{"id":42732,"date":"2015-09-17T11:25:58","date_gmt":"2015-09-17T16:25:58","guid":{"rendered":"https:\/\/content.findlaw-admin.com\/ability-legal\/contracts\/uncategorized\/research-agreement-isis-pharmaceuticals.html"},"modified":"2015-09-17T11:25:58","modified_gmt":"2015-09-17T16:25:58","slug":"research-agreement-isis-pharmaceuticals","status":"publish","type":"corporate_contracts","link":"https:\/\/corporate.findlaw.com\/contracts\/operations\/research-agreement-isis-pharmaceuticals.html","title":{"rendered":"Research Agreement – Isis Pharmaceuticals"},"content":{"rendered":"

RESEARCH AGREEMENT<\/strong><\/p>\n

THIS RESEARCH AGREEMENT (this “Agreement<\/em><\/strong>“), dated
\nas of August 10, 2011 (the “Effective Date<\/em><\/strong>“), is
\nentered into by and between ISIS PHARMACEUTICALS, INC.<\/strong>, a
\nDelaware corporation (“Isis<\/em><\/strong>“), and CHDI
\nFOUNDATION, INC.<\/strong>, a New Jersey corporation formerly known as CHDI, Inc.
\n(the “Foundation<\/em><\/strong>“). Isis and the Foundation will
\nhereinafter be referred to individually as a “Party<\/em><\/strong>”
\nand collectively as the “Parties<\/em><\/strong>“.<\/p>\n

The Foundation153s mission is to rapidly discover and develop drugs that delay
\nor slow the progression of Huntington153s disease.<\/p>\n

Isis is an RNA-based drug discovery and development company.<\/p>\n

The Parties are parties to that certain Research Agreement (as amended, the
\n“2007 Research Agreement<\/em><\/strong>“), dated October 22, 2007
\n(the “Original Effective Date<\/em><\/strong>“), pursuant to which the
\nFoundation and Isis entered into a collaboration to seek therapies for
\nHuntington153s disease.<\/p>\n

Since April 2010, the Parties ceased collaborating with one another under the
\n2007 Research Agreement.<\/p>\n

After the Parties ceased collaborating under the 2007 Research Agreement,
\nIsis continued to work on therapies for Huntington153s disease without funding
\nfrom the Foundation.<\/p>\n

The Parties now desire to enter into this new Agreement to resume
\ncollaborating on therapies for Huntington153s disease.<\/p>\n

In consideration of the mutual representations, warranties and covenants
\ncontained herein and other good and valuable consideration, the receipt and
\nsufficiency of which are hereby acknowledged, the Parties agree as follows:<\/p>\n

Definitions<\/strong><\/p>\n

1.<\/strong> Definitions<\/u><\/strong>.<\/strong>
\nFor the purposes of this Agreement, the following terms have the meanings set
\nforth below:<\/p>\n

(a)<\/strong> “2007 Research Agreement
\nProject<\/em><\/strong>” means the “Project” as defined in the 2007 Research
\nAgreement.<\/p>\n

1<\/p>\n

\n

<\/p>\n

(b)<\/strong> “2007 Research Agreement Project
\nCompound<\/em><\/strong>” means any MOE Gapmer that was identified by Isis in the
\ncourse of Isis153 conduct of the 2007 Research Agreement Project, including any
\nProject Human Compound.<\/p>\n

(c)<\/strong> “2007 Research Agreement Project
\nIntellectual Property<\/em><\/strong>” means any Intellectual Property conceived,
\ndiscovered, invented, made or first reduced to practice in the course of Isis153
\nconduct of the 2007 Research Agreement Project other than any such Intellectual
\nProperty that constitutes Isis Background Intellectual Property or Foundation
\nBackground Intellectual Property.<\/p>\n

(d)<\/strong> “2007 Research Agreement Project
\nResults<\/em><\/strong>” means all data, formulae, methods, outcomes, protocols or
\nother results produced in the course of Isis153 conduct of the 2007 Research
\nAgreement Project.<\/p>\n

(e)<\/strong> “Acquired Party<\/em><\/strong>” means the
\nParty that consummates a Change of Control with an Acquirer.<\/p>\n

(f)<\/strong> “Acquirer<\/em><\/strong>” means, with respect
\nto a Party, the Third Party or Affiliate of such Party that is a party to a
\nChange of Control with such Party after the Effective Date.<\/p>\n

(g)<\/strong> “Acquirer Intellectual
\nProperty<\/em><\/strong>” means, with respect to an Acquirer, (i) all Intellectual
\nProperty (A) owned by, or licensed by a Third Party to, such Acquirer
\nimmediately prior to the consummation of the Change of Control involving such
\nAcquirer and a Party or (B) acquired by, or licensed to, such Acquirer from a
\nThird Party after the consummation of the Change of Control involving such
\nAcquirer and a Party and (ii) all Intellectual Property conceived, discovered,
\ninvented, made or first reduced to practice by the Acquirer (or on behalf of
\nAcquirer by a Third Party) after the consummation of the Change of Control
\ninvolving such Acquirer and a Party, other than in the course of the performance
\nof the Research or using or practicing Project Intellectual Property.
\nNotwithstanding the foregoing, Acquirer Intellectual Property shall not include
\na) any Intellectual Property that constitutes the Background Intellectual
\nProperty of the Acquired Party before or on the date of the consummation of the
\nChange of Control involving such Acquirer and a Party or b) any Intellectual
\nProperty that constitutes Project Intellectual Property before, on or after the
\ndate of the consummation of the Change of Control involving such Acquirer and a
\nParty.<\/p>\n

(h)<\/strong> “Additional Project Activities
\nDescription<\/em><\/strong>” means the written document attached to this Agreement
\nas Appendix C<\/u>.<\/p>\n

(i)<\/strong> “Approved Foundation Requested Project
\nCompound<\/em><\/strong>” means a Foundation Requested Project Compound (as
\ndefined in Section 8(c)(i)<\/u> of this Agreement) approved in accordance with
\nSection 8(c)(ii)<\/u> and Section 5<\/u> of this Agreement for use by the
\nFoundation and\/or a Foundation Collaborator in an Approved Foundation Project
\nCompound Study.<\/p>\n

2<\/p>\n

\n

<\/p>\n

(j)<\/strong> “Approved Foundation Project Compound
\nStudy<\/em><\/strong>” means a Foundation Project Compound Study (as defined in
\nwith Section 8(c)(i)<\/u> of this Agreement) approved in accordance with
\nSection 8(c)(ii)<\/u> and Section 5<\/u> of this Agreement to be conducted
\nby the Foundation and\/or a Foundation Collaborator.<\/p>\n

(k)<\/strong> “ASO<\/em><\/strong>” means an oligonucleotide
\ncompound, or analog thereof, having a sequence that is at least 6 bases long and
\nthat modulates expression of a gene target via the binding of such compound to a
\nmRNA or pre-mRNA of such gene target.<\/p>\n

(l)<\/strong> “Affiliate<\/em><\/strong>” means any Person
\nwhich directly or indirectly controls, is controlled by or is under common
\ncontrol with another Person. As used in this definition, the term “control”
\nmeans, as to any Person: (i) direct or indirect ownership of 80% or more of the
\nvoting interests or other ownership interests in a Person; or (ii) direct or
\nindirect ownership of 80% or more of the interest in the income of the Person in
\nquestion. A Person will cease to be an Affiliate of another Person if such
\ncontrol relationship no longer exists.<\/p>\n

(m)<\/strong> “Background Intellectual
\nProperty<\/em><\/strong>” means Isis Background Intellectual Property and the
\nFoundation Background Intellectual Property.<\/p>\n

(n)<\/strong> “Bankruptcy Event<\/em><\/strong>” means the
\n(i) making of a general assignment for the benefit of creditors by an entity;
\n(ii) filing of any petition by an entity, or the commencement of any proceeding
\nvoluntarily by an entity, for any relief under any bankruptcy or insolvency laws
\nor any law relating to the relief of debtors; (iii) consent by an entity to the
\nentry of an order in an involuntary bankruptcy or insolvency case; (iv) entry of
\nan order or decree for relief against an entity by a court of competent
\njurisdiction in an involuntary case under any bankruptcy or insolvency laws or
\nany law relating to the relief of debtors, which order or decree is unstayed and
\nin effect for a period of 90 consecutive days; (v) appointment, with or without
\nthe consent of an entity, of any receiver, liquidator, custodian, assignee,
\ntrustee, sequestrator or other similar official of an entity or any substantial
\npart of its property; or (vi) admission by an entity in writing of its inability
\nto pay its debts generally as they become due.<\/p>\n

(o)<\/strong> “Change of Control<\/em><\/strong>” means,
\nwith respect to a Person, (i) a merger or consolidation of such Person with
\nanother Person which results in the voting securities of such Person outstanding
\nimmediately prior thereto ceasing to represent at least fifty percent (50%) of
\nthe combined voting power of the surviving Person immediately after such merger
\nor consolidation; (ii) a transaction or series of related transactions in which
\nanother Person, together with its Affiliates, becomes the owner of fifty percent
\n(50%) or more of the combined voting power of the outstanding securities of such
\nPerson; (iii) the sale or other transfer of all or substantially all of such
\nPerson153s assets to another Person; or (iv) the stockholders or equity holders of
\nsuch Person approve a plan of complete liquidation of such Person.<\/p>\n

3<\/p>\n

\n

<\/p>\n

(p)<\/strong> “Confidential Information<\/em><\/strong>”
\nmeans all information of whatsoever type or kind (i) provided (either directly
\nor indirectly in writing or other tangible form or orally) by one Party (the
\n“Disclosing Party<\/em><\/strong>“) to another Party (the
\n“Receiving Party<\/em><\/strong>“) that is clearly marked and
\nidentified as “Confidential” by the Disclosing Party at the time of disclosure
\nor (ii) specifically deemed to be “Confidential Information” pursuant to
\nSection 14(a)(i)<\/u> of this Agreement. Any information communicated orally
\nby the Disclosing Party will be considered “Confidential Information” only if
\nidentified as such by the Disclosing Party upon such first oral disclosure.
\nSpecifically excepted from Confidential Information is all information that the
\nReceiving Party can demonstrate by written records (1) to have been known by, or
\nin the possession of, the Receiving Party prior to the Disclosing Party153s
\ndisclosure of such Confidential Information to the Receiving Party; (2) has,
\nafter disclosure of such Confidential Information by the Disclosing Party to the
\nReceiving Party, become known to the Receiving Party through a Third Party who
\nis not known by the Receiving Party to be under any obligation of
\nconfidentiality to the Disclosing Party; (3) to have been part of the public
\ndomain or publicly known at the time of the Disclosing Party153s disclosure of
\nsuch Confidential Information to the Receiving Party; (4) has, after disclosure
\nof such Confidential Information by the Disclosing Party to the Receiving Party,
\nbecome part of the public domain or publicly known, by publication or otherwise,
\nnot due to any unauthorized act or omission by the Receiving Party; or (5) to
\nhave been independently developed by the Receiving Party without reference to,
\nuse of, or reliance upon, such Confidential Information.<\/p>\n

(q)<\/strong> “Control<\/em><\/strong>” or
\n“Controlled<\/em><\/strong>” means, with respect to an Intellectual
\nProperty right, a Party (i) owns or has a license to use and practice such
\nIntellectual Property right and (ii) such Party has the ability to grant a
\nlicense or sublicense as provided for in this Agreement under such Intellectual
\nProperty right without violating the terms of any agreement or other arrangement
\nbetween such Party and either an Affiliate of such Party or a Third Party.<\/p>\n

(r)<\/strong> “Detailed Project
\nDescription<\/em><\/strong>” means each written document developed and approved by
\nthe Steering Committee in accordance with Section 5(a)(ii)<\/u> of this
\nAgreement setting forth a detailed description of the Research to be performed
\nin the conduct of the Project. The Detailed Project Description (the
\n“Initial Detailed Project Description<\/em><\/strong>“) covering the
\ntwelve-month period beginning July 1, 2011 for the Project is attached to this
\nAgreement as Appendix B<\/u>. With respect to the Initial Detailed Project
\nDescription, the Parties agree that (i) the activities specified therein to be
\nconducted during the six-month period beginning July 1, 2011 (except for any
\nsuch activities specifically identified as requiring subsequent approval by the
\nSteering Committee) are firm and agreed to in detail by Isis and the Foundation
\nand (ii) the activities specified therein to be conducted during the six-month
\nperiod beginning January 1, 2012 have been listed for planning purposes and are
\ntherefore estimated and agreed to by the Parties in concept; those activities
\nare subject to further approval of the Steering Committee in accordance with
\nthis Agreement prior to their conduct by Isis.<\/p>\n

4<\/p>\n

\n

<\/p>\n

(s)<\/strong> “Foundation Background Intellectual
\nProperty<\/em><\/strong>” means (i) all Intellectual Property (including
\nIntellectual Property relating to any Foundation Provided Materials but
\nexcluding the Acquirer Intellectual Property of any Acquirer of the Foundation)
\n(A) owned by, or licensed to, the Foundation or any of its Affiliates as of the
\nOriginal Effective Date or (B) acquired by, or licensed to, the Foundation or
\nany of its Affiliates from a Third Party after the Original Effective Date and
\n(ii) all Intellectual Property conceived, discovered, invented, made or first
\nreduced to practice by, or on behalf of, the Foundation or any of its Affiliates
\nafter the Original Effective Date (other than (X) in the course of Isis153 conduct
\nof the Project or (Y) under the 2007 Research Agreement).<\/p>\n

(t)<\/strong> “Foundation Collaborators<\/em><\/strong>”
\nmeans those (i) Third Parties and Affiliates of the Foundation to which the
\nFoundation grants the right to use all or part of the Project Deliverables,
\nProject Intellectual Property or Project Results for HD Research and
\nDevelopment, including any entity collaborating with the Foundation in the
\nconduct of HD Research and Development and\/or fee-for-service laboratories or
\nrepositories providing services to the Foundation in the furtherance of the
\nFoundation153s conduct of HD Research and Development and (ii) fee-for-service
\nlaboratories providing services on behalf of any such Third Parties and
\nAffiliates described in (i) above.<\/p>\n

(u)<\/strong> “Foundation Provided
\nMaterials<\/em><\/strong>” means (i) any animal species or model (e.g.<\/u>,
\nmice, rats, etc.) (including progeny derived from inbreeding and crossbreeding
\nof any such animal species or model and unmodified derivatives of any such
\nanimal species or model and their progeny) provided to Isis by, or on behalf of,
\nthe Foundation to enable Isis to perform the Research and (ii) the physical
\nsamples of cell lines, compounds, reagents and other materials provided to Isis
\nby, or on behalf of, the Foundation to enable Isis to perform the Research, in
\neach case that is (A) expressly identified as a Foundation Provided Material in
\nthe Project Description or (B) otherwise agreed upon by the Steering Committee
\nas a Foundation Provided Material for the Project.<\/p>\n

(v)<\/strong> “Foundation Provided Material
\nInformation<\/em><\/strong>” means all information relating to a Foundation
\nProvided Material that is provided to Isis by, or on behalf of, the Foundation.\n<\/p>\n

(w)<\/strong> “FTE<\/em><\/strong>” means the equivalent of
\nthe work of one employee of Isis working on a dedicated full-time basis for one
\nyear of work (excluding vacations and holidays), consisting of at least a total
\nof 1,820 hours per year of dedicated effort.<\/p>\n

(x)<\/strong> “General Project Description<\/em><\/strong>”
\nmeans the written document attached to this Agreement as Appendix A<\/u>. For
\nclarity, the General Project Description cannot be modified or amended except by
\nthe execution of a written amendment to this Agreement by an authorized
\nsignatory of each of the Parties.<\/p>\n

5<\/p>\n

\n

<\/p>\n

(y)<\/strong> “HD Field of Use<\/em><\/strong>” means any
\nactivity useful for the creation, development, manufacture or distribution of a
\nproduct or service for the diagnosis, treatment, cure or prevention of
\nHuntington153s disease, including the manufacture or distribution of any such
\nproduct or service for sale and the sale of any such product or service.<\/p>\n

(z)<\/strong> “HD Research and Development<\/em><\/strong>”
\nmeans any activity useful for the creation, development, manufacture or
\ndistribution of a product or service for the diagnosis, treatment, cure or
\nprevention of Huntington153s disease, including pre-clinical testing of a product
\nor service or, subject to Section 10(b)<\/u> of this Agreement, human clinical
\ntrials involving a product or service, in all cases other than (i) the
\nmanufacture or distribution of any such product or service for sale or (ii) the
\nsale of any such product or service. For the avoidance of doubt, HD Research and
\nDevelopment shall not include any right to (A) manufacture or distribute any
\nsuch product or service for sale or (B) sell any such product or service;
\nexcept, in each case, for pre-clinical use or, subject to Section 10(b)<\/u>
\nof this Agreement, human clinical trials.<\/p>\n

(aa)<\/strong> “Huntington<\/em><\/strong>” means the human
\ngene known as IT15 or HD (GenBank accession #NM_002111.5), or any alternative
\nsplice variants, mutants, polymorphisms and fragments thereof.<\/p>\n

(bb)<\/strong> “Huntington153s disease<\/em><\/strong>” or
\n“HD<\/em><\/strong>” means the hereditary disorder caused by mutation
\nassociated with trinucleotide repeat expansion in the Huntington gene on
\nchromosome 4p.<\/p>\n

(cc)<\/strong> “Intellectual Property<\/em><\/strong>” means
\nany discovery, invention, formulation, know-how, method, technological
\ndevelopment, enhancement, modification, improvement, work of authorship,
\ncomputer software (including, but not limited to, source code and executable
\ncode) and documentation thereof, data or collection of data, whether patentable
\nor not, or susceptible to copyright or any other form of legal protection
\n(e.g.<\/u>, trade secret).<\/p>\n

(dd)<\/strong> “Isis Background Intellectual
\nProperty<\/em><\/strong>” means (i) all Intellectual Property (excluding (A) the
\nPre-Project Compound Intellectual Property, (B) the Acquirer Intellectual
\nProperty of any Acquirer of Isis, (C) the Isis\/[***] Collaboration Intellectual
\nProperty and (D) the Regulus Intellectual Property) (1) owned by, or licensed
\nto, Isis or any of its Affiliates as of the Original Effective Date or (2)
\nacquired by, or licensed to, Isis or any of its Affiliates from a Third Party
\nafter the Original Effective Date and (ii) all Intellectual Property conceived,
\ndiscovered, invented, made or first reduced to practice by, or on behalf of,
\nIsis or any of its Affiliates after the Original Effective Date (other than (X)
\nin the course of Isis153 conduct of the Project or (Y) under the 2007 Research
\nAgreement).<\/p>\n

6<\/p>\n

\n

<\/p>\n

(ee)<\/strong> “Isis Provided Materials<\/em><\/strong>”
\nmeans any animal species or model (e.g.<\/u>, mice, rats, etc.) (including
\nprogeny derived from inbreeding and crossbreeding of any such animal species or
\nmodel and unmodified derivatives of any such animal species or model and their
\nprogeny) and the physical samples of compounds, reagents, cell lines and other
\nmaterials acquired by Isis from a Third Party to enable Isis to perform the
\nResearch.<\/p>\n

(ff)<\/strong> “Isis Provided Reimbursable
\nMaterials<\/em><\/strong>” means each Isis Provided Material that is (i) expressly
\nidentified as an Isis Provided Reimbursable Material in the Project Description
\nor (ii) otherwise agreed upon by the Steering Committee (as defined in
\nSection 5(a)(i)<\/u> of this Agreement) as an Isis Provided Reimbursable
\nMaterial for the Project.<\/p>\n

(gg)<\/strong> “Isis\/[***] Collaboration Intellectual
\nProperty<\/em><\/strong>” means all Intellectual Property conceived, discovered,
\ninvented, made or first reduced to practice by, or on behalf of, Isis or [***]
\nunder (i) that certain Collaborative Research Agreement, dated [***], between
\nIsis and [***] and\/or (ii) that certain Amended and Restated Collaborative
\nResearch Agreement, dated [***] between Isis and [***].<\/p>\n

(hh)<\/strong> “MOE Gapmer<\/em><\/strong>” means a
\nsingle-stranded ASO of less than 25 nucleotides comprising a region of at least
\n6 unsubstituted 2153 deoxy nucleotides with the remaining nucleotides having a
\n2153-O-(methoxyethyl) substitution at the 2153 position.<\/p>\n

(ii)<\/strong> “Patent Expenses<\/em><\/strong>” means, with
\nrespect to either Party, all out-of-pocket costs and expenses (including
\nattorneys153 fees and government filing fees) incurred by that Party in accordance
\nwith Section 9(d)<\/u> of this Agreement in connection with the preparation,
\nreview, filing, prosecution and maintenance of the appropriate filings and
\nissued patents, including any extensions or supplemental protection certificates
\nthereto, to protect the Parties153 rights in any Patentable Project HD
\nIntellectual Property.<\/p>\n

(jj)<\/strong> “Patentable Project HD Intellectual
\nProperty<\/em><\/strong>” means any Project HD Intellectual Property which is or
\nmay be patentable or otherwise protectable under Title 35 U.S.C. and
\ncorresponding legislation in other jurisdictions.<\/p>\n

(kk)<\/strong> “Person<\/em><\/strong>” means any
\nindividual, corporation, company, partnership, trust, limited liability company,
\nassociation or other business entity.<\/p>\n

(ll)<\/strong> “Pre-Project Compound<\/em><\/strong>” means
\nall MOE Gapmers identified by Isis prior to the Original Effective Date in the
\ncourse of Isis153 conduct of research activities pursuant to that certain Research
\nAgreement, dated as of August 1, 2006, entered into between Isis and the
\nFoundation which (i) Isis used in the conduct of the 2007 Research Agreement
\nProject or (ii) are used in Isis153 conduct of the Project.<\/p>\n

7<\/p>\n

\n

<\/p>\n

(mm)<\/strong> “Pre-Project Compound Intellectual
\nProperty<\/em><\/strong>” means any Intellectual Property in or relating to a
\nPre-Project Compound.<\/p>\n

(nn)<\/strong> “Project<\/em><\/strong>” means (i) the
\nprograms of Research performed by, or on behalf of, Isis as described in the
\nAdditional Project Activities Description together with (ii) the program of
\nResearch to be performed by Isis as described in the Project Description.<\/p>\n

(oo)<\/strong> “Project Compound<\/em><\/strong>” means all
\n(i) Pre-Project Compounds, (ii) 2007 Research Agreement Project Compounds or
\n(iii) MOE Gapmers that are identified by Isis in the course of Isis153 conduct of
\nthe Project, including any Project Human Compound. For the avoidance of doubt,
\nPre-Project Compounds will be Project Compounds for all purposes under this
\nAgreement.<\/p>\n

(pp)<\/strong> “Project Deliverable<\/em><\/strong>” means
\n(i) those Project Reports (as defined in Section 5(e)<\/u> of this Agreement),
\nthose FTE Reports (as defined in Section 5(e)<\/u> of this Agreement) and
\nother items set forth in the Project Description which are to be delivered by
\nIsis to the Foundation in connection with the conduct of the Project by Isis,
\n(ii) those Approved Foundation Requested Project Compounds which are to be
\ndelivered by Isis to the Foundation pursuant to Section 8(c)<\/u> of this
\nAgreement and (iii) any other item or material otherwise agreed to be such by
\nthe Steering Committee.<\/p>\n

(qq)<\/strong> “Project Description<\/em><\/strong>” means
\nthe General Project Description together with the Detailed Project Descriptions
\nfor the Project.<\/p>\n

(rr)<\/strong> “Project HD Intellectual
\nProperty<\/em><\/strong>” means any Project Intellectual Property that (i) claims
\nthe composition of matter of a Project Compound and\/or a method of using a
\nProject Compound for the treatment of Huntington153s disease or (ii) is necessary
\nor useful for the creation, development, manufacture or distribution of a
\nproduct or service for the diagnosis, treatment, cure or prevention of
\nHuntington153s disease.<\/p>\n

(ss)<\/strong> “Project Human Compound<\/em><\/strong>”
\nmeans any Project Compound that modulates the expression of Huntington and acts
\npredominantly by hybridizing to mRNA or pre-mRNA in humans.<\/p>\n

