation settlement, of the Shared Claim and the Parties shall
cooperate fully with each other in connection therewith.  The Assisting Party shall also have the right
to participate in the defense of any Shared Claim, utilizing attorneys of its
choice, at its own expense.  In
furtherance of the Parties’ cooperation, the Controlling Party will consult
with the Assisting Party regarding strategic decisions, including without
limitation the retention of counsel and defense of each Shared Claim provided, however,
the Controlling Party shall control the defense of any Shared Claim.  The Controlling Party will otherwise keep the
Assisting Party fully informed of the status and progress of the defense and
any settlement discussions concerning the Shared Claim.

(f)            Neither Party shall (i) compromise or
settle any Shared Claim without prior written approval from the other Party,
which approval the other Party may grant or withhold in its sole discretion, or
(ii) make any statement or admission to any Third Party with respect to the
other Party’s liability or the availability of the compensation from the other
Party under this Agreement with respect to a Shared Claim without the prior
written approval from the other Party, which approval the other Party may grant
or withhold in its sole discretion, unless, otherwise prescribed by an
applicable law or regulation or a court order, or (iii) make any statement or
admission as to liability with respect to a Shared Claim.

(g)           (i)            To
the extent that, in connection with the defense of a Shared Claim, the
Controlling Party incurs Litigation Expenses that are allocated in Section
11.1, the Assisting 

 65
 

 

Party shall reimburse the
Controlling Party for fifty percent (50%) of such Litigation Expenses on an
ongoing basis within thirty (30) days of invoice therefor.

(ii)           To the extent that, in connection
with the defense of a Shared Claim, the Assisting Party incurs Litigation
Expenses that are permitted by this Section 11.4, the Controlling Party shall
reimburse the Assisting Party for fifty percent (50%) of such Litigation
Expenses on an ongoing basis within thirty (30) days of invoice therefor.

(iii)          Notwithstanding the percentage of
fifty percent (50%) set forth in clauses (i) and (ii) above, in the event that,
pursuant to Section 11.1 a different allocation of Litigation Expenses is
applicable, such allocation shall be used in placed of the fifty percent (50%)
set forth above.  In the event that the
applicable allocation cannot be determined at the outset of the Claim, the
fifty percent (50%) allocation shall be used until such time as the new
applicable percentages are determined. 
Once the new applicable percentages are determined, (A) the Party that
has under-reimbursed the other Party’s Litigation Expenses to date pursuant to
clauses (i) and (ii) shall make a true-up payment applying the new applicable
percentage retroactively and (B) going forward, the Parties shall use the new
applicable percentages with respect to reimbursement of Litigation Expenses
pursuant to clauses (i) and (ii).

ARTICLE 12

OPT-OUT

12.1         On a Project-by-Project basis, either
Party by written notice to the other Party shall have the right within its sole
discretion to Opt-Out of a Project which notice shall take effect with respect
to such Project six (6) months after such written notice.  The date on which such notice takes effect
for a Project is the “Opt-Out Date” for the Project, and, as of the
Opt-Out 

 66
 

 

Date, the Party
that provides such notice is the “Opt-Out Party.”  In the event that a Party receives written
notice with respect to a Project under this Section 12.1, such receiving Party,
within twenty (20) days thereafter, shall have the right by written notice to
also opt-out of such Project, in which case, as of the applicable Opt-Out Date
as determined by the first notice, each Party shall be an Opt-Out Party and
neither Party shall be a Selling Party or a Non-Selling Party.  In addition, at any time after the Opt-Out
Date for a Project, the other Party may subsequently opt-out of such Project by
written notice to the first Opt-Out Party, in which case, both Parties shall be
Opt-Out Parties.  If both parties are
Opt-Out Parties, they shall work together to maximize the value of the Project,
e.g. through the out-license or sale of the remaining assets.

12.2         After the Opt-Out Date for a Project,
the Opt-Out Party (i) shall no longer be obligated to perform work under a
Research and Development Plan or Marketing Plan for such Project and/or to pay
the Applicable Percentage of Development Costs for such Project, (ii) shall not
be entitled to receive the Applicable Percentage of positive Earnings for
Product of such Project, (iii) shall no longer be obligated to pay the
Applicable Percentage of negative Earnings for Product of such Project and (iv)
shall be entitled to receive the Royalty Percentage of Worldwide Net Sales of
Royalty Bearing Product for such Project in each case in accordance with
Article 13.  After the Opt-Out Date for a
Project, the JDT, Primary Contact Persons, project team and JCT shall
discontinue their functions with respect to such Project and Products of such
Project, and the Party that is not the Opt-Out Party shall have the right to
make any and all decisions with respect to such Project and Products of such
Project.

 67

 

ARTICLE 13

PAYMENTS

13.1         (a)           For
each Project as to which a Party becomes an Opt-Out Party, the other Party if
it has not also become an Opt-Out Party shall pay the Opt-Out Party royalties
on Worldwide Net Sales of each Royalty Bearing Product for such Project based
on the Royalty Percent of Worldwide Net Sales applicable for each Product in
such Project and the Opt-Out Date therefor as set forth in Section 1.69.

