LICENSE AGREEMENT

Exhibit 2.1.2

Certain information in this document, marked by brackets, has been omitted and filed separately with the Securities and Exchange Commission. Confidential treatment has been requested with respect to the omitted portions.

LICENSE AGREEMENT

By and Between

Maxygen, Inc.

and

Bayer HealthCare LLC

Dated July 1, 2008

TABLE OF CONTENTS

LICENSE AGREEMENT

     This License Agreement (this “ Agreement ”) is made and entered into on this 1st day of July 2008, by and between Maxygen, Inc. (“ Maxygen ”), a Delaware corporation having its principal place of business at Redwood City, California, and Bayer HealthCare LLC (“ Bayer ”), a Delaware limited liability company having its principal place of business at 555 White Plains Road, Tarrytown, New York 10591.

W I T N E S S E T H :

     Whereas, Maxygen and its Affiliates are the owners of certain right, title and interest in Enabling Technology, Software, RR Technology and CMVP Technology (each as defined herein), which may have potential usefulness in the research, development and/or manufacture of protein pharmaceutical products;

     Whereas, Bayer desires to obtain certain licenses with respect to the Enabling Technology, Software, RR Technology and CMVP Technology, and Maxygen and its Affiliates are willing to grant such licenses, all on the terms and conditions set forth herein;

     Whereas, concurrently with the execution of this License Agreement, Maxygen, Maxygen’s Affiliates Maxygen Holdings Ltd. (“ Holdings ”) and Maxygen ApS (“ ApS ”), and Bayer have executed the Technology Transfer Agreement;

     Now, therefore, in consideration of the mutual promises and obligations hereinafter set forth and for other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the Parties hereto stipulate and agree as follows:

ARTICLE 1
DEFINITIONS

     As used in this Agreement, the following capitalized terms shall have the following meanings, and singular forms, plural forms and derivative forms thereof shall be interpreted accordingly:

     1.1 “AAA” shall have the meaning set forth in Section 10.2.

     1.2 “Affiliate” shall mean, with respect to any Person, any other Person that, directly and/or indirectly, through one or more intermediaries controls, is controlled by, and/or is under common control with, such Person. For purposes of this definition, “control” means the possession, direct and/or indirect, of the power to direct and/or cause the direction of the management and policies of a Person, whether through ownership of voting securities and/or general partnership and/or managing member interests, by contract and/or otherwise. Without limiting the generality of the foregoing, a Person shall be deemed to control any other Person in which it owns, directly and/or indirectly, a majority of the ownership interests. With respect to Maxygen, in no event shall GlaxoSmithKline plc, Conus Partners, Inc. or Codexis, Inc. be deemed a direct and/or indirect Affiliate of Maxygen and/or Holdings. With respect to Bayer, “Affiliate” of Bayer shall mean (i) any Person that, directly and/or indirectly, through one or

more intermediaries controls, is controlled by, and/or is under common control with, Bayer, and (ii) which is (w) a Subsidiary of Bayer, (x) Bayer Schering Pharma AG or its Subsidiary (y) Bayer HealthCare AG or its Subsidiary, or (z) any other Person that is a Subsidiary of Bayer AG and whose principal business is not crop sciences and/or materials sciences.

     1.3 “Applicable Law” shall mean any statute, law, regulation, ordinance, rule, judgment, court order, decree, permit, approval, concession, grant, franchise, license, agreement and/or requirement of any Governmental Authority having jurisdiction over the matter and/or matters in question.

     1.4 “Area of Interest” shall have the meaning set forth in Section 2.5.6(a).

     1.5 “Bayer” shall mean Bayer HealthCare LLC.

     1.6 “Bayer Exclusive Protein” shall mean any of the proteins listed on Schedule 1.6 as modified in Section 2.5.

     1.7 “Bayer Facility” shall mean a facility located at Berkeley, California and/or Richmond, California.

     1.8 “Bayer Field” shall mean developing, making, having made, using, importing, selling, and offering for sale the Resulting Products obtained from Shuffling of any Bayer Exclusive Protein during the Exclusivity Period for such Bayer Exclusive Protein, in each case, for one or more Permitted Uses.

     1.9 “Bayer Improvements” shall have the meaning set forth in Section 5.2.1.

     1.10 “Bayer Indemnified Parties” shall have the meaning set forth in Section 3.7.

     1.11 “Bayer Other Improvements” shall have the meaning set forth in Section 5.2.2.

     1.12 “Bayer Research Facility” shall mean the following facilities where Bayer may conduct Shuffling:

               (a) any facility of Bayer and/or its Affiliates;

               (b) the facility of [****] ;

               (c) for the period beginning on the Closing Date and ending on the [****] anniversary of the Closing Date, Bayer and/or its Affiliates may contract with [****] in addition to [****] ;

               (d) for the period beginning on the [****] anniversary of the Closing Date and ending on the date the last valid claim in the Patent Rights covering the Enabling

Technology expires and/or is held unenforceable, unpatentable and/or invalid by a decision of a Governmental Authority of competent jurisdiction, there will be no restrictions on the number of Third Party facilities Bayer and/or its Affiliates can use;

     Provided, however, in each of the facilities allowed under Sections 1.12(b), (c) and (d), the facility must (1) be engaged in research for Bayer and/or its Affiliates, (2) conduct such research under a written contract containing confidentiality provisions no less restrictive than those in this Agreement, (3) conduct the research under Bayer’s and/or its Affiliates’ direction and control, (4) assign all intellectual property related to such research to Bayer and/or its Affiliates, and (5) not use the Enabling Technology outside the research contracted by Bayer and/or its Affiliates; further, provided, for any time period after the end of the time period specified in section 1.12(d), Bayer and/or its Affiliates shall be free to contract with any Third Party to perform Shuffling without any restriction. Bayer shall notify Maxygen in writing of the identity and location of each Bayer Research Facility under Sections 1.12(c) and/or (d) prior to the practice of the Enabling Technology at such Bayer Research Facility.