(tt)<\/strong> “Project Intellectual
\nProperty<\/em><\/strong>” means all (i) Pre-Project Compound Intellectual
\nProperty, (ii) 2007 Research Agreement Project Intellectual Property and (iii)
\nIntellectual Property conceived, discovered, invented, made or first reduced to
\npractice in the course of Isis153 conduct of the Project other than any such
\nIntellectual Property that constitutes Isis Background Intellectual Property or
\nFoundation Background Intellectual Property.<\/p>\n

(uu)<\/strong> “Project Non-HD Intellectual
\nProperty<\/em><\/strong>” means any Project Intellectual Property that does not
\nconstitute Project HD Intellectual Property.<\/p>\n

8<\/p>\n

\n

<\/p>\n

(vv)<\/strong> “Project Non-Human Compound<\/em><\/strong>”
\nmeans any Project Compound that does not constitute a Project Human Compound.\n<\/p>\n

(ww)<\/strong> “Project Results<\/em><\/strong>” means all
\n(i) 2007 Research Agreement Project Results and (ii) all data, formulae,
\nmethods, outcomes, protocols or other results produced in the course of Isis153
\nperformance of the Research.<\/p>\n

(xx)<\/strong> “Provided Research
\nMaterials<\/em><\/strong>” means (i) those Isis Provided Reimbursable Materials
\nfor which the Foundation has reimbursed Isis in accordance with Section
\n6(b)(i)<\/u> of this Agreement and (ii) the Foundation Provided Materials for the
\nProject.<\/p>\n

(yy)<\/strong> “Regulus<\/em><\/strong>” means (i) Regulus
\nTherapeutics Inc. and (ii) the successor Person of any Change of Control
\ndirectly or indirectly involving Regulus Therapeutics Inc.<\/p>\n

(zz)<\/strong> “Regulus Intellectual
\nProperty<\/em><\/strong>” means all Intellectual Property owned by, or licensed
\nto, Regulus.<\/p>\n

(aaa)<\/strong> “Research<\/em><\/strong>” means all of the
\nactivities undertaken by, or on behalf of, Isis under this Agreement to conduct
\nand complete the Project.<\/p>\n

(bbb)<\/strong> “Research FTE<\/em><\/strong>” means an FTE
\n(or a fractional unit thereof) that has been designated to perform the Research.\n<\/p>\n

(ccc)<\/strong> “Research FTE Rate<\/em><\/strong>” means,
\nfor all Research FTEs (on a quarterly basis), an amount equal to US$[***] per
\nResearch FTE per quarter (equivalent to an annual Research FTE Rate of
\nUS$[***]).<\/p>\n

(ddd)<\/strong> “Research and Development<\/em><\/strong>”
\nmeans any activity useful for the creation, development, manufacture or
\ndistribution of a product or service, including pre-clinical testing of a
\nproduct or service or, subject to Section 10(b)<\/u> of this Agreement, human
\nclinical trials involving a product or service, in all cases other than (i) the
\nmanufacture or distribution of any such product or service for sale or (ii) the
\nsale of any such product or service. For the avoidance of doubt, Research and
\nDevelopment will not include any right to (1) manufacture or distribute any such
\nproduct or service for sale or (2) sell any such product or service; except, in
\neach case, for pre-clinical use or, subject to Section 10(b)<\/u> of this
\nAgreement, human clinical trials.<\/p>\n

(eee)<\/strong> “Third Party<\/em><\/strong>” means any
\nPerson other than a Party or its Affiliates.<\/p>\n

9<\/p>\n

\n

<\/p>\n

Research; Project<\/strong><\/p>\n

2.<\/strong> Number of Research FTEs; Utilization of
\nResearch FTEs<\/u><\/strong>.<\/strong><\/p>\n

(a)<\/strong> Number of Research
\nFTEs<\/u><\/strong>.<\/strong><\/p>\n

(i)<\/strong> Initial Number of Research
\nFTEs<\/u><\/strong>. <\/strong>Beginning on the Effective Date, Isis will
\nprovide [***] Research FTEs to perform the Research. The Parties acknowledge and
\nagree that the number of then-current Research FTEs performing the Research will
\nonly be subject to adjustment as provided in Section 2(a)(ii)<\/u> of this
\nAgreement.<\/p>\n

(ii)<\/strong> Changes in the Number of Research
\nFTEs<\/u><\/strong>.<\/strong> The number of Research FTEs performing
\nResearch may only be increased or decreased above the then-current number of
\nResearch FTEs required to be provided by Isis to perform the Research by the
\nagreement of the Steering Committee; provided, that<\/em>, (A) at no time
\nwill the number of Research FTEs performing the Research exceed [***] ([***])
\nResearch FTEs (the “Research FTE Maximum Number<\/em><\/strong>“) and
\n(B) any increase in the number of Research FTEs may only be for the fixed period
\nof time set forth in the applicable Steering Committee meeting minutes. Any
\nagreed upon increase or decrease in the then-current number of Research FTEs
\nrequired to be provided by Isis to perform the Research will occur within a
\nperiod of time mutually agreed upon by the Steering Committee. The Parties
\nacknowledge and agree that the Research FTE Maximum Number may only be increased
\nby the execution of a written amendment to this Agreement by an authorized
\nsignatory of each of the Parties.<\/p>\n

(b)<\/strong> Utilization of Research
\nFTEs<\/u><\/strong>.<\/strong> Isis and the Foundation agree that each
\nindividual being provided by Isis to constitute all or a part of a Research FTE
\nmay (i) devote less than 100% of his or her full-time effort to perform the
\nResearch and (ii) perform activities of any type or nature for Isis or any Third
\nParty; provided, that<\/em>, the time spent by any such individual performing
\nsuch non-Project activities will not be taken into account for any purpose under
\nthis Agreement (including for purposes of calculating (A) the number of Research
\nFTEs being provided by Isis under this Agreement or (B) the amount of any
\npayment owed by the Foundation under this Agreement). Similarly, Isis may
\nsatisfy its Research FTE obligations hereunder by having multiple individuals
\ncontribute toward one full Research FTE.<\/p>\n

3.<\/strong> Performance of the Research; Limited Right to
\nSubcontract the Research; Certain Notifications Relating to the Project;
\nExperimental Nature of the Research<\/u><\/strong>.<\/strong><\/p>\n

(a)<\/strong> Performance of the Research; Limited Right to
\nSubcontract the Research<\/u><\/strong>.<\/strong><\/p>\n

(i)<\/strong> Performance of the
\nResearch<\/u><\/strong>.<\/strong> Isis agrees that (A) each Research FTE
\nwill perform the Research in accordance with this Agreement, including the
\nProject Description and (B) no Research shall be performed except as expressly
\nset forth in the Project Description or otherwise approved by the Steering
\nCommittee. During the Term (as defined in Section 17(a)<\/u> of this
\nAgreement), unless otherwise explicitly agreed to by the Steering Committee or
\nexpressly provided for in the Project Description, Isis will<\/p>\n

10<\/p>\n

\n

<\/p>\n

also provide such other resources (including all necessary administrative and
\nsupport personnel, equipment, tools, Isis Provided Materials and supplies) and
\neffort as is commercially reasonable to perform the Research in accordance with
\nthis Agreement, including the Project Description.<\/p>\n

(ii)<\/strong> Limited Right to Subcontract the
\nResearch<\/u><\/strong>.<\/strong> The Parties acknowledge and agree that
\nIsis may (A) sub-contract those activities which are expressly set forth in the
\nProject Description or otherwise agreed upon by the Steering Committee as
\nactivities to be sub-contracted (such activities, “Subcontracted
\nResearch<\/em><\/strong>“) and (B) sub-contract such Subcontracted Research to the
\nThird Party set forth in the Project Description or otherwise agreed upon by the
\nSteering Committee as the Third Party or Affiliate to conduct such
\nsub-contracted activities (each such Third Party or Affiliate, a
\n“Subcontractor<\/em><\/strong>“). Isis agrees that (1) all
\nSubcontracted Research shall be performed pursuant to a written agreement
\nbetween Isis and the Subcontractor performing such Subcontracted Research upon
\nterms and conditions that a) are consistent with the terms and conditions of
\nthis Agreement and b) do not conflict with Isis153 obligations or the Foundation153s
\nrights under this Agreement and (2) Isis shall cause each Subcontractor to
\nconduct the Subcontracted Research in accordance with, and subject to, the terms
\nand conditions of such agreement. Upon the Foundation153s request, Isis will
\nprovide the Foundation with copies of such agreements between Isis and any such
\nSubcontractor. Isis further agrees that Isis shall be solely responsible and
\nliable to CHDI under this Agreement for the Subcontracted Research conducted by
\neach Subcontractor as if such Research were conducted by Isis.<\/p>\n

(b)<\/strong> Certain Notifications Relating to the
\nResearch<\/u><\/strong>.<\/strong><\/p>\n

(i)<\/strong> Change of Circumstances
\nNotices<\/u><\/strong>.<\/strong> If at any time following the Effective
\nDate Isis makes a good faith determination that, (A) the Research cannot be
\nconducted and completed substantially in accordance with this Agreement and the
\nProject Description; (B) the Research (or any portion thereof) cannot be
\nsubstantially completed within the estimated time frame set forth in the Project
\nDescription; or (C) the continued performance of the Research in accordance with
\nthis Agreement and the Project Description (1) is unlikely to yield
\nscientifically valid or useful results, (2) will violate any applicable federal,
\nstate, local, international, health authority and institutional laws, rules,
\nregulations, orders or guidelines, or (3) will violate principles of ethics or
\nscientific integrity, Isis will promptly give written notice (each, a
\n“Change of Circumstances Notice<\/em><\/strong>“) to the Foundation.
\nEach Change of Circumstances Notice will set forth a detailed description of
\nIsis153 determination (including the facts and circumstances underlying such
\ndetermination and Isis153 basis for such determination). Following the delivery of
\na Change of Circumstances<\/p>\n

11<\/p>\n

\n

<\/p>\n

Notice, Isis will, at the request of the Foundation, promptly make senior
\nofficers and appropriate scientific or technical personnel reasonably available
\nto the Foundation to discuss the basis for Isis153 determination.<\/p>\n

(ii)<\/strong> Post-Effective Date Knowledge
\nNotice<\/u><\/strong>.<\/strong> If at any time following the Effective
\nDate Isis acquires knowledge that would render one or more of the
\nrepresentations and warranties set forth in Section 16(b)<\/u> of this
\nAgreement untrue or incorrect if such representation or warranty were based upon
\nIsis153 knowledge at such time (instead of being based upon Isis153 knowledge as of
\nthe Effective Date), Isis will promptly give written notice (each, a
\n“Post-Effective Date Knowledge Notice<\/em><\/strong>“) to the
\nFoundation. Each Post-Effective Date Knowledge Notice will set forth a detailed
\ndescription of the facts and circumstances relating to the applicable
\nrepresentation or warranty (including details as to Isis153 basis for determining
\nthat such representation or warranty would no longer be true and correct).
\nFollowing the delivery of a Post-Effective Date Knowledge Notice, Isis will, at
\nthe request of the Foundation, promptly make senior officers and appropriate
\nscientific or technical personnel reasonably available to the Foundation to
\ndiscuss (A) the facts and circumstances related to the subject matter of such
\nPost-Effective Date Knowledge Notice and (B) potential courses of action to
\naddress such matter.<\/p>\n

(c)<\/strong> Experimental Nature of the
\nResearch<\/u><\/strong>.<\/strong> The Foundation acknowledges that (i) the
\nResearch is of an experimental and developmental nature and (ii) Isis cannot
\nguarantee that the objectives of the Research will be achieved or that the
\nperformance of the Research will yield any specific deliverables, results or
\nIntellectual Property.<\/p>\n

4.<\/strong> Obligation to Provide Foundation Provided
\nMaterials and Foundation Provided Material Information; Reimbursement for Isis
\nProvided Reimbursable Materials; Use and Ownership of Provided Research
\nMaterials and Foundation Provided Material Information; Retention of Provided
\nResearch Materials; Risk of Loss of Provided Research Materials; Specialized
\nLicenses or Services<\/u><\/strong>.<\/strong><\/p>\n

(a)<\/strong> Obligation to Provide Foundation Provided
\nMaterials and Foundation Provided Material
\nInformation<\/u><\/strong>.<\/strong> The Foundation will provide Isis with
\n(i) each Foundation Provided Material designated as a Foundation Provided
\nMaterial for the Project and (ii) any information in respect of each such
\nFoundation Provided Material that is reasonably necessary to enable Isis to use
\nsuch Foundation Provided Material in the performance of the Research so long as
\nsuch information is in the possession of the Foundation and the Foundation is
\npermitted to provide such information to Isis without breaching any obligation
\nto any Third Party.<\/p>\n

(b)<\/strong> Reimbursement for Isis Provided Reimbursable
\nMaterials<\/u><\/strong>.<\/strong> The Foundation will, in accordance with
\nSection 6(b)(i)<\/u> of this Agreement, reimburse Isis for the actual costs
\nincurred by Isis to procure each Isis Provided Reimbursable Material<\/p>\n

12<\/p>\n

\n

<\/p>\n

designated as an Isis Provided Reimbursable Material for the Project (up to
\n[***]% of the estimated cost of such Isis Provided Reimbursable Material as is
\nset forth in the Project Description or the applicable mutually-approved
\nSteering Committee meeting minutes). Isis agrees that (i) each Isis Provided
\nReimbursable Material shall be procured pursuant to a written agreement between
\nIsis and the Third Party or Affiliate providing such Isis Provided Reimbursable
\nMaterial upon terms and conditions that (A) are consistent with the terms and
\nconditions of this Agreement and (B) do not conflict with Isis153 obligations or
\nthe Foundation153s rights under this Agreement and (ii) Isis shall cause each
\nThird Party or Affiliate providing Isis Provided Reimbursable Materials to
\nprovide such Isis Provided Reimbursable Materials in accordance with, and
\nsubject to, the terms and conditions of such agreement. Upon the Foundation153s
\nrequest, Isis will provide the Foundation with copies of such agreements between
\nIsis and any such Third Party or Affiliate.<\/p>\n

(c)<\/strong> Use and Ownership of Provided Research
\nMaterials and Foundation Provided Material Information; Retention of Provided
\nResearch Materials; Risk of Loss of Provided Research
\nMaterials<\/u><\/strong>.<\/strong><\/p>\n

(i)<\/strong> Use and Ownership of Provided Research
\nMaterials and Foundation Provided Material
\nInformation<\/u><\/strong>.<\/strong> Isis agrees that the Provided
\nResearch Materials and the Foundation Provided Material Information (A) will be
\nused by Isis for the sole purpose of conducting the Project and for no other
\npurpose, (B) will be used, handled, stored and disposed of in compliance with
\nall applicable laws, regulations and rules and (C) will not be transferred to
\nany Third Party or to any Affiliate of Isis except (1) as expressly required or
\ncontemplated by this Agreement (e.g.<\/u>, to a Subcontractor in accordance
\nwith Section 3(a)(ii)<\/u> of this Agreement) or (2) pursuant to the written
\nrequest of an authorized representative of the Foundation. Except to the extent
\nexpressly required by the Project Description, Isis further agrees that it will
\nnot: (a) directly or indirectly, reverse engineer, deconstruct or in any way
\nanalyze or determine the identity, structure or composition of any Foundation
\nProvided Materials or the properties thereof (chemical, biochemical, physical,
\nbiological or other); b) use any Provided Research Materials in any human; or c)
\nexport any Provided Research Materials or Foundation Provided Material
\nInformation in any manner that would violate any applicable export law or
\nregulation, including the United States. Isis acknowledges and agrees that (a)
\nas between Isis and the Foundation, the Foundation owns the Provided Research
\nMaterials and Foundation Provided Material Information and (b) Isis will not,
\npursuant to this Agreement, acquire any ownership or other interest in any
\nProvided Research Materials or Foundation Provided Material Information.<\/p>\n

13<\/p>\n

\n

<\/p>\n

(ii)<\/strong> Retention of Provided Research
\nMaterials<\/u><\/strong>. <\/strong>Except for live animals and
\nanimal-derived materials (e.g.<\/u>, tissue samples) that require consistent
\ncare or maintenance, Isis will retain all unused Provided Research Materials for
\na period of [***] following the earlier to occur of (A) the completion or
\ncancellation of the Project or (B) the expiration or termination of this
\nAgreement (such period, the “Provided Research Materials Retention
\nPeriod<\/em><\/strong>“). Except with respect to any Isis Provided Reimbursable
\nMaterial for which, prior to Isis153 purchase of such Isis Provided Reimbursable
\nMaterial, the Foundation provided written consent that Isis is not required to
\nprovide such Isis Provided Reimbursable Material to the Foundation, during the
\nProvided Research Materials Retention Period, Isis will, at the Foundation153s
\nrequest and expense, ship all or part of any or all of the unused Provided
\nResearch Materials to the Foundation or to such Third Party as the Foundation
\nwill direct in writing. Upon the expiration of the Provided Research Materials
\nRetention Period, Isis will appropriately discard or destroy all such unused
\nProvided Research Materials.<\/p>\n

(iii)<\/strong> [***] of Provided Research
\nMaterials<\/u><\/strong>.<\/strong> Immediately upon Isis153 receipt of a
\nProvided Research Material and continuing until such Provided Research Material
\nis delivered or disposed of by Isis pursuant to this Agreement (the
\n“Handling Period<\/em><\/strong>“), Isis will [***], and will be
\n[***], all [***], (A) [***] such Provided Research Material and (B) any
\npreparation for shipment and shipment of such Provided Research Material
\npursuant to this Agreement, in all cases to the extent each such Provided
\nResearch Material is [***]. If a Provided Research Material that is not [***] is
\n[***], the Parties will [***] such Provided Research Material. Isis will use
\ncommercially reasonable efforts to obtain and maintain [***] during the Handling
\nPeriod [***] each Provided Research Material.<\/p>\n

(d)<\/strong> Reimbursement for Specialized Licenses or
\nServices<\/u><\/strong>.<\/strong> The Foundation will, in accordance with
\nSection 6(b)(ii)<\/u> of this Agreement, reimburse Isis for the actual costs
\nincurred by Isis to license or procure from a Third Party or one of its
\nAffiliates, as the case may be, each license or service that is expressly
\nidentified as a license or service the costs of which are to be reimbursed by
\nthe Foundation in (i) the Project Description or (ii) otherwise agreed upon by
\nthe Steering Committee as a license or service the costs of which are to be
\nreimbursed by the Foundation for the Project (up to [***]% of the estimated cost
\nof such license or service as is set forth in the Project Description or the
\napplicable mutually-approved Steering Committee meeting minutes) (any such
\nlicense or service hereinafter referred to as a “Specialized License
\nor Service<\/em><\/strong>“). Isis agrees that (A) each Specialized License or
\nService shall be licensed or procured pursuant to a written agreement between
\nIsis and the Third Party or Affiliate licensing or providing such Specialized
\nLicense or Service upon terms and conditions that (1) are consistent with the
\nterms and conditions of this Agreement and (2) do not conflict with Isis153
\nobligations or the Foundation153s rights under this Agreement and<\/p>\n

14<\/p>\n

\n

<\/p>\n

(B) Isis shall cause each Third Party or Affiliate providing a Specialized
\nLicense or Service to provide such Specialized License or Service in accordance
\nwith, and subject to, the terms and conditions of such agreement. Upon the
\nFoundation153s request, Isis will provide the Foundation with copies of such
\nagreements between Isis and any such Third Party or Affiliate.<\/p>\n

Research\/Project Management<\/strong><\/p>\n

5.<\/strong> Steering Committee; Project Managers; Limited
\nAuthority of the Steering Committee and Project Managers; Recordkeeping; Project
\nReports<\/u><\/strong>.<\/strong><\/p>\n

(a)<\/strong> Steering
\nCommittee<\/u><\/strong>.<\/strong><\/p>\n

(i)<\/strong> Establishment and Make-Up of the Steering
\nCommittee; External Advisors<\/u><\/strong>.<\/strong><\/p>\n

(A)<\/strong> Establishment and Make-Up of the Steering
\nCommittee<\/u><\/strong>.<\/strong> Within a reasonable period of time
\nfollowing the Effective Date, not to exceed 30 days, the Parties will establish
\na committee (the “Steering Committee<\/em><\/strong>“). The Steering
\nCommittee will be comprised of four members. Each Party will designate two
\nmembers of the Steering Committee. Each Party will appoint members who possess
\nappropriate qualifications to conduct the responsibilities of the Steering
\nCommittee. Each Party may also, from time to time, invite other of its personnel
\nto attend the Steering Committee meetings; provided, that<\/em>, such other
\npersonnel will (1) act in an advisory, non-voting capacity only and (2) not be
\nentitled to decide or approve any matter requiring decision by or approval of
\nthe Steering Committee. A Party may at any time replace one or both of its
\nmembers of the Steering Committee upon written notice to the other Party. The
\nSteering Committee, as a formal governing body under this Agreement, will be
\ndissolved upon the expiration of the Term.<\/p>\n

(B)<\/strong> External
\nAdvisors<\/u><\/strong>.<\/strong> The Steering Committee may, from time to
\ntime, identify and appoint Third Party experts to advise the Steering Committee
\non technical and other matters; provided, that<\/em>, such experts will (1)
\nact in an advisory, non-voting capacity only and will not be entitled to decide
\nor approve any matter requiring decision by or approval of the Steering
\nCommittee and (2) be required to abide by confidentiality and non-use
\nobligations at least as restrictive as those set forth in Section 14<\/u> of
\nthis Agreement in respect of Confidential Information to which such experts are
\ngranted access.<\/p>\n

15<\/p>\n

\n

<\/p>\n

(ii)<\/strong> Responsibilities of the Steering Committee;
\nScope and Content of Detailed Project
\nDescriptions<\/u><\/strong>.<\/strong><\/p>\n

(A)<\/strong> Responsibilities of the Steering
\nCommittee<\/u><\/strong>.<\/strong> The Steering Committee will have the
\nauthority to make decisions about those matters that, by the express terms of
\nthis Agreement, are to be addressed by the Steering Committee. In addition to
\nany other matter that, by the express terms of this Agreement are to be
\ndetermined by the Steering Committee, the Steering Committee will be responsible
\nfor each of the following matters: (1) on at least a quarterly basis, reviewing
\nthe Detailed Project Description for the Project and, if deemed reasonably
\nnecessary by the Steering Committee, refining, updating and approving the
\nDetailed Project Description for the Project for the 12-month period beginning
\non the date such Detailed Project Description is so updated and approved by the
\nSteering Committee (each such Detailed Project Description to be developed in
\naccordance with, and set forth the information specified in, Section
\n5(a)(ii)(B)<\/u> of this Agreement), provided, that<\/em>, the Parties shall
\nuse their respective commercially reasonable efforts to facilitate the approval
\nby the Steering Committee of (and the Steering Committee will diligently
\nendeavor to approve) at least two calendar quarters of Research activities; (2)
\non at least a quarterly basis, subject to Section 2<\/u> of this Agreement,
\nreviewing and, if deemed reasonably necessary by the Steering Committee,
\napproving changes to the number of Research FTEs (not to exceed the Research FTE
\nMaximum Number) to be provided by Isis to perform the Research, provided,
\nthat<\/em>, the Parties shall use their respective commercially reasonable
\nefforts to facilitate the approval by the Steering Committee of (and the
\nSteering Committee will diligently endeavor to approve) the requisite number of
\nResearch FTEs to be provided by Isis to conduct the approved Research activities
\nfor at least two calendar quarters; (3) monitoring the coordination,
\nimplementation and conduct of the Project in accordance with the Project
\nDescription; (4) reviewing the status and progress of the conduct of the
\nProject; (5) determining if changes are needed to the scope of the Project; (6)
\nimplementing any changes to the scope of the Project that have been approved by
\nthe Parties; (7) reviewing and discussing the Invention Notices (as defined in
\nSection 9(c)(i)<\/u> of this Agreement) in respect of the Project Intellectual
\nProperty; (8) reviewing and discussing the filing of any patent applications in
\nrespect of any Patentable Project Intellectual Property; (9) reviewing and
\ndiscussing the Project Deliverables, Project Results and such other matters
\nrelated to this Agreement and the Research as are reasonably requested by either
\nof the Parties; (10) facilitating Isis153<\/p>\n