(b)           The royalties
payable under Section 13.1(a) only apply to both (i) any Royalty Bearing Product
that includes an Active Pharmaceutical Ingredient that was researched and/or
developed pursuant to a Research and Development Plan prior to the Opt-Out Date
for the applicable Project, and (ii) any Royalty Bearing Product sold in a
country that infringes a Valid Claim of Collaboration Patent Rights and/or
Infinity Existing Patent Rights and/or Patent Rights licensed to the Selling
Party by the other Party pursuant to this Agreement in the country where
sold.  In each of the foregoing cases,
royalties will be paid on a country-by-country and Royalty Bearing
Product-by-Royalty Bearing Product basis for a period beginning on the Opt-Out
Date and ending on the later of (i) in each country, ten (10) years after First
Commercial Sale in a country of such a Royalty Bearing Product; or (ii) in each
country, when such a Royalty Bearing Product sold in the country does not
infringe a Valid Claim of Collaboration Patent Rights and/or Infinity Existing
Patent Rights and/or Patent Rights licensed to the Selling Party by the other
Party pursuant to this Agreement in the country where sold.

13.2         (a)           During
the Term, following the First Commercial Sale in any country of Royalty Bearing
Product, the other Party if it is not an Opt-Out Party shall furnish to the
Opt-Out Party a written calendar quarterly report showing, on a country by
country basis: (i) the

 68
 

 

Worldwide Net Sales of all
Royalty Bearing Product sold during the reporting period; (ii) the royalties
and other payments payable in United States dollars which shall have accrued
hereunder in respect of such sales; (iii) withholding taxes, if any, required
by law to be deducted in respect of such sales, the identity of the taxing
authorities, and the taxpayer identification number under which such taxes and
deductions were remitted, as applicable; (iv) the dates of the First Commercial
Sale of the Royalty Bearing Product in any country during the reporting period;
(v) the exchange rates used in accordance with Section 6.9 in determining the
amount of United States dollars.  Reports
shall be due on the sixtieth (60th) day following the close of each calendar
quarter.  If no sales are made or if no
royalties are due for any period hereunder, the Party that is not the Opt-Out
Party shall so report.  All reports
delivered pursuant to this Section and any information that can be derived
therefrom shall be subject to the confidentiality obligations of Article
9.  The Party that is not the Opt-Out
Party shall keep complete and accurate records in sufficient detail to enable
the royalties payable under this Agreement to be determined.

(b)           Within
ten (10) days after the end of each calendar quarter, the Party that is not the
Opt-Out Party shall provide the Opt-Out Party with a preliminary report as to
royalties that are payable for the calendar quarter based on actual Worldwide
Net Sales for the first two months of the calendar quarter and estimated
Worldwide Net Sales for the last month of the calendar quarter.

(c)           In
the event that a Third Party that is not licensed by the Selling Party sells a
product in a country that has the same Active Pharmaceutical Ingredient as of a
Royalty Bearing Product sold in such country (each such product of such Third
Party being a “Generic Product”), the royalties payable for such Royalty
Bearing Product in such country shall be reduced by the

 69
 

 

following amounts if sales of the Generic Products in such country in
any two consecutive calendar quarters exceed the following percentages of the
sum of all prescriptions for such Royalty Bearing Product sold by the Selling
Party, its Affiliates and (sub)licensees and by such Third Party seller(s) of
such the Generic Product (based on unit-equivalent data for all dosage
strengths thereof:

	
  Generic Product Percentage

  	
   

  	
  Percent Royalty Reduction

  
	
  > [***] Percent ([***]%)

  	
   

  	
  [***] Percent
  ([***]%)

  

 

13.3         The non Opt-Out Party shall keep, and
shall cause each of its Affiliates and Sublicensees and their further
sublicensees to keep accurate books of account containing all particulars that
may be necessary for the purpose of calculating payments under Article 13
payable to the Opt-Out Party.  Such books
of account shall be kept at their principal place of business and, with all
necessary supporting data shall, for the three (3) years next following the end
of the calendar year to which each shall pertain be open for inspection by the
other Party’s internal audit team or an independent certified accounting firm
selected by the Opt-Out Party and reasonably acceptable to the Party that is
not the Opt-Out Party upon reasonable notice during normal business hours at
the Opt-Out Party’s expense for the sole purpose of verifying payments under
Article 13 of this Agreement, but in no event more than once in each calendar
year.  All information and data offered
shall be used only for the purpose of verifying payments.  In the event that such inspection shall
indicate that in any year the payments which should have been paid by the Party
that is not the Opt-Out Party under Article 13 are at least five percent (5%)
greater than those which were actually paid by the Party that is not the
Opt-Out Party, then the Party that is not the Opt-Out Party shall pay the cost
of such inspection.  All underpayments
and

 70
 

 

overpayments are immediately
due and payable.  Upon the expiration of
three (3) years after a calendar year, the calculation of payments under this
Article 13, shall be binding on both Parties except to the extent that
inspection during such period indicated an overpayment or underpayment.

