Exhibit 10.3
*** Text Omitted and Filed Separately

Confidential Treatment Requested

Under 17 C.F.R. §§ 200.80(b)(4)

LICENSE AND COMMERCIALIZATION AGREEMENT

 

This License and Commercialization Agreement (“Agreement”) is effective as of
the date of last signature below (the “Effective Date”) by and between Illumina,
Inc., a Delaware corporation, having a place of business at 5200 Illumina Way,
San Diego, CA, 92122 (“Illumina”), and CareDx, Inc., a Delaware corporation,
having a place of business at 3260 Bayshore Boulevard, Brisbane, CA 94005
(“CareDx”).  Illumina and CareDx may each be referred to in this Agreement
individually as a “Party” and collectively as the “Parties.”

 

RECITALS

 

A.CareDx is a business focused on developing, manufacturing, and selling
products in the Licensed Field (defined below);

 

B.Illumina owns or otherwise Controls (defined below) rights to certain
Intellectual Property (defined below), including patents, patent applications,
and know-how, relating to products in the Licensed Field;

 

C.Illumina also has existing products that it manufactures and sells (including
through distributors), and products that are in development, for use in the
Licensed Field;

 

D.CareDx desires to (i) obtain a field-based license to certain Intellectual
Property for making, using, and selling products for use in the Licensed Field
with Illumina’s sequencing platforms, (ii) purchase certain products from
Illumina for resale, and (iii) obtain a transfer of technology from Illumina
relating to the manufacture of certain products in development; and

 

E.Illumina is willing to grant such a license, sell such products, and conduct
such a technology transfer to CareDx on the terms and subject to the conditions
set forth in this Agreement.

 

NOW, THEREFORE, in consideration of the mutual covenants contained in this
Agreement, the foregoing recitals and other good and valuable consideration, the
receipt and sufficiency of which are hereby acknowledged, the Parties agree as
follows:

 

1.DEFINITIONS  

 

The following capitalized terms have the following meanings:

 

1.1“Ad/Promo Guidelines” means Illumina’s current guidelines for advertising and
promotional materials, which will be commercially reasonable at all times.

 

1.2“Affiliate” means, with respect to a Party or other party, any Person which
at the time in question directly or indirectly Controls, is Controlled by, or is
under common Control with, such Party or other party.  For the purposes of this
definition only, “Control” means the possession, directly or indirectly, of:
(i) more than 50% of the voting interests of a Person; or (ii) the power to
direct or cause the direction of the management or policies of a Person, whether
through the ownership of voting interests, by agreement with respect to the
voting of voting interests, by other agreement conferring control over
management or policy decisions, by virtue of the power to control the
composition of the

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board of directors or managers, or otherwise.  The terms “Controlling” and
“Controlled” have correlative meanings for purposes of this
definition.  Notwithstanding the foregoing, Helix Holdings I, LLC, and its
subsidiaries and members, are not Affiliates of Illumina for purposes of this
Agreement.

 

1.3“Anti-Corruption Laws” has the meaning set forth in Exhibit C.

 

1.4“Approval(s)” has the meaning set forth in Exhibit C, Section 3.

 

1.5“CareDx Existing Products” has the meaning set forth in Section 4.1.

 

1.6“CareDx Marks” has the meaning set forth in Section 5.8(b).

 

1.7“Changed Component(s)” has the meaning set forth in Section 5.7.

 

1.8“Chimerism Assay” means the [...***...] of each of [...***...] in a
[...***...].

 

1.9“Chimerism Royalty Product” means a Licensed Product that is used for a
Chimerism Assay application.

 

1.10“Claim(s)” has the meaning set forth in Section 12.1.

 

1.11“Combination Product” means any combination of the Licensed Product and
another product that is not the Licensed Product, where such products are not
formulated together but are sold together as a single product.

 

1.12“Complaint(s)” has the meaning set forth in Exhibit C.

 

1.13“Complete Change” has the meaning set forth in Section 5.7.

 

1.14“Confidential Information” means all information that (i) is provided by one
Party (or its Affiliates) to the other Party (or its Affiliates) pursuant to
this Agreement, and (ii) (A) if disclosed in writing or other tangible medium is
marked or identified as confidential at the time of disclosure to the recipient,
(B) if disclosed other than in writing, is acknowledged at the time of
disclosure to be confidential and is documented as confidential by written
notice to the recipient within 30 days after disclosure, or (C) that a recipient
should reasonably understand to be confidential.  Confidential Information shall
not include any of the following: (a) information that, at the time of
disclosure to the Receiving Party, is in the public domain through no breach of
this Agreement or breach of another obligation of confidentiality owed to the
Disclosing Party or its Affiliates by the Receiving Party; (b) information that,
after disclosure hereunder, becomes part of the public domain by publication or
otherwise, except by breach of this Agreement or breach of another obligation of
confidentiality owed to the Disclosing Party or its Affiliate by the Receiving
Party; (c) information that was in the Receiving Party’s or its Affiliate’s
possession at the time of disclosure hereunder by the Disclosing Party unless
subject to an obligation of confidentiality or restricted use owed to the
Disclosing Party or its Affiliate; (d) information that is independently
developed by or for the Receiving Party or its Affiliates without use of or
reliance on Confidential Information of the Disclosing Party; or (e) information
that the Receiving Party receives from a third party where such third party was
under no obligation of confidentiality to the Disclosing Party or its Affiliate
with respect to such information.