16<\/p>\n

\n

<\/p>\n

consideration of any Foundation Project Compound Request Notice submitted by
\nthe Foundation under Section 8(c)<\/u> of this Agreement; and (11)
\nfacilitating on-going communications between the Parties. Notwithstanding the
\nprovisions of Section 5(a)(iii)(B)<\/u> below, if the Steering Committee is
\nunable to reach consensus regarding the activities to be included and performed
\nin the Detailed Project Description (including without limitation, an inability
\nto reach consensus regarding the Research activities for the next calendar
\nquarter), the matter will first be submitted to B. Lynne Parshall, in the case
\nof Isis (or such other individual identified in writing by Isis), and Robi
\nBlumenstein, in the case of the Foundation (or such other individual identified
\nin writing by the Foundation) within five days for resolution and any such
\nresolution will be deemed to be a decision and approval by the Steering
\nCommittee for purposes of this Agreement.<\/p>\n

(B)<\/strong> Scope and Content of Detailed Project
\nDescriptions<\/u><\/strong>.<\/strong> Each Detailed Research Project
\nDescription developed and approved by the Steering Committee for the Project
\nwill be consistent with the scope of the Project as outlined in the General
\nProject Description. The Detailed Project Description for the Project will
\ninclude the following information: (1) a reasonably detailed description
\n(including the details of all material scientific protocols) of the Research
\nactivities and the timing thereof to be undertaken during the period covered by
\nsuch Detailed Project Description (all such Research activities to be consistent
\nwith the scope of the Project as outlined in the Project Description); (2) an
\nestimated time frame for the completion of the Project; (3) a breakdown of the
\nnumber of Research FTEs to be allocated to the conduct of the Project during the
\nperiod covered by such Detailed Project Description; (4) a list of each
\nSubcontractor together with a reasonably detailed description of the
\nSubcontracted Research to be undertaken by each such Subcontractor in the
\nconduct of the Project during the period covered by such Detailed Project
\nDescription; (5) a list of the Foundation Provided Materials to be provided for
\nthe conduct of the Project (including the amount and estimated cost thereof);
\n(6) a list of any Isis Provided Reimbursable Materials required for the conduct
\nof the Project (including the amount and estimated cost thereof); (7) a list of
\nany Specialized Licenses or Services required for the conduct of the Project
\n(including the cost thereof); and (8) such other information as may be necessary
\nto appropriately describe the Research activities to be undertaken in the
\nconduct of the Project during the period covered by such Detailed Project
\nDescription.<\/p>\n

17<\/p>\n

\n

<\/p>\n

(iii)<\/strong> Operating Procedures of the Steering
\nCommittee; Decisions by the Steering Committee; Steering Committee Minutes;
\nResolution of Steering Committee Disputes<\/u><\/strong>.<\/strong><\/p>\n

(A)<\/strong> Operating Procedures of the Steering
\nCommittee; Decisions by the Steering Committee; Steering Committee
\nMinutes<\/u><\/strong>.<\/strong> The Steering Committee will establish its
\nown internal operating procedures and meeting schedule (such meetings to be held
\nin person or by video or telephone conference as mutually agreed upon by the
\nSteering Committee members); provided, however<\/em>, the Steering Committee
\nwill meet on a face-to-face basis at least once every calendar quarter following
\nIsis153 delivery of the Project Report for the preceding calendar quarter in
\naccordance with Section 5(e)(i)<\/u> of this Agreement. Each Party may, as it
\ndeems reasonably necessary, call ad-hoc meetings of the Steering Committee by
\nproviding reasonable notice to the other Party. Any activity or matter that
\nrequires a decision by, or the approval of, the Steering Committee under this
\nAgreement will require the affirmative consent of each member of the Steering
\nCommittee and will only be a valid and binding decision and\/or approval of the
\nSteering Committee if such decision and\/or approval is expressly identified in
\nthe applicable mutually-approved Steering Committee meeting minutes. At each
\nmeeting of the Steering Committee, one meeting attendee will be appointed to
\nrecord and, within a period of 30 days after each such meeting, distribute the
\nminutes of such meeting to the Steering Committee members for approval (the
\napproval of the content of each such meeting minutes to be evidenced by the
\ninitialing of such meeting minutes by at least one of each Party153s designated
\nSteering Committee members).<\/p>\n

(B)<\/strong> Resolution of Steering Committee
\nDisputes<\/u><\/strong>.<\/strong> If the Steering Committee cannot reach
\nconsensus on any activity or matter that requires a decision by, or the approval
\nof, the Steering Committee (each, a “Steering Committee
\nDispute<\/em><\/strong>“), either Party may, within 30 days after the Steering
\nCommittee Dispute arises, submit such Steering Committee Dispute to B. Lynne
\nParshall, in the case of Isis (or such other individual identified in writing by
\nIsis), and Robi Blumenstein, in the case of the Foundation (or such other
\nindividual identified in writing by the Foundation), for resolution by providing
\na written notice (each, an “Internal Steering Committee Dispute
\nResolution Notice<\/em><\/strong>“) to the other Party setting forth in reasonable
\ndetail the basis of such dispute. Such individuals will, within 20 days after
\nsuch Internal Steering Committee Dispute Resolution Notice is delivered, meet
\nand attempt in good faith to resolve such Steering Committee Dispute.<\/p>\n

18<\/p>\n

\n

<\/p>\n

If such Steering Committee Dispute is not resolved within such 20-day period,
\neither Party may require that the Parties submit such Steering Committee Dispute
\nfor resolution by an independent Third Party with appropriate qualifications for
\nresolution to evaluate such matter (a “Neutral
\nExpert<\/em><\/strong>“) by providing a written notice (an “External
\nSteering Committee Dispute Resolution Notice<\/em><\/strong>“) to such effect that
\nidentifies the Steering Committee Dispute to be resolved. If the Parties fail to
\nagree on a Neutral Expert within 10 days after an External Steering Committee
\nDispute Resolution Notice is delivered, then each Party will submit the name and
\nqualifications of one proposed Neutral Expert, along with a written statement
\nnot to exceed five pages that identifies the issue(s) to be decided, to JAMS in
\nDenver, Colorado, with a copy to the other Party, and JAMS will appoint a single
\narbitrator, who will be authorized solely to select, within 10 days of his or
\nher appointment and pursuant to this Section 5(a)(iii)(B)<\/u>, which Party153s
\nproposed Neutral Expert will be designated for resolution of such matter, which
\ndecision will be final and binding on both Parties. Upon the designation of the
\nNeutral Expert, each Party will have 15 business days from the date of the
\ndesignation of such Neutral Expert to submit any appropriate materials to such
\nNeutral Expert, with copies to the other Party. No Party will communicate with
\nthe Neutral Expert except by written communications copied to the other Party,
\nor orally in the physical or telephonic presence of the other Party. The Neutral
\nExpert will render a written decision within 15 days after the deadline for
\nsubmission of materials from the Parties. The decision of the Neutral Expert
\nwill be final and binding on both Parties; provided, however<\/em>, in no
\nevent will either Party be obligated to violate any applicable federal, state,
\nlocal, international, health authority and institutional laws, rules,
\nregulations, orders or guidelines. The Parties agree that any and all such
\ndeliberations will be confidential.<\/p>\n

(b)<\/strong> Project
\nManagers<\/u><\/strong>.<\/strong><\/p>\n

(i)<\/strong> Appointment of the Project Managers;
\nOperating Procedures of the Project Managers<\/u><\/strong>.<\/strong>
\nWithin a reasonable period of time following the Effective Date, not to exceed
\n30 days, each Party will appoint a project manager (each, a
\n“Project Manager<\/em><\/strong>“) to oversee the day-to-day
\ncoordination, implementation and performance of the Research. The Project
\nManagers will establish their own operating procedures and meeting schedule
\n(such meetings to be held in person or by video or telephone conference as
\nmutually agreed upon by the Project Managers); provided, however<\/em>, the
\nProject Managers will meet on a bi-weekly basis or at such other frequency as
\nagreed upon by the Project Managers. Isis153<\/p>\n

19<\/p>\n

\n

<\/p>\n

Project Manager will keep the Foundation153s Project Manager fully informed as
\nto the status and progress of the conduct of the Project (including the status
\nof the completion time frame of the Project as compared to the estimated
\ncompletion time frame specified in the Project Description) and such other
\nmatters related to this Agreement and the Research as are reasonably requested
\nby the Foundation153s Project Manager. Upon the expiration of the Term, each
\nParty153s obligation to have and maintain a Project Manager under this Agreement
\nwill terminate.<\/p>\n

(ii)<\/strong> Responsibilities of the Project
\nManagers<\/u><\/strong>.<\/strong> The Project Managers will be responsible
\nfor the following activities: (A) assisting the Steering Committee in the
\ndevelopment of the revised Detailed Project Descriptions for the Project (each
\nsuch Detailed Project Description to be developed in accordance with, and set
\nforth the information specified in, Section 5(a)(ii)(B)<\/u> of this
\nAgreement); (B) overseeing the coordination, implementation and conduct of the
\nProject in accordance with the Project Description; (C) reviewing the status and
\nprogress of the conduct of the Project; (D) determining if changes are needed to
\nthe scope of the Project; (E) implementing any changes to the scope of the
\nProject that have been approved by the Parties; (F) reviewing and discussing the
\nProject Deliverables, Project Results and such other matters related to this
\nAgreement and the Research as are reasonably requested by either of the Parties;
\nand (G) facilitating on-going communications between the Parties.<\/p>\n

(c)<\/strong> Limited Authority of the Steering Committee
\nand Project Managers<\/u><\/strong>.<\/strong> For the avoidance of any
\ndoubt, the Parties agree that neither the Steering Committee nor any Project
\nManager will have the power or authority to (i) modify or make any amendments to
\nthis Agreement, (ii) except as otherwise provided in Section 5(a)(ii)(A)<\/u>
\nof this Agreement, modify or make any amendments to the Project Description,
\n(iii) waive a Party153s rights under, or compliance with, this Agreement or (iv)
\ndetermine whether there has been a breach of a Party153s obligations pursuant to
\nthis Agreement.<\/p>\n

(d)<\/strong> Recordkeeping<\/u><\/strong>.<\/strong>
\nIsis will keep complete and accurate records of the Research performed by it
\nunder this Agreement and of all Project Deliverables, Project Intellectual
\nProperty and Project Results. Isis will retain all such records, including all
\nraw data, for a period of not less than [***] following the date of the
\nexpiration or termination of the Term. During the Term of this Agreement and
\nsuch [***] period, such records (including the relevant pages of all applicable
\nlaboratory notebooks containing data, information or notations relating to the
\nperformance of the Research) will, upon 10 business days prior written notice
\nfrom the Foundation, be available at Isis153 facilities at all reasonable times
\nduring normal business hours for inspection, examination or copying by, or on
\nbehalf of, the Foundation at the Foundation153s expense, or alternatively, at
\nIsis153 election, will be made available to the Foundation in electronic form at
\nthe Foundation153s<\/p>\n

20<\/p>\n

\n

<\/p>\n

expense. During the [***] period following the date of the expiration or
\ntermination of the Term, Isis will, at the Foundation153s request and expense,
\nship copies of all or part of such records to the Foundation or to such Third
\nParty as the Foundation will direct in writing. Notwithstanding the foregoing,
\nIsis may retain copies of all such records to allow Isis to exercise its rights
\nand satisfy any of its obligations under this Agreement.<\/p>\n

(e)<\/strong> Project Reports; FTE
\nReports<\/u><\/strong>.<\/strong><\/p>\n

(i)<\/strong> Project
\nReports<\/u><\/strong>.<\/strong> Isis will deliver to the Foundation (A) a
\nwritten report on the performance of the Research within [***] after the end of
\neach [***] during the conduct of the Project and continuing until the
\ncancellation or completion of the Project, together with any additional reports
\nspecified in the Project Description (collectively, the “[***]
\nProject Reports<\/em><\/strong>“), and (B) a final written report on the conduct
\nof the Project (the “Final Project Report<\/em><\/strong>” and,
\ntogether with the [***] Project Reports, the “Project
\nReports<\/em><\/strong>“) within [***] of the [***]. Each Project Report will
\naddress each of the following in substantially the same format and containing
\nthe same degree of detail as Isis generally uses to communicate such information
\ninternally and to its Third Party research collaborators: (1) a summary of the
\nstatus and progress of the Project (including an update on the projected time
\nframe for the completion of the Project), (2) material developments and issues
\nrelating to the conduct of the Project and (3) a summary of any Project Results
\nproduced during the period covered by the Project Report. Each Project Report
\nwill include a copy of (a) each report related to the Research activities
\nreceived by Isis during the period from a Third Party or Affiliate and (b) all
\nfinal versions of written documents created by Isis summarizing the Project
\nResults for the Research activities and not otherwise included in the any of the
\nreports described in (a) above that are or have been previously delivered to the
\nFoundation.<\/p>\n

(ii)<\/strong> FTE Reports<\/u><\/strong>.<\/strong>
\nIsis will deliver to the Foundation Research FTE reports (each, a
\n“FTE Report<\/em><\/strong>“) on a [***] basis (each such FTE Report
\nto be delivered at least [***] prior to the Steering Committee153s regularly
\nscheduled meeting for the period covered by such FTE Report) for each [***]
\nthrough the [***]. Each FTE Report will contain [***].<\/p>\n

(f)<\/strong> Follow-Up
\nQueries<\/u><\/strong>.<\/strong> Isis will provide the Foundation153s
\nSteering Committee members with a reasoned response (including, if requested by
\na Foundation Steering Committee member, the raw data underlying the Project
\nResults or the Additional Project Activities Project Results) to any follow-up
\nscientific questions asked by a Foundation Steering Committee member concerning
\n(i) the Research that is the subject of a Project Report or arises from a
\ndiscussion at a Steering Committee meeting or (ii) the Additional Project
\nActivities that are the subject of a Project Report or arises from a discussion
\nat a Steering Committee meeting.<\/p>\n

21<\/p>\n

\n

<\/p>\n

Any requested raw data may be provided to the Foundation in the same format
\n(e.g.<\/u>, electronic transfer, CD, DVD, SAS, Microsoft Excel spreadsheet,
\netc.) as is used by Isis for its own purposes.<\/p>\n

Payments<\/strong><\/p>\n

6.<\/strong> General Payment Obligation; Reimbursement
\nObligation for Isis Provided Reimbursable Materials Costs, Specialized Licenses
\nor Services Costs and Shipping and Insurance Costs; Quarterly Research Payments;
\nConditions Precedent for the Payments; Invoicing; Payment
\nRemittance<\/u><\/strong>.<\/strong><\/p>\n

(a)<\/strong> General Payment
\nObligation<\/u><\/strong>.<\/strong> In full consideration of Isis153
\nperformance of the Research and its other obligations under this Agreement, the
\nFoundation will, subject to the terms and conditions set forth in this
\nAgreement, make payments to Isis as provided in this Agreement. The calculation
\nof the amount of such payments, the timing of the payment of such payments and
\nconditions precedent for the payment of such payments are set forth in this
\nSection 6<\/u>.<\/p>\n

(b)<\/strong> Reimbursement Obligation for Isis Provided
\nReimbursable Materials Costs, Specialized Licenses or Services Costs and
\nShipping and Insurance Costs<\/u><\/strong>.<\/strong><\/p>\n

(i)<\/strong> Isis Provided Reimbursable Materials
\nCosts<\/u><\/strong>.<\/strong> Subject to Section 4(b)<\/u> of this
\nAgreement, the Foundation will reimburse Isis for the actual costs incurred by
\nIsis to procure any Isis Provided Reimbursable Materials (all such costs
\nhereinafter referred to as the “Isis Provided Reimbursable Materials
\nCosts<\/em><\/strong>“).<\/p>\n

(ii)<\/strong> Specialized Licenses or Services
\nCosts<\/u><\/strong>.<\/strong> Subject to Section 4(d)<\/u> of this
\nAgreement, the Foundation will reimburse Isis for the actual costs incurred by
\nIsis to license or procure any Specialized Licenses or Services (all such costs
\nhereinafter referred to as the “Specialized Licenses or Services
\nCosts<\/em><\/strong>“).<\/p>\n

(iii)<\/strong> Shipping and Insurance
\nCosts<\/u><\/strong>.<\/strong> The Foundation will reimburse Isis for (A)
\nthe actual costs of carriage, customs duties and insurance incurred by Isis in
\nconnection with the delivery of the Project Deliverables and Provided Research
\nMaterials to the Foundation (or such Third Party specified by the Foundation)
\nand (B) for the actual costs and expenses incurred by Isis in connection with
\nthe shipping of the Project Deliverables and Provided Research Materials to the
\nFoundation (or such Third Party specified by the Foundation) (all such costs
\nhereinafter referred to as the “Shipping and Insurance
\nCosts<\/em><\/strong>“), in each case provided that such costs are reasonable.\n<\/p>\n

22<\/p>\n

\n

<\/p>\n

(c)<\/strong> Additional Project Activities Description
\nPayment<\/u><\/strong>.<\/strong> For the performance of the Research
\nperformed by, or on behalf of, Isis as described in the Additional Project
\nActivities Description (the “Additional Project
\nActivities<\/em><\/strong>“), the Foundation will make a one-time payment (the
\n“Additional Project Activities Payment<\/em><\/strong>“) to Isis in
\nthe amount of US$[***] (the “Additional Project Activities Payment
\nAmount<\/em><\/strong>“). Isis agrees that (i) upon the payment of the Additional
\nProject Activities Payment Amount by the Foundation, the Foundation will have
\npaid Isis all amounts owed by the Foundation to Isis for the conduct of the
\nAdditional Project Activities and (ii) the Foundation has paid Isis all amounts
\nowed by CHDI pursuant to Section 5 of the 2007 Research Agreement.<\/p>\n

(d)<\/strong> Advance Research
\nPayment<\/u><\/strong>.<\/strong> The Foundation will make a payment (the
\n“Advance Research Payment<\/em><\/strong>“) to Isis in the amount of
\nUS$[***] (the “Advance Research Payment Amount<\/em><\/strong>“). Isis
\nacknowledges and agrees that the Advance Research Payment Amount shall, in
\naccordance with Section 6(g)(i)<\/u> of this Agreement, be applied as a credit
\nagainst the final Quarterly Research Payment (as defined in Section 6(e)<\/u>
\nof this Agreement).<\/p>\n

(e)<\/strong> Quarterly Research
\nPayments<\/u><\/strong>.<\/strong><\/p>\n

(i)<\/strong> General<\/u><\/strong>.<\/strong>
\nPromptly following the end of each calendar quarter, Isis will calculate the
\npayment (each, a “Quarterly Research Payment<\/em><\/strong>“) to be
\nmade by the Foundation in respect of (A) the Research FTE costs incurred by Isis
\nin performing the Research during such period, (B) Isis Provided Reimbursable
\nMaterials Costs incurred by Isis during such period, (C) the Specialized
\nLicenses or Services Costs incurred by Isis during such period and (D) the
\nShipping and Insurance Costs incurred by Isis during such period.<\/p>\n

(ii)<\/strong> Specific Calculation of each Quarterly
\nResearch Payment<\/u><\/strong>.<\/strong> Each Quarterly Research Payment
\nin respect of the period covered by such Quarterly Research Payment will be
\ncalculated in accordance with the terms of this Agreement and will be an amount
\nequal to [***].<\/p>\n

(f)<\/strong> Conditions Precedent for
\nPayments<\/u><\/strong>.<\/strong><\/p>\n

(i)<\/strong> Conditions Precedent for the Payment of the
\nAdditional Project Activities Payment<\/u><\/strong>.<\/strong> The
\nobligation of the Foundation to pay the Additional Project Activities Payment is
\nsubject to Isis153 delivery to the Foundation, in accordance with [***] of this
\nAgreement, of [***] on or prior to the date that Isis issues an invoice in
\nrespect of such Additional Project Activities Payment.<\/p>\n

(ii)<\/strong> Conditions Precedent for the Payment of the
\nQuarterly Research Payments<\/u><\/strong>.<\/strong> With respect to each
\nQuarterly Research Payment, the obligations of the Foundation to pay such
\nQuarterly Research Payment are subject to the fulfillment of each of the
\nfollowing conditions:<\/p>\n

23<\/p>\n

\n

<\/p>\n

[***]<\/p>\n

provided, however<\/em>, that the Foundation will pay each Quarterly
\nResearch Payment to Isis no later than [***] after the date of the Foundation153s
\nreceipt of the invoice for such Quarterly Research Payment, if Isis has, with
\nrespect to such Quarterly Research Payment [***].<\/p>\n

(g)<\/strong> Invoicing; Payment
\nRemittance<\/u><\/strong>.<\/strong><\/p>\n

(i)<\/strong> Invoicing<\/u><\/strong>.<\/strong> At
\nsuch time as Isis has, in accordance with [***] of this Agreement, delivered to
\nthe Foundation the [***], Isis will also deliver to the Foundation an invoice
\nfor the Additional Project Activities Payment to be made by the Foundation for
\nsuch period. At such time as Isis has, in accordance with Section 5(e)<\/u>
\nof this Agreement, delivered to the Foundation the [***] and [***] for a
\nparticular calendar quarter, Isis will also deliver to the Foundation an invoice
\nfor the Quarterly Research Payment to be made by the Foundation for such
\ncalendar quarter. Each invoice delivered by Isis for a payment under this
\nAgreement will (A) reference the “RecID” number set forth in the footer of this
\nAgreement, (B) be issued in US Dollars, (C) be itemized and contain detailed
\ninformation in respect of the payment being billed under such invoice and (D) as
\napplicable, include a copy of all relevant receipts and\/or invoices related to
\nthe payment being billed under such invoice. Isis agrees that a) the invoice
\nsubmitted by Isis in respect of the final Quarterly Research Payment shall
\ncredit the Advance Research Payment Amount against such final Quarterly Research
\nPayment and b) if the amount of final Quarterly Research Payment is less than
\nthe Advance Research Payment Amount, Isis shall promptly make a payment to the
\nFoundation in an amount equal to the amount by which the Advance Research
\nPayment Amount exceeded the amount of the final Quarterly Research Payment.<\/p>\n

(ii)<\/strong> Payment
\nRemittance<\/u><\/strong>.<\/strong> Subject to the terms and conditions of
\nthis Agreement, each payment to be made by the Foundation under this Agreement
\nwill be due and payable by the Foundation within [***] of the date of the
\nreceipt by the Foundation of the invoice issued by Isis in accordance with this
\nAgreement in respect of such payment. All payments made by the Foundation under
\nthis Agreement will be paid by check in US Dollars and remitted to Isis at the
\naddress set forth in Section 19<\/u> of this Agreement. Any payment made by
\nthe Foundation under this Agreement in respect of an invoice issued by Isis
\nunder this Agreement using a currency other than US Dollars will be converted by
\nthe Foundation to US Dollars at the exchange rate prevailing on or about the
\ndate that the Foundation remits such payment to Isis.<\/p>\n

24<\/p>\n

\n

<\/p>\n

Project Results<\/strong><\/p>\n

7.<\/strong> Ownership of Project Results; Notification and
\nDelivery of Project Results; Withdrawal of Project Results; Transfers of the
\nProject Results to Collaborators<\/u><\/strong>.<\/strong><\/p>\n

(a)<\/strong> Ownership of Project
\nResults<\/u><\/strong>.<\/strong> Isis and the Foundation will own [***]
\nall Project Results. The ownership of the Project Results will vest in the
\nParties in that manner immediately upon creation. Each Party hereby assigns, and
\nagrees to assign, to the other Party sufficient right, title and interest in the
\nProject Results to accomplish such ownership. Each of Isis and the Foundation
\nagrees that it will not sell or otherwise transfer (including by sale of assets
\nor stock or by merger or other business combination) its title to any Project
\nResults to any Third Party or Affiliate unless such Third Party or Affiliate
\ntakes title to such Project Results (i) subject to the rights of the
\nnon-transferring Party in such Project Results under this Agreement and (ii)
\nassumes the obligations of the transferring Party with respect to such Project
\nResults under this Agreement; provided, however<\/em>, that the transferring
\nParty will (A) notify the non-transferring Party in writing within 10 days after
\nany such transfer and (B) provide the non-transferring Party with a copy of the
\nwritten assignment and assumption or similar agreement between the transferring
\nParty and the Third Party or Affiliate transferee.<\/p>\n

(b)<\/strong> Notification and Delivery of Project Results;
\nWithdrawal of Project Results<\/u><\/strong>.<\/strong><\/p>\n

(i)<\/strong> Notification and Delivery of Project
\nResults<\/u><\/strong>.<\/strong><\/p>\n