13.4         All payments to be made by the Party
that is not the Opt-Out Party under this Article 13 shall be made in
United States dollars by certified or bank check or by wire transfer to an
account designated in writing by the Opt-Out Party.

13.5         Any withholding of
taxes levied by tax authorities on the payments to the Opt-Out Party hereunder
shall be deducted by the Party that is not the Opt-Out Party from the sums
otherwise payable by it hereunder for payment to the proper tax authorities on
behalf of the Opt-Out Party and shall be borne by the Opt-Out Party.  The Party that is not the Opt-Out Party
agrees to cooperate with the Opt-Out Party in the event the Opt-Out Party
claims exemption from such withholding or seeks deductions under any double
taxation or other similar treaty or agreement from time to time in force, such
cooperation to consist of providing receipts of payment of such withheld tax,
tax certificates, affidavits or other documents as reasonably required by the
Opt-Out Party to realize the benefit from such exemptions or deductions, and to
the extent reasonably obtainable by the Party that is not the Opt-Out Party.

 71
 

 

ARTICLE 14

TERM AND TERMINATION

14.1         If not earlier terminated as provided in this Agreement, the
term of this Agreement (the “Term”) will commence on the Effective Date
and expire sixty (60) years from the Effective Date.

14.2         On
a Project-by-Project basis, in the event that a Party that is not an Opt-Out
Party materially breaches this Agreement with respect to a Project, then the
other Party who is not an Opt-Out Party shall have the right to send written
notice of such breach to the breaching Party and if such breach is not cured
within sixty (60) days thereafter (thirty (30) days in case of a material
breach involving a failure to pay an amount when due), then, as of such date,
the breaching Party shall be deemed to have given an Opt-Out Notice under
Section 12.1 and the breaching Party shall be an Opt-Out Party with respect to
such Project.

14.3         On
a Project-by-Project basis, in the event that a Party that is an Opt-Out Party
materially breaches this Agreement with respect to a Project, the other Party
shall have the right to send written notice of such breach to the breaching
Party and if such breach is not cured within sixty (60) days thereafter (thirty
(30) days in case of a material breach involving a failure to pay an amount
when due), then, as of such date the breaching Party shall no longer have any
right to receive royalties pursuant to Article 13 with respect to the Products
of such Project sold after such date or milestone payments under Section 7 with
respect to Products of such Project achieved after such date.

14.4         In
the event that a Party, with respect to any given Product, believes that such
Product: (i) if in clinical trials, should be withdrawn from such trials, (ii)
if on the market, should be withdrawn from the market, in each case due to
toxicity or safety concerns, or (iii)

 72
 

 

necessitates that any other action be taken with respect to toxicity,
safety or compliance with law with respect to toxicity or safety, e.g., that
certain information be provided to the FDA with respect to the toxicity or
safety of the Product or that the label of the Product be changed because of
toxicity or safety concerns, and if, after consulting with the Other Party for
such Product for a reasonable period in light of the applicable circumstances,
such period not to exceed ten (10) Business Days, the Parties do not agree with
respect to the course of action to be taken, then, effective immediately upon
written notice from such Party, this Agreement shall terminate with respect to
such Product.  In such event, the Product
shall no longer be considered a “Product” hereunder, the terminating Party
shall have no further rights or obligations hereunder with respect to such
Product, other than those obligations that would survive a termination of this
Agreement and all rights under this Agreement with respect to such Product
shall be deemed transferred to the non-terminating Party.  For the avoidance of doubt, the terminating
Party shall not have thereby relinquished any rights it may have in the
Project, or in any other Products of such Project.

14.5         This
Agreement shall terminate in the entirety with respect to a Project in the
event that for that Project, both Parties are Opt-Out Parties, except for
provisions that survive under Section 14.7.

14.6         This
Agreement may only be terminated as provided in Section 14.5 or by mutual
written agreement of the Parties.

14.7         Upon
termination of this Agreement in its entirety with respect to a Project or
expiration or termination of this Agreement in the entirety the rights and
obligations of the Parties under this Agreement shall terminate as to such
Project, or under this Agreement, as the case may be, except for (i) payment obligations
that accrued prior to termination; and (ii) the

 73
 

 

rights and obligations of the Parties under Sections 2.6 (with respect
to Development Costs accrued prior to termination); 5.8; 6.5, 6.6, 6.7, 6.8,
6.9 (in each case with respect to payment obligations accrued prior
termination); 6.11; 6.12; 8.1(c), 8.1(d), 8.2(c); 8.4; 8.6 (excluding the last
sentence thereof); 9.1(a); 9.1(b); 9.1(c); 9.1(d)(i); 9.1(d)(iii); 9.2; the
last sentence of 9.3; 10.5; 11 (with respect to Claims arising from activities
occurring during the Term); the last sentence of 12.1; 13.2, 13.3, 13.4, 13.5
(in each case with respect to payment obligations accrued prior termination);
14.7; 14.10; and 15.

