COLLABORATION AND LICENSE AGREEMENT by and between WYETH acting through its Wyeth Pharmaceuticals Division and TRUBION PHARMACEUTICALS, INC. December 19, 2005

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PRODUCT DEVELOPMENT, MANUFACTURING, COMMERCIALIZATION AND REGULATORY MATTERS

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DEFINITIONS.

“Additional Research and Development Expense Payment” shall have the meaning set forth in Section 5.3 hereof.

“Additional Third Party Licenses” shall have the meaning set forth in Section 6.2.3(a) hereof.

“Affiliate(s)” shall mean, with respect to any Person, any other Person which controls, is controlled by or is under common control with such Person. A Person shall be regarded as in control of another entity if it owns or controls at least fifty percent (50%) of the equity securities of the subject entity entitled to vote in the election of directors (or, in the case of an entity that is not a corporation, for the election of the corresponding managing

“Agreement” shall have the meaning set forth in the preamble hereof.

“Bankruptcy Code” shall have the meaning set forth in Section 2.7 hereof.

“BLA” shall have the meaning set forth in Section 1.100 hereof.

“Calendar Quarter” shall mean the respective periods of three (3) consecutive calendar months ending on March 31, June 30, September 30 or December 31, for so long as this Agreement is in effect.

“Category 1 Covered SMIP Improvement” shall have the meaning set forth in Section 6.1.3(b) hereof.

“Category 2 Covered SMIP Improvement” shall have the meaning set forth in Section 6.1.3(b) hereof.

“CD20 Antigen” shall mean the human protein antigen that is known as CD20, and identified as a full length CD20 protein antigen in GenBank, and identified by GenBank Accession Nos. NP_690605, NP_068769 or P11836, and any other protein that Has The Same Sequence as the foregoing.

“CD20 Effective Royalty Rate” shall have the meaning set forth in Section 5.4.2(a) hereof.

“CD20 Product” shall mean any TRU-015 Product and/or Follow-On CD20 Product (as the context requires).

“Cell Lines” shall mean the cell lines and any other expression systems that produce or express any SMIP.

“Change of Control” shall have the meaning set forth in Section 9.10.1 hereof.

“Clinical Study Supplies” shall have the meaning set forth in Section 4.9 hereof.

“Combination Product” shall mean any product containing as active ingredients both (a) a Product and (b) one or more other pharmaceutically active compounds or substances.

“Combination Sale” shall have the meaning set forth in Section 1.76 hereof.

“Commercialization” or “Commercialize” shall mean activities directed to marketing, promoting, distributing, importing or selling a product. Commercialization shall not include any activities related to Manufacturing or Development.

“Commercially Reasonable Efforts” shall mean, with respect to the efforts to be expended by any Party with respect to any objective, those reasonable, diligent, good faith efforts to accomplish such objective as such Party would normally use to accomplish a similar objective under similar circumstances. With respect to any objective relating to the Development and/or Commercialization of a Licensed Product by any Party, “Commercially Reasonable Efforts” shall mean those efforts and resources normally used by such Party with respect to a product owned or controlled by such Party, or to which such Party has similar rights, which product is of similar market potential and is at a similar stage in its development or life as is such Licensed Product, taking into account issues of safety, efficacy, product profile, the competitiveness of the marketplace, the proprietary position of the Licensed Product, the regulatory structure involved, profitability of the Licensed Product and other relevant commercial factors. A “Commercially Reasonable” action or decision of a Party refers in this Agreement to an action or decision taken or made by such Party using its Commercially Reasonable Efforts.

“Confidential Information” of a Party shall mean all Know-How or other information, including, without limitation, proprietary information and materials (whether or not patentable) regarding such Party’s technology, products, business information or objectives, that is communicated in any way or form by the Disclosing Party to the Receiving Party, either prior to or after the Effective Date of this Agreement, and whether or not such Know-How or other information is identified as confidential at the time of disclosure; provided that, information not identified as confidential by the Disclosing Party shall be deemed to be Confidential Information of the Disclosing Party if the Receiving Party knows, or should have had a reasonable expectation, that the information communicated by the Disclosing Party is Confidential Information of the Disclosing Party. The terms and conditions of this Agreement shall be considered Confidential Information of both Parties.

“Conjugate(s)” shall mean SMIP(s) fused genetically or linked, either directly or through a linker molecule, with any biological, cytostatic, cytotoxic or radioactive agent.

“Control” or “Controlled” shall mean with respect to any (a) item of information, including, without limitation, Know-How, or (b) intellectual property right, the possession (whether by ownership or license, other than pursuant to this Agreement) by a Party of the ability to grant to the other Party a license or to extend other rights as provided herein, under such item or right without violating the terms of any agreement or other arrangements with any Third Party.

“Co-Promotion” shall mean the joint promotion of a CD20 Product in the United States by both Parties and/or their respective Affiliates under the same CD20 Product Trademark(s). “Co-Promote,” when used as a verb, shall mean to engage in such Co-Promotion.

“Co-Promotion Period” shall have the meaning set forth in Section 4.11 hereof.

“Covered SMIP Improvement” shall have the meaning set forth in Section 6.1.2 hereof.

“Deposited Protein” shall have the meaning set forth in Section 1.45 hereof.

“Designated Target(s)” shall have the meaning set forth in Section 9.8 hereof.

“Development” or “Develop” shall mean non-clinical and clinical drug development activities pertaining to a product, including, without limitation, toxicology, pharmacology, test method development and stability testing, process development, formulation development, delivery system development, quality assurance and quality control development, statistical analysis, clinical studies (including pre- and post-approval studies), regulatory affairs, pharmacovigilance and Regulatory Approval and clinical study regulatory activities (including regulatory activities directed to obtaining pricing and reimbursement approvals).

“Development Plan” shall mean the written plan for the Development of CD20 Products described in Section 4.8 hereof.

“Disclosing Party” shall have the meaning set forth in Section 7.1 hereof.

“Effective Date” shall mean the later to occur of (a) the Signing Date and (b) the HSR Clearance Date.

“Exchange Act” shall mean the Securities Exchange Act of 1934, as amended.

“Excluded Target(s)” shall mean the Target(s) described in Section 3.2.4 hereof as Excluded Target(s).

“Exclusivity Covenants” shall have the meaning set forth in Section 9.10.2(c) hereof.

“Executive Officers” shall mean the President of Wyeth Pharmaceuticals (or an executive officer of Wyeth designated by such President of Wyeth Pharmaceuticals) and the Chief Executive Officer of Trubion (or an executive officer of Trubion designated by such Chief Executive Officer).

“Exercise Notice” shall have the meaning set forth in Section 9.10.2(c) hereof.

“Existing Activities” shall have the meaning set forth in Section 9.10.2(c) hereof.

“Existing Trademarks” shall have the meaning set forth in Section 9.7.1(a).

“FDA” shall mean the United States Food and Drug Administration or any successor agency thereto.

“FD&C Act” shall mean the United States Federal Food, Drug, and Cosmetic Act (21 U.S.C. § 301 et seq.), as amended, and the rules and regulations promulgated thereunder.

“First Commercial Sale” shall mean, with respect to a given Licensed Product and any country in the Territory, the first sale or transfer for value of such Licensed Product under this Agreement by Wyeth or its sublicensees to a Third Party in such country following receipt of marketing authorization from the appropriate Regulatory Authority permitting commercial sale of such Licensed Product in such country.

“Follow-On CD20 Product” shall mean any product containing a Follow-On CD20 SMIP.

“Follow-On CD20 SMIP” shall mean any SMIP (other than TRU-015) directed against the CD20 Antigen or a portion thereof.

“FTE” shall mean a full time equivalent scientific person (M.S. or Ph.D. level) year, consisting of a minimum of a total of one thousand eight hundred eighty (1,880) hours per year of scientific work by an employee of Trubion on or directly related to and in support of the Research Program. Work on or directly related to the Research Program can include, but is not limited to, experimental preclinical laboratory and research work, recording and writing up results, reviewing literature and references, holding scientific discussions, managing and leading scientific staff and carrying out management duties, in each case where such activities are directly related to the Research Program.

“Has The Same Sequence” shall mean, with respect to a specific protein (as described by an amino acid sequence identified by a GenBank accession number; a “New Protein”), that another specific protein (as described by an amino acid sequence identified by a GenBank accession number; each, a “Deposited Protein”) has at least ninety percent (90%) amino acid sequence identity over at least ninety percent (90%) of the length of the New Protein.

“HER2 Antigen” shall mean the human protein antigen that is known as human epidermal growth factor receptor (also known as c-▇▇▇-B2 or HER2/neu), and identified as a full length human epidermal growth factor receptor in GenBank and identified by GenBank Accession Nos. NP_004439.2, NP_001005862 or AAD56009 and any other protein that Has The Same Sequence as the foregoing.

“HER2 Effective Royalty Rate” shall have the meaning set forth in Section 5.4.3(a) hereof.

“HER2 Product” shall mean any product containing a HER2 SMIP.

“HER2 SMIP” shall mean any SMIP directed against the HER2 Antigen or a portion thereof.

“HSR Act” shall mean the ▇▇▇▇-▇▇▇▇▇-▇▇▇▇▇▇ Antitrust Improvements Act of 1976, as amended, and the rules and regulations promulgated thereunder.

“HSR Filing” shall mean filings by Wyeth and Trubion with the United States Federal Trade Commission and the Antitrust Division of the United States Department of Justice of a Notification and Report Form for Certain Mergers and Acquisitions (as that term is defined in the HSR Act) with respect to the matters set forth in this Agreement, together with all required documentary attachments thereto.

“HSR Clearance Date” shall mean the earliest date on which the Parties have actual knowledge that all applicable waiting periods under the HSR Act with respect to the transactions contemplated hereunder have expired or have been terminated.

“IND” shall mean an Investigational New Drug Application, as defined in the FD&C Act, that is required to be filed with the FDA before beginning clinical testing of a Licensed Product in human subjects, or an equivalent foreign filing.

“Indemnified Party” shall have the meaning set forth in Section 10.3 hereof.

“Indemnifying Party” shall have the meaning set forth in Section 10.3 hereof.

“Initial Term” shall have the meaning set forth in Section 3.3.1 hereof.

“JDC” shall have the meaning set forth in Section 4.7 hereof.

“Joint Invention(s)” shall have the meaning set forth in Section 6.1.1 hereof.

“Joint Know-How” shall mean that Know-How related to the Licensed Products that is jointly owned by the Parties in accordance with Section 6.1.1 of this Agreement.

“Joint Patent Committee” shall mean the committee described in Section 6.1.3 hereof.

“Joint Patent Right(s)” shall mean those Patent Right(s) that claim Joint Know-How or Joint Invention(s).

“Joint Technology” shall mean the Joint Patent Rights, the Joint Inventions and the Joint Know-How.

“JPT” shall have the meaning set forth in Section 4.8 hereof.

“JRC” shall have the meaning set forth in Section 3.4.1 hereof.

“JRC Liaison” shall mean a JRC member designated by a Party as its “JRC Liaison” in accordance with Section 3.4.3 hereof.

“Know-How” shall mean inventions, discoveries, data, information, processes, methods, techniques, materials, technology, results or other know-how, whether or not patentable.

“Liabilities” shall have the meaning set forth in Section 10.1 hereof.

“Licensed Product(s)” shall mean any Product(s) or Combination Product(s).

“Licensed Target(s)” shall mean any Trubion Target(s) or Wyeth Target(s), so long as they remain the subject of the licenses granted to Wyeth under this Agreement.

“Major Indication(s)” shall mean, with respect to any CD20 Product, any indication with a prevalence-based patient population of at least two hundred thousand (200,000) patients in the United States, including, without limitation, non-Hodgkin’s lymphoma, rheumatoid arthritis, systemic lupus erythematosus, Crohn’s disease and multiple sclerosis.

“Major Market Country” shall mean any of the United States, the United Kingdom, France, Germany, Italy, Spain or Japan.

“Manufacturing” or “Manufacture” shall mean activities directed to producing, manufacturing, processing, filling, finishing, packaging, labeling, quality assurance testing and release, shipping and storage of a product.

“NCBI” shall have the meaning set forth in Section 3.2.1 hereof.

“NDA” shall have the meaning set forth in Section 1.100 hereof.

“Net Combination Sale Amount” shall have the meaning set forth in Section 1.76 hereof.

“Net Sales” shall mean the gross amounts charged for sales of Licensed Products (on which payments are due under this Agreement) by Wyeth or its sublicensees to Third Parties, less the sum of (a) and (b) where (a) is a provision, determined under Generally Accepted Accounting Principles in the United States and in accordance with Wyeth’s customary and usual accrual procedures, consistently applied, for the accrual of (i) trade, cash, quantity and wholesaler discounts or rebates (other than price discounts granted at the time of sale), if any, allowed or paid, (ii) credits or allowances given or made for rejection or return of, previously sold Licensed Products or for retroactive price reductions (including Medicaid, managed care and similar types of rebates), (iii) taxes, duties or other governmental charges levied on or measured by the billing amount (excluding income and franchise taxes), as adjusted for rebates and refunds, and (iv) charges for packing, freight, and shipping to the extent included in the invoice price and (b) is a periodic adjustment (positive or negative, as applicable), determined under Generally Accepted Accounting Principles in the United States and in accordance with Wyeth’s customary and usual adjustment procedures, consistently applied, of the provision determined in (a) to reflect amounts actually incurred for (i), (ii), (iii) and (iv) based on amounts actually invoiced or as separately set forth in agreements with Third Parties or as deducted or paid as required by applicable law or regulations. (The deductions described in (i), (ii), (iii) and (iv) are referred to herein as “Permitted Deductions.”) In the case of any sale of Licensed Products for consideration other than cash, Net Sales shall be calculated on the fair market value of the consideration received.

“New Protein” shall have the meaning set forth in Section 1.45 hereof.

“Niche Indication(s)” shall mean, with respect to any CD20 Product, any indication, including, but not limited to, inflammatory myositis, for such CD20 Product other than a Major Indication.

“Notice of Breach” shall have the meaning set forth in Section 9.5 hereof.

“Notice of Modification” shall have the meaning set forth in Section 9.5 hereof.

“Notice of Termination” shall have the meaning set forth in Section 9.5 hereof.

“Other Product” shall mean any product containing a SMIP directed against a Wyeth Target or a portion thereof.

“Part(y/ies)” shall have the meaning set forth in the preamble hereof.

“Patent Rights” shall mean any and all (a) patents, (b) pending patent applications, including, without limitation, all provisional applications, substitutions, continuations, continuations-in-part, divisions, renewals, and all patents granted thereon, (c) all patents-of-addition, reissues, reexaminations and extensions or restorations by existing or future extension or restoration mechanisms, including, without limitation, supplementary protection certificates or the equivalent thereof, (d) inventor’s certificates, and (e) all United States and foreign counterparts of any of the foregoing.

“Person” shall mean an individual, sole proprietorship, partnership, limited partnership, limited liability partnership, corporation, limited liability company, business trust, joint stock company, trust, incorporated association, joint venture or similar entity or organization, including a government or political subdivision, department or agency of a government.

“Permitted Deduction” shall have the meaning set forth in Section 1.76 hereof.

“Phase I Clinical Study” shall mean a study of a Licensed Product in human subjects with the endpoint of determining initial tolerance, safety or pharmacokinetic information in single dose, single ascending dose, multiple dose and/or multiple ascending dose regimens.

“Phase II Clinical Study” shall mean a study of a Licensed Product in human patients to determine initial efficacy and dose range finding before embarking on Phase III Clinical Studies.

“Phase IIa Clinical Study” shall mean Trubion’s TRU-015 Protocol 15001.

“Phase IIb Clinical Study” shall mean Trubion’s TRU-015 Protocol 15002.

“Phase III Clinical Study” shall mean a pivotal study (whether or not denominated a “Phase III” clinical study under applicable regulations) in human patients with a defined dose or a set of defined doses of a Licensed Product designed to ascertain efficacy and safety of such Licensed Product for the purpose of enabling the preparation and submission of Regulatory Approval Applications to the competent Regulatory Authorities in a country of the Territory.

“Previously Deposited Protein” shall have the meaning set forth in Section 3.2.4(b) hereof.

“Product” shall mean any CD20 Product, HER2 Product, or Other Product, or any Conjugate of any CD20 Product, HER2 Product, or Other Product.

“Product Data and Filings” shall mean (a) all clinical protocols, studies, clinical data and results used in or resulting from any clinical trial of any Licensed Product and (b) all INDs, Regulatory Approval Applications and Regulatory Approvals regarding any Licensed Product.

“Product License” shall have the meaning set forth in Section 2.1.1 hereof.

“Product-Related Patent Rights” shall have the meaning set forth in Section 6.2.1 (a) hereof.

“Provisional Excluded Target” shall mean a Target described in Section 3.2.4 hereof as a Provisional Excluded Target.

“Receiving Party” shall have the meaning set forth in Section 7.1 hereof.

“Recombinant DNA” shall mean the DNA sequences encoding any SMIP including, without limitation, any DNA plasmid expression construct encoding any such SMIP.

“Regulatory Approval” shall mean the technical, medical and scientific licenses, registrations, authorizations and approvals (including, without limitation, approvals of New Drug Applications (“NDAs”) or Biologic License Applications (“BLAs”), supplements and amendments, pre- and post- approvals, pricing approvals, and labeling approvals) of any national, supra-national, regional, state or local regulatory agency, department, bureau, commission, council or other governmental entity, necessary for the commercial Manufacture, distribution, marketing, promotion, offer for sale, use, import, export and sale of Licensed Product(s) in a regulatory jurisdiction in the Territory. For the sake of clarity, Regulatory Approval shall not be deemed to have been obtained in a country other than the United States until any applicable governmental pricing approvals have also been obtained in such country. Regulatory Approval of a Licensed Product shall be deemed to have been obtained in the United States immediately upon BLA approval for such Licensed Product in the United States.