(A)<\/strong> General<\/u><\/strong>. <\/strong>Isis
\nwill inform the Foundation of, and deliver, the Project Results to the
\nFoundation within a reasonable period of time following the conception,
\ndiscovery, invention or production, as the case may be, of each such Project
\nResult through the Steering Committee meetings, Project Reports and the
\ntransmittal of the raw data underlying the Project Results pursuant to
\nSection 5(f)<\/u> of this Agreement.<\/p>\n

(B)<\/strong> Delivery of Additional Project Activities
\nProject Results<\/u><\/strong>.<\/strong> Isis has informed the Foundation
\nof, and delivered, the Project Results relating to the programs of Research
\nperformed by, or on behalf of, Isis as described in the Additional Project
\nActivities Description to the Foundation in a series of reports (collectively,
\nthe “Additional Project Activities Project Results<\/em><\/strong>“).
\nWithin [***] of the Effective Date, the Additional Project Activities Project
\nResults previously delivered to the Foundation will be compiled by Isis and
\norganized into a master report and redelivered to the Foundation (the
\n“Additional Project Activities Project Results
\nReport<\/em><\/strong>“), and will include an activity index listing each
\nslide\/page of such report relevant to each particular activity.<\/p>\n

25<\/p>\n

\n

<\/p>\n

(ii)<\/strong> Withdrawal of Project
\nResults<\/u><\/strong>.<\/strong> If at any time after informing the
\nFoundation of the Project Results pursuant to Section 7(b)(i)<\/u> of this
\nAgreement Isis determines that there is a reasonable scientific basis to
\nconclude that all or a portion of such Project Results are not scientifically
\nvalid or accurate, Isis will promptly so notify the Foundation in writing.<\/p>\n

(c)<\/strong> Transfers of the Project Results to
\nCollaborators; Uses of Project Results<\/u><\/strong>.<\/strong><\/p>\n

(i)<\/strong> Transfers of the Project Results by Isis to
\nThird Party Collaborators; Uses of Project
\nResults<\/u><\/strong>.<\/strong> Isis may transfer or have transferred the
\nProject Results to any of its Affiliates or one or more Third Party
\ncollaborators; provided, that<\/em>, any such Affiliate or Third Party
\ncollaborator has entered into an agreement with Isis which requires such
\nAffiliate or Third Party collaborator to maintain similar, but no less
\nburdensome, obligations of confidentiality and non-use set forth in Section
\n14(c)<\/u> of this Agreement. Subject to the foregoing, Isis and each of its
\nAffiliates and Third Party collaborators shall only have the right to use the
\nProject Results for all uses and purposes permitted under this Agreement.<\/p>\n

(ii)<\/strong> Transfers of the Project Results by the
\nFoundation to Foundation Collaborators; Uses of Project
\nResults<\/u><\/strong>.<\/strong> The Foundation may transfer or have
\ntransferred the Project Results to any of its Affiliates or one or more
\nFoundation Collaborators; provided, that<\/em>, any such Affiliate or
\nFoundation Collaborator has entered into an agreement with the Foundation which
\nrequires such Affiliate or Foundation Collaborator to maintain similar, but no
\nless burdensome, obligations of confidentiality and non-use set forth in
\nSection 14(c)<\/u> of this Agreement. Subject to the foregoing, the Foundation
\nand each of its Affiliates and Foundation Collaborators shall only have the
\nright to (A) use the Project Results for all uses and purposes relating to HD
\nResearch and Development and (B) exercise the license rights granted by Isis
\npursuant to Section 10<\/u> and Section 12<\/u> of this Agreement.<\/p>\n

Project Deliverables; Requests for Project
\nCompounds<\/strong><\/p>\n

8.<\/strong> Ownership of Project Deliverables; Delivery of
\nProject Deliverables; Transfers of the Project Deliverables to Foundation
\nCollaborators; Grant of HD Field of Use License to Isis; Isis153 Option to
\nNegotiate Additional License Rights Outside the HD Field of Use; Transfers of
\nthe Project Deliverables to Foundation Collaborators; Requests for Project
\nCompounds; Approval of Foundation Project Compound Requests; Criteria for
\nApproving Foundation Project Compound Requests; Basis for Determination to not
\nApprove a Foundation Project Compound Request; Delivery of Approved Foundation
\nRequested Project Compounds; Use of Approved Foundation Requested Project
\nCompounds; Payment for Approved Foundation Requested Project Compounds;
\nInvoicing; Payment Remittance; Delivery and Use of Results Arising from the use
\nof the Project Deliverables<\/u><\/strong>.<\/strong><\/p>\n

26<\/p>\n

\n

<\/p>\n

(a)<\/strong> Ownership of Project
\nDeliverables<\/u><\/strong>.<\/strong> Notwithstanding any provision of
\nthis Agreement to the contrary, as between the Foundation and Isis, the
\nFoundation will solely own all Project Deliverables. Isis hereby assigns, and
\nagrees to assign, to the Foundation any and all right, title and interest of
\nIsis in and to the Project Deliverables. The ownership of each Project
\nDeliverable will vest in the Foundation immediately upon production of such
\nProject Deliverable. Upon the written request of the Foundation, Isis will
\nexecute such documents and do all other acts and things as may be reasonably
\ndeemed necessary by the Foundation to effectuate and assure that all right,
\ntitle and interest of Isis in and to each Project Deliverable vest in the
\nFoundation (or its designee). The Foundation will reimburse Isis for all
\nreasonable out-of-pocket costs and expenses actually incurred by Isis to execute
\nand deliver to the Foundation any such document(s) referred to immediately
\nabove. For the avoidance of any doubt, notwithstanding any provision of this
\nAgreement to the contrary, the ownership of a Project Deliverable by the
\nFoundation does not grant any ownership rights to the Foundation in any
\nIntellectual Property embodied in or related to such Project Deliverable as the
\nownership of any such Intellectual Property is governed solely by the terms of
\nSection 9<\/u> of this Agreement.<\/p>\n

(b)<\/strong> Delivery of Project Deliverables; Transfers
\nof the Project Deliverables to Foundation Collaborators; Grant of HD Field of
\nUse License to Isis; Isis153 Option to Negotiate Additional License Rights Outside
\nthe HD Field of Use<\/u><\/strong>.<\/strong><\/p>\n

(i)<\/strong> Delivery of Project
\nDeliverables<\/u><\/strong>.<\/strong> Promptly following the production of
\neach Project Deliverable, Isis will deliver such Project Deliverable to the
\nFoundation. All Project Deliverables will be shipped to the delivery point
\nspecified by the Foundation in writing to Isis.<\/p>\n

(ii)<\/strong> Transfers of the Project Deliverables to
\nFoundation Collaborators; Grant of HD Field of Use License to Isis; Isis153 Option
\nto Negotiate Additional License Rights Outside the HD Field of
\nUse<\/u><\/strong>.<\/strong><\/p>\n

(A)<\/strong> Transfers of the Project Deliverables to
\nFoundation Collaborators<\/u><\/strong>.<\/strong> The Foundation may
\ntransfer or have transferred the Project Deliverables to one or more Foundation
\nCollaborators; provided, that<\/em>, any such Foundation Collaborator has
\nentered into an agreement with the Foundation which requires such Foundation
\nCollaborator to maintain similar, but no less burdensome, obligations of
\nconfidentiality and non-use set forth in Section 14(c)<\/u> of this Agreement.
\nThe Foundation and the Foundation Collaborators shall have the right to (A) use
\nthe Project Deliverables for all uses and purposes relating to HD Research and
\nDevelopment and (B) exercise the license rights granted by Isis pursuant to
\nSection 10<\/u> and Section 12<\/u> of this Agreement<\/p>\n

27<\/p>\n

\n

<\/p>\n

(B)<\/strong> Grant of HD Field of Use License to
\nIsis<\/u><\/strong>. <\/strong>The Foundation hereby grants (and will
\nrequire the Foundation Collaborators that use any Project Deliverables to grant)
\nIsis a fully paid-up, royalty-free, irrevocable, perpetual, worldwide,
\nnon-exclusive license solely in the HD Field of Use under any Intellectual
\nProperty that claims a method of using a Project Compound conceived, discovered,
\ninvented, made or first reduced to practice in the course of the Foundation153s or
\na Foundation Collaborator153s use of the Project Deliverables.<\/p>\n

(C)<\/strong> Isis153 Option to Negotiate Additional License
\nRights Outside the HD Field of Use<\/u><\/strong>. <\/strong>In addition to
\nthe non-exclusive license referred to in Section 8(b)(ii)(B)<\/u> of this
\nAgreement, the Foundation grants to Isis an exclusive option (each, a
\n“Project Deliverable Option<\/em><\/strong>“) to acquire a worldwide
\nlicense under any Intellectual Property that claims a method of using a Project
\nCompound conceived, discovered, invented, made or first reduced to practice in
\nthe course of the Foundation153s or a Foundation Collaborator153s use of the Project
\nDeliverables for uses outside of<\/em> the HD Field of Use, which option will
\nextend for a period (each, a “Project Deliverable Option Exercise
\nPeriod<\/em><\/strong>“) of three (3) months following receipt of a notice from
\nthe Foundation disclosing any such Intellectual Property (which notice may be
\nsatisfied by the Foundation153s delivery of the written reports described in
\nSection 8(d)<\/u> of this Agreement). With respect to any such Intellectual
\nProperty that is subject to a Project Deliverable Option, Isis shall exercise
\nsuch Project Deliverable Option by providing written notice to the Foundation
\nprior to the expiration of the Project Deliverable Option Exercise Period in
\nrespect of such Project Deliverable Option. If Isis exercises a Project
\nDeliverable Option, then Isis shall have a period (each, a “Project
\nDeliverables License Negotiation Period<\/em><\/strong>“) of one hundred and
\ntwenty (120) days following the delivery by Isis of the Project Deliverable
\nOption Exercise Notice in respect of such Project Deliverable Option within
\nwhich to negotiate and execute a license in respect of the Intellectual Property
\nsubject to such Project Deliverable Option. Each of the Foundation and Isis
\nagree (1) to negotiate any such license in good faith and (2) that, upon the
\nmutual agreement of the Foundation and Isis, to extend the Project Deliverable
\nLicense Negotiation Period in respect of such license for an additional
\nperiod(s) not to exceed an additional one hundred and twenty (120) days, in the
\naggregate.<\/p>\n

28<\/p>\n

\n

<\/p>\n

(c)<\/strong> Requests for Project Compounds; Approval of
\nFoundation Project Compound Requests; Criteria for Approving Foundation Project
\nCompound<\/u><\/strong> Requests; Basis for Determination to not
\nApprove a Foundation Project Compound Request; Delivery of Approved Foundation
\nRequested Project Compounds; Use of Approved Foundation Requested Project
\nCompounds; Grant of HD Field of Use License to Isis; Isis153 Option to Negotiate
\nAdditional License Rights Outside the HD Field of Use; Payment for Approved
\nFoundation Requested Project Compounds; Invoicing; Payment
\nRemittance<\/strong><\/u>.<\/strong><\/p>\n

(i)<\/strong> Requests for Project
\nCompounds<\/u><\/strong>.<\/strong> At any time, and from time to time,
\nduring the period beginning on [***] and ending on the date that is [***]
\nfollowing the expiration or termination of the Term (the
\n“Foundation Project Compound Request Period<\/em><\/strong>“), the
\nFoundation may request that Isis provide the Foundation with one or more Project
\nCompounds for use by the Foundation to conduct defined research activities by
\nproviding a written notice (the “Foundation Project Compound Request
\nNotice<\/em><\/strong>“) to Isis (A) identifying each Project Compound (each such
\nProject Compound, a “Foundation Requested Project
\nCompound<\/em><\/strong>“) and the requested amount thereof (with a minimum
\nrequested amount per Foundation Requested Project Compound of [***]) and (B) a
\nreasonably detailed description of the proposed research activities (each such
\nprogram of proposed research activities, a “Foundation Project
\nCompound Study<\/em><\/strong>“) to be conducted using each Foundation Requested
\nProject Compound.<\/p>\n

(ii)<\/strong> Approval of Foundation Project Compound
\nRequests; Criteria for Approving Foundation Project Compound Requests; Basis for
\nDetermination to not Approve a Foundation Project Compound
\nRequest<\/u><\/strong>.<\/strong><\/p>\n

(A)<\/strong> Approval of Foundation Project Compound
\nRequests<\/u><\/strong>.<\/strong> Within [***] of the receipt by Isis of a
\nFoundation Project Compound Request Notice, Isis will make a determination
\nregarding the Foundation153s request for the use of the Foundation Requested
\nProject Compounds for the Foundation Requested Project Compound Studies
\nspecified in such Foundation Project Compound Request Notice. As part of Isis153
\nconsideration of any such request, Isis may request that the Parties convene a
\nSteering Committee meeting (or, after the Term, convene representatives of each
\nParty) to facilitate its consideration of any such request. With respect to any
\ndecision regarding the approval of any request by the Foundation to use
\nFoundation Requested Project Compounds for the Foundation Requested Project
\nCompound Studies, Isis will (1) act in good faith and on a responsive basis and
\n(2) make such decision on a reasonable basis using the criteria set forth in
\nthis Section 8(c)(ii)<\/u>. Each Foundation Requested Project Compound and
\neach Foundation Project Compound Study that is approved by<\/p>\n

29<\/p>\n

\n

<\/p>\n

Isis in accordance with this Section 8(c)(ii)<\/u> will, for all purposes
\nof this Agreement, be referred to as an “Approved Foundation
\nRequested Project Compound<\/em><\/strong>” and “Approved Foundation
\nProject Compound Study<\/em><\/strong>“, respectively.<\/p>\n

(B)<\/strong> Criteria for Approving Foundation Project
\nCompound Requests<\/u><\/strong>. <\/strong>Isis will approve each request
\nby the Foundation to use a Foundation Requested Project Compound for a
\nFoundation Project Compound Study unless any of the following are determined by
\nIsis to be true:<\/p>\n

[***]<\/p>\n

(C)<\/strong> Basis for Determination to not Approve a
\nFoundation Project Compound Request<\/u><\/strong>. <\/strong>If Isis does
\nnot approve a request by the Foundation to use a Foundation Requested Project
\nCompound for a Foundation Project Compound Study, Isis will, no later than [***]
\nof the receipt by Isis of a Foundation Project Compound Request Notice for such
\nrequest, deliver to the Foundation a written notice setting forth in reasonable
\ndetail Isis153 basis under the criteria set forth in Section 8(c)(ii)(B)<\/u>
\nof this Agreement for not approving such request. Isis agrees that, if Isis does
\nnot approve such a request, the Foundation may dispute such determination by
\nIsis and seek resolution pursuant to Section 5(a)(iii)(B)<\/u> of this
\nAgreement.<\/p>\n

(iii)<\/strong> Delivery of Approved Foundation Requested
\nProject Compounds<\/u><\/strong>. <\/strong>Following Isis153 approval of a
\nrequest by the Foundation to use a Foundation Requested Project Compound for a
\nFoundation Project Compound Study, Isis will use reasonable commercial efforts
\nto (A) manufacture such Approved Foundation Requested Project Compound in
\naccordance with the standards and specifications developed for such Approved
\nFoundation Requested Project Compound during the course of the conduct of the
\nProject and (B) supply the Foundation with the amount of such Approved
\nFoundation Requested Project Compound within a reasonable period of time
\nfollowing such approval.<\/p>\n

(iv)<\/strong> Use of Approved Foundation Requested Project
\nCompounds; Grant of HD Field of Use License to Isis; Isis153 Option to Negotiate
\nAdditional License Rights Outside the HD Field of
\nUse<\/u><\/strong>.<\/strong><\/p>\n

(A)<\/strong> Use of Approved Foundation Requested Project
\nCompounds<\/u><\/strong>. <\/strong>The Foundation agrees that each
\nApproved Foundation Requested Project Compound will be used by the Foundation
\nand the Foundation Collaborators for the sole purpose of conducting the Approved
\nFoundation Project Compound Study for which such Approved Foundation Requested
\nProject Compound was approved.<\/p>\n

30<\/p>\n

\n

<\/p>\n

(B)<\/strong> Grant of HD Field of Use License to
\nIsis<\/u><\/strong>.<\/strong> The Foundation hereby grants (and will
\nrequire the Foundation Collaborators that use any Approved Foundation Requested
\nProject Compound to grant) Isis a fully paid-up, royalty-free, irrevocable,
\nperpetual, worldwide, non-exclusive license solely in the HD Field of Use under
\nany Intellectual Property that claims a method of using an Approved Foundation
\nRequested Project Compound conceived, discovered, invented, made or first
\nreduced to practice in the course of the Foundation153s or a Foundation
\nCollaborator153s use of an Approved Foundation Requested Project Compound.<\/p>\n

(C)<\/strong> Isis153 Option to Negotiate Additional License
\nRights Outside the HD Field of Use<\/u><\/strong>. <\/strong>In addition to
\nthe non-exclusive license referred to in Section 8(c)(iv)(B)<\/u> of this
\nAgreement, the Foundation grants to Isis an exclusive option (each, an
\n“Approved Foundation Requested Project Compound
\nOption<\/em><\/strong>“) to acquire a worldwide license under any Intellectual
\nProperty that claims a method of using an Approved Foundation Requested Project
\nCompound conceived, discovered, invented, made or first reduced to practice in
\nthe course of the Foundation153s or a Foundation Collaborator153s use of the
\nApproved Foundation Requested Project Compound for uses outside of<\/em> the
\nHD Field of Use, which option will extend for a period (each, an
\n“Approved Foundation Requested Project Compound Option Exercise
\nPeriod<\/em><\/strong>“) of three (3) months following receipt of a notice from
\nthe Foundation disclosing any such Intellectual Property (which notice may be
\nsatisfied by the Foundation153s delivery of the written reports described in
\nSection 8(d)<\/u> of this Agreement). With respect to any such Intellectual
\nProperty that is subject to an Approved Foundation Requested Project Compound
\nOption, Isis shall exercise such Approved Foundation Requested Project Compound
\nOption by providing written notice to the Foundation prior to the expiration of
\nthe Approved Foundation Requested Project Compound Option Exercise Period in
\nrespect of such Approved Foundation Requested Project Compound Option. If Isis
\nexercises an Approved Foundation Requested Project Compound Option, then Isis
\nshall have a period (each, an “Approved Foundation Requested Project
\nCompound License Negotiation Period<\/em><\/strong>“) of one hundred and twenty
\n(120) days following the delivery by Isis of the Approved Foundation Requested
\nProject Compound Option Exercise Notice in respect of such Approved Foundation
\nRequested Project Compound Option within which to negotiate<\/p>\n

31<\/p>\n

\n

<\/p>\n

and execute a license in respect of the Intellectual Property subject to such
\nApproved Foundation Requested Project Compound Option. Each of the Foundation
\nand Isis agree (1) to negotiate any such license in good faith and (2) that,
\nupon the mutual agreement of the Foundation and Isis, to extend the Approved
\nFoundation Requested Project Compound License Negotiation Period in respect of
\nsuch license for an additional period(s) not to exceed an additional one hundred
\nand twenty (120) days, in the aggregate.<\/p>\n

(v)<\/strong> Payment for Approved Foundation Requested
\nProject Compounds; Invoicing; Payment Remittance<\/u><\/strong>.<\/strong>
\nThe Foundation will pay Isis a fee of US$[***] per [***] (or portion thereof)
\nper Approved Foundation Requested Project Compound delivered to the Foundation
\npursuant to, and in accordance with, this Section 8(c)<\/u>. Simultaneously
\nwith the delivery of each Approved Foundation Requested Project Compound, Isis
\nwill deliver to the Foundation an invoice for payment in respect of such
\nApproved Foundation Requested Project Compound. Each invoice delivered by Isis
\nfor an Approved Foundation Requested Project Compound will (A) reference the
\n“RecID” number set forth in the footer of this Agreement, (B) be issued in US
\nDollars and (C) be itemized and contain detailed information in respect of the
\nApproved Foundation Requested Project Compound being billed for under such
\ninvoice. Subject to the terms and conditions of this Agreement, each payment to
\nbe made by the Foundation in respect of an Approved Foundation Requested Project
\nCompound under this Agreement will be due and payable by the Foundation within
\n60 days of the date of the receipt by the Foundation of the invoice issued by
\nIsis in accordance with this Agreement in respect of such payment. All such
\npayments made by the Foundation under this Agreement will be paid by check in US
\nDollars and remitted to Isis at the address set forth in Section 19<\/u> of
\nthis Agreement. For the avoidance of doubt, unless otherwise approved by the
\nSteering Committee pursuant to Section 13(a)(ii)(E)<\/u> of this Agreement,
\nthe (1) cost of any Approved Foundation Requested Project Compound Studies
\nconducted by the Foundation or the Foundation Collaborators and (2) amounts paid
\nto Isis under this Section 8(c)(v)<\/u> for Approved Foundation Requested
\nProject Compounds, will not be reimbursed by Isis under this Agreement, and will
\nnot be considered “Revenue<\/em>” under Section 13<\/u> of this Agreement.\n<\/p>\n

(d)<\/strong> Delivery and Use of Results Arising from the
\nuse of the Project Deliverables<\/u><\/strong>.<\/strong> The Foundation
\nwill deliver to Isis a written report setting forth a summary of all data,
\nformulae, methods, outcomes, protocols or other results produced by the
\nFoundation or any Foundation Collaborator using the Project Deliverables
\n(including any Approved Foundation Requested Project Compound). Each such report
\n(A) will be delivered to Isis within a reasonable period of time following the
\ncompletion of the research activities in which the Project Deliverables were\n<\/p>\n

32<\/p>\n

\n

<\/p>\n

used, (B) will be in substantially the same format and contain the same
\ndegree of detail as the Foundation generally uses to communicate such
\ninformation internally and to its Third Party research collaborators and (C)
\nwill include a copy of (1) each report related such results received by the
\nFoundation from a Third Party or Affiliate and (2) all final versions of written
\ndocuments created by the Foundation summarizing such results and not otherwise
\nincluded in the any of the reports described in (1) above that are delivered to
\nIsis. Isis agrees that all reports and results delivered by the Foundation to
\nIsis pursuant to this Section 8(d)<\/u> shall be deemed the Confidential
\nInformation of the Foundation and, notwithstanding any other provision of this
\nAgreement, may only be (a) used by Isis for Research and Development, (b)
\ndisclosed in accordance with, and to only those Third Parties and Affiliates
\nexpressly permitted by, Section 14(c)<\/u> of this Agreement, and (c) licensed
\nby Isis to a Third Party under a Commercial License (subject to such Third
\nParty153s agreement to keep such reports and results confidential under terms no
\nless restrictive as those set forth in Section 14<\/u> of this Agreement).
\nIsis acknowledges and agrees that, notwithstanding the foregoing, except as
\notherwise provided in this Section 8(d)<\/u> or Section 8(b)(ii)<\/u> or
\nSection 8(c)(iv)<\/u> of this Agreement, no license or other rights are
\ngranted to Isis with respect to any Intellectual Property covering or claiming,
\nor otherwise embodied in, such reports or the information contained therein.\n<\/p>\n

Intellectual Property<\/strong><\/p>\n

9.<\/strong> Ownership of Background Intellectual Property;
\nOwnership of Project Intellectual Property; Grant of Exclusive License to the
\nProject HD Intellectual Property by the Foundation Outside the HD Field of Use;
\nDisclosure of Inventions; Inventorship; Prosecution of Patentable Project HD
\nIntellectual Property; Disclaimer of Interest in Patentable Project Intellectual
\nProperty; Infringement or Misappropriation of Project Intellectual
\nProperty<\/u><\/strong>.<\/strong><\/p>\n

(a)<\/strong> Ownership of Background Intellectual
\nProperty<\/u><\/strong>.<\/strong><\/p>\n

(i)<\/strong> Ownership of Isis Background Intellectual
\nProperty<\/u><\/strong>.<\/strong> As between the Foundation and Isis, Isis
\nwill solely own all Isis Background Intellectual Property. Except as expressly
\nset forth in this Agreement, the Foundation will have no ownership or other
\ninterest in any Isis Background Intellectual Property.<\/p>\n

(ii)<\/strong> Ownership of Foundation Background
\nIntellectual Property<\/u><\/strong>.<\/strong> As between the Foundation
\nand Isis, the Foundation will solely own all Foundation Background Intellectual
\nProperty. Except as expressly set forth in this Agreement, Isis will have no
\nownership or other interest in any Foundation Background Intellectual Property.\n<\/p>\n