14.8         In
the event that either Party becomes the first Opt-Out Party with respect to a
Project, to the extent legally permitted, and subject to outstanding
sublicenses, the Opt-Out Party shall (a) transfer to the other Party any and
all Regulatory Approvals and/or regulatory filings, price approvals and global
product safety database and trademarks held by it with respect to all Products
of such terminated Project that exist as of the Opt-Out Date and (b) transfer
all Promotional Materials, customer lists and other information in its
possession related to the promotion of such Products to the other Party and
perform such services as the other Party may reasonably request with the goal
of effecting a smooth transition of the promotion duties previously performed
by the Opt-Out Party.  The cost and expense
thereof shall be shared equally by both Parties.

14.9         If a Selling Party becomes an Opt-Out
Party with respect to a Project and the Non-Selling Party becomes the Selling
Party with respect to such Project, any sublicense granted with respect to
Products of such Project shall be assigned to such new Selling Party.

14.10       If each Party is an
Opt-Out Party with respect to any Product, neither Party shall have the right
to research, develop or commercialize such Product or grant such rights with
respect thereto, without a written agreement between the Parties as to the
respective rights and

 74
 

 

obligations
of the Parties and neither Party will be permitted to use, license, assign or
transfer its Collaboration Rights to the extent they would be used by the
Party, licensee, assignee or transferee to research, develop or commercialize
such Product.  This Section 14.10 shall
survive termination or expiration of this Agreement.

ARTICLE
15

MISCELLANEOUS

15.1         Neither Party shall
be held liable or responsible to the other Party nor be deemed to have defaulted
under or breached this Agreement for failure or delay in fulfilling or
performing any term of this Agreement (other than a payment obligation which
shall not be covered by this Section) when such failure or delay is caused by
or results from causes beyond the reasonable control of the affected Party,
including but not limited to fire, floods, embargoes, war, acts of war (whether
war is declared or not), insurrections, riots, civil commotions, strikes,
lockouts or other labor disturbances, acts of gods or acts, omissions or delays
in acting by any governmental authority or the other Party; provided, however,
that the Party so affected shall use reasonable commercial efforts to avoid or
remove such causes of nonperformance, and shall continue to perform hereunder
with reasonable dispatch whenever such causes are removed.  Either Party shall provide the other Party
with prompt written notice of any delay or failure to perform that occurs by
reason of force majeure.  The Parties
shall mutually seek a resolution of the delay or the failure to perform as
noted above.

15.2         (a)           This Agreement may not be assigned by
either Party without the prior written consent of the other Party, which
consent shall not be unreasonably withheld or delayed; provided, however,
that each of the Parties may, without such consent, assign this Agreement and
its rights and obligations hereunder to its Affiliates or in connection with
the transfer or sale

 75
 

 

of
all or substantially all of its pharmaceutical business, or in the event of its
merger or consolidation or similar transaction; provided further that the
assigning Party shall deliver written notice of any such permitted assignment
to the other Party, and the assignee shall agree to be bound to the
non-assigning Party under the terms and conditions of this Agreement.  Any purported assignment in violation of the
preceding sentences shall be null and void.

(b)           Neither Party shall have the right to
assign its ownership of Collaboration Rights, except in conjunction with a
permitted assignment of this Agreement.

(c)           The granting of a sublicense as
permitted by this Agreement shall not be an assignment, as long as the Party
that is the sublicensor remains bound to the other Party.

(d)           To the extent a Party is not
prohibited from assigning Patent Rights under this Agreement, neither Party
shall assign Patent Rights licensed to the other Party without making such
assignment subject to the licenses granted under this Agreement.

15.3         Each Party hereby
agrees that it does not intend to violate any public policy, statutory or
common laws, rules, regulations, treaty or decision of any government agency or
executive body thereof of any country or community or association of
countries.  Should one or more provisions
of this Agreement be or become invalid, the Parties hereto shall substitute, by
mutual consent, valid provisions for such invalid provisions which valid
provisions in their economic effect are sufficiently similar to the invalid
provisions that it can be reasonably assumed that the Parties would have
entered into this Agreement with such valid provisions.  In case such valid provisions cannot be
agreed upon, the invalidity of one or several provisions of this Agreement
shall not affect the validity of this Agreement as a whole, unless the invalid
provisions are of such essential importance to this Agreement that it is to be
reasonably assumed that the Parties would not have entered into this Agreement
without the invalid provisions.

 76
 

 

15.4         Any consent, notice
or report required or permitted to be given or made under this Agreement by one
of the Parties hereto to the other shall be in writing, delivered personally or
by facsimile (and promptly confirmed by personal delivery or courier) or by the
next Business Day delivery service of a nationally recognized overnight courier
service (signature required), addressed to such other Party at its address
indicated below, or to such other address as the addressee shall have last
furnished in writing to the addressor and shall be effective upon receipt by
the addressee.