     1.13 “Business Day” shall mean a day that is not a Saturday, a Sunday and/or a national statutory and/or civic holiday in the United States and/or a statutory and/or civic holiday in the State of California.

     1.14 “Closing Date” shall have the same meaning as set forth in the Technology Transfer Agreement.

     1.15 “CMVP Know-How” shall mean Know-How related to CMV promoter variants that is reasonably necessary and/or useful for use of the CMVP Materials as research reagents.

     1.16 “CMVP Materials” shall mean the CMV promoter variants and related Materials listed on Schedule 1.16 .

     1.17 “CMVP Patents” shall mean the Patent Rights listed on Schedule 1.17 , and any other Patent Rights, if any, that (i) are Controlled by Maxygen and/or its Affiliates as of the Execution Date and (ii) claim the composition, and/or are directed to the manufacture and/or use of, CMV promoter variants made and/or used by Maxygen and/or its Affiliates prior to the Execution Date. CMVP Patents shall also include future patent applications and patents issuing thereon to the extent they have utility in the manufacture, use and/or sale of CMV promoter variants and claim priority to any Patent Rights within the scope of the foregoing sentence (provided, however, that with respect to continuation-in-part applications, only those claims thereof which claim priority to a date on or before the Closing Date shall be included in the license hereunder). Notwithstanding the foregoing, the CMVP Patents do not include any patents licensed to Maxygen by [****] .

     1.18 “CMVP Technology” shall mean the CMVP Patents, CMVP Materials and CMVP Know-How that are owned by Maxygen and/or its Affiliates and that exist as of the

Execution Date; provided, however, that CMVP Technology shall not include any Excluded Technology.

     1.19 “Confidential Information” shall mean any proprietary and/or non-public Know-How, Materials and/or other information, whether disclosed in tangible and/or intangible form, that is disclosed by one Party to the other hereunder. Confidential Information excludes any information that the receiving Party can demonstrate with competent evidence: (i) at the time of disclosure, is, and/or after disclosure becomes, generally known and/or available to the public other than as a consequence of receiving Party’s breach of this Agreement; (ii) was known and/or otherwise available to receiving Party without restriction prior to the disclosure by disclosing Party; (iii) was disclosed by a Third Party to receiving Party without restriction after the disclosure by disclosing Party if such Third Party’s disclosure neither violates any obligation of the Third Party to disclosing Party nor is a consequence of receiving Party’s breach of this Agreement; (iv) was developed by the receiving Party without use of and/or reference to the disclosing Party’s Confidential Information; and/or (v) the disclosing Party authorizes, in writing, for release without obligation of confidentiality. As between Bayer and Maxygen, all Know-How and Materials within the Licensed Technology shall be Confidential Information of Maxygen.

     1.20 “Control” and/or “Controlled” shall mean, with respect to Patent Rights, Know-How and/or Materials, ownership by and/or possession by Maxygen and/or its Affiliates of the ability to grant the licenses and/or sublicenses to Bayer as provided for herein, and/or to transfer Materials to Bayer as provided for herein, without (i) violating the terms of any agreement and/or other arrangement with any Third Party, and/or (ii) incurring a contractual payment obligation to a Third Party for the grant and/or practice of such license and/or sublicense, as the case may be.

     1.21 “Dispute” shall have the meaning set forth in Section 10.1.

     1.22 “Enabling Know-How” shall mean Know-How related to (a) methods of performing Shuffling (whether using tangible materials and/or in silico ), and/or (b) generally applicable screening techniques, methodologies and/or processes for identifying genetic variants of interest, in each case that is reasonably necessary and/or useful for using the Enabling Patents and Enabling Materials in and for the Permitted Uses.

     1.23 “Enabling Materials” shall mean the Materials listed on Schedule 1.23 .

     1.24 “Enabling Patents” shall mean the Patent Rights listed on Schedule 1.24 , and all other Patent Rights that (i) are Controlled by Maxygen and/or its Affiliates as of the Execution Date and (ii) claim (a) methods of performing Shuffling (whether using tangible materials and/or in silico ), and/or (b) generally applicable screening techniques, methodologies and/or processes for identifying genetic variants of interest, and/or (c) Software useful for the performance of Shuffling and/or analysis of resulting Shuffled proteins. Enabling Patents shall include future patent applications and patents issuing thereon to the extent they have utility in the performance of Shuffling and/or generally applicable screening techniques, methodologies and/or process for identifying genetic variants of interest and claim priority to any Patent Rights within the scope of the foregoing sentence (provided, however, that with respect to continuation-in-part applications,

only those claims thereof which claim priority to a date on or before the Closing Date shall be included in the license hereunder). Notwithstanding the foregoing, Enabling Patents shall not include any Excluded Technology.

     1.25 “Enabling Technology” shall mean the Enabling Patents, Enabling Materials, and Enabling Know-How, in each case Controlled by Maxygen and/or its Affiliates as of the Execution Date; provided, however, that Enabling Technology shall not include any Excluded Technology.

     1.26 “Excluded Technology” shall mean (i) rights under the Excluded Third Party Agreements, and (ii) Program-Specific Technology.

     1.27 “Excluded Third Party Agreements” shall mean the agreements entered into by Maxygen and/or its Affiliates and Third Parties set forth on Schedule 1.27 .

     1.28 “Excluded Use” shall mean any use and/or application of the Enabling Technology, and/or of any Resulting Product, set forth on Schedule 1.28

     1.29 “Exclusive Protein” shall mean a Bayer Exclusive Protein and/or Maxygen Exclusive Protein, as the case may be.

     1.30 “Exclusivity Period” shall mean, for each Exclusive Protein, the period commencing on (i) with respect to Exclusive Proteins listed on Schedule 1.6 and/or Schedule 1.45 , the Closing Date, and/or (ii) with respect to each protein which becomes an Exclusive Protein pursuant to Sections 2.5.6, the effective date on which such protein becomes an Exclusive Protein pursuant to Section 2.5.6; and ending on the earlier of (a) the date (if any) when such Exclusive Protein ceases to be a Bayer Exclusive Protein and/or Maxygen Exclusive Protein pursuant to Section 2.5.5 or 2.5.6 and (b) the fifth (5 ^th ) anniversary of the Closing Date .