“Regulatory Approval Application” shall mean an application submitted to the appropriate Regulatory Authority seeking Regulatory Approval of a Licensed Product for use in one or more therapeutic indications in a regulatory jurisdiction within the Territory.

“Regulatory Authorit(y/ies)” shall mean any national (e.g., the FDA), supra-national (e.g., the European Commission, the Council of the European Union, or the European Agency for the Evaluation of Medicinal Products), regional, state or local regulatory agency, department, bureau, commission, council or other governmental entity in each country of the Territory involved in the granting of Regulatory Approval for a Licensed Product.

“Released Target” shall have the meaning set forth in Section 3.2.2 hereof.

“Replacement Target” shall have the meaning set forth in Section 3.2.3 hereof.

“Research Budget” shall have the meaning set forth in Section 3.5 hereof.

“Research Plan” shall mean the written plan for the conduct of the Research Program described in Section 3.5 hereof as approved and amended by the Parties in accordance with Section 3.5 hereof.

“Research Program” shall have the meaning set forth in Section 3.1 hereof.

“Research Program Data” shall have the meaning set forth in Section 3.7 hereof.

“Research Term” shall have the meaning set forth in Section 3.3.1 hereof.

“Royalty Period” shall mean the period of time beginning on the date of the First Commercial Sale of a Licensed Product in any country and, on a Licensed Product-by-Licensed Product and country-by-country basis, extending until the earlier of (a) the termination of this Agreement pursuant to Article 9 hereof with respect to such Licensed Product in such country or (b) the later of (i) the date on which the last Valid Claim included within the Trubion Technology ceases to be a Valid Claim, which Valid Claim would be infringed by the composition, Manufacture, use, sale, offer for sale or importing of such Licensed Product in such country, or (ii)(A) with respect to CD20 Products, the ten (10) year anniversary of the First Commercial Sale for the first Major Indication of such CD20 Product in such country (provided, however, that if such CD20 Product has received Regulatory Approval for a Niche Indication in such country but has not received Regulatory Approval for a Major Indication in such country, the Royalty Period as defined under and for purposes of this clause (ii)(A) for such CD20 Product in such country shall be suspended beginning on the ten (10) year anniversary of the First Commercial Sale of such CD20 Product in such country until such time, if at all, as Regulatory Approval has been obtained permitting the marketing of such CD20 Product for a Major Indication in such country, at which point such Royalty Period shall commence with respect to such CD20 Product for a Major Indication) and (B) with respect to each other Licensed Product, the ten (10) year anniversary of the First Commercial Sale of such Licensed Product in such country.

“Signing Date” shall have the meaning set forth in the preamble hereof.

“SMIP(s)” or small modular immuno-pharmaceutical(s) shall mean a single chain polypeptide that (i) is not a tetrameric immunoglobulin having two (2) heavy chains and two (2) light chains or a fragment of such an immunoglobulin, (ii) binds with specificity to a target antigen, (iii) has a binding domain, and (iv) may have an effector domain which may or may not have effector function, including, but not limited to, any murine, chimeric, humanized or human forms thereof, any fragments, subunits, derivatives or multimeric forms thereof, any fusion protein or multispecific forms thereof, and any other native, genetically engineered protein or protein scaffold.

“SMIP Improvement” shall mean an invention consisting of any modification to the polynucleotide sequence encoding or the amino acid sequence of a SMIP, if the practice of such invention would infringe Patent Rights Controlled by Trubion at the time such invention is made.

“Specifically Binds” shall mean, in the case of a SMIP or other protein, the binding of such SMIP or other protein to a Target (or a portion thereof) above the level of background binding and wherein such SMIP or other protein is designed or being developed to exert its biological effect through binding to such Target (or such portion thereof).

“Successor Party” shall have the meaning set forth in Section 9.10.2(a) hereof.

“Sued Party” shall have the meaning set forth in Section 6.2.3(b) hereof.

“Target” shall mean a specific named human protein that is identified as a full length protein of that name and further identified by up to three (3) GenBank accession numbers for its amino acid sequence, as well as any additional protein(s) that Has The Same Sequence as such specific named human protein.

“Target Candidate” shall have the meaning set forth in Section 3.2.1 hereof.

“Territory” shall mean the entire world.

“Third Part(y/ies)” shall mean any Person(s) other than Wyeth or Trubion.

“Trademark” shall mean those trademarks used in connection with the Commercialization of any Licensed Product by Wyeth or its sublicensees hereunder.

“TRU-015” shall mean the chimeric SMIP directed against the CD20 Antigen that is currently designated by Trubion as “TRU-015,” as further described on Exhibit 1.122 attached hereto.

“TRU-015 Product” shall mean any product containing TRU-015.

“Trubion” shall have the meaning set forth in the preamble hereof.

“Trubion Additional Third Party License” shall have the meaning set forth in Section 6.2.3(a) hereof.

“Trubion Indemnified Party” shall have the meaning set forth in Section 10.1 hereof.

“Trubion Know-How” shall mean any Know-How, other than the Joint Know-How, that (a) Trubion Controls as of the Effective Date or that comes into the Control of Trubion during the term of this Agreement (other than through the grant of a license by Wyeth) and (b) relates to any Cell Lines, Conjugates, Licensed Products, Recombinant DNA, SMIPs, Licensed Targets, Target Candidates or the Development, Manufacture or use of any of the foregoing.

“Trubion Lawyers” shall have the meaning set forth in Section 3.2.1 hereof.

“Trubion Patent Rights” shall mean Patent Rights, other than Joint Patent Rights, that (a) Trubion Controls as of the Effective Date or that come into the Control of Trubion during the term of this Agreement and (b) claim any Trubion Know-How. Those Trubion Patent Rights known to be existing as of the Signing Date are listed on Exhibit 1.129 attached hereto.

“Trubion Target” shall mean each of the human CD20 Antigen and/or the HER2 Antigen, as the context may require.

“Trubion Technology” shall mean Trubion’s interest in the Trubion Patent Rights, the Trubion Know-How, the Joint Technology and the Research Program Data.

“Trubion Third Party Agreement(s)” shall mean the agreements specified on Exhibit 1.132 between Trubion and the indicated Third Parties that relate to the research, Development, Manufacture and/or Commercialization of Licensed Products under this Agreement.

“U.S. Wyeth Pharmaceuticals” shall have the meaning set forth in Section 12.5 hereof.

“Valid Claim” shall mean a claim that (a) in the case of any unexpired United States or foreign patent, shall not have been dedicated to the public, disclaimed, nor held invalid or unenforceable by a court or government agency of competent jurisdiction in an unappealed or unappealable decision, or (b) in the case of any United States or foreign patent application, (i) shall not have been cancelled, withdrawn or abandoned, without being refiled in another application in the applicable jurisdiction, (ii) shall not have been finally rejected by an administrative agency or other

“Wyeth” shall have the meaning set forth in the preamble hereof.

“Wyeth Applied Technology” shall mean, with respect to any Licensed Product, that Wyeth Technology which (a) Wyeth had applied to such Licensed Product prior to any termination of any rights under this Agreement with respect to such Licensed Product, provided that such Wyeth Technology is necessary or useful for the continued research, Development, Manufacture or Commercialization of such Licensed Product as it exists at the time of such termination, or (b) Wyeth had incorporated into such Licensed Product prior to any termination of rights under this Agreement with respect to such Licensed Product; provided that Wyeth shall use its Commercially Reasonable Efforts to sublicense or otherwise transfer rights under any Third-Party license to which the use or exploitation of such Wyeth Applied Technology is subject; and further provided, however, that with respect to each of clauses (a) and (b) of this Section 1.136, such Wyeth Technology shall not include any of Wyeth’s conjugation technology.

“Wyeth Indemnified Party” shall have the meaning set forth in Section 10.2 hereof.

“Wyeth Know-How” shall mean any Know-How, other than the Joint Know-How, that (a) Wyeth Controls as of the Effective Date or that comes into the Control of Wyeth (other than as a result of the licenses granted by Trubion to Wyeth under Section 2.1 hereof) during the term of this Agreement and (b) relates to the Cell Lines, Conjugates, Recombinant DNA, Licensed Products, SMIPs, Target Candidates or Licensed Targets or the Development, Manufacture, use or Commercialization of any of the foregoing.

“Wyeth Patent Rights” shall mean Patent Rights, other than the Joint Patent Rights, that (a) Wyeth Controls as of the Effective Date or that come into the Control of Wyeth (other than as a result of the licenses granted by Trubion to Wyeth under Section 2.1 hereof) during the term of this Agreement and (b) claim any Wyeth Know-How.

“Wyeth Targets” shall mean the Targets designated by Wyeth under the Research Program, as described in Section 3.2 hereof.

“Wyeth Technology” shall mean Wyeth’s interest in the Wyeth Patent Rights, the Wyeth Know-How, the Joint Technology and the Research Program Data.

LICENSES.

Licenses to Wyeth.

Exclusive Licenses. Subject to the terms and conditions of this Agreement, Trubion, effective as of the Effective Date, hereby grants to Wyeth an exclusive license (exclusive even as to Trubion, except to the extent necessary for Trubion to perform its obligations under this Agreement), with the right to grant sublicenses in accordance with the provisions of Section 2.4 hereof, under the Trubion Technology, to research, Develop, have Developed, make, have made, Manufacture, use, have used, import, have imported, export, have exported, distribute, have distributed, market, have marketed, offer and have offered for sale, sell, have sold and Commercialize (subject to Section 4.11) Licensed Products in the Territory (the license granted under this Section 2.1.1 is sometimes referred to herein as the “Product License”).

Retained Rights of Trubion. For the avoidance of doubt, but subject to Sections 2.3 and 3.2 hereof, Trubion shall retain: (a) all rights under the Trubion Technology with respect to the research, Development, Manufacture, use and Commercialization of SMIPs that (i) Specifically Bind to Targets that are not Licensed Targets and (ii) do not Specifically Bind to any Licensed Targets; and (b) the right to use SMIPs which Specifically Bind to one or more Licensed Targets in in vitro studies conducted solely as part of Trubion’s internal research efforts, provided, however, that Trubion shall not provide any such SMIP (that Specifically Binds to a Licensed Target) to any Third Party or utilize any such SMIP (that Specifically Binds to a Licensed Target) in a collaboration with any Third Party, except with Wyeth’s prior written consent.

License to Trubion. Wyeth hereby grants to Trubion a royalty-free non-exclusive license, with no right to grant sublicenses, under the Wyeth Technology, solely for the purpose of, and limited to, Trubion’s use of the Wyeth Technology in connection with the Trubion Technology to research, Develop, have Developed, make, have made, use and have used Licensed Products to fulfill its obligations under this Agreement. In addition, Wyeth hereby grants to Trubion the non-exclusive license under Wyeth’s rights to Covered SMIP Improvements as set forth in greater detail in Section 6.1.2.

Exclusivity.

CD20 Product Exclusivity. Subject to Section 2.3.3, and except for Development of the CD20 Products pursuant to the terms of this Agreement, neither Party shall Develop any human therapeutic product that contains a protein that Specifically Binds to the CD20 Antigen during the time period beginning on the Effective Date and ending on the earlier of: (a) the First Commercial Sale of any CD20 Product for a Major Indication in a Major Market Country or (b) the termination of the licenses granted by Trubion to Wyeth under this Agreement with respect to all CD20 Products.

HER2 Product Exclusivity. Subject to Section 2.3.3, and except for Development of the HER2 Products pursuant to the terms of this Agreement, neither Party shall Develop any human therapeutic product that contains a protein that Specifically Binds to the HER2 Antigen during the time period beginning on the Effective Date and ending on the earlier of: (a) the First Commercial Sale of any HER2 Product in any Major Market Country or (b) the termination of the licenses granted by Trubion to Wyeth under this Agreement with respect to all HER2 Products.

Limitations. The exclusivity provisions of Sections 2.3.1 and 2.3.2 above (a) shall not apply to Wyeth’s Manufacture of any product for a Third Party pursuant only to a contract manufacturing or supply agreement between Wyeth and such Third Party where Wyeth is acting only as a contract manufacturer or supplier for such Third Party, (b) shall in no way limit any of the licenses granted by Trubion to Wyeth under Section 2.1 hereof, and (c) shall in no way limit any of the retained rights of Trubion set forth in Section 2.1.2 hereof.

Sublicensing. Wyeth may grant to one or more Third Parties sublicenses of the rights granted to it under Section 2.1 hereof at any time; provided that Wyeth shall execute a written agreement with each such sublicensee and shall comply with the following: Each such sublicense (a) shall be subject and subordinate to, and consistent with, the terms and conditions of this Agreement, (b) shall not in any way diminish, reduce or eliminate any of Wyeth’s obligations under this Agreement, (c) shall require each such sublicensee to comply with all applicable terms of this Agreement, including to keep books and records, and permit Wyeth to audit (either directly or through an independent auditor) such books and records, and (d) shall provide that any such sublicensee shall not further sublicense except on terms consistent with this Section 2.4. Wyeth shall provide Trubion with a copy of each such sublicense agreement within thirty (30) days after the execution thereof. Such copy may be redacted to exclude confidential, non-Licensed Product-related information and financial information (other than such financial information that is necessary for assessing the obligations to Trubion under this Agreement). Upon Trubion’s request and at Trubion’s expense, Wyeth shall exercise its right to conduct an audit of a sublicensee’s books and records pertaining to the sale of a Licensed Product under any such sublicense agreement at the next time that conducting such an audit is permissible under such sublicense agreement. Wyeth shall provide Trubion with a copy of the report of the findings made in any such audit. If such audit reveals that such sublicensee has understated its Net Sales by ten percent (10%) or more, Wyeth shall be responsible for the costs of the audit. Wyeth shall remain responsible for its obligations hereunder and for the performance of its sublicensees (including, without limitation, making all payments due Trubion by reason of any Net Sales of Licensed Products), and shall ensure that any such sublicensees comply with all relevant provisions of this Agreement. In the event of any uncured material breach by any sublicensee under a sublicense agreement that would constitute a breach of Wyeth’s obligations under this Agreement, Wyeth will promptly inform Trubion in writing and shall take such action which in Wyeth’s reasonable business judgment will address such default;

Direct Licenses to Affiliates. Wyeth may at any time request and authorize Trubion to grant licenses within the scope of Section 2.1 directly to Affiliates of Wyeth by giving written notice designating to which Affiliate a direct license is to be granted. Upon receipt of any such notice, Trubion shall enter into and sign a separate direct license agreement with such designated Affiliate of Wyeth. All such direct license agreements shall be consistent with the terms and conditions of this Agreement, except for such modifications as may be required by the laws and regulations in the country in which the direct license will be exercised; provided, however, that Trubion shall have no obligation to enter into any such direct license agreement if the effect of entering into such agreement (and continuing as a Party to this Agreement) would be to increase the level of obligations owed by Trubion, decrease the obligations owed to Trubion or the enforceability thereof, or decrease the consideration owed to Trubion relative to the obligations owed by or to, or the consideration owed to, Trubion under this Agreement, had such direct license(s) not been granted. In countries where the validity of such direct license agreement requires prior government approval or registration, such direct license agreement shall not become binding between the parties thereto until such approval or registration is granted, which approval or registration shall be obtained by Wyeth. All costs of making such direct license agreement(s), including Trubion’s reasonable attorneys’ fees, under this Section 2.5 shall be borne solely by Wyeth.

Right of Reference. Trubion hereby grants to Wyeth a “Right of Reference,” as that term is defined in 21 C.F.R. § 314.3(b), to any data Controlled by Trubion that relates to any CD20 Product (and any other Licensed Product, to the extent applicable), and Trubion shall provide a signed statement to this effect, if requested by Wyeth, in accordance with 21 C.F.R. § 314.50(g)(3).

Section 365(n) of Bankruptcy Code. All rights and licenses now or hereafter granted under or pursuant to any Section of this Agreement, including Sections 2.1 and 2.5 hereof, are rights to “intellectual property” (as defined in Section 101 (35A) of Title 11 of the United States Code, as amended (such Title 11, the “Bankruptcy Code”)). In the event this Agreement is rejected under Section 365 of the Bankruptcy Code, Trubion hereby grants to Wyeth, subject to Wyeth’s obligations under Sections 365(n)(2)(A) and (B), a right of access and to obtain possession of and to benefit from each of the following embodiments to the extent related to Wyeth’s exercise of its license rights to any Licensed Products or otherwise

No Implied Rights. Except as expressly provided in this Agreement, neither Party shall be deemed by estoppel or implication to have granted the other Party any license or other right with respect to any intellectual property of such Party.

RESEARCH PROGRAM.

Scope and Conduct of the Research Program. Under the terms and conditions set forth herein, Trubion and Wyeth shall collaborate through one or more joint project teams in the conduct of a pre-clinical research program to identify and evaluate (a) SMIPs directed against Licensed Targets and (b) Licensed Products, including CD20 Products, HER2 Products and Other Products (collectively, the “Research Program”). Such activities shall include, but not be limited to, the following:

Licensed Product SMIP discovery, construction, initial expression and characterization,

Licensed Product SMIP optimization and preliminary Cell Line and bioprocess development in connection with such SMIPs,

Biological activity evaluation of Licensed Products via in vitro assays and in vivo models,

Pharmacology studies of Licensed Products to determine mechanisms of action, pharmacokinetics and pharmacodynamics,

Advanced Licensed Product process development, Licensed Product formulation, Cell Line optimization, and generation of related working and master cell banks,

Pre-clinical toxicology and safety assessment studies with respect to Licensed Products, and

Evaluation of Licensed Products and related SMIPs for use as part of Wyeth’s targeted chemotherapy products.

Designation of Targets.