33<\/p>\n

\n

<\/p>\n

(b)<\/strong> Ownership of Project Intellectual Property;
\nGrant of Exclusive License to the Project HD Intellectual Property by the
\nFoundation Outside the HD Field of Use<\/u><\/strong>.<\/strong><\/p>\n

(i)<\/strong> Ownership of Project Intellectual
\nProperty<\/u><\/strong>.<\/strong><\/p>\n

(A)<\/strong> Ownership of Project Non-HD Intellectual
\nProperty<\/u><\/strong>.<\/strong> As between the Foundation and Isis, Isis
\nwill solely own all Project Non-HD Intellectual Property. Except as expressly
\nset forth in this Agreement, the Foundation will have no ownership or other
\ninterest in any Project Non-HD Intellectual Property.<\/p>\n

(B)<\/strong> Ownership of Project HD Intellectual
\nProperty<\/u><\/strong>.<\/strong> Isis and the Foundation will own [***]
\nall Project HD Intellectual Property. The ownership of the Project HD
\nIntellectual Property will vest in the Parties in that manner immediately upon
\ncreation. Each Party hereby assigns to the other Party sufficient right, title
\nand interest in the Project HD Intellectual Property to accomplish such
\nownership. Neither Isis nor the Foundation will sell or otherwise transfer
\n(including by sale of assets or stock or by merger or other business
\ncombination) its title to any Project HD Intellectual Property (including any
\nReverted Project HD Intellectual Property (as defined in Section
\n9(b)(iii)(A)<\/u> of this Agreement)) to any Third Party or Affiliate unless such
\nThird Party or Affiliate takes title to such Project HD Intellectual Property
\n(1) subject to the rights of the non-transferring Party in such Project HD
\nIntellectual Property under this Agreement and (2) assumes in writing the
\nobligations of the transferring Party with respect to such Project HD
\nIntellectual Property under this Agreement, including the limitations under this
\nAgreement relating to the transferring Party153s use of such Project HD
\nIntellectual Property; provided, however<\/em>, that the transferring Party
\nwill a) notify the non-transferring Party in writing within 10 days after any
\nsuch transfer and b) provide the non-transferring Party with a copy of the
\nrelevant part of the written assignment and assumption or similar agreement
\nbetween the transferring Party and the Third Party or Affiliate transferee.<\/p>\n

(ii)<\/strong> Grant of Exclusive License to the Project HD
\nIntellectual Property by the Foundation Outside the HD Field of
\nUse<\/u><\/strong>.<\/strong> The Foundation grants to Isis a fully
\npaid-up, royalty-free, worldwide exclusive license under any Project HD
\nIntellectual Property (including (A) any patent application, divisional,
\ncontinuation, continuation-in-part, substitute, renewal, reexamination,
\nextension or reissue in respect of any applicable patent or (B) any intellectual
\nproperty rights claimed in respect of any applicable patent), to use the Project
\nHD Intellectual Property for any use or purpose outside the HD Field of Use. The
\nlicense rights granted by the Foundation<\/p>\n

34<\/p>\n

\n

<\/p>\n

under this Section 9(b)(ii)<\/u> will be subject to termination by the
\nFoundation in the event of Isis153 material breach of this Agreement if such
\nmaterial breach is not cured within 45 days following receipt by Isis of notice
\nof such material breach.<\/p>\n

(iii)<\/strong> Reversion of Foundation153s Rights in Project
\nHD Intellectual Property<\/u><\/strong>.<\/strong><\/p>\n

(A)<\/strong> Reversion of Foundation153s Rights in Project
\nHD Intellectual Property<\/u><\/strong>.<\/strong> Upon the termination of
\nthis Agreement by the Foundation pursuant to Section 17(b)(i)<\/u> of this
\nAgreement, subject to (1) the rights reserved by the Foundation pursuant to
\nSection 9(b)(iii)(B)<\/u> of this Agreement and (2) the Foundation153s Revenue
\n(as defined in Section 13(a)<\/u> of this Agreement) sharing rights set forth
\nin Section 13<\/u> of this Agreement, all of the Foundation153s right, title and
\ninterest in and to the Project HD Intellectual Property will revert to Isis
\n(after such termination, all Project HD Intellectual Property shall also be
\nreferred to herein as “Reverted Project HD Intellectual
\nProperty<\/em><\/strong>“).<\/p>\n

(B)<\/strong> The Foundation153s Right to Use Reverted
\nProject HD Intellectual Property<\/u><\/strong>.<\/strong> With respect to
\nall Reverted Project HD Intellectual Property, the Foundation hereby reserves,
\nand Isis hereby grants to the Foundation, a fully paid-up, royalty-free,
\nirrevocable, perpetual, world-wide non-exclusive license (including a license
\nunder any related Intellectual Property rights) for all uses and purposes
\nrelated to HD Research and Development including to (1) make, have made, use and
\nhave used products or processes resulting from such Reverted Project HD
\nIntellectual Property, (2) practice and have practiced such Reverted Project HD
\nIntellectual Property and (3) use and have used the Confidential Information
\nrelating to such Reverted Project HD Intellectual Property; provided,
\nhowever<\/em>, that, the foregoing license (1) will be for HD Research and
\nDevelopment only, (2) will not include any right to manufacture or distribute
\nfor sale or sell, (3) will not be subject to royalties or other fees and (4)
\nwill include the right to grant sublicenses on the same terms; provided,
\nfurther that<\/em>, such sublicense (i) is granted without payment of royalties,
\nother fees or profit and (ii) prohibits the sublicensee from granting
\nsublicenses.<\/p>\n

(c)<\/strong> Disclosure of Inventions;
\nInventorship<\/u><\/strong>.<\/strong><\/p>\n

(i)<\/strong> Disclosure of
\nInventions<\/u><\/strong>.<\/strong> If either Party believes that any
\nIntellectual Property has been conceived, discovered, invented, made or first
\nreduced to practice in the course of the performance of the Research, such Party
\nwill promptly give notice (each, an “Invention
\nNotice<\/em><\/strong>“) of such Intellectual Property to the other Party.<\/p>\n

35<\/p>\n

\n

<\/p>\n

(ii)<\/strong> Inventorship<\/u><\/strong>.<\/strong>
\nThe identity of the inventor(s) of all patentable Intellectual Property that has
\nbeen conceived, discovered, invented, made or first reduced to practice in the
\ncourse of the performance of the Research will be determined in accordance with
\nUnited States Patent law (or, if the jurisdiction in which patent or other
\nprotection is being sought does not permit the application of United States
\nPatent law to identify the inventor, then in accordance with the applicable law
\nin that jurisdiction).<\/p>\n

(d)<\/strong> Prosecution of Patentable Project HD
\nIntellectual Property<\/u><\/strong>.<\/strong><\/p>\n

(i)<\/strong> Responsibility for Prosecution of Patentable
\nProject HD Intellectual Property<\/u><\/strong>. <\/strong>Isis will
\nprepare, file, prosecute and maintain the appropriate filings in respect of any
\nPatentable Project HD Intellectual Property including filing (A) a provisional
\npatent application or (B) a patent application (including a patent application
\ncorresponding to a previously filed provisional patent application) claiming any
\nsuch Patentable Project HD Intellectual Property in the United States and in
\nsuch other jurisdictions as the Steering Committee jointly determine in good
\nfaith are necessary in order to protect Isis153 and the Foundation153s rights in
\nsuch Patentable Project HD Intellectual Property. Isis will ensure that all such
\nfilings are filed in the name of Isis and the Foundation as co-owners.<\/p>\n

(ii)<\/strong> Foundation Election to have Prosecution of
\nPatentable Project HD Intellectual Property
\nInitiated<\/u><\/strong>.<\/strong> At any time and from time to time, the
\nFoundation will have the right to elect to cause Isis to prepare, file,
\nprosecute and maintain the appropriate filings in respect of any Patentable
\nProject HD Intellectual Property which is the subject of an Invention Notice by
\nproviding notice (a “Foundation Patent Filing Election
\nNotice<\/em><\/strong>“) of such election to Isis. Promptly following the receipt
\nof a Foundation Patent Filing Election Notice, Isis will, to the extent not
\nprohibited by any Commercial License then in effect, prepare, file, prosecute
\nand maintain the appropriate filings in respect of the Patentable Project
\nIntellectual Property which is the subject of a Foundation Patent Filing
\nElection Notice, including filing (A) a provisional patent application or (B) a
\npatent application (including a patent application corresponding to a previously
\nfiled provisional patent application) claiming any such Patentable Project
\nIntellectual Property in the United States and in such other jurisdictions as
\nthe Steering Committee jointly determine in good faith are necessary in order to
\nprotect Isis153 and the Foundation153s rights in such Patentable Project HD
\nIntellectual Property. Isis will ensure that all such filings are filed in the
\nname of Isis and the Foundation as co-owners.<\/p>\n

(iii)<\/strong> Covenants of
\nIsis<\/u><\/strong>.<\/strong> With respect to the prosecution and
\nmaintenance by Isis of any Patentable Project HD Intellectual Property pursuant
\nto this Section 9(d)<\/u>, Isis will use commercially reasonable efforts to
\npromptly (A)<\/p>\n

36<\/p>\n

\n

<\/p>\n

give all notices required by, and comply with all other requirements of,
\napplicable law to reasonably preserve the Parties153 rights in such Patentable
\nProject HD Intellectual Property as appropriate; (B) prepare, file, prosecute
\nand maintain, as applicable, the appropriate filings and patents to reasonably
\nprotect the Parties153 rights in such Patentable Project HD Intellectual Property;
\n(C) provide the Foundation with a copy of any proposed filings in respect of
\nsuch Patentable Project HD Intellectual Property at least 15 days prior to the
\nfiling of such proposed filings; (D) provide the Foundation with a copy of any
\nprovisional patent application or patent application filed claiming such
\nPatentable Project HD Intellectual Property; (E) provide the Foundation with
\ncopies of all correspondence and other documents relating to the prosecution and
\nmaintenance of such Patentable Project HD Intellectual Property that come into
\nthe possession or control of Isis; and (F) such other documents and information
\nrelated to such Patentable Project HD Intellectual Property as the Foundation
\nmay reasonably request and Isis can provide without incurring unreasonable cost
\nand expense.<\/p>\n

(iv)<\/strong> Patent
\nExpenses<\/u><\/strong>.<\/strong> Each Party will be responsible for 100%
\nof the Patent Expenses incurred by such Party.<\/p>\n

(e)<\/strong> Disclaimer of Interest in Patentable Project
\nHD Intellectual Property<\/u><\/strong>.<\/strong><\/p>\n

(i)<\/strong> Disclaimer
\nNotice<\/u><\/strong>.<\/strong> With respect to any Patentable Project HD
\nIntellectual Property, either Party may, at any time, disclaim its interest in
\nsuch Patentable Project HD Intellectual Property by providing notice of such
\nelection (“Patentable Project HD Intellectual Property Disclaimer
\nNotice<\/em><\/strong>“) to the other Party. Isis will be deemed to have
\ndisclaimed its interest in any Patentable Project HD Intellectual Property that
\nis the subject of a Foundation Patent Filing Election Notice if Isis fails to
\ncomply with the obligations set forth in Section 9(d)<\/u> of this Agreement
\nwith respect to such Patentable Project HD Intellectual Property within 45 days
\nof Isis153 receipt of the Patentable Project HD Intellectual Property Disclaimer
\nNotice in respect of such Patentable Project HD Intellectual Property.<\/p>\n

(ii)<\/strong> Effect of Disclaimer
\nNotice<\/u><\/strong>.<\/strong> In the event that a Patentable Project HD
\nIntellectual Property Disclaimer Notice is delivered by either Party in respect
\nof Patentable Project HD Intellectual Property: (A) the disclaiming Party hereby
\nassigns its ownership interest in such Patentable Project HD Intellectual
\nProperty to the non-disclaiming Party without consideration, and will execute
\nall documents reasonably necessary to perfect such assignment at the
\nnon-disclaiming Party153s cost; (B) except as expressly set forth in this
\nAgreement, the disclaiming Party will have no further rights to such Patentable
\nProject HD Intellectual Property; and (C) the disclaiming Party will, at any
\ntime during and after the term of this<\/p>\n

37<\/p>\n

\n

<\/p>\n

Agreement, cooperate with the non-disclaiming Party without consideration but
\nat the expense of the non-disclaiming Party in preparing, filing, prosecuting
\nand maintaining, as applicable, the appropriate filings to protect the
\nnon-disclaiming Party153s rights in such Patentable Project HD Intellectual
\nProperty, including obtaining execution by its employees of any documents
\nnecessary in connection with such activities. Each of the Parties will use
\nreasonable efforts to keep the other Party advised of its deliberations
\nregarding its determinations as to electing to disclaim its interest in any
\nPatentable Project HD Intellectual Property.<\/p>\n

(f)<\/strong> Infringement or Misappropriation of Project
\nIntellectual Property<\/u><\/strong>.<\/strong><\/p>\n

(i)<\/strong> Infringement or Misappropriation of Project
\nIntellectual Property by Third Parties<\/u><\/strong>.<\/strong> Each Party
\nwill promptly notify each other in writing of any alleged or threatened
\ninfringement or misappropriation of any Project Intellectual Property of which
\nit becomes aware. In connection with any such alleged or threatened infringement
\nor misappropriation, each Party will confer and take such action and allocate
\nrecoveries in such manner as they in good faith may mutually agree. Neither Isis
\nnor the Foundation will settle a claim brought against a Third Party in respect
\nof such infringement or misappropriation without the consent of the other Party,
\nwhich consent will not be unreasonably withheld, delayed or conditioned.<\/p>\n

(ii)<\/strong> Infringement or Misappropriation Claims by
\nThird Parties Related to Project Intellectual
\nProperty<\/u><\/strong>.<\/strong> Each Party will promptly notify the
\nother Party in writing if any Third Party alleges that the use or practice of
\nany Project Intellectual Property infringes or misappropriate such Third Party153s
\nIntellectual Property rights. In connection with any such alleged infringement
\nor misappropriation, each Party will confer and take such action in such manner
\nas they in good faith may mutually agree. Neither Party will settle a claim
\nbrought by a Third Party in respect of such infringement or misappropriation
\nwithout the consent of the other Party, which consent will not be unreasonably
\nwithheld, delayed or conditioned.<\/p>\n

(iii)<\/strong> Infringement or Misappropriation Outside of
\nthe HD Field of Use<\/u><\/strong>. <\/strong>Notwithstanding the foregoing
\nin this Section 9(f)<\/u>, Isis has the sole right (but not the obligation) to
\nassume direction and control of the prosecution and\/or defense of any claim
\nagainst or alleged by a Third Party outside of the HD Field of Use that involves
\nactual or potential infringement or misappropriation of any Project Intellectual
\nProperty, or alleges that the use or practice of any Project Intellectual
\nProperty infringes or misappropriates a Third Party153s Intellectual Property
\nrights (Isis153 right shall include the sole right to settle such a claim in Isis153
\nsole discretion, provided that<\/em> such settlement does not (A) admit any
\nfault or negligence on the part of the Foundation and\/or its Affiliates, (B)
\nimpose any obligation on the Foundation and\/or its Affiliates or (C) without the
\nprior<\/p>\n

38<\/p>\n

\n

<\/p>\n

written consent of the Foundation (which consent shall not unreasonably
\nwithheld, conditioned or delayed), adversely affect the Foundation and\/or its
\nAffiliates in any way.<\/p>\n

10.<\/strong> Licenses to Project HD Intellectual Property
\nand Project Compounds in the HD Field of Use<\/u><\/strong>.<\/strong><\/p>\n

(a)<\/strong> Commercialization of Project HD Intellectual
\nProperty and Project Compounds; Reservation of Rights Regarding Project HD
\nIntellectual Property and Project Compounds<\/u><\/strong>.<\/strong><\/p>\n

(i)<\/strong> Commercialization of Project HD Intellectual
\nProperty and Project Compounds<\/u><\/strong>.<\/strong> Except as
\nexpressly permitted by this Agreement, neither Party will use or otherwise
\nexploit any Project HD Intellectual Property or any Project Compound for any use
\nor purpose or grant any license of any Project HD Intellectual Property or any
\nProject Compound for any use or purpose. Except as expressly permitted by
\nSection 10(a)(ii)<\/u> of this Agreement, (1) the use or other exploitation of
\nany Project HD Intellectual Property or any Project Compound by either of the
\nParties, an Affiliate of either Party or a Third Party and (2) the grant of any
\nlicense of any Project HD Intellectual Property or any Project Compound by
\neither of the Parties to an Affiliate of either Party or a Third Party, in each
\ncase for uses other than Research and Development in the HD Field of Use, will
\nonly be done pursuant to the grant of a commercial license under a license
\nagreement executed by both Parties (any such license will hereinafter be
\nreferred to as a “Commercial License<\/em><\/strong>“). For the
\navoidance of any doubt, the Parties agree that this Section 10<\/u> shall not
\napply to a) the use or other exploitation or b) the grant of any license for any
\npurpose of any Project HD Intellectual Property or any Project Compound outside
\nthe HD Field of Use.<\/p>\n

(ii)<\/strong> Reservation of Rights by the Parties to
\nGrant Certain Licenses<\/u><\/strong>.<\/strong><\/p>\n

(A)<\/strong> Isis153 Right to Use Project Intellectual
\nProperty and Project Compounds<\/u><\/strong>.<\/strong> Isis reserves the
\nright to use any Project HD Intellectual Property and any Project Compound for
\nall uses and purposes relating to Research and Development.<\/p>\n

(B)<\/strong> Isis153 Right to Grant Research and Development
\nLicenses<\/u><\/strong>.<\/strong> Isis reserves the right to grant
\nnon-exclusive licenses throughout the world in respect of any Project HD
\nIntellectual Property or any Project Compound for all uses and purposes relating
\nto Research and Development.<\/p>\n

(C)<\/strong> Foundation153s Right to Use Project HD
\nIntellectual Property and Project Compounds<\/u><\/strong>.<\/strong> The
\nFoundation reserves the right to use<\/p>\n

39<\/p>\n

\n

<\/p>\n

any Project HD Intellectual Property and any Project Compound for all uses
\nand purposes relating to HD Research and Development.<\/p>\n

(D)<\/strong> Foundation153s Right to Grant HD Research and
\nDevelopment Licenses<\/u><\/strong>.<\/strong> The Foundation reserves the
\nright to grant non-exclusive licenses throughout the world in respect of any
\nProject HD Intellectual Property or any Project Compound for all uses and
\npurposes relating to HD Research and Development.<\/p>\n

(b)<\/strong> Conduct of Human Clinical
\nTrials<\/u><\/strong>.<\/strong><\/p>\n

(i)<\/strong> Obligation to the Parties to
\nConfer<\/u><\/strong>.<\/strong> Isis and the Foundation will confer with
\neach other on the conduct of human clinical trials involving any Project
\nCompound prior to the initiation of any human clinical trials for such Project
\nCompound.<\/p>\n

(ii)<\/strong> Isis153 Right to Conduct Human Clinical
\nTrials<\/u><\/strong>.<\/strong> Subject to Section 10(b)(i)<\/u> of this
\nAgreement, but notwithstanding any other provision of this Agreement, Isis will
\nhave the right to conduct human clinical trials involving any Project Compound.\n<\/p>\n

(iii)<\/strong> Foundation153s Right to Conduct Human
\nClinical Trials<\/u><\/strong>.<\/strong> Subject to Section
\n10(b)(i)<\/u> of this Agreement, if (A) within [***] of Isis153 receipt of a
\nrequest from the Foundation for Isis to undertake the conduct of a human
\nclinical trial involving a Project Compound reasonably required to advance such
\nProject Compound for the diagnosis, treatment, cure or prevention of
\nHuntington153s disease, Isis does not agree to promptly initiate and conduct such
\na human clinical trial or (B) the Parties decide that the Foundation will
\nconduct human clinical trials concurrently with a human clinical trial being
\nconducted by Isis, the Foundation will have the right to conduct human clinical
\ntrials on its own or through or with a Third Party selected by the Foundation.
\nFor the avoidance of doubt, the Foundation will have the right to use Isis
\nBackground Intellectual Property, Project HD Intellectual Property and Project
\nCompounds for the conduct of any such human clinical trials.<\/p>\n

(c)<\/strong> Right to Make Proposal Regarding the Granting
\nof a Commercial License<\/u><\/strong>.<\/strong><\/p>\n

(i)<\/strong> The Parties agree (1) that either Party may submit to
\nthe Parties for their consideration under this Section 10<\/u> a proposal for
\nthe granting of a Commercial License and (2) to consult and make a determination
\nregarding the granting of a Commercial License in respect of such proposal in
\naccordance with the provisions of this Section 10<\/u>.<\/p>\n

40<\/p>\n

\n

<\/p>\n

(ii)<\/strong> If (1) the Parties are evaluating multiple proposals
\n(including one submitted by Isis or an Affiliate of Isis pursuant to which Isis
\nor an Affiliate of Isis would be granted a Commercial License (the
\n“Isis Proposal<\/em><\/strong>“)) to determine whether or not the
\nprinciples and guidelines set forth in this Section 10<\/u> for the granting
\nof a Commercial License have been satisfied and (2) more than one of such
\nproposals (including an Isis Proposal) satisfies the principles and guidelines
\nset forth in this Section 10<\/u> on a substantially equivalent basis, the
\nFoundation agrees to accept the Isis Proposal and agrees to grant a Commercial
\nLicense to Isis in accordance with this Section 10<\/u>.<\/p>\n

(d)<\/strong> Principles and Guidelines for Granting
\nCommercial Licenses<\/u><\/strong>.<\/strong><\/p>\n

(i)<\/strong> Good Faith
\nConsultations<\/u><\/strong>.<\/strong> The Parties will consult, and work
\nin a collaborative fashion, with each other in accordance with the provisions of
\nthis Section 10<\/u> concerning the grant of any Commercial License. With
\nrespect to any decision regarding the granting of any Commercial License, the
\nParties will (A) act in good faith and on a responsive basis and (B) make such
\ndecision on a reasonable basis using the principles and guidelines set forth in
\nthis Section 10(d)<\/u>. In addition, neither Isis nor the Foundation will
\nunreasonably withhold, delay or condition their consent to a Commercial License
\nor demand additional payments beyond those required under this Agreement.<\/p>\n

(ii)<\/strong> Fundamental Principles and
\nGuidelines<\/u><\/strong>.<\/strong> A Commercial License will be granted
\nif and only if the Parties mutually agree that the granting of such Commercial
\nLicense is reasonably likely to:<\/p>\n

(A)<\/strong> maximize the impact on the health and well-being of
\nHuntington153s disease patients;<\/p>\n

(B)<\/strong> maximize the availability of diagnostic or therapeutic
\nproducts to Huntington153s disease patients; and<\/p>\n

(C)<\/strong> maximize the speed of which diagnostic or therapeutic
\nproducts are available to Huntington153s disease patients.<\/p>\n

(iii)<\/strong> Availability of Products as Primary Factor
\nfor Granting Commercial Licenses<\/u><\/strong>.<\/strong> Subject to
\nSection 10(d)(iv)<\/u>, if (A) the Parties are evaluating multiple proposals
\n(including an Isis Proposal) for the granting of a Commercial License, (B) more
\nthan one of the proposals satisfies the principles and guidelines set forth in
\nthis Section 10<\/u> (other than (1) the proposed economic terms and (2) the
\nproposed time frame for making the diagnostic or therapeutic product which is to
\nbe the subject of such Commercial License available to Huntington153s disease
\npatients) on a substantially equivalent basis; and (C) one of the proposals sets
\nforth a<\/p>\n

41<\/p>\n

\n

<\/p>\n

time frame for making the diagnostic or therapeutic product which is to be
\nthe subject of such Commercial License available to Huntington153s disease
\npatients that is substantially shorter than those set forth in the other
\nproposals being considered by the Parties, then the proposal setting forth such
\nsubstantially shorter time frame, if accompanied by firm diligence obligations,
\nwill be accepted by the Parties and a Commercial License granted to the entity
\nmaking such proposal even if the economic terms of such proposal are
\nsubstantially less than those set forth in the other proposals being considered
\nby the Parties.<\/p>\n