     1.31 “Execution Date” shall have the same meaning as set forth in the Technology Transfer Agreement.

     1.32 “FTE” shall mean a full-time equivalent person year, based upon a total of [****] hours per year of work, on and/or directly related to performing activities under the Transition Plan.

     1.33 “Governmental Approval” shall mean any permit, license, franchise, approval, consent, waiver, certification, qualification, registration and/or other authorization issued, granted, given and/or otherwise made available and/or the expiration and/or termination of any applicable legally required waiting period by and/or under the authority of any Governmental Authority and/or pursuant to any Applicable Law.

     1.34 “Governmental Authority” shall mean any government and/or any agency, bureau, board, commission, court, department, political subdivision, tribunal, and/or other instrumentality of any government (including any regulatory and/or administrative agency), whether federal, state and/or local, domestic and/or foreign.

     1.35 “Indemnified Party” shall have the meaning set forth in Section 3.8.

     1.36 “Indemnifying Party” shall have the meaning set forth in Section 3.8.

     1.37 “Know-How” shall mean and include all data, invention disclosures, ideas, inventions, discoveries and information, including non-tangible technology, methodologies, instructions, processes, formulae, protocols, standards, patterns, compilations, methods, assay methods and procedures, techniques, usage information, procedures, biological, chemical, biochemical, analytical information and data, proprietary and secret ideas, technical information, trade secrets, and/or other information (whether in written or verbal form, including in notes and records, and whether or not protectable by patent, trade secret, copyright and/or other intellectual property right), and corresponding intellectual property rights (other than Patent Rights), if any, in and to the foregoing, in each case which are existing on the Execution Date and are not generally known and/or available to the public.

     1.38 “Knowledge” shall mean, with respect to a Party, the knowledge of the executive officers of the entity and in the case of Maxygen and Holdings, those individuals occupying the positions listed on Schedule 1.38 .

     1.39 “Licensed Technology” shall mean the Enabling Technology, the RR Technology, the CMVP Technology and the Software.

     1.40 “Lien” shall mean, with respect to any property and/or other asset of any Person (and/or any revenues, income and/or profits of that Person therefrom) (in each case whether the same is consensual or nonconsensual and/or arises by contract, operation of law, legal process and/or otherwise), (i) any mortgage, lien, security interest, pledge, assignment, hypothecation, title retention, preferential right, counterclaim, attachment, seizure, embargo, levy and/or other charge and/or encumbrance of any kind thereupon and/or in respect thereof and/or (ii) any other arrangement under which the same is transferred, sequestered and/or otherwise identified with the intention of subjecting the same to, and/or making the same available for, the payment and/or performance of any liability in priority to the payment of the ordinary, unsecured creditors of that Person, in each case other than (A) any liens securing the payment of taxes and filing fees not yet due and payable, (B) pledges and/or deposits under workmen’s compensation, unemployment insurance, social security and other similar laws, (C) liens imposed by law, such as mechanics’, materialmen’s, landlords’, warehousemen’s, carriers’ and other similar liens, securing obligations in the ordinary course of business, (D) applicable payment and other obligations set forth in the Third Party Agreements and incurred after the Closing Date, and (E) applicable out-licenses granted by Maxygen and/or its Affiliates to Third Parties prior to the Execution Date. For purposes of this Agreement, a Person will be deemed to own subject to a Lien any asset that it has acquired and/or holds subject to the interest of a vendor and/or lessor under any conditional sale agreement, capital lease, synthetic lease and/or other title retention agreement relating to that asset.

     1.41 “Losses” shall mean any loss, cost, liability, expense, tax, settlement, damage of any kind, judgment, obligation, charge, fee, fine, penalty, interest, court and administrative cost, reasonable attorneys’ fees, expert fees, consulting fees, and disbursements (at all levels, including appellate), but excluding all indirect corporate and administrative overhead costs. Losses shall be net of any tax benefit actually recognized by the Indemnified Parties and/or their Affiliates as a result of the indemnified Loss.

     1.42 “Materials” shall mean any chemical and/or biological substances including any: (i) organic and/or inorganic chemical element and/or compound; (ii) nucleic acid; (iii) vector of any type (e.g., cosmid, plasmid, spore, phage, virus, and/or virus-like particle), and subunits of the foregoing; (iv) host organism, including prokaryotic cells, eukaryotic cells and/or animals; (v) eukaryotic cell line, prokaryotic cell line and/or expression system; (vi) protein, including any peptide and/or amino acid sequence, enzyme, antibody and/or protein conferring targeting properties and any fragment of any of the foregoing; (vii) genetic material, including any genetic nucleic acid construct, marker gene and genetic control element (e.g., promoter, termination signal), gene, genome and/or variant of any of the foregoing; and/or (viii) assay and/or reagent, in each case which exist and are Controlled by Maxygen prior to the Closing Date.

     1.43 “MaxyBody” shall have the meaning set forth in Schedule 1.43 .

     1.44 “Maxygen” shall mean Maxygen Inc.

     1.45 “Maxygen Exclusive Protein” shall mean any of the Proteins listed on Schedule 1.45 as modified in Section 2.5.

     1.46 “Maxygen Field” shall mean developing, making, having made, using, importing, selling, and offering for sale the Resulting Products obtained from Shuffling of any Maxygen Exclusive Protein during the Exclusivity Period for such Maxygen Exclusive Protein.

     1.47 “Maxygen Improvements” shall have the meaning set forth in Section 5.1.1.

     1.48 “Maxygen Indemnified Parties” shall have the meaning set forth in Section 3.6.

     1.49 “Maxygen Other Improvements” shall have the meaning set forth in Section 5.1.2.