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1.15“Contract Year” means 12 calendar months from June 1, 2018, and every
anniversary thereof.

 

1.16“Control,” “Controls,” “Controlled,” or “Controlling” means, with respect to
any Intellectual Property, possession of the right (whether through ownership or
license (other than by operation of this Agreement) or control over an Affiliate
with such right) to grant the licenses or sublicenses as provided herein without
violating the terms of any agreement or other arrangement with any third party.

 

1.17“Customer Agreement” has the meaning set forth in Exhibit C.

 

1.18“Disclosing Party” has the meaning set forth in Section 10.1(a).

 

1.19“Discontinued Product” has the meaning set forth in Section 5.7.

 

1.20“Documentation” means Illumina’s user manual, package insert, and similar
technical documentation, for the Supplied Product in effect on the date that the
Supplied Product ships from Illumina.

 

1.21“Excluded Uses” means (i) [...***...] (but for the avoidance of doubt,
excluding bone marrow (hematopoietic stem cell) transplantation diagnostic
testing), (ii) [...***...] applications, (iii) [...***...] for [...***...],
[...***...], [...***...], [...***...], [...***...] and [...***...] or
[...***...], (iv) [...***...], (v) [...***...], and (vi) use of [...***...] for
[...***...].

 

1.22“Exclusive IP” has the meaning set forth in Section 7.2.

 

1.23“Force Majeure” has the meaning set forth in Section 14.8.

 

1.24“Illumina Chimerism Formulation” means the formulations of the [...***...]
that Illumina developed for and included in its [...***...] for Chimerism Assay
applications as of the Effective Date in the Licensed Field.  The Illumina
Chimerism Formulation excludes the Illumina Chimerism Primers.

 

1.25“Illumina Chimerism Primers” means the [...***...] primer sequences and
design parameters that Illumina developed for and included in its [...***...]
for Chimerism Assay applications as of the Effective Date in the Licensed
Field.  

 

1.26“Illumina Chimerism Software” means the [...***...] software that Illumina
developed for and included in its development-stage assay for Chimerism Assay
applications as of the Effective Date in the Licensed Field.

 

1.27“Illumina HLA Existing Products” means the Illumina HLA v1 Product and
Illumina HLA v2 Product.

 

1.28“Illumina HLA Existing Product Primers” means the [...***...] primers
included as components of the Illumina HLA Existing Products.

 

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1.29“Illumina HLA Existing Product Software” means version nos. 1.0, 2.0, and
2.1 of the software, referred to as “TruSight HLA Assign,” that as of the
Effective Date are licensed to purchasers of the Illumina HLA Existing Products
for use with Illumina HLA Existing Products including released and unreleased
IMGT database software updates.

 

1.30“Illumina HLA v1 Product” means the products bearing Illumina catalogue
numbers FC-142-1001, 20006995, 20005171, and 20005172 as of the Effective Date.

 

1.31“Illumina HLA v2 Product” means the products bearing Illumina catalogue
numbers 20000215 and 20005170, as of the Effective Date.

 

1.32“Illumina HLA v3 [...***...]” means the [...***...] and [...***...] that
Illumina is developing or had previously developed for, and as or was included
in, its [...***...] (as the next version of the Illumina [...***...] Product) as
of the Effective Date that includes the Illumina [...***...] Reagents and the
Illumina HLA v3 Software.

 

1.33“Illumina HLA v3 Software” means the [...***...] software for use with its
[...***...] (as the next version of the Illumina [...***...] Product) as of the
Effective Date that includes the Illumina [...***...] Reagents and the Illumina
HLA v3 [...***...].

 

1.34“Illumina [...***...] Reagents” means the products listed in Exhibit B under
the heading “Illumina [...***...] Reagent Pricing.”

 

1.35“Illumina Product Restriction” has the meaning set forth in Section 4.2.

 

1.36“Illumina Sequencing Instrument” means: (i) any instrument for [...***...]
offered for sale in Illumina’s product catalogue up to and as of the Effective
Date, excluding the [...***...], the [...***...], and the [...***...], and (ii)
any improvement, update or upgrade to such instruments, whether such
improvement, update or upgrade is incorporated into such instruments or
installed or added to such instruments separately, provided that the instruments
still have substantially the same functionality and throughput.

 

1.37“Illumina Software Code” means the source code and executable code contained
in the Illumina HLA Existing Product Software, Illumina HLA v3 Software, and
Illumina Chimerism Software.

 

1.38 “Improvement” means any improvement, enhancement, or modification made by
or on behalf of CareDx during the Term to technology or other subject matter
that (i) is claimed by the Licensed Patents (pending or issued), (ii)
constitutes a derivative work of a work subject to a Licensed Field Copyright,
or (iii) constitutes a derivative work or is based on Licensed Know-How, and all
Intellectual Property embodied therein, that has, in each of the foregoing
cases, uses outside of the Licensed Field.  