	
  

  	
  If to Infinity:

  	
   

  
	
   

  	
   

  	
  Infinity
  Pharmaceuticals, Inc

  
	
   

  	
   

  	
  780 Memorial
  Drive

  
	
   

  	
   

  	
  Cambridge,
  Massachusetts 02139

  
	
   

  	
   

  	
  Attn: CEO with a
  copy to the General Counsel

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  If to MedImmune:

  	
   

  
	
   

  	
   

  	
  MedImmune, Inc.

  
	
   

  	
   

  	
  One MedImmune
  Way

  
	
   

  	
   

  	
  Gaithersburg,
  Maryland 20878

  
	
   

  	
   

  	
  Attn: CEO with a
  copy to the General Counsel

  

 

15.5         This Agreement shall
be governed by and construed in accordance with the laws of the State of New
York U.S.A, without regard to any choice of law principles that would dictate
the application of the laws of another jurisdiction, provided, however,
that as to matters involving Patent Rights of a country that are controlled by
the patent laws thereof, such patent laws shall be controlling.

15.6         Except for those disputes
which this Agreement specifies are to be resolved in accordance with Exhibit A
any disputes arising between the Parties relating to, arising out of or in any
way connected with this Agreement or any term or condition hereof, or the
performance by either Party of its obligations hereunder, shall be resolved as
follows:

 77
 

 

(a)           The Chief Executive
Officers of Infinity and MedImmune shall meet in person at a mutually
acceptable time and location or by means of telephone or video conference
within thirty (30) days of such notice and attempt to negotiate a
settlement.  If the matter remains
unresolved within such thirty (30) day period by the Chief Executive Officers,
then either MedImmune or Infinity may initiate arbitration upon written notice
to the other.

(b)           If the Parties fail
to resolve the dispute, then such dispute shall be finally resolved by binding
arbitration.  Whenever a Party shall
decide to institute arbitration proceedings, it shall give written notice to
that effect to the other Party. Any arbitration hereunder shall be conducted
with three arbitrators under the Commercial Arbitration Rules of the American
Arbitration Association.  Each such
arbitration shall be conducted in the English language by three arbitrators
appointed in accordance with such Rules. 
Any such arbitration shall be held in New York, NY, and, if applicable
law is consulted, the applicable law shall be as set forth in Section 15.5
hereof.  The arbitrators shall have the
authority to grant specific performance, and to allocate between the Parties
the costs of arbitration in such equitable manner as they determine.  In reaching its decision, if applicable, the
arbitrators shall be guided by the Diligent Effort standard of Section 6.1 and
shall reach such a decision based on the rights and obligations of the Parties
as set forth in this Agreement and in reaching such a decision, the Arbitrators
shall not have the power to vary the terms and conditions of this Agreement
and/or the obligations of the Parties under this Agreement.  Judgment upon the award so rendered may be
entered in any court having jurisdiction or application may be made to such
court for judicial acceptance of any award and an order of enforcement, as the
case may be.  The decision of the
arbitrators shall be final and binding on the Parties.

 78
 

 

15.7         This Agreement, together with the
Exhibits hereto, contains the entire understanding of the Parties with respect
to the subject matter hereof and supersedes and terminates all prior and
contemporaneous agreements and understandings between the Parties, whether oral
or in writing, by and between MedImmune and Infinity.  In the event of any conflict or inconsistency
between any provision of any Exhibit hereto and any provision of this Agreement,
the provisions of this Agreement shall prevail. 
All express or implied agreements and understandings, either oral or
written, heretofore made are expressly merged in and made a part of this
Agreement.  This Agreement may be
amended, or any term hereof modified, only by a written instrument duly
executed by the Parties hereto.  Each of
the Parties hereby acknowledges that this Agreement and the related documents
are each the result of mutual negotiation and, therefore, any ambiguity in
their respective terms shall not be construed against the drafting Party.

15.8         The captions to the
several Articles and Sections hereof and Exhibits hereto are not a part of this
Agreement, but are merely guides or labels to assist in locating and reading
the several Articles and Sections hereof.

15.9         It is expressly
agreed that Infinity and MedImmune shall be independent contractors and that
the relationship between the two Parties shall not constitute a partnership,
joint venture or agency.  Neither
Infinity nor MedImmune shall have the authority to make any statements,
representations or commitments of any kind, or to take any action, which shall
be binding on the other, without the prior written consent of the other Party
to do so.

15.10       The waiver by either
Party hereto of any right hereunder or the failure to perform or of a breach by
the other Party shall not be deemed a waiver of any other right hereunder or of
any other breach or failure by said other Party whether of a similar nature or
otherwise.

 79
 

 

15.11       This Agreement may be
executed in two or more counterparts, each of which shall be deemed an
original, but all of which together shall constitute one and the same
instrument.  Counterparts may be
exchanged by facsimile if mutually agreed by the Parties.