     1.50 “Objection Notice” shall have the meaning set forth in Section 2.5.6(b).

     1.51 “Owner” Shall have the meaning set forth in Section 4.3.

     1.52 “Party” and/or “Parties” shall mean Bayer and/or Maxygen, as appropriate.

     1.53 “Patent Challenge” shall have the meaning set forth in Section 4.4.

     1.54 “Patent Rights” shall mean any and all U.S., Patent Cooperation Treaty (“ PCT ”) and foreign patents and patent applications including all divisionals, reissues, re-examinations, continuations, and continuations-in-part, extensions (including governmental equivalents thereto), and renewal applications and patents thereof, and any and all other counterpart

applications in any countries and patents and inventors’ certificates, utility models and the like issuing therefrom.

     1.55 “Permitted Uses” shall mean all uses of the Enabling Technology and Resulting Products that are not an Excluded Use.

     1.56 “Person” shall mean an individual, corporation, limited liability corporation, joint stock company, partnership, joint venture, trust, unincorporated organization, university, college, Governmental Authority and/or other entity.

     1.57 “Program-Specific Technology” shall mean all Materials, Know-How and Patent Rights (and other materials and know-how) generated, developed and/or produced in, and/or obtained and/or acquired for use by Maxygen and/or any of its Affiliates in past, on-going and/or future programs which materials are not both (a) generally applicable to and (b) reasonably necessary and/or useful for, practice of the Licensed Technology for the Permitted Uses, including: (i) Resulting Products generated and/or produced by Maxygen and/or its Affiliates in former, on-going and/or future programs (whether or not in collaboration with any Third Party), including all protein variants generated and/or produced by and/or on behalf of Maxygen and/or its Affiliates, genetic materials encoding such variants and cells expressing such variants, (ii) reagents and materials related to assays and/or other screening technologies generated, produced and/or employed by and/or on behalf of Maxygen and/or its Affiliates in former, on-going and/or future programs (whether or not in collaboration with any Third Party), including assay reagents developed and/or obtained for specific programs, (iii) other biological materials obtained for use in, and/or generated in connection with, former, on-going and/or future programs of Maxygen and/or its Affiliates (whether or not in collaboration with any Third Party) (iv) Patent Rights related to any of the foregoing and/or uses thereof, and (v) information, data and results generated by and/or on behalf of Maxygen and/or its Affiliates in former, on-going and/or future programs (whether or not in collaboration with any Third Party). For the avoidance of doubt Program-Specific Technology shall not include Materials, Know-How, and Patent Rights that are (x) generally applicable to and (y) reasonably necessary and/or useful for, practicing the Licensed Technology for the Permitted Uses. Notwithstanding the foregoing, Program-Specific Technology shall not include any such Materials, Know-How and Patent Rights (and other materials and know-how) constituting Acquired Assets and/or Retained Intellectual Property as such terms are defined in the Technology Transfer Agreement.

     1.58 “Recipient” Shall have the meaning set forth in Section 4.3.

     1.59 “Resulting Genetic Material” shall mean any genetic material (including DNA and/or RNA) that is generated, created and/or otherwise results directly from Shuffling.

     1.60 “Resulting Product” shall mean any of the following (i) any Resulting Genetic Material, (ii) any vector of any type (e.g., cosmid, plasmid, spore, phage, virus, and/or virus-like particle), and subunits of the foregoing, which contain any Resulting Genetic Material, (iii) any organism, including any prokaryotic and/or eukaryotic cell and/or animal containing any Resulting Genetic Materials; (iv) any Resulting Protein; (iv) any eukaryotic cell, prokaryotic cell and/or expression systems expressing, secreting and/or otherwise producing a Resulting Protein; and/or (v) any product containing in whole and/or part, and/or made with and/or using in whole

and/or part, any of the foregoing, in each case, in purified or unpurified form, and alone and/or in combination with other substances, and including any modifications, derivatives, progeny (altered and/or unaltered) and/or fragments of any of the foregoing.

     1.61 “Resulting Protein” shall mean any protein, polypeptide, antibody and/or other molecule encoded in whole and/or part by any Resulting Genetic Material.

     1.62 “RR Know-How” shall mean Know-How related to methods of cell selection related to selective suppression of stop codons during protein translation that is reasonably necessary and/or useful for using the RR Patents and RR Materials in and/or for research, development, manufacture, and/or use of protein pharmaceuticals.

     1.63 “RR Materials” shall mean the Materials listed on Schedule 1.63 .

     1.64 “RR Patents” shall mean the Patent Rights listed on Schedule 1.64 , and any other Patent Rights, if any, that (i) are Controlled by Maxygen and/or its Affiliates as of the Execution Date and (ii) claim methods of [****] . RR Patents shall also include future patent applications and patents issuing thereon to the extent they have utility in the methods of [****] and claim priority to any Patent Rights within the scope of the foregoing sentence (provided, however, that with respect to continuation-in-part applications, only those claims thereof which claim priority to a date on or before the Closing Date shall be included in the license hereunder). Notwithstanding the foregoing, the RR Patents do not include any Patent Rights within the Excluded Technology.

     1.65 “RR Technology” shall mean the RR Patents, RR Materials, and RR Know-How, in each case Controlled by Maxygen and/or its Affiliates as of the Execution Date; provided, however, that RR Technology shall not include any Excluded Technology.

     1.66 “Shuffle” and/or “Shuffling” shall mean techniques, methodologies, processes, materials and/or instrumentation for performing recombination-based modification of genetic material for the creation of potentially useful variant nucleic acids and/or proteins (regardless of whether conducted with tangible materials and/or in silico ). When used with respect to a protein, “Shuffle” and/or “Shuffling” shall mean such activities conducted using, as starting materials, genetic materials which encode such protein and/or variants and/or homologs thereof, in whole and/or material part, for the purpose of identifying, generating and/or creating variants of such protein.