(iv)<\/strong> Commercial License Agreement Terms and
\nConditions<\/u><\/strong>.<\/strong> In addition to the principles and
\nguidelines set forth in Section 10(d)(ii)<\/u> and Section 10(d)(iii)<\/u>
\nof this Agreement, a Commercial License will be granted if and only if the
\nParties mutually agree that the terms and conditions of the license agreement in
\nrespect of such Commercial License incorporates the following terms, principles
\nand guidelines:<\/p>\n

(A)<\/strong> reasonable performance milestones and a demonstrated
\ncapacity of the licensee to be able to meet those milestones; and<\/p>\n

(B)<\/strong> reasonable business and other terms and conditions that
\nare in keeping with the then existing market standards for agreements of such
\ntype and nature in respect of similar technology and in similar disease
\nindications.<\/p>\n

(e)<\/strong> Resolution of Disputes Regarding the Granting
\nof Commercial Licenses<\/u><\/strong>.<\/strong> If the Parties cannot
\nreach a mutual agreement regarding the granting of a Commercial License in
\nrespect of a proposal for the granting of a Commercial License submitted by
\neither of the Parties for their consideration in accordance with the provisions
\nof this Section 10<\/u> (each, a “Commercial License Grant
\nDispute<\/em><\/strong>“), either Party may submit such Commercial License Grant
\nDispute to B. Lynne Parshall, in the case of Isis (or such other individual
\nidentified in writing by Isis), and Robi Blumenstein, in the case of the
\nFoundation (or such other individual identified in writing by the Foundation),
\nfor resolution by providing a written notice (each, a “Internal
\nCommercial License Grant Dispute Resolution Notice<\/em><\/strong>“) to the other
\nParty setting forth in reasonable detail the basis of such Commercial License
\nGrant Dispute. Such individuals will, within 20 days after such Internal
\nCommercial License Grant Dispute Resolution Notice is delivered, meet and
\nattempt in good faith to resolve such Commercial License Grant Dispute. If such
\nCommercial License Grant Dispute is not resolved within such 20-day period,
\neither Party may require that the Parties submit such Commercial License Grant
\nDispute for resolution by an independent Third Party with appropriate
\nqualifications for resolution to evaluate such matter (a “Neutral
\nExpert<\/em><\/strong>“) by providing a written notice (an “External
\nCommercial License Grant Dispute Resolution Notice<\/em><\/strong>“) to such
\neffect that identifies the Commercial License Grant Dispute to be resolved to
\nthe other Party within 15 days after the end of<\/p>\n

42<\/p>\n

\n

<\/p>\n

such 20-day period. If the Parties fail to agree on a Neutral Expert within
\n10 days after an External Commercial License Grant Dispute Resolution Notice is
\ndelivered, then each Party will submit the name and qualifications of one
\nproposed Neutral Expert, along with a written statement not to exceed five pages
\nthat identifies the issue(s) to be decided, to JAMS in Denver, Colorado,
\npursuant to its Streamlined Arbitration Rules and Procedures, with a copy to the
\nother Party, and JAMS will appoint a single arbitrator, who will be authorized
\nsolely to select, within 10 days of his or her appointment and pursuant to this
\nSection 10(e)<\/u>, which Party153s proposed Neutral Expert will be designated
\nfor resolution of such matter, which decision will be final and binding on both
\nParties. Upon the designation of the Neutral Expert, each Party will have 10
\ndays to submit any appropriate materials to such Neutral Expert, with copies to
\nthe other Party. No Party will communicate with the Neutral Expert except by
\nwritten communications copied to the other Party, or orally in the physical or
\ntelephonic presence of the other Party. The Neutral Expert will render a written
\ndecision within 15 days after the deadline for submission of materials from the
\nParties. The decision of the Neutral Expert will be final and binding on both
\nParties. The Parties agree that any and all such deliberations will be
\nconfidential.<\/p>\n

(f)<\/strong> Grants of Non-Exclusive Licenses Under
\nDisclaimed Patentable Project Intellectual
\nProperty<\/u><\/strong>.<\/strong><\/p>\n

(i)<\/strong> Grant of Non-Exclusive License to the
\nFoundation<\/u><\/strong>.<\/strong> With respect to each patent (including
\n(A) any patent application, divisional, continuation, continuation-in-part,
\nsubstitute, renewal, reexamination, extension or reissue in respect of such
\npatent or (B) any intellectual property rights claimed in respect of such
\npatent) claiming Patentable Project HD Intellectual Property that the Foundation
\nhas disclaimed its interest pursuant to Section 9(e)<\/u> of this Agreement
\n(the “Foundation Disclaimed Intellectual Property<\/em><\/strong>“),
\nIsis hereby grants the Foundation a fully paid-up, royalty-free, irrevocable,
\nperpetual, worldwide non-exclusive license, with the limited right to sublicense
\nas set forth in this Section 10(f)(i)<\/u>, under such Foundation Disclaimed
\nIntellectual Property for HD Research and Development, including a license to
\n(1) make, have made, use, have used, import and have imported any product
\ncovered by such Foundation Disclaimed Intellectual Property, (2) practice and
\nhave practiced any method or process covered by such Foundation Disclaimed
\nIntellectual Property, and (3) use and have used the Confidential Information
\nrelating to such Foundation Disclaimed Intellectual Property, in each case
\nsolely for HD Research and Development. The foregoing license a) will be for HD
\nResearch and Development only, b) will not include any right to manufacture or
\ndistribute for sale or sell, c) will not be subject to royalties or other fees
\nand d) will include the right to grant sublicenses on the same terms;
\nprovided, that<\/em>, such sublicense 1) is granted without payment of
\nroyalties, other fees or profit and 2) prohibits the sublicensee from granting
\nsublicenses.<\/p>\n

43<\/p>\n

\n

<\/p>\n

(ii)<\/strong> Grant of Non-Exclusive License to
\nIsis<\/u><\/strong>.<\/strong> With respect to each patent (including (A)
\nany patent application, divisional, continuation, continuation-in-part,
\nsubstitute, renewal, reexamination, extension or reissue in respect of such
\npatent or (B) any intellectual property rights claimed in respect of such
\npatent) claiming Patentable Project HD Intellectual Property that Isis has
\ndisclaimed its interest pursuant to Section 9(e)<\/u> of this Agreement (the
\n“Isis Disclaimed Intellectual Property<\/em><\/strong>“), the
\nFoundation hereby grants Isis a fully paid-up, royalty-free, irrevocable,
\nperpetual, worldwide non-exclusive license, with the limited right to sublicense
\nas set forth in this Section 10(f)(ii)<\/u>, under such Isis Disclaimed
\nIntellectual Property for Research and Development, including a license to (1)
\nmake, have made, use, have used, import and have imported any product covered by
\nsuch Isis Disclaimed Intellectual Property, (2) practice and have practiced any
\nmethod or process covered by such Isis Disclaimed Intellectual Property and (3)
\nuse and have used the Confidential Information relating to such Isis Disclaimed
\nIntellectual Property, in each case solely for Research and Development. The
\nforegoing license a) will be for Research and Development only, b) will not
\ninclude any right to manufacture or distribute for sale or sell, c) will not be
\nsubject to royalties or other fees and d) will include the right to grant
\nsublicenses on the same terms; provided, that<\/em>, such sublicense 1) is
\ngranted without payment of royalties, other fees or profit and 2) prohibits the
\nsublicensee from granting sublicenses.<\/p>\n

(g)<\/strong> Grant of Non-Exclusive Licenses Under Isis
\nBackground Intellectual Property in Connection with Commercial
\nLicenses<\/u><\/strong>.<\/strong> Subject to the disclosure set forth on
\nSchedule 16(b)(iv)(B) – 2<\/u>, Isis will grant to each Third Party or
\nAffiliate of a Party that is a party to a Commercial License, in sole
\nconsideration for the amounts paid by such Third Party or Affiliate under such
\nCommercial License, a worldwide non-exclusive license (with the right to grant
\nsublicenses to any Affiliate or Third Party collaborator of such licensee, but
\nwithout the right to grant further sublicenses) under any Isis Background
\nIntellectual Property Controlled by Isis (including (A) any patent application,
\ndivisional, continuation, continuation-in-part, substitute, renewal,
\nreexamination, extension or reissue in respect of any applicable patent within
\nsuch Isis Background Intellectual Property Controlled by Isis or (B) any
\nintellectual property rights claimed in respect of any applicable patent within
\nsuch Isis Background Intellectual Property Controlled by Isis), to the extent
\nnecessary to enable such Third Party or Affiliate to exploit the Project HD
\nIntellectual Property in accordance with the terms of such Commercial License
\nand the terms of this Agreement. Any license granted by Isis to a Third Party or
\nAffiliate of a Party pursuant to this Section 10(g)<\/u> shall terminate only
\nin accordance with the terms and conditions of the Commercial<\/p>\n

44<\/p>\n

\n

<\/p>\n

License granted to such Third Party or Affiliate. For the avoidance of doubt,
\nany license to Isis Background Intellectual Property Controlled by Isis granted
\nunder this Section 10(g)<\/u> will in no event entitle a licensee under a
\nCommercial License to use such Isis Background Intellectual Property to
\nresearch, develop or otherwise use or make any compound other than the Project
\nCompound(s) subject to such Commercial License.<\/p>\n

11.<\/strong> Non-Assert
\nCovenants<\/u><\/strong>.<\/strong><\/p>\n

(a)<\/strong> Mutual Non-Assert Regarding
\nValidity<\/u><\/strong>.<\/strong> Each Party will not, and will not permit
\nits Affiliates to, challenge, nor assist others in challenging, and will
\nundertake to ensure, by contract or otherwise, that its licensees and assignees
\nof any Project Intellectual Property will not challenge nor assist others in
\nchallenging, the validity of any Project Intellectual Property (including any
\nProject Intellectual Property that is disclaimed by a Party); provided,
\nhowever<\/em>, that each Party (and its Affiliates, licensees and assignees) has
\nthe right to comply with applicable laws, including subpoenas in connection with
\na challenge by a Third Party to Project Intellectual Property.<\/p>\n

(b)<\/strong> Isis Non-Assert Regarding
\nInfringement<\/u><\/strong>.<\/strong> Isis will not, and will not permit
\nits Affiliates to, bring any action or assist others in bringing any action, and
\nundertakes to ensure, by contract or otherwise, that its licensees and assignees
\nof any Project Intellectual Property (including any Isis Disclaimed Intellectual
\nProperty) will not bring any action or assist others in bringing any action,
\nagainst the Foundation or the Foundation153s licensees or assignees of any Project
\nHD Intellectual Property (including any Foundation Collaborator) on the ground
\nthat the practice or use, as the case may be, of any Project HD Intellectual
\nProperty for HD Research and Development infringes or misappropriates the
\nproprietary rights of Isis or Isis153 licensees or assignees of any Project
\nIntellectual Property; provided, however<\/em>, that Isis (and its
\nAffiliates, licensees and assignees) has the right to comply with applicable
\nlaws, including subpoenas in connection with a challenge by a Third Party to
\nProject HD Intellectual Property.<\/p>\n

(c)<\/strong> Foundation Non-Assert Regarding
\nInfringement<\/u><\/strong>.<\/strong> The Foundation will not, and will
\nnot permit its Affiliates to, bring any action or assist others in bringing any
\naction, and undertakes to ensure, by contract or otherwise, that its licensees
\nand assignees of any Project HD Intellectual Property (including any Foundation
\nDisclaimed Intellectual Property) will not bring any action or assist others in
\nbringing any action, against Isis or Isis153 licensees or assignees of any Project
\nIntellectual Property on the ground that the practice or use, as the case may
\nbe, of any Project Intellectual Property outside the HD Field of Use infringes
\nor misappropriates the proprietary rights of the Foundation or the Foundation153s
\nlicensees or assignees of any Project HD Intellectual Property; provided,
\nhowever<\/em>, that the Foundation (and its Affiliates, licensees and assignees)
\nhas the right to comply with applicable laws, including subpoenas in connection
\nwith a challenge by a Third Party to Project Intellectual Property.<\/p>\n

45<\/p>\n

\n

<\/p>\n

12.<\/strong> Grant of Non-Exclusive License to the
\nFoundation Under Isis Background Intellectual
\nProperty<\/u><\/strong>.<\/strong> Subject to the disclosure set forth on
\nSchedule 16(b)(iv)(B) – 2<\/u>, Isis hereby grants to the Foundation a fully
\npaid-up, royalty-free, worldwide non-exclusive license (with the right to grant
\nsublicenses to a Third Party designated by the Foundation, including a
\nFoundation Collaborator) under the Isis Background Intellectual Property
\nControlled by Isis (including (A) any patent application, divisional,
\ncontinuation, continuation-in-part, substitute, renewal, reexamination,
\nextension or reissue in respect of any applicable patent within such Isis
\nBackground Intellectual Property Controlled by Isis, or (B) any intellectual
\nproperty rights claimed in respect of any applicable patent within such Isis
\nBackground Intellectual Property Controlled by Isis), to the extent necessary to
\nenable the Foundation and\/or such Third Party (including Foundation
\nCollaborators) to use the Project Results, any Project Deliverables, any Project
\nHD Intellectual Property and any Project Compound solely for HD Research and
\nDevelopment. The license rights granted by Isis under this Section 12<\/u>
\nwill be subject to termination by Isis in the event of the Foundation153s material
\nbreach of this Agreement if such material breach is not cured within 45 days
\nfollowing receipt by Isis of notice of such material breach. For the avoidance
\nof doubt, any license to Isis Background Intellectual Property Controlled by
\nIsis granted under this Section 12<\/u> will in no event entitle a licensee to
\nuse such Isis Background Intellectual Property to research, develop or otherwise
\nuse or make any compound other than the Project Compound(s).<\/p>\n

13.<\/strong> Revenue
\nSharing<\/u><\/strong>.<\/strong><\/p>\n

(a)<\/strong> Agreement to Share
\nRevenue<\/u><\/strong>.<\/strong> All revenue (i) received by either of the
\nParties from a Third Party or an Affiliate of either Party in connection with
\nthe grant of any Commercial License (including a Commercial License pursuant to
\nwhich Isis or an Affiliate of Isis is the Licensee) of any Project HD
\nIntellectual Property (other than Project HD Intellectual Property which has
\nbeen disclaimed by one of the Parties pursuant to Section 9(e)<\/u> of this
\nAgreement) to a Third Party or an Affiliate of either Party or (ii) received by
\nIsis from a Third Party or any of Isis153 Affiliates in connection with the
\nexploitation of any Reverted Project HD Intellectual Property (including in
\nconnection with any sale, transfer, license or other disposition of any such
\nReverted Project HD Intellectual Property or the sale of any product or service
\ncovered by any such Reverted Project HD Intellectual Property to a Third Party
\nor an Affiliate of Isis) ((i) and (ii) immediately above collectively referred
\nto herein as “Revenue<\/em><\/strong>“) will be distributed as
\nfollows:<\/p>\n

(i)<\/strong> First, to the Parties pro rata<\/em> based upon the
\namount of Patent Expenses paid by each Party out of the total amount Patent
\nExpenses paid by both of the Parties until the aggregate amount of Patent
\nExpenses paid by each of the Parties has been received by each such Party.<\/p>\n

(ii)<\/strong> Second, to the Foundation and Isis equally until an
\namount equal to the sum of the following amounts has been received by the
\nFoundation:<\/p>\n

46<\/p>\n

\n

<\/p>\n

(A)<\/strong> an amount equal to US$[***] (such amount representing
\nthe aggregate payments made by the Foundation to Isis and Affiliates of Isis
\nunder the 2007 Research Agreement) plus<\/u><\/p>\n

(B)<\/strong> the aggregate amount of payments made by the Foundation
\nto Isis under that certain Letter Agreement, dated as of [***], between Isis and
\nthe Foundation related to [***] (as amended from time to time) plus<\/u><\/p>\n

(C)<\/strong> the aggregate amount of payments made by the Foundation
\nto Isis and Affiliates of Isis under this Agreement (as amended from time to
\ntime), including all amounts paid by the Foundation to Isis to reimburse Isis
\nfor Isis Provided Reimbursable Materials Costs and Specialized Licenses or
\nServices Costs plus<\/u><\/p>\n

(D)<\/strong> the aggregate of the amounts set forth on Schedule
\n13(a)(ii)(D)<\/u> attached hereto (each such amount representing a prior
\npayment(s) made by the Foundation to a Third Party or Affiliate of Isis for the
\ndevelopment of the Project HD Intellectual Property as a therapeutic product for
\nHuntington153s disease patients) plus<\/u><\/p>\n

(E)<\/strong> the aggregate amount of payments made by the Foundation
\nto Third Parties and Affiliates of Isis for research and development activities
\nrelated to developing the Project HD Intellectual Property as a therapeutic
\nproduct for Huntington153s disease patients that (1) are set forth on Schedule
\n13(a)(ii)(E)<\/u> attached hereto or (2) have been approved by the Steering
\nCommittee (any such agreement to be set forth in the applicable
\nmutually-approved Steering Committee meeting minutes) plus<\/u><\/p>\n

(F)<\/strong> [***].<\/p>\n

(iii)<\/strong> Thereafter, 100% of all Revenue to Isis.<\/p>\n

(b)<\/strong> Amounts not Subject to Revenue
\nSharing<\/u><\/strong>.<\/strong><\/p>\n

(i)<\/strong> Revenue Sharing only Applicable to Amounts
\nReceived by either Party in Connection with Commercial License Granted to Third
\nParties and Affiliates<\/u><\/strong>.<\/strong> For the avoidance of
\ndoubt, the Parties agree that this Section 13<\/u> will only apply to Revenue
\nreceived by either of the Parties.<\/p>\n

(ii)<\/strong> No Revenue Sharing for Amounts Received by
\nIsis in Connection with Research and Development of the Project HD Intellectual
\nProperty<\/u><\/strong>.<\/strong> For the avoidance of doubt, the Parties
\nagree that this Section 13<\/u> will only apply to Revenue and will not apply
\nto any amounts received by Isis so<\/p>\n

47<\/p>\n

\n

<\/p>\n

long as any such amounts are paid (x) solely to reimburse Isis for the actual
\ninternal costs and expenses incurred by Isis from the use of Project HD
\nIntellectual Property for Research and Development conducted internally by Isis
\nor (y) for the use or other exploitation (including the grant of any license for
\nany purpose) of any Project HD Intellectual Property outside the HD Field of
\nUse.<\/p>\n

(c)<\/strong> Relation to Revenue Sharing under the 2007
\nResearch Agreement<\/u><\/strong>.<\/strong> Isis and the Foundation agree
\nthat this Section 13<\/u> supersedes and replaces in its entirety Section 11
\nof the 2007 Research Agreement.<\/p>\n

Confidentiality; Trademarks<\/strong><\/p>\n

14.<\/strong> Certain Information Deemed Confidential
\nInformation; Certain Information Specifically Excepted from Being Deemed
\nConfidential Information; Permitted Uses of Confidential Information;
\nConfidentiality and Non-Use; Use by Representatives; Exceptions to
\nConfidentiality and Non-Use<\/u><\/strong>.<\/strong><\/p>\n

(a)<\/strong> Certain Information Deemed Confidential
\nInformation; Certain Information Specifically Excepted from Being Deemed
\nConfidential Information<\/u><\/strong>.<\/strong><\/p>\n

(i)<\/strong> Certain Information Deemed Confidential
\nInformation<\/u><\/strong>.<\/strong><\/p>\n

(A)<\/strong> Certain Information Deemed Confidential
\nInformation of Isis<\/u><\/strong>.<\/strong> The Foundation agrees that
\nall Isis Background Intellectual Property will be deemed Confidential
\nInformation of Isis (the foregoing, together with any additional information
\ndisclosed by Isis in accordance with clause (i) of the first sentence of
\nSection 1(p)<\/u> of this Agreement (except to the extent that any such
\ninformation constitutes Project Intellectual Property or Project Results), the
\n“Isis Confidential Information<\/em><\/strong>“).<\/p>\n

(B)<\/strong> Certain Information Deemed Confidential
\nInformation of the Foundation<\/u><\/strong>.<\/strong> Isis agrees that
\nall Foundation Provided Material Information and Foundation Background
\nIntellectual Property will be deemed Confidential Information of the Foundation
\n(the foregoing, together with such additional information disclosed by the
\nFoundation in accordance with clause (i) of the first sentence of Section
\n1(p)<\/u> of this Agreement (except to the extent that any such information
\nconstitutes Project Intellectual Property or Project Results), the
\n“Foundation Confidential Information<\/em><\/strong>“).<\/p>\n

(C)<\/strong> Certain Information Deemed Confidential
\nInformation of both Parties<\/u><\/strong>.<\/strong> The Parties agree
\nthat (1) the terms and conditions of this Agreement (including all appendices,
\nsupplements or exhibits attached to this Agreement) and all Project Intellectual
\nProperty<\/p>\n

48<\/p>\n

\n

<\/p>\n

and Project Results (including all Project Results set forth in the Project
\nReports) will be deemed Confidential Information of both Parties
\n(“Joint Confidential Information<\/em><\/strong>“) and (2) each Party
\nwill be deemed both a “Disclosing Party” and a “Receiving Party” of all Joint
\nConfidential Information. The Parties further agree to treat all Joint
\nConfidential Information as Confidential Information of each of the Parties in
\naccordance with the terms of this Section 14<\/u>. Notwithstanding the
\nforegoing, the Parties agree after the sixth anniversary of the Original
\nEffective Date (the “Disclosure Date<\/em><\/strong>“) the Project
\nResults shall no longer be deemed Confidential Information and may be disclosed
\nby either Party to any Affiliate or Third Party without restriction unless prior
\nto the Disclosure Date Isis notifies the Foundation that there exists good
\nreasons for such disclosure to be withheld for an additional six-month period,
\nin which case the Disclosure Date will be extended for an additional six months
\nand the provisions of this Section 14(a)(i)(C)<\/u> will apply to such new
\nDisclosure Date.<\/p>\n

(ii)<\/strong> Certain Information Specifically Excepted
\nfrom Being Deemed Confidential Information<\/u><\/strong>.<\/strong> For
\nthe avoidance of any doubt, the Parties acknowledge and agree that any
\ninformation deemed to be Confidential Information pursuant to Section
\n14(a)(i)<\/u> of this Agreement will not constitute Confidential Information
\nunder this Agreement if such information constitutes information which is
\nspecifically excepted from being Confidential Information in accordance with
\nSection 1(p)<\/u> of this Agreement; provided, however<\/em>, the Parties
\nacknowledge and agree that no Joint Confidential Information will be
\nspecifically excepted from being Confidential Information pursuant to clause (1)
\nof the last sentence of Section 1(p)<\/u> of this Agreement.<\/p>\n

(b)<\/strong> Permitted Uses of Confidential
\nInformation<\/u><\/strong>.<\/strong><\/p>\n

(i)<\/strong> Permitted Uses of Joint Confidential
\nInformation<\/u><\/strong>.<\/strong><\/p>\n

(A)<\/strong> Permitted Uses of Joint Confidential
\nInformation by Isis<\/u><\/strong>.<\/strong> The Foundation agrees that
\nIsis may (1) use, or have used, the Joint Confidential Information for all uses
\nand purposes to the extent necessary or useful to enable Isis to perform its
\nobligations or exercise its rights under this Agreement and (2) subject to
\nSection 14(c)<\/u> of this Agreement, disclose the Joint Confidential
\nInformation to Third Parties and Affiliates of Isis.<\/p>\n

(B)<\/strong> Permitted Uses of Joint Confidential
\nInformation by the Foundation<\/u><\/strong>.<\/strong> Isis agrees that
\nthe Foundation may (1) use, or have used, the Joint Confidential Information for
\nall uses and purposes to the extent necessary or useful to enable Isis to
\nperform its<\/p>\n

49<\/p>\n

\n

<\/p>\n

obligations or exercise its rights under this Agreement and (2) subject to
\nSection 14(c)<\/u> of this Agreement, disclose the Joint Confidential
\nInformation to Third Parties and Affiliates of the Foundation.<\/p>\n

(ii)<\/strong> Permitted Uses of Foundation Confidential
\nInformation by Isis<\/u><\/strong>.<\/strong> Isis agrees that the
\nFoundation Confidential Information may only (A) be used by Isis to the extent
\nnecessary or useful to enable Isis to perform its obligations or exercise its
\nrights under this Agreement and (B) be disclosed in accordance with, and to only
\nthose Third Parties and Affiliates expressly permitted by, Section 14(c)<\/u>
\nof this Agreement.<\/p>\n