Target Candidates. Within thirty (30) days after the Effective Date, Wyeth shall provide Trubion’s Vice President, Legal Affairs & Chief Patent Counsel with a list of up to thirty (30) Targets (each a “Target Candidate”) from which Wyeth shall have the exclusive right, until the second anniversary of the Effective Date (or in the event that the Research Program is extended, until the third anniversary of the Effective Date), to designate up to ten (10) Wyeth Targets, in accordance with the following provisions (subject to Wyeth’s right under Section 3.2.3 to designate as Wyeth Targets up to five (5) Targets (of the ten (10) Targets that Wyeth may designate as Wyeth Targets)

Released Targets. On or before the first anniversary of the Effective Date, Wyeth, by written notice to Trubion’s Vice President, Legal Affairs & Chief Patent Counsel, shall identify at least fifteen (15) Target Candidates from the list delivered pursuant to Section 3.2.1 (inclusive of any Target Candidates that have become Released Targets during such period pursuant to Section 3.2.4 hereof), which from the date of such identification shall cease to be Target Candidates (each, a “Released Target”). At the time that a Target Candidate becomes a Released Target, Trubion, subject to Section 2.8, shall be free to undertake research and Development activities independent of obligations under this Agreement, and to enter into discussions or an agreement with a Third Party, with respect to SMIPs directed against any such Released Target or any other activities in connection with such Released Target. On or before the second anniversary of the Effective Date, Wyeth, by written notice to Trubion, shall identify such additional Target Candidates from the list delivered pursuant to Section 3.2.1, if any, as additional Released Targets, such that there are no more than ten (10) Target Candidates remaining on the list delivered pursuant to Section 3.2.1 (less the number of Wyeth Targets that were Target Candidates at the time of selection as a Wyeth Target(s) pursuant to Section 3.2.3), which from the date of such identification shall cease to be Target Candidates and, thereafter each shall also become a Released Target. At the end of the Research Term, all remaining Target Candidates, if any, shall become Released Targets.

Wyeth Targets. Wyeth Targets shall be designated only from either (a) Target Candidates that have not become Released Targets, or (b) any other Target (including a Released Target that is or becomes available, as described below) that is not then an Excluded Target or a Provisional Excluded Target; provided, however, that no more than five (5) of the Targets designated by Wyeth as Wyeth Targets may be Targets that are not Target Candidates at the time of selection. Subject to the foregoing sentence, Wyeth shall designate: (y) at least two (2) Target Candidates or other Targets as Wyeth Targets on or before the first anniversary of the Effective Date; and (z) up to ten (10) Target Candidates or other Targets (inclusive of those designated as Wyeth Targets during the first year) as Wyeth

Excluded Targets. Excluded Targets are not eligible to be Wyeth Targets for so long as they remain Excluded Targets. The Targets deemed “Excluded Targets” as of the Effective Date are set forth in Exhibit 3.2.4 attached hereto. Trubion may add additional Targets as Excluded Targets or Provisional Excluded Targets (which may be selected from Released Targets and other Targets, but would not include any Wyeth Targets or any Target Candidate that has not become a Released Target) in accordance with the following procedures:

During the period when at least one Target Candidate exists, and upon the written request of a potential Third Party collaborator and/or licensee of Trubion pertaining to the identification, generation and/or Development of SMIPs directed against a Target or Targets, Trubion’s Legal Department shall promptly determine whether or not any of such Targets is a Wyeth Target.

With respect to any Target newly submitted by a Party to Trubion’s Legal Department hereunder, Trubion’s Lawyers will determine whether such submitted Target Has The Same Sequence as any specific, previously deposited protein within the list of Licensed Targets, Target Candidates, Released Targets, Excluded Targets and Provisional Excluded Targets available to Trubion’s Lawyers (each a “Previously Deposited Protein”). By way of example only, if the New Protein consists of 100 amino acids, and any contiguous sequence of 90 amino acids contained in the Previously Deposited Protein has at least 90% sequence identity to any contiguous sequence of 90 amino acids in the New Protein (that is, at least 81 of the 90 contiguous amino acids in such Previously Deposited Protein sequence are identical to any 81 of any 90 contiguous amino acids in such New Protein), then the New Protein Has The Same Sequence as the Previously Deposited Protein. Should Wyeth designate a Target that is not a protein, the Parties agree to negotiate in good faith the procedure for identifying and testing whether a subsequent proposed non-protein Target is the “same as” such designated non-protein Target for purposes of this Section 3.2.

If Trubion’s Legal Department determines, in accordance with Section 3.2.4(b) above, that any such Target is a Wyeth Target, Trubion shall not proceed with such potential Third Party collaboration or license with respect to such Target. If any of such Targets is not a Wyeth Target or a Target Candidate, such Target shall automatically be deemed a “Provisional Excluded Target”. If such Target is a Target Candidate, Trubion shall notify Wyeth in writing of Trubion’s request that a Target Candidate be recategorized as a Released Target, in order for Trubion to be able to enter substantive negotiations with such Third Party regarding such Target that is a Target

If Trubion and such potential Third Party collaborator and/or licensee do not enter into a definitive agreement regarding such Provisional Excluded Target within twelve (12) months after the date that such Target is deemed a Provisional Excluded Target (such 12-month period being subject to a three (3) month extension by Trubion, if Trubion declares, in writing, to Wyeth that at least one draft definitive agreement has been exchanged between Trubion and such potential Third Party collaborator and/or licensee), thereafter such Provisional Excluded Target would revert to being a Released Target. If Trubion and such potential Third-Party collaborator and/or licensee enter into a definitive agreement within the time period provided above, such Provisional Excluded Target shall be deemed an Excluded Target.

During the period when at least one (1) Target Candidate exists, if Trubion itself identifies internally a Target that has progressed to Milestone One (as defined in Exhibit 3.2.1 attached hereto) of Trubion’s internal product development process, Trubion’s Legal Department shall promptly determine whether or not such Target is a Target Candidate. If such Target is not a Target Candidate, such Target shall be deemed an Excluded Target. If Trubion thereafter abandons work on such Excluded Target, Trubion shall notify Wyeth in writing that Trubion has abandoned work on such Excluded Target and such Excluded Target shall thereafter be deemed a Released Target. If such Target is a Target Candidate, Trubion may Put such Target Candidate to Wyeth. From the date that

With respect to the Puts described in (c) and (e) above, Trubion shall not be permitted to Put more than two (2) Target Candidates to Wyeth during the first six (6) full Calendar Quarters of the Research Program.

Term and Termination of the Research Program.

Research Term. The term of the Research Program (the “Research Term”) shall begin on the Effective Date and shall continue until the three (3) year anniversary of the Effective Date (the “Initial Term”), subject to extension as described below. At Wyeth’s option (exercisable by providing written notice to Trubion no later than six (6) months prior to the end of the Initial Term of the Research Program or any extension year thereof), the Research Term may be extended for up to two (2) additional one (1) year periods and, thereafter, shall be renewable annually only upon mutual written agreement of the Parties.

Termination of Research Program by Wyeth. Commencing on the first anniversary of the Effective Date, Wyeth shall have the right to terminate the Research Program, at will, at any time, in its entirety, upon one (1) year prior written notice to Trubion; provided that Trubion shall have no obligation after the effective termination date to complete any Research Program activities in connection with any Trubion Target, Wyeth Target, SMIP or Licensed Product. Such termination of the Research Program shall not constitute termination of this Agreement and shall not affect the Parties’ rights and obligations under this Agreement other than those relating to the Research Program.

Joint Research Committee.

Composition. Within thirty (30) days after the Effective Date, the Parties shall establish a Joint Research Committee (the “JRC”) to oversee the Research Program. The JRC will be in effect only during the Research Term. The JRC shall be composed of three (3) representatives from each Party. Each Party may replace any of its representatives at any time upon written notice to the other Party. From time to time, the JRC may establish subcommittees to oversee particular projects or activities, and such subcommittees shall be constituted as the JRC decides.

Responsibilities. The JRC shall be responsible for establishing, reviewing and recommending modifications and updates to the Research Plan, including the Research Budget, in accordance with Section 3.5 hereof, monitoring and reporting to the Parties on activities conducted pursuant to the Research Plan, and for such other functions as agreed by the Parties.

Meetings. The JRC shall meet as soon as practicable after it is established by the Parties and, thereafter, at such additional times as the Parties deem appropriate, not less frequently than quarterly. Each Party shall designate one of its JRC members as its “JRC Liaison” to co-chair meetings, prepare and circulate JRC meeting agendas and JRC meeting minutes. The meetings of the JRC shall be held in the United States, and shall alternate between the Parties’ business locations or as otherwise decided by the JRC. JRC meetings may be conducted in person, by telephone or by videoconference. Each Party shall use reasonable efforts to cause its representatives to attend the meetings of the JRC. If a representative of a Party is unable to attend a meeting, such Party may designate an alternate member to attend such meeting in place of the absent member.

Voting. Decisions of the JRC shall be made by unanimous consent, with each Party having one vote. The JRC may act without a meeting if an action by unanimous written consent is signed by each Party’s JRC Liaison.

Dispute Resolution. If the JRC is unable to reach agreement on a matter, the matter may be referred, at the request of either Party, for resolution through good faith discussions between Wyeth’s Executive Vice President of Discovery Research and Trubion’s Senior Vice President of Research and Development or their respective designees. Notwithstanding the foregoing, in the event the JRC cannot promptly resolve a disagreement or a

Minutes. The JRC shall keep accurate and complete minutes of its meetings that record all proposals and recommendations made, and all actions and decisions taken. The JRC minutes shall not be effective until approved in writing by each Party’s JRC Liaison. All records of the JRC shall be available at all times to each Party.

Research Plan. The Parties shall use their Commercially Reasonable Efforts to develop and approve a complete Research Plan (including a corresponding Research Budget) within sixty (60) days of the Effective Date. The Parties shall ensure that the Research Plan is consistent with the terms and conditions of this Agreement, and the Research Plan shall not impose obligations on either Party that are inconsistent with the terms of this Agreement. The Research Plan shall set forth generally (a) the activities to be undertaken by the Parties under the Research Program consistent with the terms of Section 3.1, (b) the utilization of ten (10) Trubion FTEs in conducting such activities, (c) the anticipated schedule on which such activities are to be conducted, (d) the desired deliverables to be provided by each Party with respect to each Licensed Target that is the subject of the Research Program, and (e) the annual budget for non-ordinary expenses (as described in Section 3.6.1 below) to be incurred by Trubion under the Research Program (the “Research Budget”). The JRC shall review the Research Plan, including the Research Budget, on at least an annual basis and submit any proposed modifications or updates to the Parties for review and approval; any such modifications or updates shall not become effective until approved in writing by an authorized officer of each of the Parties. The Parties shall review and consider any such proposed modifications or updates on an expeditious basis. The Parties shall promptly amend the Research Plan from time to time to address the performance of the Research Program as it relates to any Licensed Targets designated by Wyeth in accordance with Section 3.2 above.

Funding of the Research Program.

Research Funding. During each year of the Research Term (as it may be extended), Wyeth shall pay Trubion Three Million Dollars ($3,000,000) per year for services performed in accordance with the Research Plan. Trubion shall commit to the Research Program ten (10) FTEs per year to provide services in furtherance of the Research Program in accordance with the Research Plan. For the avoidance of doubt, Trubion may, at its

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Reimbursement Payments. Reimbursement to be made to Trubion by Wyeth pursuant to Section 3.6.1 will be made pursuant to invoices submitted by Trubion to Wyeth no more often than once with respect to any Calendar Quarter, within thirty (30) days of the end of such Calendar Quarter. Payment shall be due within forty-five (45) days after Wyeth receives such an invoice from Trubion. Each invoice must be accompanied by supporting documentation sufficiently demonstrating the expense so paid on a cash basis (such as receipts for out-of-pocket expenses and other written documentation reasonably acceptable to Wyeth) and by a certificate executed by Trubion’s VP, Finance & Administration, of the number of FTEs used by Trubion in such Calendar Quarter in performing Trubion’s obligations under the Research Program. Except as approved in writing in advance by Wyeth, Wyeth shall not be obligated to reimburse Trubion for amounts in excess of the applicable budgeted amounts in the Research Budget.

Records and Audits. During the Research Term, Trubion shall keep books and accounts of record in connection with the expenses reimbursable under Section 3.6.1 hereof in accordance with GAAP and in sufficient detail to permit accurate determination of all figures necessary for verification of costs to be reimbursed hereunder. Trubion shall maintain such cost records for a period of at least three (3) years after the end of the calendar year in which they were generated in order to enable audit of such records as set forth below. Upon thirty (30) days prior written notice from Wyeth, Trubion shall permit an independent certified public accounting firm of nationally recognized standing selected by Wyeth and reasonably acceptable to Trubion, to examine, at Wyeth’s sole expense, the relevant books and records of Trubion as may be reasonably necessary to verify the amount of reimbursable out-of-pocket expenses incurred. An examination by Wyeth under this Section 3.6.3 shall occur not more than once in any calendar year and shall be limited to the pertinent books and records for any calendar year ending not more than thirty six (36) months before the date of the request. The accounting firm shall be provided access to such books and records at Trubion’s facility(ies) where such books and records are normally kept and such examination shall be conducted during Trubion’s normal business hours. Trubion may require the accounting firm to sign a standard non-disclosure agreement before providing the accounting firm access to Trubion’s facilities or records. The accounting firm shall provide both Trubion and Wyeth a written report disclosing whether the certificates and invoices submitted by Trubion under Section 3.6.2 are correct or incorrect and the specific details concerning any discrepancies. No other information shall be provided to Wyeth. If the accounting firm determines that the aggregate amount of out-of-pocket expenses actually incurred by Trubion was less than the amount reimbursed by Wyeth during the period covered by the audit, Trubion shall refund the excess payments to Wyeth within thirty (30) days of its receipt of the auditor’s report so concluding (or, if later, within fifteen (15) days after resolution of a bona fide objection by Trubion to the findings in such report). If the amount to be refunded exceeds more than ten percent (10%) of the amount that was properly payable, Trubion shall reimburse Wyeth for the cost of the audit. All information of Trubion which is subject to review under this Section 3.6.3 shall be deemed to be Confidential Information of Trubion subject to the provisions of Article 7, and such Confidential Information shall not be disclosed to any Third Party or used for any purpose other than verifying the information provided by Trubion to Wyeth; provided, however, that such Confidential Information may be disclosed to Third Parties only to the extent necessary to enforce Wyeth’s rights under this Agreement, as may be necessary for Wyeth to exercise its rights under this Agreement, or as otherwise expressly permitted under this Agreement.

Data and Deliverables. During the Research Term, each Party will use Commercially Reasonable Efforts to promptly provide to the other Party the data or desired deliverables specified in the Research Plan, including, without limitation, (a) SMIPs, Recombinant DNA, and Cell Lines, to the extent related to Licensed Targets and/or Licensed Products, (b) activity evaluation of the items listed in (a) obtained from in vitro or in vivo assays, pharmacology studies, process development data, drug product formulation data, toxicology and safety studies, and evaluation of chemotherapy conjugates, but only to the extent and in the manner that items listed in (a) and (b) are set forth in the Research Plan. Each Party shall also disclose to the other Party in writing all data, information, inventions, techniques and discoveries (whether patentable or not) arising out of the conduct of the Research Program. Disclosure of all such aforementioned inventions and discoveries shall be delivered to the other Party in a manner mutually agreed upon by the Joint Patent Committee. Subject to the terms and conditions of this Agreement, each Party shall have the right to use any data or information generated under the Research Program for its permitted activities under the Research Program and this Agreement (collectively, “Research Program Data”). TRUBION MAKES NO REPRESENTATION OR WARRANTY, EITHER EXPRESS OR IMPLIED, THAT IT WILL BE ABLE TO SUCCESSFULLY DISCOVER, DEVELOP OR DELIVER ANY SMIP DIRECTED AGAINST A LICENSED TARGET OR ANY LICENSED PRODUCT.

Alliance Managers. Each Party shall designate a single alliance manager, who shall perform such duties relating to the day-to-day worldwide coordination of the collaboration contemplated by this Agreement as are determined by the JRC and the JDC. Such alliance managers shall have experience and knowledge appropriate for managers with such project management responsibilities. Such alliance managers may attend, as non-voting members, any meetings of the committees contemplated by this Agreement as deemed fit by such committees. Each Party may change its designated alliance manager from time to time upon notice to the other Party.

PRODUCT DEVELOPMENT, MANUFACTURING, COMMERCIALIZATION AND REGULATORY MATTERS.

Product Development. Except as otherwise expressly provided in Articles 2 and 3 hereof and in this Article 4, Wyeth shall have the sole authority, at its expense, for the Development of Licensed Products, including the initiation and conduct of clinical trials. Wyeth shall be responsible for the Development of and shall use its Commercially Reasonable Efforts to Develop Licensed Products throughout the Territory where it is Commercially Reasonable to do so (it being understood that Wyeth shall have the sole discretion to select those countries in which it will conduct clinical studies of Licensed Products and, when Commercially Reasonable to do so, to delay or discontinue the Development of any Licensed Product directed against a particular Licensed Target in favor of pursuing Development of another Licensed Product directed against such Licensed Target). When appropriate based on the data obtained during Development, Wyeth shall use its Commercially Reasonable Efforts to secure Regulatory Approval for Licensed Products in the Territory.