     1.67 “Software” shall mean, individually and collectively, the software programs for use with the Enabling Technology that are listed on Schedule 1.67 .

     1.68 “Subsidiary” shall mean an Affiliate of a Person controlled by such Person directly, and/or indirectly through one or more intermediaries.

     1.69 “Substitution Notice” shall have the meaning set forth in Section 2.5.6(a).

     1.70 “Technology Transfer Agreement” shall mean that certain Technology Transfer Agreement by and among Maxygen, Holdings, ApS and Bayer effective on the Execution Date.

     1.71 “Territory” shall mean worldwide.

     1.72 “Third Party” shall mean any Person other than Maxygen and/or Affiliates of Maxygen, as applicable, and/or Bayer and/or Affiliates of Bayer, as applicable.

     1.73 “Third Party Agreement” shall mean each license and/or agreement that was entered and/or is entered by Maxygen and/or any of its Affiliates with a Third Party prior to the Execution Date, and which is not terminated and/or expired prior to the Execution Date, pursuant to which Maxygen and/or any of its Affiliates obtained a license of Patent Rights within the Licensed Technology useful for the Permitted Uses, and which Maxygen and/or its Affiliates Controls, other than the Excluded Third Party Agreements. The Third Party Agreements are listed, as of the Execution Date, on Schedule 1.73 .

     1.74 “Transition Period” shall have the meaning set forth in Section 6.2.1(a).

     1.75 “Transition Plan” shall have the meaning set forth in Section 6.1.2.

     1.76 “Transition Services” shall have the meaning set forth in Section 6.1.2.

     1.77 “Transition Services Statement” shall have the meaning set forth in Section 6.3.

     1.78 Construction of Certain Terms Except where the context requires otherwise, the following rules of construction shall apply with respect to this Agreement and its schedules and exhibits:

               (a) The word “including” shall be deemed to be followed by the words “without limitation” regardless of whether they are included or not;

               (b) The word “will” shall be construed to have the same meaning and effect as the word “shall”;

               (c) Definitions shall be deemed to include both the singular and/or plural usages of such terms, as applicable;

               (d) Masculine pronouns shall be deemed to include references to feminine and/or genderless terms, as applicable;

               (e) The words “herein,” “hereof” and “hereunder,” and words of similar import, shall be construed to refer to this Agreement in its entirety and not to any particular provision hereof;

               (f) All references herein to Articles, Sections, Exhibits and/or Schedules shall be construed to refer to Articles, Sections, Exhibits and Schedules of this Agreement, and references to this Agreement include all Exhibits and Schedules hereto; and

               (g) References to any specific law, rule and/or regulation, and/or article, section and/or other division thereof, shall be deemed to include the then-current amendments thereto and/or any replacement and/or successor law, rule and/or regulation thereof.

ARTICLE 2
TECHNOLOGY LICENSES

     2.1 Licenses.

          2.1.1 Enabling Technology.

               (a)  License Grant . Subject to the terms and conditions herein (including Sections 2.3 and 2.4), effective as of the Closing Date, Maxygen hereby grants to Bayer, and shall cause its Affiliates to grant to Bayer, and Bayer hereby accepts, irrevocable (except as set forth in Section 4.4 and/or 8.4.1), royalty-free licenses under the Enabling Technology in the Territory, as follows:

                    (A) an exclusive license, during the applicable Exclusivity Period for each Bayer Exclusive Protein, on a protein-by-protein basis, to practice the Enabling Technology to Shuffle the Bayer Exclusive Proteins, with the right to develop, make, have made, use, import, sell, offer for sale, market and otherwise commercially exploit the Resulting Products, in each case solely for the Permitted Uses; and

                    (B) a non-exclusive license to practice the Enabling Technology to Shuffle any and all proteins (except any of the Maxygen Exclusive Proteins during the applicable Exclusivity Period for such Maxygen Exclusive Protein), with the right to develop, make, have made, use, import, sell, offer for sale, market and otherwise commercially exploit the Resulting Products, in each case solely for the Permitted Uses.

The licenses in (A) and (B) above shall include the right to use consultants, temporary employees and/or other Third Party service providers to perform, under a written contract containing confidentiality provisions no less restrictive than those in this Agreement and containing a covenant from such Third Party not to practice the Enabling Technology and/or improvements thereto except as set forth in this paragraph until expiration, on a patent-by-patent basis, of applicable Patent Rights within the Enabling Patents, activities on behalf of Bayer in the practice of the Enabling Technology and/or improvements thereto, provided that (i) such Third Party service provider acquires no rights in the Enabling Technology and/or improvements thereto and (ii) all Shuffling shall only be conducted at a Bayer Research Facility. Bayer shall be responsible to ensure the compliance with applicable confidentiality terms set forth herein (including the restrictions both on disclosure and on use) by any and all such Third Party service providers.

               (b)  Excluded Uses . It is understood and agreed that the licenses set forth above do not convey any license to practice the Enabling Technology in and/or for any aspect of the Excluded Uses.

          2.1.2 RR Technology. Subject to the terms and conditions herein (including Sections 2.3 and 2.4), effective as of the Closing Date, Maxygen hereby grants to Bayer, and shall cause its Affiliates to grant to Bayer, and Bayer hereby accepts, an irrevocable (except as set forth in Section 4.4), royalty-free, non-exclusive license under the RR Technology, to practice the RR Technology for research, development, and/or manufacture of Resulting Products in the Territory. The license in this Section 2.1.2 shall include the right to use consultants, temporary employees and/or other Third Party service providers to perform, under a contract containing confidentiality provisions no less restrictive than those in this Agreement, activities on behalf of Bayer and/or its Affiliates in the practice of the RR Technology, provided that such Third Party service provider acquires no rights in the RR Technology and/or improvements thereto.