(iii)<\/strong> Permitted Uses of Isis Confidential
\nInformation by the Foundation<\/u><\/strong>.<\/strong> The Foundation
\nagrees that Isis Confidential Information may only (A) be used by the Foundation
\nto the extent necessary or useful to enable the Foundation to perform its
\nobligations or exercise its rights under this Agreement and (B) be disclosed in
\naccordance with, and to only those Third Parties and Affiliates expressly
\npermitted by, Section 14(c)<\/u> of this Agreement.<\/p>\n

(c)<\/strong> Confidentiality and Non-Use; Use by
\nRepresentatives<\/u><\/strong>.<\/strong><\/p>\n

(i)<\/strong> Confidentiality and
\nNon-Use<\/u><\/strong>.<\/strong> Each Receiving Party will treat the
\nConfidential Information of the Disclosing Party in the same manner, and with
\nthe same level of care (but, in no event, with less than a reasonable level of
\ncare), as the Receiving Party would treat its own confidential or proprietary
\ninformation. Without limiting the generality of the foregoing, and except to the
\nextent expressly permitted by this Agreement (including pursuant to Section
\n14(b)<\/u> of this Agreement), no Receiving Party will, without the prior written
\nconsent of the Disclosing Party, (A) disclose, reveal, report, publish or give
\nthe Confidential Information of the Disclosing Party to any Third Party or
\nAffiliate or (B) use the Confidential Information of the Disclosing Party for
\nany purpose.<\/p>\n

(ii)<\/strong> Use by
\nRepresentatives<\/u><\/strong>.<\/strong> Except as expressly permitted by
\nthis Agreement, each Receiving Party will limit disclosure of the Disclosing
\nParty153s Confidential Information to (A) those of its Affiliates, directors,
\nofficers, employees, representatives, consultants, agents, service providers and
\nadvisors (including scientific advisors, legal counsel, etc.) (B) in the case of
\nIsis only, any Third Party collaborator of Isis and (C) in the case of the
\nFoundation only, the Foundation Collaborators (collectively,
\n“representatives<\/em><\/strong>“) who (1) have a need to know such
\nConfidential Information to enable such Receiving Party to perform its
\nobligations or exercise its rights under this Agreement, (2) have similar, but
\nno less burdensome, obligations of confidentiality and non-use to those
\ncontained in this Agreement and (3) have been advised of the confidential and\n<\/p>\n

50<\/p>\n

\n

<\/p>\n

proprietary nature of such Confidential Information and of their obligations
\nwith respect to such Confidential Information. Each Receiving Party will (x)
\ndirect its representatives not to disclose the Confidential Information of the
\nDisclosing Party to any person or entity, except as expressly permitted under
\nthis Agreement and (y) be responsible for any breach by its representatives of
\nthe obligations under this Agreement relating to Confidential Information of the
\nDisclosing Party.<\/p>\n

(d)<\/strong> Exceptions to Confidentiality and
\nNon-Use<\/u><\/strong>.<\/strong> Each Receiving Party may, without the
\nprior written authorization of the Disclosing Party, disclose the Confidential
\nInformation of the Disclosing Party to the limited extent it is required to
\npursuant to any applicable federal, state, local, or international law, or any
\njudicial or government request, requirement or order; provided, that, such
\nReceiving Party provides the Disclosing Party with sufficient prior notice, and
\ncooperates with the Disclosing Party (at such Disclosing Party153s cost and
\nexpense), to allow the Disclosing Party to contest such request, requirement or
\norder. In addition, each Party may disclose (i) the existence of this Agreement;
\n(ii) a general summary of the Research being provided under this Agreement;
\n(iii) the aggregate dollar amount of fees to be paid by the Foundation under
\nthis Agreement; and (iv) any specific terms of this Agreement that are a matter
\nof public record except by breach of this Agreement; provided, that, if Isis
\ndetermines that applicable securities laws or regulations require it to disclose
\nadditional information about this Agreement or its terms or conditions, Isis
\nwill notify the Foundation in writing of such disclosure requirement and will
\ncooperate with the Foundation in requesting confidential treatment of any
\nprovision of this Agreement as reasonably requested by the Foundation.<\/p>\n

(e)<\/strong> [***] Collaboration<\/u><\/strong>. The
\nFoundation has entered into a collaboration with [***] and [***] related to the
\ndevelopment of therapeutics to treat Huntington153s disease (the
\n“[***] Project<\/em><\/strong>“). Notwithstanding any provision to the
\ncontrary in this Agreement, the Foundation will not (i) disclose, reveal or give
\nany Isis Confidential Information or Joint Confidential Information to [***] or
\n[***] or (ii) provide any Project Compounds to [***] or [***], in each case for
\nuse in connection with the [***] Project. The Foundation will not (A) disclose,
\nreveal or give any confidential information of any of the parties to the [***]
\nProject to Isis or (B) provide any compounds resulting from the [***] Project to
\nIsis or any of its Affiliates, in each case for use in connection with this
\nProject. The Parties will implement reasonable safeguards, processes and
\nprocedures necessary to abide by the obligations in this Section 14(e)<\/u>.\n<\/p>\n

15.<\/strong> Use of
\nTrademarks<\/u><\/strong>.<\/strong> No Party will use the name,
\ntrademarks, logos, physical likeness or other symbol of the other Party (or
\ntheir employees) for any marketing, advertising, public relations or other
\npurposes without the prior written authorization of the other Party, except that
\neither Party may (a) make reference to the Foundation153s funding of the Research
\nand (b) use the other Party153s name in any disclosure permitted pursuant to
\nSection 14(d)<\/u> of this Agreement; provided, that<\/em>, in each case
\nthe relationship of the Parties is accurately and appropriately described.<\/p>\n

51<\/p>\n

\n

<\/p>\n

Covenants; Representations and Warranties<\/strong>\n<\/p>\n

16.<\/strong> Covenants; Representations and
\nWarranties<\/u><\/strong>.<\/strong><\/p>\n

(a)<\/strong> Covenants<\/u><\/strong>.<\/strong>
\nIsis agrees to each of the following:<\/p>\n

(i)<\/strong> Conduct of the Research; Compliance with
\nLaw<\/u><\/strong>.<\/strong> Isis will perform the Research using
\ngenerally accepted industry standards and practices and in compliance with all
\napplicable federal, state, local, international, health authority and
\ninstitutional laws, rules, regulations, orders and guidelines.<\/p>\n

(ii)<\/strong> Audit; Access<\/u><\/strong>.<\/strong>
\nAt reasonably convenient times and dates and upon reasonable prior notice (in
\nall cases at least 10 business days), (A) the Foundation and its representatives
\nwill have the right to audit Isis153 compliance with this Agreement and (B) Isis
\nwill provide the Foundation and its representatives with reasonable access to
\nthe facilities used in the performance of the Research, data and personnel in
\norder to enable the Foundation to assess the status and progress of the Research
\nbeing performed by Isis.<\/p>\n

(iii)<\/strong> Research
\nTeam<\/u><\/strong>.<\/strong> The Research will only be performed by
\nindividuals who have assigned to Isis any ownership or other rights they may
\nacquire in any (A) Project Results produced or (B) Project Intellectual Property
\nconceived, discovered, invented, made or first reduced to practice, in each case
\nin the course of the performance of the Research under this Agreement, so that
\nIsis may perform its obligations and convey the rights granted by it under this
\nAgreement. Isis will not permit any individual to perform any Research or
\nreview, or have access to, any Project Results, prior to such individual153s
\nexecution and delivery of the invention assignments required by this Section
\n16(a)(iii)<\/u>. Isis will cause any such individual to assign any such (1)
\nProject Results produced or (2) Project Intellectual Property conceived,
\ndiscovered, invented, made or reduced to practice, in each case in the course of
\nthe performance of the Research under this Agreement to Isis.<\/p>\n

(iv)<\/strong> Consents, Licenses, Permits and
\nApprovals<\/u><\/strong>.<\/strong> Isis will obtain all consents, permits
\nand other approvals necessary for Isis to perform its obligations and convey the
\nrights granted by it under this Agreement.<\/p>\n

(v)<\/strong> Conflicting
\nObligations<\/u><\/strong>.<\/strong> Isis will not enter into, any
\nagreement, contract, license or other arrangement that conflicts with Isis153
\ndischarge of its obligations under this Agreement or the Foundation153s exercise
\nof its rights under this Agreement.<\/p>\n

52<\/p>\n

\n

<\/p>\n

(vi)<\/strong> Third Party and Affiliate Intellectual
\nProperty<\/u><\/strong>.<\/strong> Except for the Isis Background
\nIntellectual Property set forth on Schedule 16(a)(vi)<\/u>, without the prior
\nwritten consent of the Foundation, Isis will not use or practice any (A)
\nIntellectual Property (1) that is known by Isis to be owned by a Third Party or
\none of Isis153 Affiliates or (2) which is owned by, or licensed to, Isis (or
\notherwise subject to restrictions on use known to Isis), (B) Acquirer
\nIntellectual Property of any Acquirer of Isis, (C) Isis\/[***] Collaboration
\nIntellectual Property or (D) Regulus Intellectual Property, in the performance
\nof the Research, if the use or practice of any such Intellectual Property would
\nbe necessary to enable a) licensee under a Commercial License to practice any
\nProject HD Intellectual Property to the extent necessary for such licensee to
\ncommercialize one or more Project Compounds under a Commercial License in
\naccordance with the terms of this Agreement or b) the Foundation and the
\nFoundation Collaborators to use any Project Results, Project Deliverables or
\nProject HD Intellectual Property solely for HD Research and Development,
\nunless<\/em> (1) Isis Controls, and at all times retains Control of, such
\nIntellectual Property, (2) except as set forth on Schedule 16(b)(iv)(B) –
\n2<\/u>, Isis does not have to obtain the consent of any Third Party or Affiliate
\nor pay any compensation to any Third Party or Affiliate to license or sublicense
\nsuch Intellectual Property and (3) grants a license or sublicense, as the case
\nmay be, in respect of any such Intellectual Property to (a) a licensee under a
\nCommercial License to the extent necessary for such licensee to commercialize
\none or more Project Compounds under such Commercial License in accordance with
\nthe terms of this Agreement, including under Section 10(g)<\/u> of this
\nAgreement and (b) the Foundation (with the right to grant sublicenses to the
\nFoundation Collaborators), pursuant to the terms and conditions of this
\nAgreement, including Section 12<\/u> of this Agreement, to use any Project
\nResults, Project Deliverables or Project HD Intellectual Property solely for HD
\nResearch and Development.<\/p>\n

(vii)<\/strong> Further
\nAssurances<\/u><\/strong>.<\/strong> Isis will, at the Foundation153s
\nexpense, (A) execute such further documents, instruments, licenses and
\nassurances and (B) take such further actions, in each case as the Foundation may
\nreasonably request from time to time to better enable the Foundation to exercise
\nits rights under this Agreement; provided, that<\/em>, such further
\ndocuments, instruments, licenses, assurances and actions will not materially
\nchange either Party153s rights or obligations under this Agreement.<\/p>\n

(viii)<\/strong> No
\nDebarment<\/u><\/strong>.<\/strong> Isis will not use a Debarred Individual
\n(as defined below) or Debarred Entity (as defined below) to perform any
\nactivities or render any assistance on Isis153 behalf relating to activities
\nperformed pursuant to this Agreement. A “Debarred
\nEntity<\/em><\/strong>” is a corporation, partnership or association that has been
\ndebarred by the FDA pursuant to 21 U.S.C. \u00a7335a (a) or (b) from submitting or
\nassisting in the submission of any drug<\/p>\n

53<\/p>\n

\n

<\/p>\n

product application, or a member, subsidiary or Affiliate of a Debarred
\nEntity; and a “Debarred Individual<\/em><\/strong>” is an individual
\nwho has been debarred by the FDA pursuant to 21 U.S.C. \u00a7335a (a) or (b) from
\nproviding services in any capacity to a person that has an approved or pending
\ndrug product application.<\/p>\n

(b)<\/strong> Representations and
\nWarranties<\/u><\/strong>.<\/strong> Isis hereby represents and warrants to
\neach of the following as of the Effective Date:<\/p>\n

(i)<\/strong> No Debarment<\/u><\/strong>.<\/strong>
\nIsis represents and warrants that it has never been, and is not currently, a
\nDebarred Entity.<\/p>\n

(ii)<\/strong> Consents, Licenses, Permits and
\nApprovals<\/u><\/strong>.<\/strong> Isis has obtained all consents,
\nlicenses, permits and other approvals necessary for Isis to enter into this
\nAgreement.<\/p>\n

(iii)<\/strong> Conflicting
\nObligations<\/u><\/strong>.<\/strong> Neither the execution and delivery of
\nthis Agreement by Isis nor the discharge by Isis of its obligations under this
\nAgreement will conflict with, result in a breach of, constitute a default under,
\nrequire any notice under or create in any Third Party the right to terminate,
\nmodify or cancel any agreement, contract, instrument, license or other
\narrangement to which Isis is or becomes a party or by which it is or becomes
\nbound. Isis has not entered into any agreement, contract, license or other
\narrangement that conflicts with Isis153 discharge of its obligations under this
\nAgreement or the Foundation153s exercise of its rights under this Agreement.<\/p>\n

(iv)<\/strong> Intellectual
\nProperty<\/u><\/strong>.<\/strong><\/p>\n

(A)<\/strong> General Intellectual
\nProperty<\/u><\/strong>.<\/strong> To the knowledge of Isis, Isis owns or
\nhas the right to use pursuant to a valid and enforceable, written license,
\nsublicense, agreement or other permission, all Intellectual Property necessary
\nto perform the Research. To the knowledge of Isis, except as specifically
\ndisclosed in that certain letter dated as of the Original Effective Date from
\nGrantland E. Bryce, Vice President, Corporate Development & Legal Counsel to
\nRobi Blumenstein, Isis153 performance of the Research will not interfere with,
\ninfringe upon, violate or misappropriate any Intellectual Property rights of any
\nThird Party or Affiliate of Isis.<\/p>\n

(B)<\/strong> Isis Background Intellectual
\nProperty<\/u><\/strong>.<\/strong> Schedule 16(b)(iv)(B) – 1<\/u> sets
\nforth a complete and accurate list of all Isis Background Intellectual Property
\nthat is not Controlled by Isis that would be necessary to enable (1) a Third
\nParty licensee under a Commercial License to practice any Project HD
\nIntellectual Property to the extent necessary for such Third Party to
\ncommercialize one or<\/p>\n

54<\/p>\n

\n

<\/p>\n

more Project Compounds under a Commercial License in accordance with the
\nterms of this Agreement and (2) the Foundation and the Foundation Collaborators
\nto use the Project Results, any Project Deliverables and Project HD Intellectual
\nProperty solely for HD Research and Development. Except as set forth on
\nSchedule 16(b)(iv)(B) – 2<\/u>, Isis has the right to grant the licenses and
\nsublicenses contemplated by this Agreement to the Isis Background Intellectual
\nProperty Controlled by Isis without obtaining the consent of any Third Party or
\nAffiliate and without the payment of any compensation to any Third Party or
\nAffiliate.<\/p>\n

(C)<\/strong> Certain Third Party and Affiliate
\nIntellectual Property<\/u><\/strong>.<\/strong> During the period beginning
\non the Original Effective Date and ending on the Effective Date, Isis did not
\nuse or practice any (A) Intellectual Property (1) that was known by Isis to be
\nowned by a Third Party or one of Isis153 Affiliates or (2) which was owned by, or
\nlicensed to, Isis (or otherwise subject to restrictions on use known to Isis),
\n(B) Acquirer Intellectual Property of any Acquirer of Isis, (C) Isis\/[***]
\nCollaboration Intellectual Property or (D) Regulus Intellectual Property, in the
\nconduct of the 2007 Research Agreement Project, that would be necessary to be
\nused or practiced to enable a) licensee under a Commercial License to practice
\nany Project HD Intellectual Property to the extent necessary for such licensee
\nto commercialize one or more Project Compounds under a Commercial License in
\naccordance with the terms of this Agreement or b) the Foundation and the
\nFoundation Collaborators to use any Project Results, Project Deliverables or
\nProject HD Intellectual Property solely for HD Research and Development,
\nother than<\/em> any such Intellectual Property that Isis (1) Controls, and
\nat all times retains Control of, such Intellectual Property and (2) grants a
\nlicense or sublicense, as the case may be in respect of any such Intellectual
\nProperty to (a) a licensee under a Commercial License to the extent necessary
\nfor such licensee to commercialize one or more Project Compounds under such
\nCommercial License in accordance with the terms of this Agreement, including
\nunder Section 10(g)<\/u> of this Agreement and (b) the Foundation (with the
\nright to grant sublicenses to the Foundation Collaborators), pursuant to the
\nterms and conditions of this Agreement, including Section 12<\/u> of this
\nAgreement, to use any Project Results, Project Deliverables or Project HD
\nIntellectual Property solely for HD Research and Development.<\/p>\n

55<\/p>\n

\n

<\/p>\n

Term; Termination; Effect of Termination<\/strong><\/p>\n

17.<\/strong> Term; Termination of Certain Sections by the
\nFoundation; Termination of Certain Sections by Isis; Termination of Specified
\nSections; Survival of Remaining Sections; Effect of Termination of Certain
\nSections<\/u><\/strong>.<\/strong><\/p>\n

(a)<\/strong> Term<\/u><\/strong>.<\/strong> The term
\n(the “Term<\/em><\/strong>“) of this Agreement will commence on the
\nEffective Date and will, unless earlier terminated in accordance with the terms
\nhereof or by the mutual written agreement of the Parties, continue in effect
\nuntil the date that is 30 days after the date on which all activities that have
\nbeen approved by the Steering Committee to be conducted as part of the Project
\n(as evidenced by such activities being set forth in the Detailed Project
\nDescription most recently approved by the Steering Committee) have been
\ncompleted.<\/p>\n

(b)<\/strong> Termination of Certain Sections by the
\nFoundation<\/u><\/strong>.<\/strong><\/p>\n

(i)<\/strong> Termination with
\nNotice<\/u><\/strong>.<\/strong> The Foundation may elect for any reason to
\nimmediately terminate all of the sections specified in Section 17(d)(i)<\/u>
\nof this Agreement and discontinue Isis153 performance of the Research by giving 60
\ndays prior written notice to such effect to Isis.<\/p>\n

(ii)<\/strong> Termination Upon the Occurrence of Certain
\nEvents<\/u><\/strong>.<\/strong> The Foundation may, by giving notice to
\nIsis, elect to terminate each of the sections specified in Section
\n17(d)(i)<\/u> of this Agreement and discontinue Isis153 performance of the Research
\nupon the occurrence of any of the following events:<\/p>\n

(A)<\/strong> Breach of this
\nAgreement<\/u><\/strong>.<\/strong> If Isis (1) materially breaches any
\nrepresentation, warranty or covenant given by it under this Agreement or (2)
\nmaterially defaults in the performance of its obligations under this Agreement
\nand such breach or default is not remedied within 45 days of the receipt by Isis
\nof notice of such breach or default from the Foundation.<\/p>\n

(B)<\/strong> Change of Circumstances Notice.<\/u><\/strong>
\nIsis delivers a Change of Circumstances Notice to the Foundation pursuant to
\nSection 3(b)(i)<\/u> of this Agreement.<\/p>\n

(C)<\/strong> Post-Original Effective Date Knowledge
\nNotice<\/u><\/strong>. <\/strong>If Isis delivers a Post-Original Effective
\nDate Knowledge Notice to the Foundation pursuant to Section 3(b)(ii)<\/u> of
\nthis Agreement.<\/p>\n

(D)<\/strong> Bankruptcy
\nEvent<\/u><\/strong>.<\/strong> If Isis is the subject of a Bankruptcy
\nEvent.<\/p>\n

(c)<\/strong> Termination of Certain Sections by
\nIsis<\/u><\/strong>.<\/strong> Isis may, by giving notice to the
\nFoundation, elect to terminate each of the sections specified in Section
\n17(d)(i)<\/u> of this Agreement and discontinue Isis153 performance of the Research
\nupon the occurrence of any of the following events:<\/p>\n

56<\/p>\n

\n

<\/p>\n

(i)<\/strong> Breach of this
\nAgreement<\/u><\/strong>.<\/strong> If the Foundation (A) materially
\nbreaches any representation, warranty or covenant given by it under this
\nAgreement or (B) materially defaults in the performance of any of its
\nobligations under this Agreement and such breach or default is not remedied
\nwithin 45 days of the receipt by the Foundation of notice of such breach or
\ndefault from Isis.<\/p>\n

(ii)<\/strong> Bankruptcy
\nEvent<\/u><\/strong>.<\/strong> If the Foundation is the subject of a
\nBankruptcy Event.<\/p>\n

(d)<\/strong> Termination of Specified Sections; Survival
\nof Remaining Sections; Effect of Termination of Certain
\nSections<\/u><\/strong>.<\/strong><\/p>\n

(i)<\/strong> Termination of Specified Sections; Survival
\nof Remaining Sections<\/u><\/strong>.<\/strong> Immediately upon the
\nearlier to occur of either (A) the expiration of the Term, (B) the mutual
\nagreement of the Parties to terminate this Agreement, (C) an election by the
\nFoundation pursuant to Section 17(b)<\/u> of this Agreement or (D) an election
\nby Isis pursuant to Section 17(c)<\/u> of this Agreement, then subject to
\nSection 17(d)(ii)<\/u> of this Agreement, each of Section 2<\/u>,
\nSection 3(a)<\/u>, Section 3(b)<\/u>, Section 4(a)<\/u>, Section
\n4(b)<\/u>, Section 4(c)(iii)<\/u>, Section 5(a)<\/u>, Section 5(b)<\/u>,
\nSection 6(a)<\/u> and Section 6(b)<\/u> will a) immediately terminate and b)
\nsubject to Section 17(d)(ii)<\/u> of this Agreement, have no further force or
\neffect. The Parties acknowledge and agree that in the event of the termination
\nof the sections specified in this Section 17(d)(i)<\/u>, all other sections of
\nthis Agreement will survive indefinitely and remain in full force and effect.\n<\/p>\n

(ii)<\/strong> Effect of Termination of Certain
\nSections<\/u><\/strong>.<\/strong><\/p>\n

(A)<\/strong> Delivery of Final Project Reports, Provided
\nResearch Materials, Project Deliverables and Project
\nResults<\/u><\/strong>.<\/strong> Upon the termination of the sections
\nspecified in Section 17(d)(i)<\/u> of this Agreement, Isis will deliver to the
\nFoundation each of the following: (1) in accordance with Section 5(e)<\/u> of
\nthis Agreement, a Final Project Report for the Project for the period beginning
\non the Effective Date through the date of such termination, (2) in accordance
\nwith Section 5(e)<\/u> of this Agreement, a final FTE Report for the period
\nbeginning on the end date of the period covered by the last FTE Report delivered
\nthrough the date of such termination, (3) in accordance with Section 4(c)<\/u>
\nof this Agreement, all unused Provided Research Materials and (4) in accordance
\nwith Section 7(b)<\/u> and Section 8(b)<\/u>, respectively, of this
\nAgreement, all Project Results and Project Deliverables produced by Isis but not
\nyet delivered to the Foundation through the date of such termination.<\/p>\n

57<\/p>\n

\n

<\/p>\n

(B)<\/strong> Foundation153s Payment Obligation Upon
\nTermination<\/u><\/strong>.<\/strong> The Parties acknowledge and agree
\nthat, upon the termination of the sections specified in Section 17(d)(i)<\/u>
\nof this Agreement, the Foundation will, subject to Section 6<\/u> of this
\nAgreement, make a payment (to the extent such payment is not in dispute) (1) in
\nrespect of the Research FTEs performing the Research through the effective date
\nof the termination of the sections specified in Section 17(d)(i)<\/u> of this
\nAgreement (such payment to be calculated in accordance with Section 6<\/u> of
\nthis Agreement) and (2) to reimburse Isis for any Isis Provided Reimbursable
\nMaterials Costs and Specialized Licenses or Services Costs incurred by Isis in
\naccordance with, and subject to, Section 4(b)<\/u> and Section 4(d)<\/u> of
\nthis Agreement, respectively, unless the obligations of Isis to procure Isis
\nProvided Reimbursable Materials and Specialized Third Party Licenses and
\nServices related to such costs may be cancelled by Isis in which case the
\nFoundation will only reimburse Isis for the contractual cancellation fees
\nassociated with the cancellation of such obligations. Isis agrees that a) the
\ninvoice submitted by Isis in respect of the final Quarterly Research Payment
\nshall credit the Advance Research Payment Amount against such final Quarterly
\nResearch Payment and b) if the amount of final Quarterly Research Payment is
\nless than the Advance Research Payment Amount, Isis shall promptly make a
\npayment to the Foundation in an amount equal to the amount by which the Advance
\nResearch Payment Amount exceeded the amount of the final Quarterly Research
\nPayment.<\/p>\n

