AMENDMENT NUMBER ONE TO THE AMENDED AND RESTATED LICENSE AND COLLABORATION AGREEMENT

paid by Collaborator to Regulus arising from payment obligations to Third Parties) with respect to such  Royalty-Bearing Product; or”

2.2           Section 5.2 of the Amended License Agreement shall be deleted and replaced in its entirety by the following:

“5.2       Continued Development by Regulus of Development Projects.

(a)       Diligence.  If Regulus notifies Licensors pursuant to Section 5.1 that Regulus will continue to pursue the Development and Commercialization of such Development Project (on its own or with a Collaborator, as defined below), then, without limiting the generality of Section 4.1, Regulus will use Commercially Reasonable Efforts to Develop and Commercialize the relevant Development Compounds and Development Therapeutics in the Field.

(b)       Third Party Payments.  Regulus will be responsible for all milestones, royalties and other payments payable to Third Parties in respect of the Development, Manufacture and Commercialization of Development Therapeutics in the Field, by Regulus, its Affiliates and Sublicensees, including any amounts payable by either Licensor to Third Parties under the Third Party Rights.  The Parties will use reasonable efforts to [***].

(c)       Net Sales by Regulus.  Regulus will pay to each Licensor a royalty of [***]% of Net Sales of Development Therapeutics which are Royalty-Bearing Products which Net Sales are generated by Regulus rather than a Collaborator, during the relevant Royalty Term (provided, however, that, for the remainder of the relevant Royalty Term following the end of the relevant Exclusivity Period, the royalty rate will be [***]%).  Regulus agrees that the royalty described in Section 5.2(c) is payable to each Licensor, regardless of whether a particular Royalty-Bearing Product is covered by such Licensor’s Licensed IP.

(d)       Net Sales by a Collaborator of Regulus.  With respect to Net Sales by a Collaborator of Regulus (other than Alnylam or Isis), Regulus will pay to each Licensor a royalty of [***]% of Net Sales of such Development Therapeutics which are Royalty-Bearing Products; provided, that (i) the agreement with such Collaborator requires such Collaborator to make royalty payments to Regulus of at least [***]% of Net Sales (after any payments required to be made by Regulus to Third Parties) and (ii) the length of the Exclusivity Period with respect to such Collaborator is no shorter than the Exclusivity Period which would apply to Net Sales by Regulus under Section 5.2(c) above ((i) and (ii) being collectively referred to as “Consistent Sublicense Terms”).  Notwithstanding the foregoing, if the agreement with such Collaborator does not contain Consistent Sublicense Terms or if Regulus chooses at the time of, or prior to, entering into such agreement to have this sentence apply in lieu of the first sentence of this Section 5.2(d), such choice to be delivered in writing to Alnylam and Isis within thirty (30) days of entering into such sublicense agreement (a “Sublicense Income Agreement”), then (x) Isis, Alnylam and Regulus will each receive the [***] of (I) [***]% of [***] (A) [***] received by Regulus on the basis of such [***] pursuant to such Sublicense Income Agreement, and (B) [***] made to Third Parties as described in [***], and (II) [***]%