 

1.39“Intellectual Property” means all patents, patent rights, trademarks,
service marks, trade names, trade dress, copyrights, works of authorship,
Know-How and any other intellectual property or industrial property rights
anywhere in the world.

 

 

 

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1.40“Know-How” means any ideas, inventions, know-how, trade secrets, data,
specifications, instructions, processes, formulas, and technology, including
analytical and manufacturing data and information.

 

1.41“Knowledge Transfer” has the meaning set forth in Section 8.1.

 

1.42“Lead Time” means the maximum number of business days between the date
CareDx issues a purchase order for the applicable Supplied Product and the date
that such Supplied Product is delivered to the delivery location specified on
such purchase order.

 

1.43“Licensed Field” means (a) Chimerism Assay applications for the [...***...]
by [...***...] of up to [...***...] in a [...***...] following and in
association with bone marrow (hematopoietic stem cell) transplantation or solid
organ transplantation or (b) [...***...] of the following [...***...] (or
[...***...] only if expressly noted in this definition) of the [...***...]
solely for bone marrow (hematopoietic stem cell) transplantation diagnostic
testing and solid organ transplantation diagnostic testing (or only a specific
application of such testing if expressly noted in this definition) of: (1) human
leukocyte antigen (HLA); (2) [...***...]; (3) [...***...]; (4) the [...***...]
listed in Exhibit H for use in [...***...] only; and (5) [...***...] in the
[...***...] to [...***...] only up to [...***...] in such [...***...] and not
for [...***...] level or [...***...] level [...***...].  The Licensed Field
excludes the Excluded Uses.

 

1.44“Licensed Field Copyrights” means the copyrights owned or Controlled by
Illumina and its Affiliates in the Illumina Software Code.

 

1.45“Licensed Field General Know-How” means all Know-How owned or Controlled by
Illumina or its Affiliates any time during the Term that is or was used for, but
not specific only to, the development, manufacture, supply or commercialization
of Licensed Products or the provision of Licensed Services (but only relating to
use of a Licensed Product in the Licensed Service) in the Licensed
Field.  Licensed Field General Know-How excludes Know-How relating to Third
Party Knowledge Transfer Components.

 

1.46“Licensed Field General Patents” means any patents and patent applications
which are owned or Controlled by Illumina and its Affiliates at any time during
the Term which in the absence of a license or sublicense granted by Illumina
would be infringed (directly or indirectly) by the development, manufacture,
marketing, use, development, Sale, offer for Sale, importation, exportation,
commercialization, service, support or other exploitation of Licensed Products
or the provision of Licensed Services.

 

1.47“Licensed Field Specific Know-How” means all Know-How owned or Controlled by
Illumina or its Affiliates any time during the Term that is or was used for and
is specific only to the development, manufacture or commercialization of
Licensed Products or the provision of Licensed Services (but only relating to
the use of a Licensed Product in the Licensed Service) in the Licensed
Field.  The Illumina HLA Existing Product Primers, Illumina HLA v3 [...***...],
and Illumina Chimerism Primers are Licensed Field Specific Know-How.  Licensed
Field Specific Know-How excludes Know-How relating to Third Party Knowledge
Transfer Components.  

 

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1.48“Licensed Field Specific Patents” means (i) the patents and patent
applications listed in Exhibit A, (ii) any divisionals, continuations,
continuations-in-part (only to the extent a priority claim can be made),
reissues, reexaminations, and extensions of the patents and patent applications
described in (i), (iii) any foreign equivalents of the patents and patent
applications described in (i) and (ii), and (iv) any patents that issue from
such patent applications described in (i), (ii), and (iii).

 

1.49“Licensed IP” means Licensed Patents, Licensed Know-How, Licensed Field
Copyrights, and Illumina Software Code.

 

1.50“Licensed Know-How” means Licensed Field Specific Know-How and Licensed
Field General Know-How.

 

1.51“Licensed Patents” means the Licensed Field Specific Patents and the
Licensed Field General Patents.

 

1.52“Licensed Products” means a product for either [...***...] for nucleic acid
sequencing on an Illumina Sequencing Instrument or [...***...] of nucleic acid
sequence data obtained from (i.e., downstream in a workflow from, and not
located on) an Illumina Sequencing Instrument which product or service (i) uses
the Illumina Chimerism Formulation and Illumina Chimerism Software or any
improvement, enhancement, or modification of any of the foregoing made by or on
behalf of CareDx or (ii) incorporates any [...***...], [...***...] and
[...***...] or any [...***...]. For the avoidance of doubt, any CareDx Existing
Products are not, and are not deemed to be, a Licensed Product and CareDx does
not owe any royalty or other amounts to Illumina for any such CareDx Existing
Products under this Agreement.

 

1.53“Licensed Service” means any service performed for a third party that uses a
Licensed Product.

 

1.54“Losses” has the meaning set forth in Section 12.1.