          2.1.3 CMVP Technology. Subject to the terms and conditions herein (including Sections 2.3 and 2.4), effective as of the Closing Date, Maxygen hereby grants to Bayer, and shall cause its Affiliates to grant to Bayer, and Bayer hereby accepts, an irrevocable (except as set forth in Section 4.4), royalty-free, non-exclusive license under the CMVP Technology, to use the CMVP Materials (and materials derived therefrom) as research reagents in the Territory. Bayer acknowledges that (i) the license from Maxygen to use the CMVP Materials does not include any sublicense and/or right under the Patent Rights licensed by [****] to Maxygen and/or its Affiliates, and (ii) the CMVP Materials are subject to restriction on their use for any purpose other than as research reagents. The license in this Section 2.1.3 shall include the right to use consultants, temporary employees and/or other Third Party service providers to perform, under a contract containing confidentiality provisions no less restrictive than those in this Agreement, activities on behalf of Bayer and/or its Affiliates in the practice of the CMVP Technology, provided that such Third Party service provider acquires no rights in the CMVP Technology and/or improvements thereto.

          2.1.4 Software. Subject to the terms and conditions herein (including Sections 2.3 and 2.4), effective as of the Closing Date, Maxygen hereby grants, and shall cause its Affiliates to hereby grant to Bayer, and Bayer hereby accepts, an irrevocable (except as set forth in Section 4.4), royalty-free, non-exclusive license with respect to the Software in the Territory, to use, modify, reproduce, copy, maintain, fix, improve enhance, display, and/or create derivative works of the Software in the Territory in connection with the exercise of the license to Enabling Technology provided in Section 2.1.1 above, with the right to develop, make and have made, use, import, sell, market and otherwise commercially exploit any Resulting Product developed using the Software in the Permitted Uses; provided , however , that no license is granted with respect to uses of the Software (and/or modifications, improvements, enhancements and/or derivative works thereof) in connection with the practice of Shuffling (whether with tangible

materials and/or in silico ) for Excluded Uses and/or in connection with Shuffling of any Maxygen Exclusive Protein during the applicable Exclusivity Period for such Maxygen Exclusive Protein. Bayer acknowledges that Maxygen has informed Bayer that the Software is designed and intended to function with, and may not function properly and/or to its full extent without, certain Third Party software that Maxygen believes (without any duty of inquiry) is commercially available. A list of such Third Party software used by Maxygen in connection with its use of the Software as of the Execution Date is set forth in Schedule 2.1.4 . Bayer and/or its Affiliates shall be responsible, in its discretion and at its expense, for obtaining such Third Party software and appropriate licenses therefore for use in connection with the Software. Maxygen makes no representation and/or warranty that such Third Party software will be commercially available and/or that Bayer and/or any of its Affiliates will be able to obtain appropriate licenses therefor, and shall neither be responsible nor liable for obtaining rights to such Third Party software for Bayer and/or any of its Affiliates.

          2.1.5 Development and Improvement of Licensed Technology . Maxygen and Bayer agree that that the licenses set forth above include the right to develop and improve each of the Enabling Technology, RR Technology, CMVP Technology and Software in the exercise of the applicable license above.

     2.2 Sublicensing Only to Bayer Affiliates. Bayer shall have the right to sublicense to Bayer’s Affiliates, the rights licensed to Bayer pursuant to Section 2.1. Bayer shall not grant to any Third Party any sublicense to practice, make and/or otherwise use the Enabling Technology, RR Technology and/or CMVP Technology, and/or any sublicense with respect to the Software (and/or modifications, improvements, enhancements and/or derivative works thereof). Any such sublicense shall only be effective for so long as the sublicensee remains an Affiliate of Bayer. Bayer shall notify Maxygen in writing upon each grant of such a sublicense to any of its Affiliates, and shall be responsible for ensuring the compliance of each of its Affiliates to which it grants a sublicense hereunder with the applicable terms and conditions of this Agreement, including Section 3.4.3. For clarity, it is understood and agreed that the foregoing limitations shall not be construed to prohibit Bayer and/or its Affiliates from granting licenses to Third Parties with respect to (a) any Resulting Products for the Permitted Uses, and/or (b) any protein pharmaceutical product developed, manufactured and/or produced using the RR Technology and/or developed using the CMVP Technology, in each case so long as such license to a Third Party does not include a license to practice the Enabling Technology, RR Technology and/or CMVP Technology per se , and/or any license with respect to the Software (and/or modifications, improvements, enhancements and/or derivative works thereof).

     2.3 Limitations on Licenses.

          2.3.1 No Fee for Service . The licenses set forth in Section 2.1 exclude any right to practice the Enabling Technology, RR Technology, CMVP Technology, and/or to use the Software (and/or modifications, improvements, enhancements and/or derivative works thereof), in the conduct of services on behalf of any Third Party in connection with the discovery, creation, identification, development, manufacture and/or production of protein pharmaceuticals, and/or other products, that are proprietary, and/or licensed, to a Third Party, and/or which a Third Party has rights, and/or an option to obtain rights, for commercialization in any field.

          2.3.2 Limited Maxygen Rights . It is understood and agreed that with respect to any aspect of the Enabling Technology, RR Technology, and/or CMVP Technology for which Maxygen has less than fully exclusive, worldwide rights (i.e., co-exclusive, non-exclusive, limited territorial and/or otherwise restricted rights), the licenses provided in Section 2.1 shall be limited to the scope of those rights that Maxygen and/or its Affiliates Controls and has the right to sublicense to Bayer.