Transfer of Product Data and Filings. Upon Wyeth’s reasonable request and in consultation with the JDC from time to time during the term of this Agreement and to the extent permitted by applicable law, Trubion shall assign and transfer to Wyeth Trubion’s entire right, title and interest in and to any of the Product Data and Filings pursuant to an instrument to such effect in form and substance reasonably satisfactory to Wyeth and shall perform all other actions reasonably requested by Wyeth to effect and confirm such transfer. The Parties shall cooperate through the JDC to ensure that assignment and transfer of Trubion’s right, title and interest in and to Product Data and Filings relating to CD20 Products is made in a manner that does not impede Trubion’s activities and responsibilities under Section 4.6. After receipt of Wyeth’s request consistent with the foregoing, Trubion shall provide to Wyeth, at Wyeth’s expense, within sixty (60) days of receipt of such request, complete copies of such Product Data and Filings, including, without limitation, relevant clinical data, INDs, additional regulatory filings with FDA or other Regulatory Authorities, supplements or amendments thereto, all written correspondence with FDA or other Regulatory Authorities regarding the regulatory filings, and all existing written minutes of meetings and memoranda of conversations between Trubion (including, to the extent practicable, Trubion’s investigators) and FDA or other Regulatory Authorities in Trubion’s possession (or in the possession of any of Trubion’s agents and subcontractors, such as contract research organizations used by Trubion), to the extent Trubion has the right to access and provide to Wyeth such Product Data and Filings, regarding such regulatory filings, each to the extent they relate to Licensed Products. Within thirty (30) days (or such later date as Wyeth may request) after the date of receipt of Wyeth’s reasonable request after consultation with the JDC, Trubion shall execute and deliver a letter to the FDA or other Regulatory Authorities, in a form approved by Wyeth, transferring ownership to Wyeth of such regulatory filings, if any, filed in the name of Trubion that are related to Licensed Products. After such transfer of ownership of regulatory filings relating to a Licensed Product, during the term of this Agreement all regulatory filings with the FDA or other Regulatory Authorities pertaining to such Licensed Product shall be made in the name of Wyeth, in accordance with the terms of Section 4.3 below.

Regulatory Approvals. Wyeth shall have the sole authority to file, in its own name, at its sole expense, all Regulatory Approval Applications for Licensed Products. Wyeth shall have the sole authority and responsibility for communicating with any Regulatory Authority regarding any Regulatory Approval Application, or any Regulatory Approval once granted. To the extent necessary to satisfy applicable regulatory requirements with respect to the INDs for the clinical studies of CD20 Products described in Section 4.6, Wyeth hereby grants to Trubion a “Right of Reference,” as that term is defined in 21 C.F.R. § 314.3(b), to any data Controlled by Wyeth that relates to any CD20 Products that are the subject of the clinical studies described in Section 4.6 hereof, and Wyeth shall provide a signed statement to this effect, if requested by Trubion, in accordance with 21 C.F.R. § 314.50(g)(3). Copies of all Wyeth regulatory filings that relate to Trubion’s Development activities under this Agreement will be provided by Wyeth to Trubion upon request, subject to reasonable resource and time constraints.

Regulatory Reporting. Wyeth shall be responsible for preparing and filing all reports required to be filed in order to maintain any Regulatory Approvals granted for Licensed Products in the Territory, including, without limitation, adverse drug experience reports. To the extent Trubion has or receives any information regarding any adverse drug experience which may be related to the use of any Licensed Product or to Licensed Product Development, Trubion shall promptly provide Wyeth with all such information in accordance with the Adverse Event Reporting and pharmacovigilance procedures set forth in Exhibit 4.4 attached hereto (as may be amended from time to time upon written mutual agreement of the Parties). From time to time after the Effective Date, representatives from both Parties shall meet to review and revise or replace such Adverse Event Reporting and pharmacovigilance procedures.

Progress Reports.

Wyeth shall provide Trubion with confidential summary reports of its and its sublicensees’ Development activities, on a Licensed Product-by-Licensed Product basis, on a quarterly basis, with respect to CD20 Products and HER2 Products, and on an annual basis, with respect to Other Products. The form of the summary reports, and the type of information and the appropriate and reasonable level of detail to be included in such reports, shall be mutually and reasonably agreed by the Parties; provided that the Parties agree that such reports shall include information regarding progress towards and achievement of any event set forth in Exhibit 5.3 attached hereto.

Wyeth shall provide Trubion with confidential summary reports of its and its sublicensees’ CD20 Product Commercialization activities on a quarterly basis after the First Commercial Sale of a CD20 Product. Beginning six (6) months prior to the anticipated First Commercial Sale of a CD20 Product, and thereafter on a semi-annual basis, Wyeth shall meet with Trubion and provide updates on CD20 Product Commercialization activities.

Wyeth shall provide Trubion with confidential summary reports of its and its sublicensees’ HER2 Product Commercialization activities on a semi-annual basis after the First Commercial Sale of a HER2 Product. Beginning six (6) months prior to the anticipated First Commercial Sale of a HER2 Product, and thereafter on a semi-annual basis, Wyeth shall meet with Trubion and provide updates on HER2 Product Commercialization activities.

Wyeth shall provide Trubion with confidential summary reports of its and its sublicensees’ Other Product Commercialization activities on an annual basis after the First Commercial Sale of an Other Product. Beginning six (6) months prior to the anticipated First Commercial Sale of an Other Product, and thereafter on an annual basis, Wyeth shall meet with Trubion and provide updates on Other Product Commercialization activities.

The meetings described in clauses (b) – (d) above shall be coordinated to occur at the same time, to the extent practicable.

CD20 Product Development. Subject to Section 4.7 hereof, Trubion shall use its Commercially Reasonable Efforts to conduct the following Development activities for CD20 Products: (a) Trubion shall continue the Phase I Clinical Studies and Phase IIa Clinical Studies of TRU-015 ongoing at the Effective Date for treatment of rheumatoid arthritis until completion or termination of such studies, including the re-treatment periods of such studies; (b) Trubion shall initiate and perform the planned Phase IIb Clinical Study of TRU-015 for treatment of rheumatoid arthritis through the completion or termination of such study; (c) Trubion shall continue the Phase I Clinical Study ongoing at the Effective Date, and shall initiate and perform the planned Phase III Clinical Studies (or the appropriate subsequent clinical study) of TRU-015 for the treatment of inflammatory myositis through the completion or termination of such studies; (d) Trubion

Joint Development Committee. Within thirty (30) days of the Effective Date, Wyeth and Trubion shall establish a CD20 Product Joint Development Committee (the “JDC”), comprised of appropriate representatives of both Parties, to review and provide input to Wyeth regarding CD20 Product Development in the Territory, including the strategic direction of the overall CD20 Product Development program. Wyeth shall consider in good faith any of Trubion JDC members’ comments and recommendations regarding CD20 Product Development,

Joint Project Team; Development Plan. Trubion and Wyeth shall form a Joint Project Team (“JPT”) comprised of appropriate representatives of both Parties to plan and implement the CD20 Product Development activities in accordance with the Development Plan. The JPT shall report to the JDC. If the JPT cannot promptly resolve a disagreement or a voting deadlock regarding the CD20 Product Development activities, the matter shall be brought before the JDC for resolution. Wyeth shall prepare the Development Plan with input and advice from Trubion through the JPT. The Development Plan will define each Party’s roles and responsibilities, provide a mechanism to coordinate each Party’s and/or joint activities, and provide a process for monthly meetings of the JPT to monitor and report on all activities of the Parties conducted under the Development Plan. The Development Plan shall not impose different or greater CD20 Product Development obligations on Trubion than those specified in Section 4.6. The Development Plan shall be updated annually by the JPT.

Manufacturing. Wyeth shall have the exclusive right to Manufacture Licensed Products itself or through one or more Third Parties selected by Wyeth; provided, however, that Trubion shall use its Commercially Reasonable Efforts to Manufacture and supply Wyeth with its requirements of the TRU-015 Product in accordance with the Development Plan under Trubion’s existing contract Manufacturing arrangements for use in pre-clinical studies and clinical trials (“Clinical Study Supplies”); provided that Trubion cannot guarantee as of the Effective Date that it will be able to Manufacture and supply such requirements. Wyeth shall reimburse Trubion for its direct out-of-pocket cost of Clinical Study Supplies, including, without limitation, out-of-pocket expenses incurred by Trubion prior to the Effective Date that are directly related to the Manufacture, testing and release of Clinical Study Supplies to be used after the Effective Date (such pre-Effective Date out-of-pocket expenses not to exceed Three Million Dollars ($3,000,000)). Reimbursement of such pre-Effective Date expenses shall be due within thirty (30) days after the first patient is dosed in the first Phase IIb Clinical Study for rheumatoid arthritis using such Clinical Study Supplies. Upon Wyeth’s written request, Trubion shall provide reasonable assistance to Wyeth, until the first cGMP batch of TRU-015 Product is Manufactured in a Wyeth facility (or the facility of a Third Party designated by Wyeth), in support and facilitation of Wyeth’s efforts

Commercialization. Subject to the terms and conditions of this Agreement, Wyeth shall have the sole authority and the exclusive right to Commercialize Licensed Products itself or through one or more Third Parties selected by Wyeth and shall have sole authority and responsibility in all matters relating to the Commercialization of Licensed Products. Wyeth shall use Commercially Reasonable Efforts to Commercialize Licensed Products in the Territory in each country where Wyeth has obtained Regulatory Approval for such Licensed Product(s) and for each indication of such Licensed Product(s) for which Regulatory Approval has been obtained in such country.

Co-Promotion Option. Subject to the foregoing, in the event of a BLA filing with the FDA for Regulatory Approval of a CD20 Product for a Niche Indication in the United States, Trubion shall have the option to Co-Promote the CD20 Product in the United States for such Niche Indication in accordance with Wyeth’s marketing plan for up to five (5) years after the First Commercial Sale of the first CD20 Product for any Niche Indication in the United States (the “Co-Promotion Period”). The Trubion Co-Promotion option shall be exercisable by Trubion giving written notice to Wyeth no later than forty-five (45) days after the date of the first BLA filing with the FDA for the first Niche Indication for the first CD20 Product (or such longer time as the Parties may mutually agree). Promptly after Trubion’s exercise of such option, the Parties shall negotiate, in good faith, a definitive Co-Promotion Agreement, which shall require Trubion and Wyeth to use Commercially Reasonable Efforts to Co-Promote such CD20 Product. Such Co-Promotion Agreement shall contain customary provisions relating to relative sales force efforts, responsibility for sales calls, sales force training, promotional materials and samples, detailing and the number and qualifications of sales force personnel (including medical science liaisons) that will be devoted to such Co-Promotion activities. The Parties hereby agree, inter alia, that such Co-Promotion Agreement, and Wyeth’s marketing plan for such CD20 Product, shall provide (a) Trubion’s sales force with a meaningful role in the Commercialization of such CD20 Product; (b) that Wyeth shall provide CD20 Product-related sales training to Trubion’s sales force, at no cost to Trubion; and (c) that Trubion’s sales force shall use CD20 Product promotional materials and samples, to be provided by Wyeth at no cost, in connection with their sales efforts. As compensation for sales force support provided by Trubion in connection with such Co-Promotion, Wyeth shall pay Trubion a fixed fee (to be set

Co-Promotion Committee. If Trubion exercises its Co-Promotion option with respect to a CD20 Product in accordance with Section 4.11 hereof, a Co-Promotion Committee shall be formed by the Parties within thirty (30) days after such exercise. The Co-Promotion Committee shall oversee all aspects of Co-Promotion-related activities and reasonably relevant aspects of Commercialization of such CD20 Product during the Co-Promotion Period, and shall include Trubion’s Chief Executive Officer and Wyeth’s Executive Vice President and General Manager, Wyeth BioPharma.

Co-Branding. To the extent allowed by applicable law, all product labeling for CD20 Products shall include both Parties’ names, which shall be of similar size and prominence to the extent practicable (except (i) with respect to labeling of vials or other components of a CD20 Product that do not include either Party’s name or (ii) with respect to labeling of diluent or other components packaged together with the CD20 Product that do not customarily contain another Person’s name).

Marking. All Licensed Products shall be marked with the patent numbers of issued patents within Trubion Patent Rights and Wyeth Patent Rights that cover such Licensed Products, to the extent practicable and permitted by law in countries in which such markings have notice value against infringers of patents.

CONSIDERATION.

Initial Research and Development Expense Payment. In consideration of Trubion’s agreement to conduct the Research Program and to participate on the JRC and JDC, Wyeth shall pay to Trubion Forty Million Dollars ($40,000,000.00) within ten (10) days after the Effective Date, which payment shall be non-refundable and non-creditable.

Equity. Wyeth shall purchase from Trubion common stock of Trubion at such time, in such amounts and for such price as specified in the Stock Purchase Agreement, attached hereto as Exhibit 5.2A. Concurrent with the execution of the Stock Purchase Agreement, the Parties shall enter into an amendment of Trubion’s Amended and Restated Investor Rights Agreement, attached hereto as Exhibit 5.2B.

Additional Research and Development Expense Payments. In further consideration of Trubion’s contributions under the Research Program and the Development Program, as provided in Articles 3 and 4 above, Wyeth shall pay to Trubion the payments specified in Exhibit 5.3 attached hereto (each an “Additional Research and Development Expense Payment”) in the amounts and at such times as specified in Exhibit 5.3. Wyeth shall notify Trubion promptly upon the achievement of each event specified in Exhibit 5.3.

Royalties.

Licensed Product Royalties. In consideration for the licenses granted to Wyeth under Section 2.1 hereof, and in addition to those payments required to be made by Wyeth pursuant to Section 5.1, Section 5.2 and Section 5.3, Wyeth shall pay to Trubion royalties during the Royalty Period as set forth in Sections 5.4.2, 5.4.3 and 5.4.4 below, subject to the adjustments provided in Section 5.4.6 below.

CD20 Product Royalties.

Except as provided in Sections 5.4.2(b) and 5.4.2(c) below, Wyeth shall pay to Trubion royalties in the amount of the Marginal Royalty Rates (set forth below) of the aggregate Net Sales collectively obtained by Wyeth and its sublicensees from the sale of CD20 Products in the Territory during each calendar year in the applicable Royalty Period:

Annual Net Sales Level

Less than $500 million

From $500 million up to $1.0 billion

From $1.0 billion up to $1.5 billion

From $1.5 billion up to $2.0 billion

Greater than $2.0 billion

Subject to the provisions of Section 5.4.2(c) below, in the event that, at any time during the term of the Product License, no issued Valid Claim is included within the Trubion Patent Rights in a country where a CD20 Product is sold (which claim, but for the licenses granted hereunder to Wyeth, would be infringed by Wyeth’s or its sublicensees’ Manufacture, use, sale, offer for sale or import of such CD20 Product in such country); Wyeth shall pay to Trubion royalties with respect to such CD20 Product in such country during such time period, in lieu of the royalties described in Section 5.4.2(a), equal to the following amount: (i) the CD20 Effective Royalty Rate of the aggregate Net Sales obtained by Wyeth and its sublicensees from the sale of such CD20 Product in such country during such time period minus (ii) two percent (2%) of the aggregate Net Sales obtained by Wyeth and its sublicensees from the sale of such CD20 Product in such country during such time period. By way of example only,

In the event that at any time during the term of the Product License: (i) no issued Valid Claim is included within the Trubion Patent Rights in a country where a CD20 Product is sold (which claim, but for the licenses granted hereunder to Wyeth, would be infringed by Wyeth’s or its sublicensees’ Manufacture, use, sale, offer for sale or import of such CD20 Product in such country), (ii) a product is sold by a Third Party in such country, which product would, if sold by such Third Party in the United States, infringe an issued Valid Claim included within the Trubion Patent Rights in the United States, and (iii) such product sold by the Third Party has a ten percent (10%) or greater unit market share in such country (where the market is defined as the sum of the unit sales of such CD20 Product and of the product described in clause (ii)), Wyeth shall pay to Trubion royalties with respect to such CD20 Product in such country during such time period, in lieu of the royalties described in Section 5.4.2(a) and Section 5.4.2(b), equal to the following amount: (i) fifty percent (50%) of (ii) the CD20 Effective Royalty Rate of the aggregate Net Sales obtained by Wyeth and its sublicensees from the sale of such CD20 Product in such country during such time period. By way of example only, if the aggregate Net Sales of such a CD20 Product in such country during the relevant time period were $100,000,000 and the CD20 Effective Royalty Rate for such time period were 11.875%, the royalties payable under this Section 5.4.2(c) would equal (i) 50% of (ii) 11.875% of $100,000,000, (or $11,875,000), which would equal $5,937,500.

HER2 Product Royalties.

Except as provided in Sections 5.4.3(b) and 5.4.3(c) below, Wyeth shall pay to Trubion royalties in the amount of the Marginal Royalty Rates (set forth below) of the aggregate Net Sales collectively obtained by Wyeth and its sublicensees from the sale of each HER2 Product in the Territory during each calendar year in the applicable Royalty Period:

Annual Net Sales Level

Less than $500 million

From $500 million up to $1.0 billion

From $1.0 billion up to $1.5 billion

From $1.5 billion up to $2.0 billion

Greater than $2.0 billion

Subject to the provisions of Section 5.4.3(c) below, in the event that, at any time during the term of the Product License, no issued Valid Claim is included within the Trubion Patent Rights in a country where a HER2 Product is sold (which claim, but for the licenses granted hereunder to Wyeth, would be infringed by Wyeth’s or its sublicensees’ Manufacture, use, sale, offer for sale or import of such HER2 Product in such country), Wyeth shall pay to Trubion royalties with respect to such HER2 Product in such country during such time period, in lieu of the royalties described in Section 5.4.3(a), equal to the following amount: (i) the HER2 Effective Royalty Rate for such HER2 Product of the aggregate Net Sales obtained by Wyeth and its sublicensees from the sale of such HER2 Product in such country during such time period minus (ii) two percent (2%) of the aggregate Net Sales obtained by Wyeth and its sublicensees from the sale of such HER2 Product in such country during such time period. By way of example only, if the aggregate Net Sales of such a HER2 Product in such country during the relevant time period were $100,000,000 and the HER2 Effective Royalty Rate (based on Net Sales of such HER2 Product throughout the Territory) for such time period for such HER2 Product were 9.375%, the royalties payable under this Section 5.4.3(b) on Net Sales in such country would equal (i) 9.375% of $100,000,000, (or $9,375,000), minus (ii) 2% of $100,000,000, (or $2,000,000), which would equal $7,375,000. By way of further example only, if the Net Sales of such HER2 Product in such country during the relevant time period were $30,000,000 and the HER2 Effective Royalty Rate (based on Net Sales of such HER2 Product throughout the Territory) for such time period were 11.429%, the royalties payable under this Section 5.4.3(b) on Net Sales in such country would equal (i) 11.429% of $30,000,000, (or $3,428,700), minus (ii) 2% of $30,000,000, (or $600,000), which would equal $2,828,700.