 

1.55“Material Change” means a material change to form, fit or function of any
Illumina HLA Existing Product or Illumina [...***...] Reagent with respect to
its written, published technical specifications (in effect on the date that the
product ships from Illumina).

 

1.56“Net Sales” means the gross amount invoiced by CareDx or its Affiliates for
the Sale of a Licensed Product during the relevant three (3) month period during
the Contract Year, minus the following deductions to the extent each is actually
given or incurred or separately accounted for in the corresponding invoice: (i)
value added taxes, sales taxes, consumption taxes, excise taxes or custom duties
and government charges levied on the production, sale, transportation or
delivery of such products and services; (ii) costs of insurance and
transportation from the place of manufacture to the customer’s premises; (iii)
credit, allowances and charge backs for rejections, returns, allowances or
trades; and (iv) customary trade, quantity and cash and prompt payment
discounts. Net Sales shall not include any amounts received or invoiced by
CareDx or its Affiliates for using or disposing any Licensed Product for
assuring internal product testing, validation or control, or obtaining
regulatory approvals.  For any performance of a Licensed Service, the Net Sales
amount for such Licensed Service shall be the average invoice amount of the
Licensed Product(s) used in the Licensed Service as if such Licensed Product was
Sold on its own in an arm’s-length transaction in the same three (3) month
period, subject

 

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to the foregoing allowable deductions. For the avoidance of doubt, for the
performance of a Licensed Service, the Net Sales amount for such Licensed
Service will be used for purposes of determining royalties and the Licensed
Product used in such Licensed Service will not be counted more than once or
separately be subject to royalties.  For any Sale of Licensed Products for
non-monetary consideration, the Net Sales amount for each such Sale shall be the
average invoice amount calculated from all sales of applicable Licensed Products
on their own in arm’s-length transactions in the same three (3) month period,
subject to the foregoing allowable deductions. If CareDx appoints a distributor
to sell a Licensed Product, then only the amount invoiced by CareDx to such
distributor shall be included in the calculation of Net Sales, not any amounts
invoiced by the distributor to an end-user or other customer. In the case of any
Combination Product, the Net Sales for such Combination Product for purposes of
determining royalties shall be determined by mutual agreement of the Parties in
good faith taking into account the relative value of the Licensed Product to the
other product(s) included in the Combination Product.

 

1.57“Non-Chimerism Royalty Product” means a Licensed Product that (i) has a Net
Sales amount that is greater than $[...***...] per sample (e.g., a Licensed
Product that is a 10-sample kit with a Net Sales amount of $[...***...] is
$[...***...] per sample), (ii) is not used for a Chimerism Assay application.

 

1.58“Non-Illumina Sequencing Instrument” means an instrument not sold by
Illumina that performs the actual nucleic acid sequencing, not including
ancillary instruments such as robotic liquid handlers that do not perform actual
sequencing.

 

1.59“Person” means an individual or firm, trust, corporation, partnership, joint
venture (whether entity-based or by contract), limited liability company,
association, unincorporated organization, or other legal or governmental entity.

 

1.60“Receiving Party” has the meaning set forth in Section 10.1(a).

 

1.61“[...***...]” means use of a Licensed Product in the Licensed Field for
[...***...].

 

1.62“Representatives” means a Party’s (and a Party’s Affiliates’) officers,
directors, legal representatives, financial representatives, employees and
agents.

 

1.63“Restriction Period” means the period beginning on the Effective Date and
ending on the later of the date that is either (a) the [...***...] anniversary
of the Effective Date, or (b) the expiration or termination of
[...***...].  [...***...]

 

1.64“RMA” has the meaning set forth in Exhibit B.

 

1.65“Sell” means to sell, distribute, lease, license, provide, or otherwise make
available.  The terms “Sale,” “Sold,” and other forms of the term “Sell” have
correlative meanings.

 

1.66“Substitute Product” has the meaning set forth in Section 5.7.

 

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1.67“Supplied Product” means the Illumina HLA Existing Products and the Illumina
[...***...] Reagents.  

 

1.68“Taxes” has the meaning set forth in Section 9.8(a).

 

1.69“Term” has the meaning in Section 13.1.

 

1.70“Territory” means worldwide.

 

1.71“Third Party Knowledge Transfer Components” has the meaning set forth in
Section 8.2.

 

1.72“Trade Secret Information” means Confidential Information owned or
controlled by a Party that such Party, in good faith based on trade secret law,
marks as a trade secret prior to sharing with the other Party.  

 

2.LICENSE GRANTS TO CAREDX

 

2.1Licensed Intellectual Property.  Subject to the terms and conditions of this
Agreement, Illumina hereby grants to CareDx:

 

(a)A non-transferable (except as expressly permitted in Section 14.5),
non-sublicensable (except as permitted in Section 2.2) license under all rights
owned or Controlled by Illumina in and to the Licensed Field Specific Patents to
(i) make, have made (on CareDx’s behalf), use, Sell, have Sold, offer for Sale,
import, and export any Licensed Product, and (ii) perform Licensed Services,
both in the case of (i) and (ii) solely in the Licensed Field in the Territory
during the Term.  The license granted in this Section 2.1(a) shall be exclusive
for uses within subparts [...***...] and [...***...] of the Licensed Field
during the Restriction Period only, and non-exclusive for such subparts for the
remainder of the Term.  The license granted in this Section 2.1(a) shall be
non-exclusive during the Term for subparts [...***...] through [...***...] of
the Licensed Field.