          2.3.3 Maxygen Exercise of Retained Rights . Bayer acknowledges and agrees that Maxygen and/or its Affiliates shall have the right, without violating any term of this Agreement, to practice the Enabling Technology, RR Technology and/or CMVP Technology, and to use, modify, reproduce, copy, maintain, fix, improve and/or enhance, display, and/or create derivative works of the Software (and to grant to Maxygen’s Affiliates and/or to any Third Parties any and/or all such rights) for any use other than (i) to practice the Enabling Technology to Shuffle Bayer Exclusive Proteins during the applicable Exclusivity Period for such Bayer Exclusive Protein, and/or (ii) to develop, make, have made, use, import, have imported, sell, offer for sale, market and otherwise commercially exploit Resulting Products from Shuffling of Bayer Exclusive Proteins during the applicable Exclusivity Periods, and Maxygen and/or its Affiliates shall have the right to sell and/or otherwise dispose of the Enabling Technology, RR Technology, CMVP Technology and/or Software, subject to the licenses granted to Bayer and Section 12.5. At all times during and after this Agreement, nothing herein shall restrict, and/or be construed to restrict, Maxygen’s and/or its Affiliates’ right to practice and grant licenses to practice the Enabling Technology and/or use related Know-How, outside the Bayer Field.

          2.3.4 U.S. Rights. Bayer acknowledges that certain of the inventions claimed in the Patent Rights within the Enabling Technology have been made with funds provided by the U.S. Government, and that with respect thereto the U.S. government retains a non-exclusive license as set forth in 35 U.S.C. §202. To Maxygen’s Knowledge as of the Execution Date, attached at Schedule 2.3.4 is a list of such Patent Rights that claim inventions made with funds provided by the U.S. Government. In addition, Bayer acknowledges that 35 U.S.C. §200 et seq . sets forth additional obligations with regard to inventions made with U.S. government funds and products based thereon, including a preference for manufacture in the United States pursuant to 35 U.S.C. §204.

     2.4 Acknowledgement of Third Party Rights . Bayer hereby acknowledges that Maxygen has informed Bayer prior to the Execution Date that:

          2.4.1 In connection with the initial establishment of Maxygen, Maxygen entered into the Affymax/Maxygen Technology Transfer Agreement, effective February 1, 1997, entered by and among Affymax Technologies N.V., Glaxo Group Limited and Maxygen, as amended on March 1, 1998, subject to the letter agreements dated January 14, 2000 and December 17, 2001, pursuant to which Maxygen has granted perpetual, worldwide, non-exclusive licenses to certain entities associated with Glaxo Wellcome Companies (as defined in that agreement) to use certain Enabling Technology for internal research purposes only, and Bayer hereby agrees that the rights and licenses granted Bayer in Section 2.1 with respect to Enabling Technology are subject to such licenses.

          2.4.2 Pursuant to that certain Cross-License Agreement between Maxygen and Avidia Research Institute dated as of July 16, 2003, subject to the letter agreement dated march 29, 2005, Maxygen has granted a non-exclusive license to practice certain claims of Patent Rights within the Enabling Technology with respect to MaxyBodies.

          2.4.3 Third Parties granting and/or conveying rights to Maxygen and/or its Affiliates under the Third Party Agreements have retained rights with respect to some of the Enabling Technology pursuant to those agreements, and in some cases such Third Parties’ rights are subject to retained rights of their Third Party licensors.

          2.4.4 Prior to the Execution Date, Maxygen and/or its Affiliates have granted to Third Parties, including those Third Parties set forth in Schedule 2.4.4 , licenses and/or rights with respect to Enabling Technology in fields outside the Bayer Field, and that after the Execution Date, Maxygen and/or its Affiliates may grant licenses under the Enabling Technology and related Know-How to other Third Parties (including to Affiliates and/or former Affiliates of Maxygen) for use outside the Bayer Field.

          2.4.5 Maxygen intends to, and retains the right to, use Enabling Technology itself and/or to grant to one or more other Third Parties rights to use Enabling Technology to discover novel pharmaceutical products and other Resulting Products, and to develop, make, have made, use and commercialize such products; provided, however, that such retained rights shall not include the right to Shuffle any Bayer Exclusive Protein during the applicable Exclusivity Period for such Bayer Exclusive Protein, and/or to commercialize Resulting Products therefrom.

     2.5 Exclusive Proteins.

          2.5.1 Initial List of Exclusive Proteins . From the Closing Date until the first anniversary of the Closing Date, the Bayer Exclusive Proteins shall consist of the thirty (30) proteins set forth on Schedule 1.6 , and the Maxygen Exclusive Proteins shall consist of the thirty (30) proteins set forth on Schedule 1.45 .

          2.5.2 Reduction on First Anniversary . As of the first anniversary of the Closing Date, seven (7) proteins (determined in accordance with Section 2.5.5(a)) shall be removed from the list of Bayer Exclusive Proteins, and seven (7) proteins (determined in accordance with Section 2.5.5(b)) shall be removed from the list of Maxygen Exclusive Proteins, in each case as described in Section 2.5.5, and from and after the first anniversary of the Closing Date, the proteins so removed shall no longer be Bayer Exclusive Proteins and/or Maxygen Exclusive Proteins, as the case may be, for purposes of this Agreement. For clarity, the number of remaining Exclusive Proteins for each Party after such reduction will be twenty-three (23).

          2.5.3 Further Reduction on Second Anniversary . As of the second anniversary of the Closing Date, five (5) more proteins (determined in accordance with Section 2.5.5(a)) shall be removed from the list of Bayer Exclusive Proteins, and five (5) more proteins (determined in accordance with Section 2.5.5(b)) shall be removed from the list of Maxygen Exclusive Proteins, in each case as described in Section 2.5.5, and from and after the second anniversary of the Closing Date, the proteins so removed shall no longer be Bayer

Exclusive Proteins and/or Maxygen Exclusive Proteins, as the case may be, for purposes of this Agreement. For clarity, the number of remaining Exclusive Proteins for each Party after such reduction will be eighteen (18).

          2.5.4 Further Reduction on Third Anniversary . As of the third anniversary of the Closing Date, three (3) more proteins (determined in accordance with Section 2.5.5(a)) shall be removed from the list of Bayer Exclusive Proteins, and three (3) more proteins (determined in accordance with Section 2.5.5(b)) shall be removed from Maxygen Exclusive Proteins and from and after the third anniversary of the Closing Date, the proteins so removed shall no longer be Bayer Exclusive Proteins and/or Maxygen Exclusive Proteins as the case may be, for purposes of this Agreement. For clarity, the number of remaining Exclusive Proteins for each Party after such reduction will be fifteen (15).