In the event that at any time during the term of the Product License: (i) no issued Valid Claim is included within the Trubion Patent Rights in any country where a HER2 Product is sold (which claim, but for the licenses granted hereunder to Wyeth, would be infringed by Wyeth’s or its sublicensees’ Manufacture, use, sale, offer for sale or import of such HER2 Product in such country), (ii) a product is sold by a Third Party in such country, which product would, if sold by such Third Party in the United States, infringe an issued Valid Claim included within the Trubion Patent Rights in the United States, and (iii) such product sold by a Third Party has a ten percent (10%) or greater unit market share in such country (where the market is defined as the sum of the unit sales of such HER2 Product and of the product described in clause (ii)), Wyeth shall pay to Trubion royalties with respect to such HER2 Product in such country during such time period, in lieu of the royalties described in Section 5.4.3(a) and Section 5.4.3(b), equal to the following amount: (i) fifty percent (50%) of (ii) the HER2 Effective Royalty Rate for such HER2 Product of the aggregate Net Sales obtained by Wyeth and its sublicensees from the sale of such HER2 Product in such country during such time period. By way of example only, if the aggregate Net Sales of such a HER2 Product in such country during the relevant time period were $100,000,000 and the HER2 Effective Royalty Rate for such time period for such HER2 Product were 9.375%, the royalties payable under this Section 5.4.3(c) on Net Sales in such country would equal (i) 50% of (ii) 9.375% of $100,000,000, (or $9,375,000), which would equal $4,687,500. By way of further example only, if the Net Sales of such HER2 Product in such country during the relevant time period were $30,000,000 and the HER2 Effective Royalty Rate (based on Net Sales of such HER2 Product throughout the Territory) for such time period were 11.429%, the royalties payable under this Section 5.4.3(c) on Net Sales in such country would equal (i) 50% multiplied by (ii) 11.429% of $30,000,000, (or $3,428,700), which would equal $1,714,350.

Other Product Royalties.

Except as provided in Sections 5.4.4(b) and 5.4.4(c) below, Wyeth shall pay Trubion a royalty of five percent (5.0%) of the aggregate Net Sales obtained by Wyeth and its sublicensees from the sale of each Other Product in the Territory during each calendar year in the applicable Royalty Period.

Subject to the provisions of Section 5.4.4(c) below, in the event that, at any time during the term of the Product License, no issued Valid Claim is included within the Trubion Patent Rights in a country where an Other Product is sold (which claim, but for the licenses granted hereunder to Wyeth, would be infringed by Wyeth’s or its sublicensees’ Manufacture, use, sale, offer for sale or import of such Other Product in such country), Wyeth shall pay to Trubion, with respect to such Other Product in such country during such time period, in lieu of the royalty described in Section 5.4.4(a), a royalty of four percent (4.0%) of the aggregate Net Sales obtained by Wyeth and its sublicensees from the sale of such Other Product in such country during such time period.

In the event that at any time during the term of the Product License: (i) no issued Valid Claim is included within the Trubion Patent Rights in any country where an Other Product is sold (which claim, but for the licenses granted hereunder to Wyeth, would be infringed by Wyeth’s or its sublicensees’ Manufacture, use, sale, offer for sale or import of such Other Product in such country), (ii) a product is sold by a Third Party in such country, which product would, if sold by such Third Party in the United States, infringe an issued Valid Claim included within the Trubion Patent Rights in the United States, and (iii) such product sold by a Third Party has a ten percent (10%) or greater unit market share in such country (where the market is defined as the sum of the unit sales of such Other Product and of the product described in clause (ii)), Wyeth shall pay to Trubion, with respect to such Other Product in such country during such time period, in lieu of the royalties described in Section 5.4.4(a) and Section 5.4.4(b), a royalty of two and one half percent (2.5%) of the aggregate Net Sales obtained by Wyeth and its sublicensees from the sale of such Other Product in such country during such time period.

Expiration of Royalty Period. After the expiration of the Royalty Period for any Licensed Product in any country in the Territory, no further royalties shall be payable in respect of sales of such Licensed Product in such country and thereafter the licenses granted to Wyeth under Section 2.1 with respect to such Licensed Product in such country shall be fully paid-up, perpetual, irrevocable, royalty-free, exclusive licenses.

Royalty Adjustments.

Certain Third Party Agreements. On a country-by-country basis in a given calendar year, Wyeth shall deduct from CD20 Product royalties otherwise payable to Trubion under Section 5.4.2 fifty percent (50%) of the aggregate amount of royalties actually paid to Third Parties under Additional Third Party Licenses with respect to the Development, Manufacture or Commercialization of CD20 Products in such country in such calendar year; provided, however, that (i) the amount of such deduction shall not exceed twenty percent (20%) of the amount of the CD20 Product royalties otherwise payable to Trubion under Section 5.4.2 in a given calendar year and (ii) such deduction shall not have the effect, under any circumstances, of reducing the CD20 Product royalties payable under Section 5.4.2 below ten percent (10%) of the aggregate Net Sales obtained by Wyeth and its sublicensees from the sale of CD20 Products in such country in a given calendar year (before taking into account the operation of Sections 5.4.2(b) and 5.4.2(c)). On a country-by-country basis in a given calendar year, Wyeth shall deduct from HER2 Product royalties otherwise payable to Trubion under Section 5.4.3 fifty percent (50%) of the aggregate amount of royalties actually paid to Third Parties under Additional Third Party Licenses with respect to the Development, Manufacture or Commercialization of such HER2 Product in such country in such calendar year; provided, however, that (i) the amount of such deduction shall not exceed twenty percent (20%) of the amount of the HER2 Product royalties otherwise payable to Trubion under Section 5.4.3 in a given calendar year and (ii) such deduction shall not have the effect, under any circumstances, of reducing the HER2 Product royalties payable under Section 5.4.3 below seven and one-half percent (7.5%) of the aggregate Net Sales obtained by Wyeth and its sublicensees from the sale of such HER2 Product in such country in a given calendar year (before taking into account the operation of Sections 5.4.3(b) and 5.4.3(c)). Wyeth shall not make any deductions under this Section 5.4.6(a) from royalties payable to Trubion under

Other Third Party Agreements. Wyeth shall be solely responsible for all payment obligations related to the Conjugates, Licensed Products and Wyeth Technology under its licenses and other agreements with Third Parties that are in effect as of the Effective Date, and no adjustment to the royalties payable by Wyeth under Section 5.4.1 shall be made on account of any such obligations. Trubion shall be solely responsible for all payment obligations related to the Trubion Technology under its licenses and other agreements with Third Parties that are in effect as of the Effective Date including, without limitation, those obligations arising under the Trubion Third Party Agreements.

Reports and Payments.

Cumulative Royalties. The obligation to pay royalties under Section 5.4 of this Agreement shall be imposed only once with respect to a single unit of a Licensed Product, regardless of how many Valid Claims included within the Trubion Technology would, but for this Agreement, be infringed by the Manufacture, use, import, offer for sale or sale of such Licensed Product in the countr(y)ies of such Manufacture, use or sale. For the avoidance of doubt, if a single Licensed Product is both a CD20 Product and an Other Product, such Licensed Product shall be deemed to be a CD20 Product for purposes of the royalty obligations under Section 5.4. If a single Licensed Product is both a HER2 Product and an Other Product, such Licensed Product shall be deemed to be a HER2 Product for purposes of the royalty obligations under Section 5.4.

Royalty Statements and Payments. Within sixty (60) days after the end of each Calendar Quarter, Wyeth shall deliver to Trubion a report setting forth for such Calendar Quarter the following information, on a Licensed Product-by-Licensed Product and country-by-country basis: (a) the gross sales amount (by Wyeth and its sublicensees) for each category of Licensed Product sold in the United States and the number of units of Licensed Product sold in the United States and other countries in the Territory, on a country-by-country basis; (b) the Net Sales for each Licensed Product; (c) any adjustments (including the basis therefor) made pursuant to Sections 5.4.2(b), 5.4.2(c), 5.4.3(b), 5.4.3(c), 5.4.4(b), 5.4.4(c) or 5.4.6(a) to the royalty amount payable for the sale of each Licensed Product, the applicable Marginal Royalty Rates and the CD20 Effective Royalty Rate or HER2 Effective Royalty Rate (as the case may be) payable on the Net Sales, and (d) the royalty amount due hereunder for the sale of each Licensed Product. No such reports shall be due for any Licensed Product before the First Commercial Sale of such Licensed Product. The total royalty due for the sale of Licensed Products during such Calendar Quarter shall be remitted at the time such report is made.

Taxes and Withholding. All payments due Trubion under this Agreement will be made without any deduction or withholding for or on account of any tax unless such deduction or withholding is required by applicable laws or regulations to be assessed against Trubion. If Wyeth is so required to deduct or withhold, Wyeth will (a) promptly notify Trubion of such requirement, (b) pay to the relevant authorities the full amount required to be deducted or withheld promptly upon the earlier of determining that such deduction or withholding is required or receiving notice that such amount has been assessed against Trubion, (c) promptly forward to Trubion an official receipt (or certified copy) or other documentation reasonably acceptable to Trubion evidencing such payment to such authorities, and (d) otherwise reasonably cooperate with Trubion in connection with Trubion’s attempts to obtain favorable tax treatment and credit therefor (where appropriate) in accordance with applicable laws.

Currency. All amounts payable and calculations hereunder shall be in United States Dollars. As applicable, Net Sales and any royalty deductions shall be translated into United States dollars in accordance with Wyeth’s customary and usual translation procedures, consistently applied, which procedures are in accordance with Generally Accepted Accounting Principles in the United States.

Additional Provisions Relating to Royalties. Trubion acknowledges and agrees that nothing in this Agreement (including, without limitation, any exhibits or attachments hereto) shall be construed as representing an estimate or projection of either (a) the number of Licensed Products that will or may be successfully Developed or Commercialized or (b) anticipated sales or the actual value of any Licensed Product and that the figures set forth in Section 5.4 or elsewhere in this Agreement or that have otherwise been discussed by the Parties are merely intended to define Wyeth’s royalty obligations to Trubion in the event such sales performance is achieved. WYETH MAKES NO REPRESENTATION OR WARRANTY, EITHER EXPRESS OR IMPLIED, THAT IT WILL BE ABLE TO SUCCESSFULLY DEVELOP OR COMMERCIALIZE ANY LICENSED PRODUCT OR, IF COMMERCIALIZED, THAT IT WILL ACHIEVE ANY PARTICULAR SALES LEVEL OF SUCH LICENSED PRODUCT(S).

Interest on Past Due Payments. If either Party fails to pay any payment due under this Agreement on or before the date such payment is due, as provided in this Agreement, such late payment shall bear interest, to the extent permitted by applicable law, at the average one-month London Inter-Bank Offering Rate (LIBOR) for the United States Dollar as reported from time to time in The Wall Street Journal, effective for the first date on which payment was delinquent and calculated on the number of days such payment is overdue or, if such rate is not regularly published, as published in such source as the Parties agree.

Maintenance of Records; Audits.

Record Keeping. Wyeth shall keep accurate books and accounts of record in connection with the sale of Licensed Products, in sufficient detail to permit accurate determination of all figures necessary for verification of royalties and other payments to be paid to Trubion hereunder. Wyeth shall keep accurate records of its activities under this Agreement that relate to the events with respect to which Additional Research and Development Expense Payments may be made under Section 5.3 hereof. Wyeth shall maintain such records for a period of at least three (3) years after the end of the calendar year in which they were generated.

Audits. Upon thirty (30) days prior written notice from Trubion, Wyeth shall permit an independent certified public accounting firm of nationally recognized standing selected by Trubion and reasonably acceptable to Wyeth, to examine, at Trubion’s sole expense, the relevant books and records of Wyeth as may be reasonably necessary to verify the accuracy of the reports submitted by Wyeth in accordance with Section 5.5 and the payment of royalties hereunder. An examination by Trubion

Underpayments/Overpayments. If such accounting firm concludes that additional royalties were due to Trubion, Wyeth shall pay to Trubion the additional royalties within thirty (30) days of the date Wyeth receives such accountant’s written report so concluding. If such royalty underpayment exceeds ten percent (10%) of the royalties that were to be paid to Trubion, Wyeth also shall reimburse Trubion for the out-of-pocket expenses incurred in conducting the audit. If such accounting firm concludes that Wyeth overpaid royalties to Trubion, Trubion, within thirty (30) days of the date Trubion receives such account’s report so concluding, will refund such overpayments to Wyeth less the reasonable out-of-pocket costs incurred by Trubion in conducting the audit.

Confidentiality. All financial information of Wyeth which is subject to review under this Section 5.6 shall be deemed to be Wyeth’s Confidential Information subject to the provisions of Article 7 hereof, and Trubion shall not disclose such Confidential Information to any Third Party or use such Confidential Information for any purpose other than verifying payments to be made by Wyeth to Trubion hereunder; provided, however, that such Confidential Information may be disclosed by Trubion to Third Parties only to the extent necessary to enforce Trubion’s rights under this Agreement.

INTELLECTUAL PROPERTY.

Inventions; Joint Patent Committee.

Ownership and Inventorship. A Party shall own all inventions and Know-How made solely by employees of such Party, and shall jointly own with the other Party any invention, whether or not patentable, made jointly by employees of both Parties (a “Joint Invention”), all Joint Patent Rights directed thereto, and any Know-How made jointly by employees of both Parties (“Joint Know-How”). All determinations of inventorship under this Agreement shall be made in accordance with United States patent law. Each Party shall disclose promptly in writing to the other any Joint Inventions and any candidate Joint Inventions of which it becomes aware. Subject to (a) the grant of licenses to Wyeth under Section 2.1 and to Trubion under Section 2.2, (b) the exclusivity provisions of Section 2.3, and (c) the Parties’ other rights and obligations under this Agreement, each Party shall be free to exploit (including to research, Develop, Manufacture, Commercialize and enforce), either itself or through the grant of licenses to Third Parties (which Third Party licenses are further sublicensable), Joint Patent Rights and Joint Know-How throughout the world without restriction, without the need to obtain further consent from the other Party, and without payment of any compensation to the other Party.

SMIP Improvements. All SMIP Improvements made by Wyeth, whether independently or jointly with Trubion, in the course of performing Wyeth’s obligations under this Agreement during the term of the Agreement (each, a “Covered SMIP Improvement”) shall be promptly disclosed by Wyeth to Trubion. Wyeth, subject to the rights and licenses granted by Trubion to Wyeth hereunder, hereby grants to Trubion a worldwide, royalty-free (other than as expressly set forth in this Section 6.1.2), irrevocable, non-exclusive license (with the right to sublicense), under Wyeth’s rights to such Covered SMIP Improvements, to practice, exploit and use such Covered SMIP Improvements in connection with the research, Manufacture, Development, Commercialization or use of SMIPs (but, to the extent any Covered SMIP Improvement is directed to a complementarity determining region or any portion of a binding domain provided by Wyeth, Trubion shall not have a license from Wyeth hereunder to practice, exploit and use such Covered SMIP Improvement in connection with the research, Manufacture, Development, Commercialization and use of proteins other than SMIPs); provided, however, for the avoidance of doubt, that the license granted to Trubion pursuant to this sentence shall not be deemed to constitute or include a license with respect to any underlying Wyeth technology or any Wyeth Technology (including without limitation Manufacturing, delivery, formulation and conjugation technology) other than Wyeth’s rights to such Covered SMIP Improvements. In the event, and to the extent, that

Joint Patent Committee.

Establishment; Meetings; Decisions. Within thirty (30) days after the Effective Date, the Parties shall establish a Joint Patent Committee composed of at least one (1) representative from each Party with experience in the prosecution 01 biotechnology patents. The Joint Patent Committee will have such duties and responsibilities as are expressly assigned to it under this Article 6. The Joint Patent Committee shall meet as soon as practicable after it is established by the Parties and, thereafter, at such additional times as the Parties deem appropriate, not less frequently than quarterly. The meetings of the Joint Patent Committee shall alternate between the Parties’ business locations or as otherwise decided by the Joint Patent Committee; provided that Joint Patent Committee meetings may be conducted in person, by telephone or by videoconference. Each Party shall use reasonable efforts to cause its representative(s) to attend each Joint Patent Committee meeting. Decisions of the Joint Patent Committee shall be made by unanimous consent, with each Party having one vote. The Joint Patent Committee may act without a meeting if an action by unanimous written consent is signed by each committee member. If the Joint Patent Committee is unable to reach agreement on a matter for which it has decision-malting authority pursuant to Section 6.1.3(b), 6.2.1(c) or 6.2.2(c), the matter may be

Category 1 Covered SMIP Improvements and Category 2 Covered SMIP Improvements. Without limiting Wyeth’s obligation under Section 6.1.1 and Section 6.1.2 to disclose promptly to Trubion any inventions and candidate inventions made hereunder (including, without limitation, any Covered SMIP Improvements), each Party shall report on a quarterly basis to the Joint Patent Committee whether any of its activities hereunder during the prior Calendar Quarter involved a new Covered SMIP Improvement. The Joint Patent Committee shall decide whether a given Covered SMIP Improvement (i) is solely applicable to SMIP coding regions (a “Category 1 Covered SMIP Improvement”), or (ii) is not solely applicable to SMIP coding regions (a “Category 2 Covered SMlP Improvement”). As provided in greater detail in Section 6.2.1(d) below, Trubion shall be responsible for preparation, filing, prosecution and maintenance of all Patent Rights directed to Category 1 Covered SMIP Improvements, and Wyeth shall be responsible for preparation, filing, prosecution and maintenance of all Patent Rights directed to Category 2 Covered SMlP Improvements.