 

(b)A non-exclusive, non-transferable (except as expressly permitted in Section
14.5), non-sublicensable (except as permitted in Section 2.2) license under all
rights owned or Controlled by Illumina in and to the Licensed Field General
Patents to (i) make, have made (on CareDx’s behalf), use, Sell, have Sold, offer
for Sale, import, and export any Licensed Product, and (ii) perform Licensed
Services, both in the case of (i) and (ii) solely in the Licensed Field in the
Territory during the Term.

 

(c)A non-transferable (except as expressly permitted in Section 14.5) and
non-sublicensable (except as expressly permitted in Section 2.2) license under
all rights owned or Controlled by Illumina in and to the Licensed Field
Copyrights and Illumina Software Code to copy, use, display and perform
(publicly or otherwise), modify, create derivative works of, distribute, compile
and otherwise commercialize and exploit Licensed Products solely in the Licensed
Field in the Territory during the Term.  With respect to any Licensed Field
Copyrights and Illumina Software Code that are specific only for use in the
Licensed Field, the license granted in this Section 2.1(c) is exclusive during
the Restriction Period for use within subparts [...***...] and [...***...] of
the Licensed Field, and it is non-exclusive for the remainder of the Term and
for uses within subparts [...***...] through [...***...] of the Licensed
Field.  With respect to Licensed Field Copyrights and Illumina Software Code
covering other uses outside of the Licensed Field, the license granted in this
Section 2.1(c) shall be non-exclusive only.

 

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(d)A non-transferable (except as expressly permitted in Section 14.5),
non-sublicensable (except as permitted in Section 2.2) license under all rights
owned or Controlled by Illumina in and to the Licensed Field Specific Know-How
to (i) develop, make, have made (on CareDx’s behalf), use, market, Sell, offer
for Sale, import, export, commercialize, service, support and otherwise dispose
of any Licensed Product, and (ii) perform Licensed Services, both in the case of
(i) and (ii) solely in the Licensed Field in the Territory during the Term.  The
license granted in this Section 2.1(d) shall be exclusive for uses within
subparts [...***...] of the Licensed Field [...***...], and non-exclusive for
such subparts for the remainder of the Term.  The license granted in this
Section 2.1(d) shall be [...***...] for uses within subparts [...***...] through
[...***...] of the Licensed Field.

 

(e)A non-exclusive, non-transferable (except as expressly permitted in Section
14.5), non-sublicensable (except as permitted in Section 2.2) license under all
rights owned or controlled by Illumina in and to the Licensed Field General
Know-How to (i) develop, make, have made (on CareDx’s behalf), use, market,
Sell, offer for Sale, import, export, commercialize, service, support and
otherwise dispose of any Licensed Product, and (ii) perform Licensed Services,
both in the case of (i) and (ii) solely in the Licensed Field in the Territory
during the Term.

 

2.2Sublicense. The foregoing licenses include the right for CareDx to allow its
subsidiaries (but only for so long as they remain CareDx subsidiaries) and any
third parties to exercise CareDx’s licenses but solely on behalf and for the
benefit and account of CareDx (provided that if such third party is an acquirer
of CareDx, the obligations of Section 14.5 shall apply). CareDx shall be
responsible for any acts or omissions of any such subsidiary or third party
exercising CareDx’s licenses on CareDx’s behalf under this Agreement. Subject to
the terms and conditions of this Agreement, CareDx may sublicense its rights to
a subsidiary (but only for so long as it remains a subsidiary of CareDx) to the
extent necessary for such subsidiary to market, Sell, offer for Sale, import,
export, commercialize and otherwise dispose of any Licensed Product; provided
that any such sublicense shall be consistent with the terms and conditions of
this Agreement and CareDx shall be responsible for such sublicensee’s compliance
with such terms and shall provide prior written notice and a copy to Illumina of
such sublicense.

 

2.3No Other Licenses.  No license, sublicense or other rights granted in this
Agreement includes any license, sublicense, right, immunity or authorization,
either expressly, by implication, by estoppel or otherwise, (i) under any
Intellectual Property that is not included in the Licensed IP, (ii) outside of
the Licensed Field, or (iii) for use of products other than the Licensed
Products.  Nothing in this Agreement (i) grants a license to CareDx to any
Intellectual Property covering nucleic acid sequencing chemistries, methods,
reagents, flow cells, or instruments, or (ii) authorizes the use or Sale of any
products that are not used with an Illumina Sequencing Instrument.