          2.5.5 Selection of Proteins to be Removed on First, Second, and Third Anniversary .

               (a)  Bayer . Bayer shall have the right to select the Bayer Exclusive Proteins to be removed from the list of Bayer Exclusive Proteins on each of the first, second, and third anniversaries of the Closing Date by written notice to Maxygen on or before the applicable anniversary. If Bayer does not provide written notice identifying the proteins to be removed from the list of Bayer Exclusive Proteins on or before the applicable anniversary of the Closing Date (and/or if Bayer identifies less than proteins to be removed on the applicable anniversary), then (A) Maxygen may at any time after the applicable anniversary of the Closing Date request in writing that Bayer identify the proteins to be removed pursuant to Section 2.5.2, Section 2.5.3 and/or Section 2.5.4 as applicable; (B) Bayer shall have fifteen (15) days after receipt of such a notice to identify the proteins to be removed from the list of Bayer Exclusive Proteins; and (C) if Bayer does not identify the proteins to be so removed (and/or if Bayer identifies less than the required number of proteins), then proteins (if any) identified by Bayer shall first be removed, and thereafter the first listed of the remaining Bayer Exclusive Proteins, and then the next listed of the remaining Bayer Exclusive Proteins, and so on in the order in which the remaining proteins are listed in Schedule 1.6 , shall be removed until a total required number of proteins have been removed from the list as of the applicable anniversary of the Closing Date.

               (b)  Maxygen . Maxygen shall have the right to select the Maxygen Exclusive Proteins to be removed from the list of Maxygen Exclusive Proteins on each of the first, second, and third anniversaries of the Closing Date by written notice to Bayer on or before the applicable anniversary. If Maxygen does not provide written notice identifying the proteins to be removed from the list of Maxygen Exclusive Proteins on or before the applicable anniversary of the Closing Date (and/or if Maxygen identifies less than the required number of proteins to be removed on the applicable anniversary), then (A) Bayer may at any time after the applicable anniversary of the Closing Date request in writing that Maxygen identify the proteins to be removed pursuant to Section 2.5.2, Section 2.5.3, and/or Section 2.5.4, as applicable; (B) Maxygen shall have fifteen (15) days after receipt of such a notice to identify the proteins to be removed from the list of Maxygen Exclusive Proteins; and (C) if Maxygen does not identify the proteins to be so removed (and/or if Maxygen identifies less than the required number of proteins), then proteins (if any) identified by Maxygen shall first be removed, and thereafter the first listed of the remaining Maxygen Exclusive Proteins, and then the next listed of the

remaining Maxygen Exclusive Proteins, and so on in the order in which the remaining proteins are listed in Schedule 1.45 , shall be removed until a total required number of proteins have been removed from the list as of the applicable anniversary of the Closing Date.

          2.5.6 Substitution of Exclusive Proteins .

               (a) Each Party may, by written notice within thirty (30) days of the first, second and/or third anniversary of the Closing Date (the “ Substitution Notice ”) substitute up to [****] of its Exclusive Proteins (i.e., Bayer may substitute Bayer Exclusive Proteins, and Maxygen may substitute Maxygen Exclusive Proteins) on each anniversary with the consent of the other Party, which consent will not unreasonably be withheld; provided, however, that Bayer may not substitute one of its Exclusive Proteins with a protein that is at the time a Maxygen Exclusive Protein, and Maxygen may not substitute one of its Exclusive Proteins with a protein that is at the time a Bayer Exclusive Protein. Bayer shall only identify as a proposed substitution protein a protein that Bayer reasonably believes to have application in one or more of the areas of hematology, women’s health and/or cardiovascular disease (Bayer’s “ Area of Interest ”), and Maxygen shall only identify as a proposed substitution protein a protein that Maxygen Reasonably believes to have application in the area of immunosuppression (including autoimmunity and/or transplant rejection) (Maxygen’s “ Area of Interest ”).

               (b) If the Party receiving a Substitution Notice reasonably believes that the proposed substitution protein is one of its Exclusive Proteins and/or that the proposed substitution protein is not in the other Party’s Area of Interest, and/or has other reasonable basis for objecting to such substitution, then it may give written notice of objection (an “ Objection Notice ”) within thirty (30) days, and the Parties shall promptly discuss the basis for such objection. If the Party receiving a Substitution Notice does not provide the other Party an Objection Notice with respect to the substitution of any given Exclusive Protein with the corresponding proposed substitution protein in writing within thirty (30) days after receiving the applicable Substitution Notice, the applicable proposed substitution protein shall become an Exclusive Protein effective as of the date the other Party consents to such substitutions, or on the expiration of the thirty (30) day period without written objection. The identified Exclusive Protein that has been replaced shall thereafter no longer be an Exclusive Protein. For clarity, the Exclusivity Period for the Exclusive Protein that has been replaced shall end upon the effective date of such substitution, and the Exclusivity Period for the protein which becomes an Exclusive Protein shall begin on the effective date of such substitution and shall end as specified in Section 1.30 (unless earlier replaced under this Section 2.5.6).

     2.6 No Future IP; No Implied Rights . Bayer acknowledges and agrees that, (i) except to the extent otherwise expressly provided in Section 3.2.5 and Article 5, no rights and/or licenses are conveyed to Bayer with respect to Patent Rights, Know-How, Materials and/or other materials, know-how and/or intellectual property rights that are invented, developed, created, acquired, licensed to and/or otherwise obtained by Maxygen and/or any of its Affiliates after the Closing Date, and/or (ii) no rights and/or licenses are conveyed to Bayer with respect to

any Patent Rights, Know-How, Materials and/or other materials, know-how and/or intellectual property rights owned and/or Controlled by any Third Party that becomes an Affiliate of Maxygen after the Closing Date; except to the extent expressly provided in Section 3.2.5 and Article 5 fo