Patent Rights.

Filing, Prosecution and Maintenance of Patent Rights

Trubion Patent Rights.

Trubion Patent Rights. Trubion shall use its Commercially Reasonable Efforts to prepare, file, prosecute and maintain, throughout the Territory, all

Wyeth Patent Rights. Subject to Section 6.2.l(d), and except with respect to Covered SMIP Improvements, Wyeth, at its own expense, shall have the sole right, but not the obligation, to prepare, file, prosecute and maintain, throughout the Territory, all Wyeth Patent Rights, using patent counsel of Wyeth’s choice.

Joint Patent Rights. Subject to Section 6.2.l(d), in the event the Parties make any Joint Invention (excluding a Covered SMIP Improvement), the Joint Patent Committee shall promptly meet to discuss and determine whether to seek patent protection thereon. If the Joint Patent Committee decides to seek patent protection on such Joint Invention, then Wyeth shall have the primary obligation to prepare, file, prosecute and maintain any corresponding Joint Patent Rights throughout the Territory using patent counsel mutually agreeable to the Parties, such agreement not to be unreasonably withheld. Wyeth shall give Trubion a reasonable opportunity to review and comment on the text of any patent application with respect to such Joint Patent Right before filing, shall consult with Trubion with respect thereto, shall reasonably consider and address any of Trubion’s comments, and shall supply Trubion with a copy of each such patent application as filed, together with notice of its filing date and serial number. Wyeth shall keep Trubion advised of the status of the actual and prospective patent filings (including, without limitation, the grant of any Joint Patent Rights), shall provide Trubion with a reasonable opportunity to comment on all correspondence received from and all proposed submissions to be made to any government patent office or authority related to the filing, prosecution and maintenance of such patent filings, shall consult with Trubion with respect thereto, and shall reasonably consider and address any or ‘Trubion’s comments on such correspondence and submissions. Trubion shall reimburse Wyeth for fifty percent (50%) of the out-of-pocket expenses incurred by

Category 1 and Category 2 Covered SMIP Improvements.

Category 1 Covered SMIP Improvements. In the event that Wyeth makes any Category 1 Covered SMIP Improvement (whether it is an invention solely by Wyeth or a Joint Invention), Trubion shall have the first right and primary obligation to prepare, file, prosecute and maintain any Patent Rights covering such Category 1 Covered SMlP Improvement, using patent counsel mutually agreeable to the Parties, such

Category 2 Covered SMIP Improvements. In the event that Wyeth makes any Category 2 Covered SMIP Improvement (whether it is an invention solely by Wyeth or a Joint Invention), Wyeth shall have the first right and primary obligation to prepare, file, prosecute and maintain any Patent Rights covering such Category 2 Covered SMIP Improvement, at its own expense, using patent counsel mutually agreeable to the Parties, such agreement not to be unreasonably withheld. Wyeth shall give Trubion a reasonable opportunity to review and comment on the text of any patent application with respect to such Category 2 Covered SMIP Improvement before filing, shall consult with Trubion with respect thereto, shall reasonably consider and address any of Trubion’s comments, and shall supply Trubion with a copy 01 the patent application as filed, together with notice of its filing date and serial number. Wyeth shall keep Trubion advised of the status of the actual and prospective patent filings (including, without limitation, the grant of any Patent Rights covering such Category 2 Covered SMlP Improvement), shall provide Trubion with a reasonable opportunity to

Enforcement of Patent Rights.

Notice. lf either Wyeth or Trubion becomes aware of any infringement, anywhere in the Territory, of any issued patent within the Trubion Patent Rights (including Product- Related Patent Rights), Wyeth Patent Rights or Joint Patent Rights, which infringing activity adversely affects or is reasonably expected to adversely affect any SMIP or Licensed Product hereunder, it will promptly notify the other Party in writing to that effect and the Parties will consult with each other through the Joint Patent Committee regarding any actions to be taken with respect to such infringing activity; provided, however, that neither Party is obligated to disclose confidential information of a Third Party (other than a sublicensee under this Agreement, to the extent such Party is permitted to do so under the terms of the sublicense).

Product-Related Patent Rights. To the extent permitted under the Trubion Third Party Agreements, if applicable, Wyeth shall have the first right, but not the obligation, to take action to obtain a discontinuance of infringement or bring suit against a Third Party infringer of Product-Related Patent Rights under which Wyeth has an exclusive license to make, use and sell Licensed Products under this Agreement, to the extent such infringement involves a product directed against a Licensed Target. Wyeth shall have such first right within three (3) months from the date of notice and the right to join Trubion as a party plaintiff. Wyeth shall be responsible for, and shall bear, all the out-of-pocket expenses of any suit brought by it claiming infringement of any such Product-Related Patent Rights; provided that Trubion shall reimburse Wyeth for twenty percent (20%) of the out-of-pocket expenses incurred in connection therewith. Trubion will cooperate with Wyeth in any such suit and shall have the right to consult with Wyeth and to participate in and be represented by independent counsel in such litigation at its own expense. Wyeth shall incur no liability to Trubion as a consequence of such litigation or any unfavorable decision resulting therefrom, including any decision holding any of the Product-Related Patent Rights invalid or unenforceable. Any recoveries obtained by Wyeth as a result of any proceeding against such Third Party infringer shall be allocated as follows:

Such recovery shall first be used to reimburse each Party for all out-of-pocket litigation expenses in connection with such litigation paid by that Party; and

With respect to any remaining recovery, eighty percent (80%) shall go to Wyeth and twenty percent (20%) shall go to Trubion.

Such recovery shall first be used to reimburse each Party for all out-of-pocket litigation expenses in connection with such litigation paid by that Party; and

With respect to any remaining recovery, one hundred percent (100%) shall go to Trubion.

Joint Patent Rights. With respect to any notice of a Third Party infringer of the Joint Patent Rights, the Joint Patent Committee shall meet as soon as reasonably practicable to discuss such infringement and determine an appropriate course of action. Wyeth shall have the first right but not the obligation to bring an action against such Third Party infringer or otherwise address such alleged infringement within three (3) months from the date of notice and to control such litigation or other means of addressing such infringement. Wyeth shall be responsible for, and shall bear, all the out-of-pocket expenses of any suit brought by it claiming infringement of any such Joint Patent Rights; provided that Trubion shall reimburse Wyeth for twenty percent (20%) of the out-of-pocket expenses incurred in connection therewith. Trubion shall cooperate with Wyeth, at Wyeth’s expense, in any such suit brought by Wyeth and shall have the right to consult with Wyeth and participate in and be represented by independent counsel in such litigation at its own expense. Wyeth shall incur no liability to Trubion as a consequence of such litigation or any unfavorable decision resulting therefrom, including any decision holding any of the Joint Patent Rights invalid or

Such recovery shall first be used to reimburse each Party for all out-of-pocket litigation expenses in connection with such litigation paid by that Party; and

With respect to any remaining recovery, eighty percent (80%) shall go to Wyeth and twenty percent (20%) shall go to Trubion.

Infringement and Third Party Licenses

Infringement of Third Party Patents - Course of Action. If the research, Development, Manufacture or Commercialization of any Licensed Product is alleged by a Third Party to infringe a Third Party’s patent, the Party becoming aware of such allegation shall promptly notify the other Party.

Third Party Infringement Suit. If a Third Party sues a Party (the “Sued Party”) alleging that the Sued Party or its Affiliates’ or sublicensees’ research, Development, Manufacture or Commercialization of any Licensed Product during the term of and pursuant to this Agreement infringes or will infringe said Third Party’s patent, then, upon the Sued Party’s request and in connection with the Sued Party’s defense of any such Third Party infringement suit, the other Party shall provide reasonable assistance to the Sued Party for such defense. If both Wyeth and Trubion are sued by a Third Party, then the Parties shall consult with one another through the Joint Patent Committee. Unless otherwise determined by the Joint Patent Committee, Wyeth will control the defense of any suit relating to Licensed Products (whether one or both Parties are Sued Parties) and shall select counsel for such suit after consultation through the Joint Patent Committee. Trubion shall have the right to participate in and be represented by independent counsel in such litigation at its own expense. If the alleged infringement is of claims related to the Trubion Technology utilized by Wyeth hereunder, Wyeth shall be responsible for, and shall bear, all the out-of-pocket expenses of such actions; provided that Trubion shall reimburse Wyeth for twenty percent (20%) of the out-of-pocket expenses incurred in connection therewith. In the event Trubion is the Party paying such expenses, Trubion shall periodically, but no more than once per Calendar Quarter, invoice Wyeth for its eighty percent (80%) share of expenses incurred. All invoices shall be accompanied by supporting documentation reasonably showing the expenses so incurred. Such invoices shall be paid within thirty (30) days of receipt. In the event Wyeth is the Party paying such expenses, Wyeth shall receive a credit in the amount of Trubion’s share of such expenses, which credit shall be applied to royalties due to Trubion under Section 5.4, as adjusted under Section 5.4.6; provided that, no such royalty payment to Trubion shall be

Interference, Opposition, Revocation, and Declaratory Judgment Actions. If the Parties, though the Joint Patent Committee, mutually determine that, based upon the review of a Third Party’s patent or patent application or other intellectual property rights, it may be desirable to provoke or institute an interference, opposition, revocation or declaratory judgment action with respect thereto, then the ‘Parties shall consult with one another and shall reasonably cooperate in connection with such an action. Unless otherwise determined by the Joint Patent Committee, Wyeth will control such action and shall select counsel for such action. Wyeth shall be responsible for, and shall bear, all the out-of-pocket expenses of such action; provided that Trubion shall reimburse Wyeth for twenty percent (20%) of the out-of-pocket expenses incurred in connection therewith. Wyeth shall submit invoices to Trubion for such expenses, such invoices to be accompanied by supporting documentation reasonably showing the expenses so incurred. Trubion shall have the right to participate in and be represented by independent counsel in such action at its own expense.

Patent Certifications. Each Party shall immediately give written notice to the other of any certification of which it becomes aware filed pursuant to 21 U.S.C. 5 355(b)(2)(A) or 5 355(j)(2)(A)(vii) (or any amendment or successor statute thereto), any similar statutory or regulatory requirement enacted in the future regarding biologic products, or any similar statutory or regulatory requirement in any non-U.S. country in the Territory claiming that a Joint Patent Right, Wyeth Patent Right or a Trubion Patent Right covering a Licensed Product is invalid or that infringement will not arise from the Manufacture, use or sale of a product by a Third Party. Upon the giving or receipt of such notice, Wyeth shall have the first right, but not the obligation, to bring an infringement action against such Third Party. In such a case, Wyeth shall notify Trubion at least ten (10) days prior to the date set forth by statute or regulation of its intent to exercise, or not exercise, this right. Any infringement action against a Third Party arising under this Section 6.2.4 shall be governed by the provisions of Section 6.2.2(b) hereof.

Patent Term Restoration. The Parties hereto shall cooperate with each other in obtaining patent term restoration, or its equivalent anywhere in the Territory, including under 3 5 U.S .C. 5 156 and its foreign counterparts, where applicable to the Trubion Patent Rights, Wyeth Patent Rights and Joint Patent Rights. If elections with respect to obtaining such patent term restoration are to be made, Wyeth shall make such election (after consultation with Trubion through the Joint Patent Committee) and Trubion shall abide by such election.

Trademarks. Wyeth shall, in its sole discretion select and own all Licensed Product-related Trademarks, trade dress, logos and copyrights and names to be used in connection with the Commercialization of any Licensed Product hereunder. Trubion shall neither use nor seek to register, anywhere in the Territory, any trademarks which are confusingly similar to any Trademark or any other trademarks, trade names, trade dress or logos used by or on behalf of Wyeth or its sublicensees in connection with any Licensed Product; provided, however*, that nothing in this Section 6.3 shall be construed to prevent Trubion from enforcing its own trademark, trade name, trade dress or logo rights or affect the Parties’ obligations under Section 4.13.

CONFIDENTIALITY.

Confidentiality. Except to the extent expressly authorized by this Agreement or otherwise agreed in writing, the Parties agree that, for the term of this Agreement and for five (5) years thereafter, each Party (the “Receiving Party”), receiving any Confidential Information of the other Party (the “Disclosing Party”) hereunder shall keep such Confidential Information confidential and shall not publish or otherwise disclose or use such Confidential Information for any purpose other than as provided for in this Agreement except for Confidential Information that the Receiving Party can establish:

was already known by the Receiving Party (other than under an obligation of confidentiality), at the time of disclosure by the Disclosing Party and such Receiving Party has documentary evidence to that effect;

was generally available to the public or otherwise part of the public domain at the time of its disclosure to the Receiving Party;

became generally available to the public or otherwise part of the public domain after its disclosure or development, as the case may be, and other than through any act or omission of a Party in breach of this confidentiality obligation;

was disclosed to that Party, other than under an obligation of confidentiality, by a Third Party who had 110 obligation to the Disclosing Party not to disclose such information to others; or

was independently discovered or developed by or on behalf of the Receiving Party without the use of the Confidential Information belonging to the other Party and the Receiving Party has documentary evidence to that effect.

Authorized Disclosure and Use.

Disclosure. Notwithstanding the foregoing Section 7.1, each Party may disclose Confidential Information belonging to the other Party to the extent such disclosure is reasonably necessary to:

file or prosecute patent applications covering Trubion Know-How, Wyeth Know-How or Joint Know-How as contemplated by this Agreement, in a manner consistent with decisions and recommendations of the Joint Patent Committee under Article 6, if the affected Party consents to such disclosure (such consent not to be unreasonably withheld or delayed); provided that a disclosure of a Party’s Confidential Information under this Section 7.2.l(a) shall be treated as a publication under Section 7.4.3, and shall be subject to the requirements of advance notice, review period and opportunity to file patent application(s), as set forth in Section 7.4.3,

prosecute or defend litigation,

exercise rights hereunder provided such disclosure is covered by terms of confidentiality similar to those set forth herein,

facilitate discussions with prospective investors (other than pharmaceutical or biotechnology companies) in connection with financing arrangements (not involving any license, collaboration or other arrangement relating to such Party’s technology or products) or a proposed acquisition of such Party, subject to appropriate confidentiality agreements and limiting such disclosure to disclosure of the terms and conditions of this Agreement and Know-How to the extent contained in such Party’s patent applications; and

comply with applicable governmental laws and regulations.

Use. Notwithstanding the foregoing Section 7.1, each Party shall have the right to use Confidential Information of the other Party in carrying out its responsibilities under this Agreement in the research, Development, Manufacture and Commercialization of Licensed Products.

SEC Filings. Either Party may disclose the terms of this Agreement to the extent required, in the reasonable opinion of such Party’s legal counsel, to comply with applicable laws, including, without limitation, the rules and regulations promulgated by the United States Securities and Exchange Commission. Notwithstanding the foregoing, before disclosing this Agreement or any of the terms hereof pursuant to this Section 7.3, the Parties will reasonably consult with one another on the terms of this Agreement to be redacted in malting any such disclosure. If a Party discloses this Agreement or any of the terms hereof in accordance with this Section 7.3, such Party agrees, at its own expense, to seek confidential treatment 01 portions of this Agreement or such terms, as may be reasonably requested by the other Party.

Public Announcements; Publications

Coordination. The Parties agree on the importance of coordinating their public announcements respecting this Agreement and the subject matter thereof (other than academic, scientific or medical publications that are subject to the publication provision set forth below). Trubion and Wyeth shall, from time to time, and at the request of the other Party, discuss and agree on the general information content relating to this Agreement (including relating to the Research Program and Development Program, and/or to research, Development, Manufacture and/or Commercialization of Licensed Products) which may be publicly disclosed (including, without limitation, by means of any printed publication or oral presentation).

Announcements. Except as may be expressly permitted under Section 7.3 or Section 7.4.3 or as may be appropriate for Wyeth to make in connection with its Commercialization activities as contemplated hereunder, subject to Sections 7.1 and 7.2 hereof, neither Party will make any public announcement regarding this Agreement, the Research Program or the Development Program,

Publications. During the term of this Agreement, each Party will submit to the other Party for review and approval all proposed academic, scientific and medical publications and public presentations relating to the Research Program, the Development Program and/or to the research, Development, Manufacture and/or Commercialization of any Licensed Product, or any proposed disclosure under Section 7.2.l(a), for review in connection with preservation of Patent Rights and/or to determine whether any of such other Party’s Confidential Information should be modified or deleted. Written copies of such proposed publications and presentations shall be submitted to the non-publishing Party no later than thirty (30) days before submission for publication or presentation and the non publishing Party shall provide its comments with respect to such publications and presentations within fifteen (1 5) business days of its receipt of such written copy. The review period may be extended for an additional thirty (30) days in the event the non-publishing Party can demonstrate reasonable need for such extension, including, but not limited to, the preparation and filing of patent applications. By mutual agreement, this period may be further extended. Wyeth and Trubion will each comply with standard academic practice regarding authorship of scientific publications and recognition of contribution of other parties in any publications relating to the Research Program, the Development Program and/or to the research, Development, Manufacture and/or Commercialization of any Licensed Product.

REPRESENTATIONS AND WARRANTIES.