 

2.4CareDx Commercialization and Milestones.  As between Illumina and CareDx,
CareDx shall have sole responsibility for the development (except for Supplied
Products), manufacture (except for Supplied Products), marketing, Sales,
service, and support of Licensed Products in the Licensed Field.  CareDx shall
use commercially reasonable efforts to: (i) develop, manufacture, market, Sell,
service, and support Licensed Products in the Licensed Field in accordance with
this Agreement, and (ii) satisfy each of the following milestones:

 

(a)First commercial availability of a Licensed Product for purchase by third
parties that (i) uses the Illumina Chimerism Formulation and Illumina Chimerism
Software, and (ii) is marketed for Chimerism Assay applications in the Licensed
Field, by [...***...];

 

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(b)First commercial availability of a Licensed Product for purchase by third
parties that is a developed version of an assay incorporating the Illumina
[...***...] Reagents, Illumina HLA v3 [...***...], and Illumina HLA v3 Software
by the later of (i) [...***...], or (ii) [...***...] months after Illumina first
delivers commercial production Illumina [...***...] Reagents to CareDx; and

 

(c)Cumulatively spend at least $[...***...] between the Effective Date and the
fifth anniversary of the Effective Date in incremental research and development,
sales, marketing, and support of Licensed Products.

 

Notwithstanding anything to the contrary in this Agreement, if Illumina fails
to: (i) complete the Knowledge Transfer in accordance with Section 8.1, (ii)
supply the Supplied Products on the timing specified in this Agreement, or (iii)
[...***...] then, in any of the foregoing cases, CareDx will be excused from
meeting any of the above milestones by the specified dates above for the amount
of time it takes Illumina to remedy any such failure. If CareDx fails to use
commercially reasonable efforts to meet any of the above milestones by the
specified date above for reasons other than (i) Illumina’s failure to complete
the Knowledge Transfer, supply the Supplied Products or provide a Substitute
Product, in each case, as set forth in the immediately preceding sentence or
(ii) Force Majeure then, in such a case, Illumina may give written notice
[...***...] and upon CareDx’s receipt of such notice, the Parties will promptly
meet to discuss a resolution in good faith for a reasonable period of time
mutually agreed upon by the Parties, but in any event not longer than 30 days
unless the Parties agree to extend the discussion period, in which case the
discussion period shall expire at the end of the extension period. In the event
that (i) CareDx fails to meet any agreed upon resolution within any mutually
agreed upon timing for such resolution, or (ii) no resolution is agreed upon by
the expiration of the foregoing good faith discussion period and the milestone
is still not achieved by the conclusion of such good faith discussions then, the
licenses granted in this Agreement with respect to the Licensed Product for
which CareDx failed to achieve the milestone [...***...]. For the avoidance of
doubt, the Parties acknowledge and agree that neither (x) the failure by
Illumina to complete the Knowledge Transfer or supply the Supplied Products
within 5 days after the timing specified in this Agreement nor (y) the failure
by CareDx to meet any milestone within 5 days after the specified date above
shall, in either case, be deemed to be a material breach of this Agreement.   

 

3.IMPROVEMENTS BY CAREDX; FUTURE ILLUMINA TECHNOLOGY

 

3.1License to Illumina.  Subject to the terms and conditions of this Agreement
CareDx hereby grants to Illumina a non-exclusive, fully paid-up, worldwide,
transferable (but only to the extent expressly permitted under Section 14.5),
sublicensable (but only to its Affiliates for as long as they remain Illumina’s
Affiliates) license (including the right to have third parties acting on behalf
of Illumina but solely for the benefit and account of Illumina, provided that
Illumina will remain responsible for the acts and omissions of its Affiliates or
third parties under any such sublicense or this right) during the Term to use
and exploit any Improvements to make, have made, use, sell, offer for sale,
import, and

 

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export any product or service for use outside of the Licensed Field but only in
certain fields mutually agreed upon by the Parties.  CareDx shall provide
written notice to Illumina of any Improvements at each quarterly meeting
described in Section 6.1 (or if no such meeting occurs, then either (i) at least
30 days prior to the planned commercial launch of such Improvement, or (ii)
within 5 days of a patent application being filed that claims all or any
material portion of such Improvement, whichever is first), and such notice shall
describe the Improvements in a level of detail sufficient to enable Illumina to
evaluate the Improvement to determine whether or not to exercise the Option set
forth in Section 3.2.

 

3.2Illumina Option.  Subject to the terms and conditions of this Agreement,
CareDx hereby grants to Illumina an exclusive option to receive a co-exclusive
(with CareDx) license under all rights CareDx has or may have in any
Improvements in certain fields mutually agreed upon by the Parties outside of
the Licensed Field (the “Option”). Any definitive license agreement(s) will be
on commercially reasonable terms negotiated in good faith, will be for use
outside of the Licensed Field, and will be sublicensable to Illumina’s
Affiliates (but solely for so long as they remain Illumina’s Affiliates) and, as
part of any such license granted to Illumina from the exercise of its Option,
Illumina may have third parties exercising its license on its behalf and solely
for its benefit and account; provided that Illumina will remain responsible for
the acts and omissions of its Affiliates or third parties under any such
sublicense or this right.  Illumina may exercise its Option on a case by case
basis by providing written notice of exercise to CareDx within [...***...] after
receiving written notice of the Improvement in accordance with Section 3.1.  If
(without in any way limiting the notice requirement) Illumina reasonably
believes that no notice of the Improvement is provided, then the Parties will
promptly meet to discuss in good faith the reason therefor and, if appropriate
and the Parties believe in good faith that such Improvement is either intended
to be commercially launched or intended to be patented (all or any material
portion of such Improvement) then, in such a case, Illumina may exercise its
Option for such Improvement by providing written notice of exercise to CareDx
within [...***...] of the date the Parties first meet to discuss the same.  The
Option, and any co-exclusive license(s) granted upon the exercise of the Option,
will be subject to CareDx’s non-transferable (except as expressly permitted in
Section 14.5), non-sublicensable (except as expressly permitted in Section 2.2),
co-exclusive right to use and, in the Licensed Field commercialize, the
Improvement for any purpose.  The Option will be binding on any assignee or
other successor in interest of any Improvement.