15.12       Each
Party shall cause its Affiliates to comply with the terms and conditions of
this Agreement as if such Affiliate was a signatory to this Agreement.  The failure of an Affiliate of a Party to
comply with the terms and conditions of this Agreement shall be deemed a breach
by such Party.

15.13       No remedy referred to
in this Agreement is intended to be exclusive and shall be cumulative and in
addition to any other remedy otherwise available under law or equity.

15.14       Except where the
context otherwise requires, wherever used, the singular will include the
plural, the plural the singular, the use of any gender will be applicable to
all genders, and the word “or” is used in the inclusive sense (and/or).  The captions of this Agreement are for
convenience of reference only and in no way define, describe, extend or limit
the scope or intent of this Agreement or the intent of any provision contained
in this Agreement.  The term “including”
as used herein means including, without limiting the generality of any
description preceding such term. 
References to “Section” or “Sections” are references to the numbered
sections of this Agreement, unless expressly stated otherwise.  All dollars are United States Dollars.

15.15       It is understood that Infinity and
MedImmune and/or their licensors may be subject to United States laws and
regulations controlling the export of technical data, computer software,
laboratory prototypes, and other commodities (including the Arms Export Control
act, as amended, and the Export Administration Act of 1979), and to the extent
applicable, a Party receiving such technical data, computer software,
laboratory prototypes and other commodities

 80
 

 

from the other Party shall
not export such data or commodities to certain foreign countries without a
license from the applicable governmental agency.  For the avoidance of doubt, any use of such
data or commodities in violation of the applicable export control laws and
regulations is prohibited under this Agreement.

[Execution
Page to Follow]

 81
 

 

IN WITNESS WHEREOF, the
Parties have caused this Collaboration Agreement to be executed and sealed by
their respective duly authorized representatives as of the date first set forth
above.

 

	
  MEDIMMUNE, INC.

  	
   

  	
  INFINITY PHARMACEUTICALS, INC.

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  By:

  	
       /s/
  Edward T. Mathers

  	
   

  	
  By:

  	
      /s/ Adelene Q. Perkins

  	
   

  
	
   

  	
   

  	
   

  
	
  Name:

  	
     Edward
  T. Mathers

  	
   

  	
  Name:  Adelene Q. Perkins

  
	
   

  	
   

  	
   

  
	
  Title:

  	
     EVP,
  Corp. Dev. & Venture

  	
   

  	
  Title:

  	
  Executive Vice President and Chief

  
	
   

  	
   

  	
   

  	
  Business Officer

  
	
   

  	
   

  	
   

  
	
  Date:

  	
     August 25, 2006

  	
   

  	
  Date: August 25, 2006

  
										

 

 82
 

 

Exhibit
A

ARBITRATION

(a)           In the event the Parties are unable to reach agreement
with respect to any matter which is expressly made subject to arbitration in
this Agreement under Sections 3.1(d), 5.4(b), 6.4 or 8.3, such matter will be
determined through binding arbitration in New York, NY in accordance with the
Commercial Rules of Arbitration of the American Arbitration Association.

(b)           The arbitration panel shall be comprised of three (3)
arbitrators. Each Party shall be entitled to appoint one arbitrator. The Parties
shall appoint their respective arbitrators within thirty (30) days after
submission for arbitration.  The two
arbitrators so appointed shall agree on the appointment of the third arbitrator
from the list of arbitrators maintained by the American Arbitration
Association. If the Parties’ appointed arbitrators shall fail to agree. within
thirty (30) days from the date both Parties’ arbitrators have been appointed,
on the identity of the third arbitrator, then such arbitrator shall be
appointed by the appropriate administrative body of the American Arbitration
Association.

(c)           Within ten (10) days of appointment of the full
arbitration panel, the Parties shall exchange their final proposed positions
with respect to the matters to be arbitrated, which shall approximate as
closely as possible the closest positions of the Parties previously taken in
the negotiations.  Within thirty (30)
days of appointment of the arbitration Panel, each Party shall submit to the
arbitrators a copy of the proposed position which it previously delivered to
the other Party, together with a brief or other written memorandum supporting
the merits of its proposed position. The arbitration panel shall promptly
convene a hearing, at which time each Party shall have one (1) hour to argue in
support of its proposed position. The Parties will not call any witnesses in
support of their arguments.

 83
 

 

(d)           The arbitration panel shall select either of the Party’s
proposed position on the issue as the binding final decision to be embodied as
an agreement between the Parties. In making their selection, the arbitrators
shall not modify the terms or conditions of either Party’s proposed position;
nor will the arbitrators combine provisions from both proposed position. In
making their selection, to the extent applicable, the arbitrators shall
consider the Diligent Effort standard of Section 6.1 and the other terms and
conditions of this Agreement, the relative merits of the proposed position and
the written and oral arguments of the Parties. In the event the arbitrators
seek the guidance of the law of any jurisdiction, the law of the State of New
York shall govern.