Representations and Warranties of Each Party. Each or Trubion and Wyeth hereby represents and warrants to the other Party hereto as follows:

it is a corporation or entity duly organized and validly existing under the laws of the state or other jurisdiction of its incorporation or formation;

the execution, delivery and performance of this Agreement by such Party has been duly authorized by all requisite corporate action and does not require any shareholder action or approval;

it has the power and authority to execute and deliver this Agreement and to perform its obligations and to grant the licenses granted by it to the other Party pursuant to this Agreement;

the execution, delivery and performance by such Party of this Agreement and its compliance with the terms and provisions hereof does not and will not conflict with or result in a breach of any of the terms and provisions of or constitute a default under (i) any agreement or instrument binding or affecting it or the subject matter of this Agreement; (ii) the provisions of its charter or operative documents or bylaws; or (iii) any order, writ, injunction or decree of any court or governmental authority entered against it or by which any of its property is bound, except where such conflict, breach or default would not materially impact (A) the Party’s ability to meet its obligations hereunder or (B) the rights granted to the other Party hereunder; and

it has not granted to any Third Party any right or license which would conflict in any material respect with the rights granted by it to the other Party hereunder.

Additional Representations and Warranties of Trubion In addition to the representations and warranties made by Trubion in Section 8.1, Trubion, subject to Section 8.7, hereby represents and warrants to Wyeth that as of the Signing Date:

except as disclosed in Exhibit 8.2(d) attached hereto, Trubion is the sole and exclusive owner of the Trubion Patent Rights and Trubion has not placed, or suffered to be placed, any liens, charges or encumbrances on or against the Trubion Patent Rights;

Exhibit 1.129 is a true and complete list of Trubion Patent Rights that pertain to Licensed Products, provided that an inadvertent omission from such list may be cured by amending Exhibit 1.129;

the Trubion Patent Rights are existing and, to Trubion’s knowledge, no issued or granted patents within the Trubion Patent Rights are invalid or unenforceable;

except as disclosed in Exhibit 8.2(d) attached hereto, Trubion has no knowledge that any Third Party has any right, title or interest in or to any of the Trubion Patent Rights;

except as set forth in Exhibit 8.2(e) attached hereto, no Trubion Patent Right listed in Exhibit 1.129 attached hereto is subject to any funding agreement with any government or government agency;

Trubion has received no written notice alleging infringement of a Third Party Patent Right in connection with its research and Development of SMIPs directed against a Trubion Target, and Trubion has disclosed to Wyeth all material information of which Trubion is aware as to whether the research, Development, Manufacture, use or sale of SMIPs directed against a Trubion Target, in the form that is the subject of the clinical studies ongoing as of the Signing Date, if such SMIPs were researched, Developed, Manufactured, used or sold as of the Signing Date, infringes or would infringe issued or granted patents owned by a Third Party as of the Signing Date;

the Trubion Patent Rights are not subject to any litigation, judgments or settlements against or owed by Trubion, nor has Trubion received written notice of any threats of such litigation;

Trubion is in compliance in all material respects with all agreements with Third Parties relating to Licensed Products that are sublicensed to Wyeth hereunder;

Trubion has not knowingly used any Know-How misappropriated from a Third Party in connection with a Licensed Product to be provided for Commercialization under this Agreement, and Trubion is not aware of any claim by a Third Party that Know-How misappropriated from such Third Party has been used by Trubion in its Development of SMIPs directed against a Trubion Target; and

the Trubion Patent Rights are not the subject of any interference, opposition, reissue or reexamination proceeding in the United States or, to the knowledge of Trubion, any opposition proceeding outside of the United States.

Mutual Covenant. Each Party covenants to the other Party that it shall at all times comply with all applicable material laws and regulations relating to its activities under this Agreement.

Additional Covenants of Trubion. During the term of this Agreement, Trubion will use diligent efforts not to materially breach any agreement between Trubion and a Third Party that provides Trubion Patent Rights pertaining to the research, Development, Manufacture or Commercialization of any Licensed Product, and it will provide Wyeth promptly with notice of any such alleged breach. The foregoing sentence shall not be construed to prevent the termination of any such Third-Party agreement by Trubion; provided, however, that Trubion shall not terminate any such Third-Party agreement without obtaining Wyeth’s prior written consent, which consent shall not be unreasonably withheld or delayed. During the term of this Agreement, Trubion will not knowingly use any Know-How misappropriated from a Third Party in connection with any Licensed Product being provided for Commercialization under this Agreement.

Representation by Legal Counsel. Each Party hereto represents that it has been represented by legal counsel in connection with this Agreement and acknowledges that it has participated in the drafting hereof, In interpreting and applying the terms and provisions of this Agreement, the Parties agree that no presumption shall exist or be implied against the Party which drafted such terms and provisions.

No Inconsistent Agreements. Neither Party has in effect and after the Signing Date neither Party shall enter into any oral or written agreement or arrangement that would be inconsistent with its obligations under this Agreement.

Disclaimer. EXCEPT AS OTHERWISE EXPRESSLY SET FORTH IN SECTIONS 8.1, 8.2 AND 8.5, THE PARTIES MAKE NO REPRESENTATIONS AND EXTEND NO WARRANTIES OF ANY KIND, EITHER EXPRESS OR IMPLIED, AND PARTICULARLY THAT LICENSED PRODUCTS WILL BE SUCCESSFULLY DEVELOPED HEREUNDER, AND IF LICENSED PRODUCTS ARE DEVELOPED, WITH RESPECT TO SUCH LICENSED PRODUCTS, THE PARTIES DISCLAIM ALL IMPLIED WARRANTIES OF TITLE, NON-INFRINGEMENT, MERCHANTABILITY AND FITNESS FOR A PARTICULAR PURPOSE.

GOVERNMENT APPROVALS; TERM AND TERMINATION.

HSR Filing. Each Party shall be responsible for its own costs, expenses, and filing fees associated with any HSR Filing; provided, however, that Wyeth shall be solely responsible for any fees (other than penalties that

Other Government Approvals. Trubion and Wyeth will cooperate and use respectively all reasonable efforts to make all registrations, filings and applications, to give all notices and to obtain as soon as practicable all governmental or other consents, transfers, approvals, orders, qualifications authorizations, permits and waivers, if any, and to do all other things necessary or desirable for the consummation of the transactions as contemplated hereby.

Term. The term of this Agreement will commence on the Signing Date and shall extend, unless this Agreement is terminated earlier in accordance with this Article 9, on a Licensed Product by Licensed Product and country by country basis until such time as the Royalty Period with respect to the sale of such Licensed Product in such country expires.

Termination Upon HSR Denial. This Agreement shall terminate (a) at Wyeth’s option, immediately upon written notice to Trubion, in the event that the United States Federal Trade Commission and/or the United States Department of Justice shall seek a preliminary injunction under the HSR Act against Trubion and Wyeth to enjoin the transactions contemplated by this Agreement, (b) at the election of either Party, immediately upon written notice to the other Party, in the event that the United States Federal Trade Commission and/or the United States Department of Justice shall obtain a preliminary injunction under the HSR Act against Trubion and Wyeth to enjoin the transactions contemplated by this Agreement, or (c) at the election of either Party, immediately upon written notice to the other Party, in the event that the HSR Clearance Date shall not have occurred on or prior to one hundred eighty (180) days after the effective date of the HSR Filing.

Material Breach. In the event that either Party commits a material breach of its representations, warranties or obligations under this Agreement, the other Party may terminate this Agreement (a) on a Licensed Target by Licensed Target and country by country basis, to the extent that such material breach relates to Licensed Product(s) directed against such Licensed Target(s) in such country(ies) or (b) in its entirety only if such material breach fundamentally frustrates the objectives or transactions contemplated by this Agreement taken as a whole. If a Party elects to exercise such right to terminate, it shall do so by providing written notice of the alleged breach (the “Notice of Breach”) to the breaching Party. If such material breach pertains to the payment of undisputed amounts payable under this Agreement and remains uncured for thirty (30) days after the breaching Party’s receipt of such Notice of Breach or, if such material breach pertains to another material breach (other than for non-payment) and

Termination by Wyeth.

Termination Without Cause. Commencing on the second anniversary of the Effective Date, Wyeth shall have the right, exercisable upon ninety (90) days prior written notice to Trubion, to terminate this Agreement either (a) in its entirety, or (b) on a Licensed Target by Licensed Target and country by country basis. Wyeth’s rights under this Section 9.6.1 are separate from and in addition to its rights to terminate the Research Program under Section 3.3.2 hereof.

Termination for a Material Safety or Regulatory Issue. Wyeth shall have the right to terminate this Agreement, at any time, on a Licensed Target by Licensed Target basis, by giving

Effects of Termination.

Effect of Termination by Wyeth for Cause.

Without limiting any other legal or equitable remedies that Wyeth or Trubion may have, subject to Section 11.3, if this Agreement is terminated in its entirety by Wyeth for cause under Section 9.5, the following provisions shall apply:

all licenses granted by each Party to the other Party under this Agreement shall terminate (except as provided in Section 9.7.10 below);

during the one (1) year period after the effective date of such termination, Trubion shall have the right to negotiate with Wyeth an agreement which grants to Trubion a non-exclusive license (with the right to grant sublicenses) to practice, use and exploit the Wyeth Applied Technology with respect to the research, Development, Manufacture and Commercialization of Licensed Products on commercially reasonable terms. If Trubion exercises such right, Wyeth shall negotiate the terms of such license with Trubion diligently and in good faith; provided that, if Trubion and Wyeth negotiate, but do not enter into, such non-exclusive license, Wyeth shall not enter into any agreement granting a license to a Third Party under the Wyeth Applied Technology within one (1) year after the end of such negotiations on terms more favorable to such Third Party than those last offered by Wyeth to Trubion, without first offering Trubion, for a period of not less than sixty (60) days, the opportunity to review such terms after full disclosure thereof and enter into a non-exclusive license on such more favorable terms, and, if Trubion accepts such more favorable terms, the Parties shall promptly negotiate definitive agreements relating thereto;

during the one (1) year period after the effective date of such termination, Trubion shall have the right to negotiate with Wyeth for the transfer of Product Data and Filings to Trubion, and for the grant by Wyeth to Trubion of the right and license to use the Licensed Product-specific Trademarks and Product-specific names pertaining to the Licensed Product(s) as existing at the time of termination (collectively, “Existing Trademarks”), on commercially reasonable terms. If Trubion exercises such right, Wyeth shall negotiate the terms of such transfer and license with Trubion diligently and in good faith; provided that, if Trubion and Wyeth negotiate but do not enter into such an agreement, Wyeth shall not enter into any agreement granting such rights to a Third Party within one (1) year after the end of such negotiation on terms more favorable to such Third Party than those last offered by Wyeth to Trubion, without first offering Trubion, for a period of not less than sixty (60) days, the opportunity to review such terms after full disclosure thereof and enter into such an agreement on such more favorable terms, and, if Trubion accepts such more favorable terms, the Parties shall promptly negotiate definitive agreements relating thereto; and

subject to the provisions of Section 9.9, this Agreement shall be of no further force or effect.

Without limiting any other legal or equitable remedies that Wyeth or Trubion may have, subject to Section 11.3, if this Agreement is terminated by Wyeth for cause under Section 9.5 with respect to a Licensed Target in all countries, but not in its entirety, the following provisions shall apply:

if such Licensed Target is a Trubion Target, all of the Parties’ rights and obligations under Article 3 in connection with the Research Program shall cease in their entirety; provided that all amounts due for research performed and costs incurred prior to the date of such termination shall remain payable in accordance with the provisions of Article 3;

if such Licensed Target is a Wyeth Target, all of the Parties’ rights and obligations under Article 3 in connection with the Research Program shall continue, subject to Wyeth’s option, exercisable in its sole discretion, to terminate the Research Program as

if such terminated Licensed Target is the CD20 Antigen, Wyeth shall have no further obligation to reimburse Trubion under Section 4.6 with respect to expenses incurred after the effective date of termination;

all licenses granted by each Party to the other Party under this Agreement with respect to Licensed Products directed against such Licensed Target shall terminate (except as provided in Section 9.7.10 below);

the provisions of Section 9.7.1(a)(ii), with such changes as are appropriate in the context of such limited termination, shall apply with respect to the Licensed Products directed against such Licensed Target; and

the provisions of Section 9.7.l(a)(iii), with such changes as are appropriate in the context of such limited termination, shall apply with respect to Product Data and Filings, and Existing Trademarks, relating to the Licensed Products directed against such Licensed Target.

Without limiting any other legal or equitable remedies that Wyeth or Trubion may have, subject to Section 11.3, if this Agreement is terminated by Wyeth for cause under Section 9.5 with respect to all Licensed Targets in a country, but not in its entirety, the following provisions shall apply:

if such country is a Major Market Country, all of the Parties’ rights and obligations under Article 3 in

if such country is not a Major Market Country, all of the Parties’ rights and obligations under Article 3 in connection with the Research Program shall continue, subject to Wyeth’s option, exercisable in its sole discretion, to terminate the Research Program as follows: Wyeth shall exercise such option to terminate the Research Program (if it so elects) by a written statement to that effect included in Wyeth’s Notice of Termination (described in Section 9.5 above). If Wyeth exercises such option to terminate the Research Program, all of the Parties’ rights and obligations under Article 3 in connection with the Research Program shall cease in their entirety fifteen (15) days after Trubion’s receipt of such Notice of Termination; provided that all amounts due for research performed and costs incurred prior to the date of such termination shall remain payable in accordance with the provisions of Article 3;

all licenses granted by each Party to the other Party under this Agreement with respect to such country shall terminate (except as provided in Section 9.7.10 below); and

the term “Territory” as used in this Agreement shall thereafter exclude such country;

except as provided in Section 9.9, neither Wyeth nor Trubion shall have any further obligations under this Agreement with respect to such country;

the provisions of Section 9.7.l(a)(ii), with such changes as are appropriate in the context of such limited termination, shall apply with respect to Licensed Products in such country; and

the provisions of Section 9.7.1(a)(iii), with such changes as are appropriate in the context of such limited termination, shall apply with respect to Product Data and Filings, and Existing Trademarks, relating to Licensed Products in such country.

Effect of Termination by Trubion for Cause

Without limiting any other legal or equitable remedies that Trubion or Wyeth may have, subject to Section 11.3, if this Agreement is terminated in its entirety by Trubion for cause under Section 9.5, the following provisions shall apply:

all licenses granted by each Party to the other Party under this Agreement shall terminate (except as provided in Section 9.7.10 below);

Wyeth and Trubion shall, upon Trubion’s request, such request made within ninety (90) days after such termination, enter into negotiations of a non-execlusive license from Wyeth to Trubion under which Wyeth will grant to Trubion a non-exclusive license (with the right to grant sublicenses) to practice, use and exploit the Wyeth Applied Technology with respect to the research, Development, Manufacture and Commercialization of Licensed Products as constituted at the time of termination of this Agreement. The Parties hereby agree that such license shall include, inter alia, provisions whereby Trubion shall agree (A) to comply with the applicable requirements of any Third Party license to which the use or exploitation of such Wyeth Applied Technology is subject including, but not limited to the payment of royalties; (B) with respect to any CD20 Products or HER2 Products, to pay to Wyeth (I) if such termination occurs prior to BLA filing in a Major Market Country, royalties and Additional Research and Development Expense Payments in amounts equal to twenty-five percent (25%) of those amounts Wyeth would have been obligated to pay Trubion had this Agreement remained in full force and effect or (11) if such termination occurs after BLA filing in a Major Market Country, royalties and Additional Research and Development Expense Payments in amounts equal to fifty percent (50%) of those amounts Wyeth would have been obligated to pay Trubion had this Agreement remained in full force and effect; (C) with respect lo any Licensed Products other than CD20 Products and HER2 Products, to pay to Wyeth royalties and other non-royalty payments on commercially reasonable terms; and (D) that Trubion shall have no other financial obligations to Wyeth;

the provisions of Section 9.7.7 (Post-Termination Transfer of Product Data and Filings and Existing Trademarks) shall apply;

the provisions of Section 9.7.8 (Manufacturing of Licensed Products After Termination) shall apply; and

subject to the provisions of Section 9.9, this Agreement shall be of no further force or effect.

Without limiting any other legal or equitable remedies that Trubion or Wyeth may have, subject to Section 11.3, if this Agreement is terminated by Trubion for cause under Section 9.5 with respect to a Licensed Target in all countries, but not in its entirety, the following provisions shall apply:

all of the Parties’ rights and obligations under Article 3 in connection with the Research Program shall cease in their entirety; provided that all amounts due for research performed and costs incurred prior to the date of such termination shall remain payable in accordance with the provisions of Article 3;

if such terminated Licensed Target is the CD20 Antigen, Wyeth shall have no further obligation to reimburse Trubion under Section 4.6 with respect to expenses incurred after the effective date of termination;

all licenses granted by each Party to the other Party under this Agreement with respect to Licensed Products directed against such Licensed Target shall terminate (except as provided in Section 9.7.10 below);

the provisions of Section 9.7.2(a)(ii) (Wyeth’s grant of a non-exclusive license to Trubion under Wyeth Applied Technology), with such changes as arc appropriate in the context of such limited termination, shall apply to Licensed Products directed against such Licensed Target;

the provisions of Section 9.7.7 (Post-Termination Transfer of Product Data and Filings and Existing Trademarks), with such changes as are appropriate in the context of such limited termination, shall apply with respect to Product Data and Filings, and Existing Trademarks, related to Licensed Products directed against such Licensed Target; and

the provisions of Section 9.7.8 (Manufacturing of Licensed Products After Termination), with such changes as are appropriate in the context of such limited termination, shall apply with respect to Licensed Products directed against such Licensed Target.