 

3.3Future Illumina Technology.  If requested in writing by CareDx (such request
not to be made more than once every 6 months), Illumina shall engage in good
faith discussions with CareDx about the potential application of technology
created by or on behalf of Illumina after the Effective Date in the Licensed
Field; provided that Illumina shall not be obligated to share any non-public
information in such discussions.

 

4.SALES RESTRICTIONS

 

4.1CareDx Restrictions.  For the period from the Effective Date until
[...***...] or the termination of this Agreement, if earlier, CareDx and its
Affiliates shall not, and shall not facilitate, grant licenses to, or assist a
third party to, [...***...], [...***...] or [...***...]; provided that
notwithstanding the foregoing, CareDx shall not be in breach of this Section
4.1: (a) for developing, making, having made (on CareDx’s behalf), using,
marketing, Selling, offering for Sale, importing, exporting, commercializing,
servicing, supporting and otherwise disposing of in the Licensed Field: (i) any
current products or services of CareDx or its

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Affiliates, including Allosure and AlloMap, or any products or services in
development that are not intended for use in a next-generation nucleic acid
sequencing workflow, in each case, as of the Effective Date, (ii) any
improvements, enhancements, modifications, updates, upgrades or future
equivalents to any of the foregoing products or services not used in a
next-generation nucleic acid sequencing workflow, (iii) any natural evolutions
or new versions that are based substantially on such products or services set
forth in Section 4.1(a)(i) and/or Section 4.1(a)(ii) above (subsections (i),
(ii) and (iii) above, collectively, “CareDx Existing Products”), or (b) if any
of its distributors separately promote, recommend or sell products or services
in the Licensed Field that use Non-Illumina Sequencing Instruments which, other
than CareDx Existing Products, are not provided to such distributor by CareDx or
its Affiliate, directly or indirectly. For the avoidance of doubt and
notwithstanding anything else in this Agreement or otherwise, the use of
Allosure and Allomap, and any improvements, enhancements, modifications, updates
or upgrades of, or future equivalents to Allosure or Allomap, will not be, and
will not be deemed to be part of, the Licensed Field.

 

4.2Illumina Restriction.  

 

(a)[...***...], neither Illumina nor any of its Affiliates shall, nor shall they
collaborate with a third party to manufacture, develop, promote, launch or
commercialize a product or service that Illumina knows is or will be promoted,
designed, and intended specifically for use in subpart [...***...] or subpart
[...***...] of the Licensed Field (“Illumina Product Restriction”).  For the
avoidance of doubt, the Illumina Product Restriction will not apply to the
extent that [...***...].

 

(b)Without limiting Section 4.2(a) or any exclusivity associated with the
license grants in Section 2, nothing in this Agreement shall obligate Illumina
or its Affiliates to (i) [...***...], or (ii) [...***...].

 

(c)If the exclusive licenses granted in this Agreement [...***...] with respect
to a Licensed Product, [...***...].

 

(d)Upon the earlier of: (i) [...***...] and (ii) [...***...], develop,
manufacture, promote, recommend, Sell or commercialize a product or service that
otherwise would have been prohibited under Section 4.2(a); provided that
[...***...]. Upon [...***...] will, in each of the foregoing cases, [...***...].
In the event that [...***...] for use in subpart [...***...] or subpart
[...***...] of the

(a)

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Licensed Field in a [...***...] that uses Non-Illumina Sequencing Instruments,
or CareDx does so itself, then Illumina shall have the right [...***...].

 

5.USE AND RE-SALE OF ILLUMINA PRODUCTS

 

5.1Supply and Use of Illumina HLA Existing Products.  CareDx will purchase, and
Illumina will Sell, Illumina HLA Existing Products in accordance with the
pricing and the terms and conditions set forth in Exhibit B.  Illumina HLA
Existing Products shall only be used in the Licensed Field, with an Illumina
Sequencing Instrument, and in accordance with their Documentation.  All terms
and conditions apply whether CareDx is purchasing such products for its own use
or for re-Sale.  Illumina may, in its sole discretion, stop supply to CareDx of
all Illumina HLA Existing Products on or after December 31, [...***...] (“Supply
Expiration Date”); provided that Illumina will provide written notice of the
same to CareDx more than six (6) months from the Supply Expiration Date. CareDx
may place one last-time-buy order for the Illumina HLA Existing Products, for an
amount of Illumina HLA Existing Products not to exceed [...***...]% of its most
recent forecast provided to Illumina under this Agreement for the period between
the last-time-buy order and the Supply Expiration Date, at least six (6) months
prior to the Supply Expiration Date.  Illumina will supply the Illumina HLA
Existing Products under the last-time-buy order by the delivery date set forth
in such last-time-buy-order; provided that such delivery date is at or longer
than Lead Time. To the extent that Illumina believes that such shipment may be
delayed then, without limiting CareDx’s other rights or remedies, the Parties
will discuss a revised shipping schedule for Illumina HLA Existing Products
under the last-time-buy order in good faith.

