Re: Collaboration and Option Agreement between Fate Therapeutics, Inc. (“Fate”) and Ono Pharmaceutical Co., Ltd. (“Ono”), dated September 14, 2018 (the “Agreement”)

Exhibit 10.39

0000 Xxxxxxx Xxxxxxx Xxxxx, Xxxxx 000 • San Diego, CA 92121 • 858.875.1800 Office • 000.000.0000 Fax • xxx.xxxxxxxxxxxxxxxx.xxx

December 4, 2020

Ono Pharmaceutical Co., Ltd.

Minase Research Institute

1-1, Sakurai 3-chome, Xxxxxxxxx-xxx

Mishima-gun, Osaka 618-8585

Japan

Attention: Xx. Xxxxxx Xxxxxx

Re:	Collaboration and Option Agreement between Fate Therapeutics, Inc. (“Fate”) and Ono Pharmaceutical Co., Ltd. (“Ono”), dated September 14, 2018 (the “Agreement”)

Dear Xx. Xxxxxx:

As you know, Fate and Xxx are conducting a research collaboration under the Agreement, pursuant to which (i) Fate is conducting research on Collaboration Candidate 1; and (ii) Xxx and Fate are conducting research to enable Xxx to determine the Ono Antigen Binding Domain for Collaboration Candidate 2, upon which determination the Ono Antigen Binding Domain will be incorporated into Collaboration Candidate 2 for further research and development of Collaboration Candidate 2 under the Agreement. Xxx has exclusive options under the Agreement to obtain exclusive licenses to Collaboration Candidate 1 and Collaboration Candidate 2. Capitalized terms used but not defined in this letter will have the meanings given in the Agreement.

With respect to Collaboration Candidate 1, pursuant to Section 2.4.3 of the Agreement, Xxx has determined that it does not wish to exercise the Ono Option for Collaboration Candidate 1 and, therefore, Xxx wishes to terminate the Agreement with respect to Collaboration Candidate 1, which will be deemed a termination pursuant to Section 11.3 (ONO Unilateral Termination Rights) of the Agreement.

With respect to Collaboration Candidate 2, pursuant to Sections 2.1.1, 2.3.4 and 2.3.5 of the Agreement, Xxx has until [***], to determine the Ono Antigen Binding Domain [***]. [***]. As of the date of this letter agreement (the “Letter Agreement”), Xxx and Fate agree that Xxx has delivered to Fate [***] Antigen Binding Domains for [***] and such Antigen Binding Domains for [***] the Ono Antigen Binding Domain.

0000 Xxxxxxx Xxxxxxx Xxxxx, Xxxxx 000 • San Diego, CA 92121 • 858.875.1800 Office • 000.000.0000 Fax • xxx.xxxxxxxxxxxxxxxx.xxx

Accordingly, Xxxx and Xxx, intending to be legally bound, agree as follows effective as of the date set forth above (the “Letter Agreement Effective Date”):

Fate and Xxx agree to terminate the Agreement with respect to Collaboration Candidate 1 effective on the Letter Agreement Effective Date. Such termination will be deemed a termination by Ono pursuant to Section 11.3.1 of the Agreement, and the consequences set forth in Section 11.6.1 of the Agreement will apply to such termination.

Collaboration Candidate 1 will become a FATE Cell Therapy on the Letter Agreement Effective Date, and Fate will retain all rights, in its sole discretion, to research, develop and commercialize such FATE Cell Therapy worldwide, alone or with or through any Affiliate or Third Party, without any obligation to Ono.

For the avoidance of doubt, Xxx represents and warrants that there are no Valid Claims in the ONO Patents or the Joint Patents covering Collaboration Candidate 1 and, therefore, in accordance with [***] of the Agreement, Fate shall have no payment obligations to Ono or any other obligations to Ono under the Agreement or this Letter Agreement in connection with such FATE Cell Therapy.

Xxx has delivered to Fate [***] Antigen Binding Domains for [***] for incorporation into Collaboration Candidate 2, and Xxx hereby notifies Fate pursuant to Section 2.3.4 of the Agreement of its designation of each such Antigen Binding Domain for [***], as Ono Antigen Binding Domains for further Research and Development of Collaboration Candidate 2 in accordance with the Joint Development Plan.

5.	Xxx agrees that the OABD Research Milestone Fee under Section 6.3.1 of the Agreement is due as of the Letter Agreement Effective Date and shall be paid to Fate in accordance with the Agreement.

[***] Certain information in this exhibit has been omitted because it is both (i) not material and (ii) would likely cause competitive harm to the registrant if publicly disclosed.

0000 Xxxxxxx Xxxxxxx Xxxxx, Xxxxx 000 • San Diego, CA 92121 • 858.875.1800 Office • 000.000.0000 Fax • xxx.xxxxxxxxxxxxxxxx.xxx

Please confirm Xxx’s understanding of and agreement to the foregoing by signing this Letter Agreement below and returning a signed copy to me at your earliest convenience.

Sincerely,

Fate Therapeutics, Inc.

X. Xxxxx Xxxxxxx

President and CEO

Acknowledged and agreed to by:

Ono Pharmaceutical Co., Ltd.

By:		/s/Xxxxxx Xxxxxx
Name:		Xxxxxx Xxxxxx, Ph.D.
Title:		Corporate Executive Officer
		Executive Director, Discovery & Research

[***] Certain information in this exhibit has been omitted because it is both (i) not material and (ii) would likely cause competitive harm to the registrant if publicly disclosed.

0000 Xxxxxxx Xxxxxxx Xxxxx, Xxxxx 000 • San Diego, CA 92121 • 858.875.1800 Office • 000.000.0000 Fax • xxx.xxxxxxxxxxxxxxxx.xxx

EXHIBIT A

ONO ANTIGEN BINDING DOMAIN

[***]

[***] Certain information in this exhibit has been omitted because it is both (i) not material and (ii) would likely cause competitive harm to the registrant if publicly disclosed.

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Re: Collaboration and Option Agreement between Fate Therapeutics, Inc. (“Fate”) and Ono Pharmaceutical Co., Ltd. (“Ono”), dated September 14, 2018 (the “Agreement”)

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