(e)           The arbitrators shall make their decision known to the
Parties as promptly as possible by delivering written notice of their decision
to both Parties. Such written notice need not justify their decision. The
Parties will execute any and all papers necessary to obligate the Parties to
the position selected by the arbitration Panel within five (5) days of receipt
of notice of such selection. The decision of the arbitrators shall be final and
binding on the Parties, and specific performance may be ordered by any court of
competent jurisdiction.

(f)            The Parties will bear their own costs in preparing for
the arbitration. The costs of the arbitrators will be equally divided between
the Parties.

 84

 

Exhibit Y

[*   *   *]

 

 

Exhibit
Z-1

[*   *   *]

 

 

Exhibit
Z-2

[*   *   *]Exhibit 10.1

AEP INDUSTRIES
INC.

2007 MANAGEMENT INCENTIVE PLAN

PLAN
OVERVIEW

Each participant
will have a target incentive opportunity, stated as a percentage of
salary.  Awards at, above, or below
target can be earned based on financial performance, using the following
approach:

·                                          Realization
of “MIP Earnings” from operations will determine the participant’s award.  This award can range down to zero and up to
200% of the individual’s target award.  “MIP
Earnings” will be defined as either:

(a)           Budgeted earnings before interest and
taxes, depreciation and amortization (EBITDA).

- OR -

(b)                                 An
amount of EBITDA agreed and appropriately documented between the participant
and either the CEO or the CFO of the company to be earned by the business unit.

DETERMINING PRELIMINARY INCENTIVE
AWARDS BASED ON EBITDA

The basis for
determining awards will be “MIP Earnings” as described above.  This measure of earnings reflects business
unit performance and excludes financing and tax considerations.

The following
procedures will be followed in measuring “MIP Earnings”:

·                                          Negative
“MIP Earnings” budgets will be treated on an absolute basis (i.e., if the
budget is to lose $100, then losing $90 would be treated as a 10% improvement).

·                                          Special
situations, such as a provision for the sale or closing of a piece of land, a
plant or business, may be proposed for exclusion.

·                                          “MIP
Earnings” will be calculated in the Business units primary currency.  In cases where “currency exchange rates” have
an impact on Business unit profits, the exchange rate used to calculate the
budget will be used in order to eliminate and effect of currency exchange
variations.

·                                          Accounting
policy changes dictated by U.S. Securities and Exchange Commission (SEC), the
U.S. Financial Accounting Standards Board (FASB) or the Chief Financial Officer
of AEP Industries Inc.

·                                          Inter-unit
management fees shall be included in “MIP Earnings”.

·                                          Inter-unit
royalty fees shall be excluded from “MIP Earnings”.

 

 

The relationship between
incentive awards relative to actual target and “MIP Earnings” as shown in the
following exhibit will be used:

PAY PERFORMANCE RELATIONSHIP

2007 ANNUAL INCENTIVE PLAN

Percent of

Target Award

Earned

 

 

Percent of “MIP
Earnings” Achieved

The target award
is paid for meeting budgeted “MIP Earnings”.

·                                          No
award is paid for achieving less than 80% of budgeted “MIP Earnings”.

·                                          50%
of the target award is paid for achieving 80% of budgeted “MIP Earnings”.

·                                          Maximum
award of 200% of target is paid for achieving 120% of budgeted “MIP Earnings”.

·                                          Increased
or decreased award percentages are used for “MIP Earnings” results between 80%
and 100%, and between 100% and 120%, based on the above graph.

As an example of
how the MIP award determination would work, assume that a participant has a
salary of $70,000, and an annual bonus target of 20%.  His business unit has an “MIP Earnings”
budget above $2.5 million, and the actual “MIP Earnings” is 110% of budget:

	
  Salary

  	
   

  	
  $70,000

  
	
  Annual Incentive Target

  	
   

  	
  20%, or $14,000

  
	
  MIP Earnings as a % of Budget

  	
   

  	
  110%

  
	
  % Award Earned

  	
   

  	
  150%

  
	
  Award

  	
   

  	
  $21,000

  	
   

  

 2
 

 

 

ADJUSTING PRELIMINARY AWARDS
BASED ON CRITICAL MEASUREMENT

In the past, you
may have experienced an MIP program that had a separate incentive component
resulting from subjective or critical measurements such as:

·                       Market
Share

·                       Number or
type of customers

·                       Quality

·                       Customer
satisfaction

·                       New product
introductions

·                       Sale of
assets at an attractive price

·                       Health and
safety improvements

·                       New
sales/promotion tracking system

·                       New
financial control system

·                       Improved distribution system

In 2007
AEP is taking the view that everyone in the company should be motivated to
perform in the best interests of the company. 
It is assumed that people in an MIP are the most committed of all,
therefore a separate, and subjective encouragement to perform one’s job well is
an insult to those who are, in fact, our best performers. Management does,
however, reserve the right to reduce an award to any individual within a
business unit whose activities during the period has been counterproductive to
the efforts of the business unit or who has not, for other reasons, added to
the profit making goals of this plan.