(C)<\/strong> Facilitation of Continued
\nResearch<\/u><\/strong>.<\/strong> Upon the termination of the sections
\nspecified in Section 17(d)(i)<\/u> of this Agreement, if requested by the
\nFoundation, Isis and the Foundation will, in good faith, discuss the use of
\nreasonable efforts to facilitate the continuance of the Project elsewhere.<\/p>\n

(D)<\/strong> Liabilities and Obligations Accrued Prior to
\nTermination<\/u><\/strong>.<\/strong> The Parties acknowledge and agree
\nthat the termination of the sections specified in Section 17(d)(i)<\/u> of
\nthis Agreement will not (1) relieve any Party then in breach of this Agreement
\nfor any liabilities to the other Party in respect of any breach under this
\nAgreement or (2) relieve either Party from any of the obligations such Party may
\nhave under this Agreement to the extent such obligations accrued prior to the
\ndate of such termination or (3) relieve either Party from any of the obligations
\nsuch Party may have under any of the sections of this Agreement that expressly
\nsurvive any such termination.<\/p>\n

58<\/p>\n

\n

<\/p>\n

Miscellaneous<\/strong><\/p>\n

18.<\/strong> Independent
\nContractor<\/u><\/strong>.<\/strong> Isis is acting as an independent
\ncontractor and not an agent, joint venturer or partner of the Foundation.
\nNothing in this Agreement will create, evidence or imply any agency, partnership
\nor joint venture between the Parties. Neither Party will act or describe itself
\nas the agent of the other Party nor will it represent that it has any authority
\nto make commitments on the other Party153s behalf.<\/p>\n

19.<\/strong> Notices<\/u><\/strong>.<\/strong> Any
\nnotice required or permitted to be given by this Agreement will be in writing
\nand will be delivered by personal delivery, US mail with postage prepaid and
\nreturn receipt requested, facsimile (provided the sender has evidence of
\nsuccessful transmission) or next-day courier service. Any notice so delivered
\nwill be deemed to be given, delivered and received, if delivered by personal
\ndelivery or if delivered by US mail, on the day received as indicated by the
\npostal receipt and if delivered by facsimile or courier service, on the day
\nfollowing dispatch. All such notices are to be given or made at the following
\naddresses (or to such other address as may be designated by a notice given in
\naccordance with the provisions of this Section 19<\/u>):<\/p>\n

If to the Foundation to:<\/p>\n

CHDI Foundation, Inc.<\/p>\n

c\/o CHDI Management, Inc.<\/p>\n

350 Seventh Avenue, Suite 601<\/p>\n

New York, NY 10001<\/p>\n

Attention: Ruth Basu, Chief Administrative Officer<\/p>\n

Fax: 212-239-2101<\/p>\n

With a copy to:<\/p>\n

CHDI Foundation, Inc.<\/p>\n

c\/o CHDI Management, Inc.<\/p>\n

350 Seventh Avenue, Suite 601<\/p>\n

New York, NY 10001<\/p>\n

Attention: David P. Rankin, Chief Legal Officer<\/p>\n

Fax: 212-239-2101<\/p>\n

If to Isis prior to August 22, 2011<\/u><\/strong>, to:<\/p>\n

Isis Pharmaceuticals, Inc.<\/p>\n

1896 Rutherford Road<\/p>\n

Carlsbad, CA 92008<\/p>\n

Attention: C. Frank Bennett, Ph.D.<\/p>\n

Fax: 760-603-4650<\/p>\n

59<\/p>\n

\n

<\/p>\n

With copies to:<\/p>\n

Isis Pharmaceuticals, Inc.<\/p>\n

1896 Rutherford Road<\/p>\n

Carlsbad, CA 92008<\/p>\n

Attention: Chief Operating Officer & Chief Financial Officer<\/p>\n

Fax: 760-918-3592<\/p>\n

and<\/p>\n

Isis Pharmaceuticals, Inc.<\/p>\n

1896 Rutherford Road<\/p>\n

Carlsbad, CA 92008<\/p>\n

Attention: Vice President, Legal & General Counsel<\/p>\n

Fax: 760-268-4922<\/p>\n

If to Isis on or after August 22, 2011<\/u><\/strong>, to:<\/p>\n

Isis Pharmaceuticals, Inc.<\/p>\n

2855 Gazelle Court<\/p>\n

Carlsbad, CA 92010<\/p>\n

Attention: C. Frank Bennett, Ph.D.<\/p>\n

Fax: 760-603-4650<\/p>\n

With copies to:<\/p>\n

Isis Pharmaceuticals, Inc.<\/p>\n

2855 Gazelle Court<\/p>\n

Carlsbad, CA 92010<\/p>\n

Attention: Chief Operating Officer & Chief Financial Officer<\/p>\n

Fax: 760-918-3592<\/p>\n

and<\/p>\n

Isis Pharmaceuticals, Inc.<\/p>\n

2855 Gazelle Court<\/p>\n

Carlsbad, CA 92010<\/p>\n

Attention: Vice President, Legal & General Counsel<\/p>\n

Fax: 760-268-4922<\/p>\n

20.<\/strong> Indemnity; Limitation on
\nDamages<\/u><\/strong>.<\/strong><\/p>\n

(a)<\/strong> Indemnification by the
\nFoundation<\/u><\/strong>.<\/strong> The Foundation will defend and
\nindemnify Isis, its Affiliates and their respective directors, officers,
\nemployees, representatives, consultants, agents and service providers
\n(collectively, the “Isis Indemnified Parties<\/em><\/strong>“),
\nagainst any and all costs, damages, expenses (including reasonable legal fees)
\nand losses suffered by any Isis Indemnified Party in<\/p>\n

60<\/p>\n

\n

<\/p>\n

connection with any Third Party action, assessment, claim, demand, proceeding
\nor suit to the extent arising or resulting from (i) the Foundation153s negligence
\nor willful misconduct; (ii) the Foundation153s breach of this Agreement; (iii)
\nIsis153 use, or alleged use, in the performance of the Research of any Foundation
\nProvided Materials or Foundation Provided Material Information provided by the
\nFoundation to Isis for the purpose of performing the Research; or (iv) the
\nstorage, distribution or use of a Project Compound by the Foundation or any
\nFoundation Collaborator (but in each case only to the extent such claim does not
\nresult from, or arise out of, an action for which Isis is obligated to indemnify
\nthe Foundation pursuant to Section 20(b)<\/u> of this Agreement). For clarity,
\nthe Parties agree that the parenthetical clause in the immediately preceding
\nsentence is not intended to obviate or otherwise limit the possibility that both
\nIsis and the Foundation may be determined to be joint tort-feasors and,
\ntherefore, share liability.<\/p>\n

(b)<\/strong> Indemnification by
\nIsis<\/u><\/strong>.<\/strong> Isis will defend and indemnify the
\nFoundation and its Affiliates, members, directors, officers, employees,
\nrepresentatives, consultants, agents and service providers (collectively, the
\n“Foundation Indemnified Parties<\/em><\/strong>“), against any and all
\ncosts, damages, expenses (including reasonable legal fees) and losses suffered
\nby any Foundation Indemnified Party in connection with any Third Party action,
\nassessment, claim, demand, proceeding or suit to the extent arising or resulting
\nfrom (i) Isis153 negligence or willful misconduct; (ii) Isis153 breach of this
\nAgreement; (iii) the storage, distribution or use of a Project Compound by Isis
\nor any collaborator of Isis (other than the Foundation) or (iv) the activities
\nof Isis in the course of Isis153 performance of the Research, including activities
\nwhich infringe upon, violate or misappropriate, or are alleged to infringe upon,
\nviolate or misappropriate, the Intellectual Property rights of a Third Party
\n(but (A) excluding all activities that infringe upon, violate or misappropriate,
\nor are alleged to infringe upon, violate or misappropriate, the Intellectual
\nProperty rights of a Third Party if (1) in accordance with Section
\n16(a)(vi)<\/u> of this Agreement, the Foundation consented to the use or
\npractice, as the case may be, of such Third Party Intellectual Property by Isis
\nin the conduct of such activities or (2) in accordance with Section
\n3(b)(ii)<\/u> of this Agreement, Isis notified the Foundation with respect to the
\nto the use or practice, as the case may be, of such Third Party Intellectual
\nProperty by Isis in the conduct of such activities and the Foundation did not
\nexercise, within 90 days of the Foundation153s receipt of Isis153 notice, its right
\nto terminate the applicable Project(s) or this Agreement and (B) only to the
\nextent such claim does not result from, or arise out of, an action for which the
\nFoundation is obligated to indemnify Isis pursuant to Section 20(a)<\/u> of
\nthis Agreement). For clarity, the Parties agree that the parenthetical clause in
\nthe immediately preceding sentence is not intended to obviate or otherwise limit
\nthe possibility that both Isis and the Foundation may be determined to be joint
\ntort-feasors and, therefore, share liability.<\/p>\n

61<\/p>\n

\n

<\/p>\n

(c)<\/strong> Limitation on Damages; Damages
\nCap<\/u><\/strong>.<\/strong><\/p>\n

(i)<\/strong> Limitation on
\nDamages<\/u><\/strong>.<\/strong> NOTWITHSTANDING ANY OTHER PROVISION OF
\nTHIS AGREEMENT BUT SUBJECT TO SECTION 20(d)<\/u> OF THIS AGREEMENT, NEITHER
\nPARTY NOR ITS AFFILIATES WILL BE LIABLE TO THE OTHER PARTY OR ITS AFFILIATES FOR
\nANY CONSEQUENTIAL, SPECIAL, INDIRECT, INCIDENTAL, PUNITIVE OR EXEMPLARY DAMAGES
\nOR OTHER SIMILAR OR LIKE DAMAGES (INCLUDING LOSS OF PROFITS) UNDER THIS
\nAGREEMENT EVEN IF SUCH PARTY OR AFFILIATE HAS BEEN ADVISED OF THE POSSIBILITY OF
\nSUCH DAMAGES; PROVIDED, THAT<\/em>, NOTHING IN THIS AGREEMENT WILL EXCLUDE OR
\nLIMIT THE LIABILITY OF EITHER PARTY FOR (A) A BREACH OF SECTION 14<\/u> OF
\nTHIS AGREEMENT; (B) DEATH OR PERSONAL INJURY; OR (C) FRAUD.<\/p>\n

(ii)<\/strong> Damages Cap<\/u><\/strong>.<\/strong>
\nIsis153 liability to the Foundation under this Agreement and the 2007 Research
\nAgreement shall not exceed the sum of (A) US$[***] plus<\/u> (B) [***]. The
\nFoundation153s liability to Isis under this Agreement and the 2007 Research
\nAgreement shall not exceed [***]. Isis and the Foundation agree that this
\nSection 20(c)(ii)<\/u> supersedes and replaces in its entirety Section
\n18(c)(ii) of the 2007 Research Agreement.<\/p>\n

(d)<\/strong> Indemnity
\nAmounts<\/u><\/strong>.<\/strong> Any amounts owing pursuant to a Party153s
\nexpress indemnity obligations under this Agreement will not be subject to the
\nlimitation on damages restrictions set forth in Section 20(c)<\/u> of this
\nAgreement.<\/p>\n

(e)<\/strong> Indemnity Procedures<\/u><\/strong>.
\n<\/strong>In the event that a Party that is entitled to indemnification under
\nSection 20(a)<\/u> or Section 20(b)<\/u> of this Agreement, as the case may
\nbe (such Party the “Indemnified Party<\/em><\/strong>“) seeks
\nindemnification from the other Party (such Party an “Indemnifying
\nParty<\/em><\/strong>“), the Indemnified Party will (i) inform, in writing, the
\nIndemnifying Party of the claim as soon as reasonably practicable after the
\nIndemnified Party receives notice of such claim; (ii) permit the Indemnifying
\nParty to assume direction and control of the defense of such claim (including
\nthe sole right to settle such claim in the Indemnifying Party153s sole discretion,
\nprovided that<\/em> any such settlement does not (A) admit any fault or
\nnegligence on the part of the Indemnified Party, (B) impose any obligation on
\nthe Indemnified Party or (C) without the prior written consent of the
\nIndemnified Party (which consent shall not unreasonably withheld, conditioned or
\ndelayed), adversely affect the Indemnified Party in any way; (iii) cooperate as
\nreasonably requested (at the cost and expense of the Indemnifying Party) in the
\ndefense of such claim; and (iv) undertake commercially (at the cost and expense
\nof the Indemnifying Party) reasonable steps to mitigate any loss, damage or
\nexpense with respect to such claim. Notwithstanding anything in this Agreement
\nto the contrary, the Indemnifying Party will have no liability under Section
\n20(a)<\/u> or Section 20(b)<\/u>, of this Agreement, as the case may be, with
\nrespect to any claims settled by the Indemnified Party without the Indemnifying
\nParty153s prior written consent.<\/p>\n

62<\/p>\n

\n

<\/p>\n

21.<\/strong> Alternative Dispute
\nResolution<\/u><\/strong>.<\/strong><\/p>\n

(a)<\/strong> General<\/u><\/strong>.<\/strong>
\nExcept for (i) Steering Committee Disputes which are to be resolved pursuant to
\nSection 5(a)(iii)(B)<\/u> of this Agreement and (ii) Commercial License Grant
\nDisputes which are to be resolved pursuant to Section 10(e)<\/u> of this
\nAgreement, if a dispute arises out of or relates to this Agreement, or breach
\nthereof, the Parties agree that such dispute will be resolved exclusively in
\naccordance with this Section 21<\/u>.<\/p>\n

(b)<\/strong> Resolution by Good Faith
\nNegotiations<\/u><\/strong>.<\/strong> If a dispute arises out of or
\nrelates to this Agreement, or breach thereof, the Parties agree to negotiate in
\ngood faith to settle such dispute in accordance with this Section 21(b)<\/u>.
\nIf a dispute arises out of or relates to this Agreement, or breach thereof,
\neither Party may submit such dispute to B. Lynne Parshall, in the case of Isis
\n(or such other individual identified in writing by Isis), and Robi Blumenstein,
\nin the case of the Foundation (or such other individual identified in writing by
\nthe Foundation), for resolution by providing a written notice (each, a
\n“Senior Management Dispute Resolution Notice<\/em><\/strong>“) to the
\nother Party setting forth in reasonable detail the basis of such dispute. If a
\ndispute that is the subject of a Senior Management Dispute Resolution Notice is
\nnot resolved by the Parties within 60 days of the delivery of such Senior
\nManagement Dispute Resolution Notice, such dispute will be resolved in
\naccordance with Section 21(c)<\/u> of this Agreement. The Parties agree that
\nany and all such negotiations will be confidential.<\/p>\n

(c)<\/strong> Resolution by Binding
\nArbitration<\/u><\/strong>.<\/strong> If a dispute that is the subject of a
\nSenior Management Dispute Resolution Notice is not resolved by the Parties
\nwithin 60 days of the delivery of such Senior Management Dispute Resolution
\nNotice, either Party may submit such dispute for final resolution by an
\narbitrator in accordance with this Section 21(c)<\/u> by providing a written
\nnotice (each, an “Arbitration Dispute Resolution
\nNotice<\/em><\/strong>“) to the other Party to such effect within 30 days after
\nthe end of such 60-day period. The Parties agree that any dispute that is the
\nsubject of an Arbitration Dispute Resolution Notice will be settled by a single
\narbitrator in a binding arbitration in Denver, Colorado administered by JAMS
\nunder its Comprehensive Arbitration Rules and Procedures. The Parties will
\ninstruct the arbitrator that the prevailing party of any dispute (as determined
\nby the arbitrator) will be awarded the reasonable attorneys153 fees, costs and
\nother expenses incurred by the prevailing party in the course of the arbitration
\nof such dispute. The award rendered by the arbitrator will be final and binding
\non the Parties, and judgment on the award may be entered in any court having
\njurisdiction thereof if reasonably necessary for enforcement. The Parties agree
\nthat, notwithstanding anything to the contrary in such rules, any and all such
\nproceedings will be confidential.<\/p>\n

63<\/p>\n

\n

<\/p>\n

22.<\/strong> Assignment<\/u><\/strong>.<\/strong>
\nIsis may not assign this Agreement without the prior written consent of the
\nFoundation, except to an (a) Affiliate of Isis, or (b) entity that acquires all
\nor substantially all of the business of Isis (whether by sale of assets or stock
\nor by merger or other business combination), and in each case who agrees, in
\nwriting, to assume Isis153 obligations under this Agreement. Isis agrees that any
\nsuch assignee will (i) acquire Isis153 interest in all of the Isis Background
\nIntellectual Property, Project Compounds, Project Intellectual Property and
\nProject Results and (ii) agree, in writing, to assume Isis153 obligations under
\nthis Agreement. The Foundation may assign this Agreement so long as the assignee
\nexpressly assumes in writing the Foundation153s obligations in this Agreement.\n<\/p>\n

23.<\/strong> Press Releases<\/u><\/strong>.<\/strong>
\nUpon execution of this Agreement, the Parties will mutually agree to issue
\neither a joint press release or separate press releases announcing the existence
\nof this Agreement, in any case in a form and substance agreed to in writing by
\nthe Parties. Each Party agrees not to issue any other press release or other
\npublic statement disclosing other information relating to this Agreement or the
\ntransactions contemplated hereby without the prior written consent of the other
\nParty, which consent will not be unreasonably withheld or delayed, provided
\nhowever, that each Party may make disclosures permitted by, and in accordance
\nwith, Section 14<\/u> of this Agreement. Each Party agrees to provide to the
\nother Party a copy of any public announcement regarding this Agreement or the
\nsubject matter thereof as soon as reasonably practicable under the circumstances
\nprior to its scheduled release. Except under extraordinary circumstances, each
\nParty will provide the other with an advance copy of any such announcement at
\nleast five business days prior to its scheduled release.<\/p>\n

24.<\/strong> Incorporation of Appendices, Exhibits and
\nSchedules; Entire Agreement; Amendment<\/u><\/strong>.<\/strong> The
\nappendices, exhibits and schedules identified in this Agreement are incorporated
\nherein by reference and made a part hereof. If (a) any terms or conditions of
\nthe 2007 Research Agreement, (b) anything in any appendix, exhibit or schedule
\nattached to this Agreement or (c) any notice, invoice or other document
\ndelivered by a Party under this Agreement conflicts with any terms or conditions
\nset forth in the body of this Agreement, the terms and conditions set forth in
\nthe body of this Agreement will control. This Agreement constitutes the entire
\nagreement among the Parties relating to the Research and all prior
\nunderstandings and agreements relating to the Research are superseded hereby.
\nThis Agreement may not be amended except by a document signed by authorized
\nrepresentatives of each of the Parties.<\/p>\n

25.<\/strong> No Waiver<\/u><\/strong>.<\/strong> Any
\nfailure of a Party to enforce any provision of this Agreement will not be deemed
\na waiver of its right to enforce such provision on any subsequent occasion. No
\nwaiver of any provision of this Agreement will be valid unless it is in writing
\nand is executed by the Party against whom such waiver is sought to be enforced.
\nA waiver by any of the Parties of any provision of this Agreement will not be
\nconstrued to be a waiver of any succeeding breach thereof or of any other
\nprovision of this Agreement.<\/p>\n

26.<\/strong> Severability<\/u><\/strong>.<\/strong>
\nWhenever possible, each provision of this Agreement will be interpreted in such
\nmanner as to be effective and valid under applicable law. In the event a court
\nof competent jurisdiction holds any provision of this Agreement to be invalid,
\nsuch holding will have no effect on the remaining provisions of this Agreement,
\nand they will continue in full force and effect.<\/p>\n

64<\/p>\n

\n

<\/p>\n

27.<\/strong> Interpretation;
\nHeadings<\/u><\/strong>.<\/strong> The word “including” will mean
\n“including without limitation”. All pronouns and any variations thereof refer to
\nthe masculine, feminine or neuter, singular or plural, as the context may
\nrequire. All terms defined in this Agreement in their singular or plural forms
\nhave correlative meanings when used herein in their plural or singular forms,
\nrespectively. Headings used in this Agreement are for convenience of reference
\nonly and are not intended to influence the interpretation hereof.<\/p>\n

28.<\/strong> Governing Law<\/u><\/strong>.<\/strong>
\nThis Agreement will be governed by and construed in accordance with the domestic
\nlaws of the State of New York without giving effect to any choice or conflict of
\nlaw provision or rule (whether of the State of New York or any other
\njurisdiction) that would cause the application of the laws of any jurisdiction
\nother than the State of New York.<\/p>\n

29.<\/strong> No Strict
\nConstruction<\/u><\/strong>.<\/strong> The Parties have participated
\njointly in the negotiation and drafting of this Agreement. In the event of an
\nambiguity or question of intent or interpretation arises, this Agreement will be
\nconstrued as if drafted jointly by the Parties, and no presumption or burden of
\nproof will arise favoring or disfavoring any of the Parties by virtue of the
\nauthorship of any of the provisions of this Agreement.<\/p>\n

30.<\/strong> Counterparts<\/u><\/strong>.<\/strong>
\nThis Agreement may be signed, including by facsimile signature, in two or more
\ncounterparts and each such counterpart will constitute an original document and
\nsuch counterparts, taken together, will constitute the same instrument.<\/p>\n

65<\/p>\n

\n

<\/p>\n

In witness to the foregoing, the Parties have executed this Agreement as of
\nthe Effective Date.<\/p>\n\n\n\n\n\n\n\n\n\n\n\n\n\n\n\n\n\n\n\n\n
\n

FOUNDATION:<\/strong><\/p>\n<\/td>\n

<\/td>\n<\/td>\n<\/tr>\n
<\/td>\n<\/td>\n<\/td>\n<\/tr>\n
\n

CHDI Foundation, Inc.<\/p>\n<\/td>\n

<\/td>\n<\/td>\n<\/tr>\n
<\/td>\n<\/td>\n<\/td>\n<\/td>\n<\/tr>\n
<\/td>\n<\/td>\n<\/td>\n<\/td>\n<\/tr>\n
\n

By:<\/p>\n<\/td>\n

\n

\/s\/ Robi Blumenstein<\/p>\n<\/td>\n

<\/td>\n<\/td>\n<\/tr>\n
<\/td>\n\n

Name: Robi Blumenstein<\/p>\n<\/td>\n

<\/td>\n<\/td>\n<\/tr>\n
<\/td>\n\n

Title: President, CHDI Management<\/p>\n<\/td>\n

<\/td>\n<\/td>\n<\/tr>\n
<\/td>\n<\/td>\n<\/td>\n<\/td>\n<\/tr>\n
<\/td>\n<\/td>\n<\/td>\n<\/td>\n<\/tr>\n
\n

ISIS:<\/strong><\/p>\n<\/td>\n

<\/td>\n<\/td>\n<\/tr>\n
<\/td>\n<\/td>\n<\/td>\n<\/tr>\n
\n

Isis Pharmaceuticals, Inc.<\/p>\n<\/td>\n

<\/td>\n<\/td>\n<\/tr>\n
<\/td>\n<\/td>\n<\/td>\n<\/td>\n<\/tr>\n
<\/td>\n<\/td>\n<\/td>\n<\/td>\n<\/tr>\n
\n

By:<\/p>\n<\/td>\n

\n

\/s\/ B. Lynne Parshall<\/p>\n<\/td>\n

<\/td>\n<\/td>\n<\/tr>\n
<\/td>\n\n

Name: B. Lynne Parshall<\/p>\n<\/td>\n

<\/td>\n<\/td>\n<\/tr>\n
<\/td>\n\n

Title: Chief Operating Officer & CFO<\/p>\n<\/td>\n

<\/td>\n<\/td>\n<\/tr>\n<\/tbody>\n<\/table>\n
\n

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