Without limiting any other legal or equitable remedies that Trubion or Wyeth may have, subject to Section 11.3, if this Agreement is terminated by Trubion for cause under Section 9.5 with respect to all Licensed Targets in a country, but not in its entirety, the following provisions shall apply:

all of the Parties’ rights and obligations under Article 3 in connection with the Research Program shall cease in their entirety; provided that all amounts due for research performed and costs incurred prior to the date of such termination shall remain payable in accordance with the provisions of Article 3;

all licenses granted by each Party to the other Party under this Agreement with respect to such country shall terminate (except as provided in Section 9.7.10 below);

the provisions of Section 9.7.2(a)(ii) (Wyeth’s grant of a non-exclusive license to Trubion under Wyeth Applied Technology), with such changes as are appropriate in the context of such limited termination, shall apply to a non-exclusive license to research, Develop, Manufacture and Commercialize Licensed Products in such country;

the provisions of Section 9.7.7 (Post-Termination Transfer of Product Data and Filings and Existing Trademarks), with such changes as are appropriate in the context of such limited termination, shall apply with respect to Product Data and Filings, and Existing Trademarks, related to Licensed Products in such country; and

the term “Territory” as used in this Agreement shall thereafter exclude such country.

Effect of Termination by Wyeth Without Cause.

If this Agreement is terminated in its entirety by Wyeth under Section 9.6.1, the following provisions shall apply:

all licenses granted by each Party to the other Party under this Agreement shall terminate (except as provided in Section 9.7.10 below);

the provisions of Section 9.7.2(a)(ii) (Wyeth’s grant of a non-exclusive license to Trubion under Wyeth Applied Technology) shall apply;

the provisions of Section 9.7.7 (Post-Termination Transfer of Product Data and Filings and Existing Trademarks) shall apply;

the provisions of Section 9.7.8 (Manufacturing of Licensed Products After Termination) shall apply; and

subject to the provisions of Section 9.9, this Agreement shall be of no further force or effect.

If this Agreement is terminated by Wyeth under Section 9.6.1 with respect to a Licensed Target in all countries, but not in its entirety, the following provisions shall apply:

all of the Parties’ rights and obligations under Article 3 in connection with the Research Program shall cease in their entirety; provided that all amounts due for research performed and costs incurred prior to the date of such termination shall remain payable in accordance with the provisions of Article 3;

if such terminated Licensed Target is the CD20 Antigen, Wyeth shall have no further obligation to reimburse Trubion under Section 4.6 with respect to expenses incurred after the effective date of termination;

all licenses granted by each Party to the other Party under this Agreement with respect to Licensed Products directed against such Licensed Target shall terminate (except as provided in Section 9.7.10 below);

the provisions of Section 9.7.2(a)(ii) (Wyeth’s grant of a non-exclusive license to Trubion under Wyeth Applied Technology), with such changes as are appropriate in the context of such limited termination, shall apply to a non-exclusive license to research, Develop, Manufacture and Commercialize Licensed Products directed against such Licensed Target;

the provisions of Section 9.7.7 (Post-Termination Transfer of Product Data and Filings and Existing Trademarks), with such changes as are appropriate in the context of such limited termination, shall apply with respect to Product Data and Filings, and Existing Trademarks, related to Licensed Products directed against such Licensed Target; and

the provisions of Section 9.7.8 (Manufacturing of Licensed Products After Termination), with such changes as are appropriate in the context of such limited termination, shall apply with respect to Licensed Products directed against such Licensed Target.

If this Agreement is terminated by Wyeth under Section 9.6.1 with respect to all Licensed Targets in a country, but not in its entirety, the following provisions shall apply:

if such country is a Major Market Country, all of the Parties’ rights and obligations under Article 3 in connection with the Research Program shall cease in their entirety; provided that all amounts due for research performed and costs incurred prior to the date of such termination shall remain payable in accordance with the provisions of Article 3; and if such country is not a Major Market Country, all of the Parties’ rights and obligations under Article 3 in connection with the Research Program shall continue;

all licenses granted by each Party to the other Party under this Agreement with respect to such country shall terminate (except as provided in Section 9.7.10 below);

the provisions of Section 9.7.2(a)(ii) (Wyeth’s grant of a non-exclusive license to Trubion under Wyeth Applied Technology), with such changes as are appropriate in the context of such limited termination, shall apply to a non-exclusive license to research, Develop, Manufacture and Commercialize Licensed Products in such country;

the provisions of Section 9.7.7 (Post-Termination Transfer of Product Data and Filings and Existing Trademarks), with such changes as are appropriate in the context of such limited termination, shall apply with respect to Product Data and Filings, and Existing Trademarks, related to Licensed Products in such country; and

the term “Territory” as used in this Agreement shall thereafter exclude such country.

Effect of Termination by Wyeth for a Material Safety or Regulatory Issue. If this Agreement is terminated with respect to a Licensed Target by Wyeth under Section 9.6.2, the following provisions shall apply:

all of the Parties’ rights and obligations under Article 3 in connection with the Research Program shall continue;

if such terminated Licensed Target is the CD20 Antigen, Wyeth shall have no further obligation to reimburse Trubion under Section 4.6 with respect to with respect to expenses incurred after the effective date of termination;

all licenses granted by each Party to the other Party under this Agreement with respect to Licensed Products directed against such Licensed Target shall terminate (except as provided in Section 9.7.10 below);

unless the basis of termination under Section 9.6.2 is the imposition of a. clinical hold by a Regulatory Authority, a determination by Wyeth to place a hold on further clinical studies of a Licensed Product directed against such Licensed Target (such determination to be made by Wyeth in accordance with its standard procedures of addressing such safety issues) or a withdrawal of a Licensed Product from the market for patient safety reasons, whether voluntary or otherwise, the provisions of Section 9.7.2(a)(ii) (Wyeth’s grant of a non-exclusive license to Trubion under Wyeth Applied Technology), with such changes as are appropriate in the context of such limited termination, shall apply to a non-exclusive license to research, Develop, Manufacture and Commercialize Licensed Products directed against such Licensed Target;

the provisions of Section 9.7.7 (Post-Termination Transfer of Product Data and Filings and Existing Trademarks), with such changes as are appropriate in the context of such limited termination, shall apply with respect to Product Data and Filings, and Existing Trademarks, related to Licensed Products directed against such Licensed Target; and

unless the basis of termination under Section 9.6.2 is the imposition of a clinical hold by a Regulatory Authority, a determination by Wyeth to place a hold on further clinical studies of a Licensed Product directed against such Licensed Target (such determination to be made by Wyeth in accordance with its standard procedures of addressing such safety issues) or a withdrawal of a Licensed Product from the market for patient safety reasons, whether voluntary or otherwise, the provisions of Section 9.7.8 (Manufacturing of Licensed Products After Termination), with such changes as are appropriate in the context of such limited termination, shall apply with respect to Licensed Products directed against such Licensed Target.

Post-Termination Rights to Wyeth Technology and Trubion Technology. Except as otherwise expressly set forth in this Agreement, expiration or termination of this Agreement for any reason shall have no effect on Wyeth’s rights with respect to the Wyeth Technology, and Trubion shall have no right, title or interest in or to any of the Wyeth Technology, and such expiration or termination shall have no effect on Trubion’s rights with respect to the Trubion Technology, and Wyeth shall have no right, title or interest in or to any of the Trubion Technology.

Post-Termination Licenses to Wyeth Technology. In the event that Wyeth grants to Trubion a license under any Wyeth Technology pursuant to Section 9.7.1, 9.7.2, 9.7.3 or 9.7.4, such license shall include, inter alia, provisions whereby Trubion shall agree to comply with the applicable requirements of any Third Party license to which the use or exploitation of any such items may be subject including, but not limited to, the payment of royalties.

Post-Termination Transfer of Product Data and Filings and Existing Trademarks. The following provisions shall apply in the event of termination by Trubion under Section 9.5 or termination by Wyeth under Section 9.6. To the extent permitted by applicable law, Wyeth shall assign and transfer to

Manufacturing of Licensed Products After Termination. If (a) with respect to a particular Licensed Target, Trubion terminates this Agreement pursuant to Section 9.5 hereof or Wyeth terminates this Agreement pursuant to Section 9.6 hereof, and (b) Wyeth is engaged in the Manufacturing of a Licensed Product directed against such Licensed Target on the date the terminating Party gives notice of termination under Section 9.5

Post-Termination Disposition of Inventories of Licensed Products. Following termination of this Agreement with respect to one or more Licensed Targets, Wyeth and its sublicensees shall have the right to continue to sell their existing inventories of Licensed Products directed against such Licensed Targets for a period not to exceed one hundred eighty (180) days after the effective date of such termination. Wyeth shall pay royalties and report on such sales, and maintain records thereon, in accordance with Sections 5.4, 5.5 and 5.6, which shall survive termination for such purpose.

Continuation of Rights and Licenses Under Sections 6.1.1 and 6.1.2. Notwithstanding anything in this Section 9.7 to the contrary, the Parties’ rights and licenses set forth in Sections 6.1.1 and 6.1.2 shall survive any expiration or termination of this Agreement.

Continuation of Other Rights and Obligations. Except as expressly provided to the contrary in this Section 9. 7, in the event that a Party exercises any right that results in the termination of some, but not all, of the Parties’ rights and obligations under this Agreement, all non-terminated rights and obligations of the Parties shall continue in full force and effect.

Modification of Agreement Terms by Wyeth. Without limiting any other legal or equitable remedies that Wyeth or Trubion may have, subject to Section 11.3, in the event that Wyeth elects to modify the terms of this Agreement as provided in Section 9.5, in lieu of terminating this Agreement under Section 9.5, with respect to one or more Licensed Targets identified by Wyeth in its Notice of Modification (the “Designated Target(s)”), the following terms shall apply:

except as set forth in Section 9.8.4 below, all rights and obligations of the Parties under this Agreement shall continue in full force and effect, and shall not be subject to any unilateral modification by Wyeth; provided that, if the Designated Target is the CD20 Antigen, Trubion shall have no further option to Co-Promote CD20 Products under Section 4.11 and the JDC and JPT shall have no further jurisdiction over Licensed Products directed against such CD20 Antigen that is such Designated Target;

all licenses granted by Trubion to Wyeth under this Agreement with respect to Licensed Products directed against each Designated Target shall remain in effect;

all of the Parties’ rights and obligations under Article 3 in connection with the Research Program shall cease in their entirety; provided that all amounts due for research performed and costs incurred prior to the date of such termination shall remain payable in accordance with the provisions of Article 3; and

only in the event of (i) a material breach by Trubion of Section 2.3.1 or 2.3.2; or (ii) a material breach by Trubion of Section 8.1(e), 8.2(c) or 8.2(d); or (iii) a material breach by Trubion of Section 8.2(a) (and, in the case of a material breach by Trubion of Section 8.2(a), only where Wyeth establishes that Trubion

Wyeth’s diligence obligations to use Commercially Reasonable Efforts under Sections 4.1 and 4.10 shall no longer apply to Licensed Products directed against such Designated Target;

the amount of any Additional Research and Development Expense Payment that Wyeth thereafter becomes obligated to pay under Section 5.3 relating to Licensed Products directed against such Designated Target shall be reduced by fifty percent (50%) of such amount; and

the amounts of any royalties that Wyeth thereafter becomes obligated to pay under Section 5.4 relating to Licensed Products directed against such Designated Target shall be reduced by fifty percent (50%) of such amounts.

Survival of Certain Obligations. Expiration or termination of this Agreement shall not relieve the Parties of any obligation accrued or accruing before such expiration or termination (including situations where it becomes clear only after the time of such expiration or termination that such obligation had already accrued). The following provisions shall survive the expiration or termination of this Agreement: Article 1 (to the extent definitions are embodied in the following listed Articles and Sections); Sections 3.6.3, 3.7, 5.6, 6.1.1, 6.1.2, 9.2, 9.5, 9.6, 9.7, 9.9, 9.10.2, 12.3, 12.6, 12.8, 12.9, 12.10, 12.11 and 12.12; and Articles 7, 10 and 11. Any expiration or early termination of this Agreement shall be without prejudice to the rights of either Party against the other accrued or accruing under this Agreement before expiration or termination, including, without limitation, the obligations (1) to provide research funding and reimbursement of expenses for activities undertaken prior to such expiration or termination under and in accordance with Sections 3.6.1, 3.6.2, 4.6, 4.9, 6.1.3, 6.2.1(a), (c) and (d), 6.2.2(b) and (c), and 6.2.3(b) and (c); and (2) to pay royalties for Licensed Products sold before such expiration or termination, and, to the extent permitted under Section 9.7.9, after expiration or termination in accordance with Section 5.4 (and subject to the related obligations under Section 5.5); and (3) to pay any Additional Research and Development Expense Payments in connection with any events specified on Exhibit 5.3 that are achieved prior to such expiration or termination, but with respect to which the corresponding payments under Exhibit 5.3 were not paid prior to such expiration or termination.

Change of Control.

Definition. With respect to any Party, a “Change of Control” means an event in which: (a) any other person or group of persons (as the term “person” is used for purposes of Section 13(d) or 14(d) of the Exchange Act) not then beneficially owning more than fifty percent (50%) of the voting power of the outstanding securities of such Party acquires or otherwise becomes the beneficial owner (within the meaning of Rule 13d-3 promulgated under the Exchange Act) of securities of such Party representing more than fifty percent (50%) of the voting power of the then outstanding securities of such Party with respect to the election of directors of such Party; or (b) such Person (i) consummates a merger, consolidation or similar transaction with another Person where the voting securities of such Party outstanding immediately preceding such transaction (or the voting securities issued with respect to the voting securities of such Party outstanding immediately preceding such transaction) represent less than fifty percent (50%) of the voting power of such Party or surviving entity, as the case may be, immediately following such transaction, (ii) sells or otherwise transfers to any Person(s) in one or more related transactions more than fifty percent (50%) of its consolidated total assets, or assets from which more than fifty percent (50%) of its consolidated operating income for its most recent financial year was derived, (iii) disposes by sale, assignment, exclusive license or otherwise of all or substantially all of its intellectual property rights, except for licenses under such intellectual property rights in the ordinary course of business and any isolated sale or assignment of specific items of intellectual property, or (iv) liquidates, dissolves or winds-up; or (c) with respect to Wyeth and with respect to Trubion, (at any time following any public offering of voting securities by Trubion), any “person” (as the term “person” is used for the purposes of Sections 13(d) or 14(d) of the Exchange Act) other than Wyeth acquires nineteen and nine-tenths percent (19.9%) or more of the voting power of the then-outstanding voting securities of such Party.

Change of Control of Wyeth.

In the event that any transaction results in a Change of Control of Wyeth, Trubion shall be entitled to request further written assurances from the successor in interest to Wyeth (the “Successor Party”) re-affirming the commitment of the Successor Party to comply with the terms and conditions of the Agreement. Such further written assurances shall be delivered within ninety (90) days of written request by Trubion. Trubion may so request at any time during the one-hundred eighty (180) day period following completion of the subject transaction. Subject to the operation of Section 9.10.2(b) below, the failure of such Successor Party to provide the requested written assurance shall be deemed to be a material breach of the Agreement.

In the event that in connection with, or during the twelve (12) month period following, a Change of Control of Wyeth, Wyeth or the Successor Party is required, or voluntarily decides, to divest itself of one or more Licensed Products, Wyeth or the Successor Party, subject to any restrictions or limitations imposed by the Federal Trade Commission or other governmental agency on such divestiture, shall offer to Trubion an exclusive opportunity to negotiate the acquisition or license of all rights of Wyeth or such Successor Party, as the case may be, to such Licensed Product(s) on commercially reasonable terms. In the event that Trubion and the Successor Party, after ninety (90) days’ good faith negotiations, are unable to conclude a definitive agreement regarding the acquisition or license of such Licensed Product(s), the Successor Party shall be entitled to divest itself of such Licensed Product(s) to a party other than Trubion; provided, however, no such divestiture to a Third Party shall take place on terms more favorable to such Third Party than those last offered by the Successor Party to Trubion, without first offering such Licensed Product(s) to Trubion on such more favorable terms. Such Third Party shall be required to assume all of the Successor Party’s obligations owed to Trubion pursuant to this Agreement with respect to the Licensed Product(s) so divested.

In the event of a Change of Control of Wyeth, the restrictive covenants set forth in Sections 2.3.1 and 2.3.2 (the “Exclusivity Covenants”) shall apply to the Successor Party’s then-existing Development and Commercialization activities that otherwise would violate the Exclusivity Covenants (the “Existing Activities”). In such event, Trubion shall have the right, exercisable upon written notice given by Trubion (an “Exercise Notice”) within thirty (30) days after consummation of the Change of

Change of Control of Trubion. In the event of a Change of Control of Trubion where the acquiring party is a top fifteen (15) pharmaceutical company (measured by market capitalization), Wyeth shall have the right to terminate the Co-Promotion rights of Trubion provided for in Section 4.11 above by giving written notice to Trubion.

INDEMNIFICATION AND INSURANCE.

Indemnification by Wyeth. Wyeth will indemnify, defend and hold harmless Trubion, and each of its respective employees, officers, directors and agents (each, a “Trubion Indemnified Party”) from and against any and all liability, loss, damage, expense (including reasonable attorneys’ fees and expenses) and cost (collectively, “Liabilities”) that the Trubion Indemnified Party may be required to pay to one or more Third Parties resulting from or arising out of:

any claims of any nature pertaining to any act or omission related to performance under this Agreement by, on behalf of, or under the authority of Wyeth (other than by any Trubion Indemnified Party) including, but not limited to, research, Development, Manufacture or Commercialization of Licensed Product(s) or any violation of applicable law, rule or regulation by, on behalf of, or under the authority of Wyeth (other than by any Trubion Indemnified Party); and/or