If you
have any questions concerning this incentive program, contact your manager or
your Human Resources Manager.

 

 3

 

AEP
INDUSTRIES INC. 2007 MANAGEMENT INCENTIVE PLAN ADMINISTRATIVE GUIDELINES

1. Base Salary
for Bonus Calculations.  October 31,
2007 Annual Base Salary will be used to calculate the incentive.

2. Eligibility.  To be eligible to receive an incentive award under
the program, you must be an active associate as of the end of the measurement
period (i.e., October 31, 2007).  The
only exceptions to this rule are detailed below under item number.

3. Pro-Rata
Eligibility.  Where incentives are to
be paid for partial periods, the incentive will be calculated on a pro-rata
basis. Eligibility for pro-rata payments is detailed in items number 4, 5, and
6 below.  Pro-rata calculations will be
done on completed quarters only.

4. New Hires,
Transfers or Promotions During the Incentive Period.

For New Hires or
participants added to the Plan in the first through third quarters, the bonus
will be calculated on a pro-rated basis from the date of hire, but only in
completed quarters.  Fourth quarter New
Hires will not be eligible for an award.

For Promotions and
Transfers, the bonus will be pro-rated from the date of promotion or transfer
in whole quarters.  This pro-ration will
apply to both changes in target incentive percentage and to changes in goals.

For all
pro-rations under this item, effective dates as of the first through the
fifteenth of the first month in the quarter will count the full quarter.  Effective dates after the sixteenth day of
the first month will not include that quarter in the pro-ration calculation.

5. Termination
During the Incentive Period.

If it is
a Voluntary Termination, no bonus will be earned.

If it is an
Involuntary Termination due to unsatisfactory performance or cause, no bonus
will be earned.  Note: Achieving business
results at the expense of violations of laws, regulations or business ethics or
allowing any individuals to behave in this manner will be considered cause for
termination.

If it is an
Involuntary Termination due to job elimination or reorganization, the bonus
will be paid on a pro-rated basis as of the termination date.  Terminations prior to the fifteenth of the
last month in the quarter will disqualify the termination quarter in the
pro-rata calculation.  Terminations
effective on the sixteenth through the last day of the last month of the
quarter will include the termination quarter in the pro-rata calculation.  Payments will be made at the same time as
they are made to participants who continue to work for the Company through the
end of the year.

6. Death or
Disability During the Incentive Period.

The incentive
earned as of the date of death will be paid, on a pro-rated basis, to the
estate of the participant at the same time payments are made to associates who
continue to work for the Company through the end of the year.

Disabilities of 30
days or less will not have an impact on the participant’s ability to continue
to be eligible for an incentive.

If a disability
lasts more than 30 days, then the incentive will be earned only in quarters in
which the participant works more than 60 days.

7. Adding
Participants to the Plan.  New
participants will be added to this program during the year as recommended by
the appropriate Vice President/Group Manager and with the approval of the CEO
and/or CFO of AEP Industries Inc.  The
criteria for participation will be based on both similar job classification as
the list of current participants in this program and a responsibility level
commensurate with the participant’s ability to influence goal outcomes.  Approval will be required for both the addition
of a participant to the program and the proposed participant’s target incentive
level.

8. Timing of
Payments.  Bonus awards will be paid
in local currency as quickly after the end of 2007 as possible.  Financial results will need to be finalized
as appropriate by the AEP Industries Inc. Vice President, Controller and the
independent auditors before bonuses can be calculated and paid.

 

 

9. Financial
Adjustments.  Actual financial
results as reported on a GAAP basis will be utilized for incentive award
calculation with the following exceptions:

·                  Special
situations, such as a provision for the sale of assets, the closing of a plant
or business or other extraordinary transactions which are not a part of normal
operations, may be proposed for inclusion/exclusion if the
proposal is presented when the charge is taken or when the budgets are
presented. 
Inclusions/Exclusions will need to be approved in writing by the CEO
and/or CFO of AEP Industries Inc.

·                  Accounting
policy changes dictated by the U.S. Securities and Exchange Commission (SEC),
the U.S. Financial Accounting Standards Board (FASB) or AEP Industries Inc.
Chief Financial Officer may be proposed for exclusion if the
proposal is presented when the change is made.  Inclusions/Exclusions will need to be
approved by AEP Industries Inc. Chief Financial Officer and/or the Chief
Executive Officer.

·                  If earnings were
achieved in ways that are considered undesirable (such as reducing budgeted
advertising expenditures where this would hurt the business), an adjustment may
be made at the discretion of the Chief Financial Officer or the Chief Executive
Officer of AEP Industries Inc.

10. All Plan Payments
Subject to Discretion. 
Notwithstanding the attainment of financial results, all awards under
the Plan are subject to the approval of the Chief Financial Officer and the
Chief Executive Officer of AEP Industries Inc.

Source: [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00112-of-00352.parquet"}, [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00112-of-00352.parquet"}]]