 

5.2Appointment of CareDx to Re-Sell Illumina HLA Existing Products.  Subject to
the terms and conditions of this Agreement, including but not limited to this
Section 5.2 and Exhibit C, Illumina hereby appoints CareDx as its exclusive
(even as to Illumina and its Affiliates) distributor for the re-Sale of Illumina
HLA Existing Products during the Term for use in the Licensed Field only,
subject to the following:

 

(a)Such exclusivity shall commence on June 1, 2018, prior to which time the
appointment shall be non-exclusive; provided that during such period Illumina
will not, directly or indirectly, accept any new orders to Sell any of the
Illumina HLA Existing Products to any distributors or similar third parties, and
that both before and after the commencement of exclusivity, current distributors
will be allowed to sell HLA Existing Products that are in inventory or have
shipped to the distributor at the time of the Effective Date;

 

(b)The terms for transitioning Illumina’s existing obligations for sales and
support of Illumina HLA Existing Products are set forth in Exhibit F; and

 

(c)Notwithstanding the foregoing or otherwise, Illumina shall still have sole
responsibility for the [...***...] customer account, and shall directly sell the
Illumina HLA Existing Products to [...***...], in each case, until [...***...].

 

5.3Supply and Use of Illumina [...***...] Reagents.  CareDx will purchase, and
Illumina will Sell, Illumina [...***...] Reagents in accordance with the pricing
and the terms and conditions set forth in Exhibit B.  Illumina [...***...]
Reagents shall only be used in the Licensed Field, with an Illumina Sequencing
Instrument, and in accordance with their Documentation, and subject to the
restrictions set forth in Section 5.4(a)-(c).  All terms and conditions apply
whether CareDx is

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purchasing such Illumina [...***...] Reagents for its own use or for
re-Sale.  Illumina shall use commercially reasonable efforts to first make
commercial production Illumina [...***...] Reagents (for non-[...***...] use)
available for purchase under this Agreement no later than [...***...].

 

5.4Appointment of CareDx to Re-Sell Illumina [...***...] Reagents.  Subject to
the terms and conditions of this Agreement, including but not limited to this
Section 5.4 and Exhibit C, Illumina hereby appoints CareDx as its non-exclusive
distributor for the re-Sale of Illumina [...***...] Reagents during the Term for
use in the Licensed Field only, subject to the following additional restrictions
on CareDx and any third parties that are re-Selling or using Illumina
[...***...] Reagents purchased under this Agreement:

 

(a)Illumina [...***...] Reagents shall only be re-Sold and used as a component
of a Licensed Product that provides [...***...];

 

(b)The configuration of Illumina [...***...] Reagents received from Illumina
shall not be broken-up or diluted for use or re-Sale (e.g., a group of Illumina
[...***...] Reagents intended for use with [...***...] samples may not be split
up into kits for use with [...***...] samples, and may not be diluted for use
with a kit for use with [...***...] samples); and

 

(c)Illumina [...***...] Reagents sold to CareDx for use in preparing libraries
for up to [...***...] samples (with [...***...]) may only be used and re-Sold
for [...***...].

 

Illumina agrees to consider in good faith any written proposals made by CareDx
to modify the above restrictions in subsections (a) – (c) of this Section 5.4 to
enable a bona fide opportunity for re-Sale of such products to a third party for
use as [...***...] for [...***...].

 

5.5Use of Subdistributors and Agents.  CareDx may, with Illumina’s prior written
consent, appoint a distributor, agent, or other third party to promote or
re-Sell Supplied Products. To the extent Illumina approves of a third party
authorized by CareDx to re-Sell Supplied Products as its agent or otherwise on
CareDx’s behalf , CareDx shall ensure that such third party enters into a
written agreement with CareDx that binds such third party to terms that are at
least as protective of Illumina as those under this Agreement, including without
limitation terms relating to Illumina Intellectual Property, Illumina
Confidential Information, anti-bribery, anti-corruption, and ethics. Illumina
has the right to receive, upon written request, a copy of any written agreement
entered into by CareDx with any such third party relating to Supplied Products
in order to verify that the terms and conditions of any agreement comply with
this Section 5.5. In all cases and at all times CareDx shall remain fully liable
for performance, acts, and omissions of any third parties re-Selling the
Supplied Products as its agent or otherwise on its behalf. Without limiting the
foregoing, the aforementioned written agreement must include a prohibition on
the third party registering any Supplied Products in any jurisdiction. For the
avoidance of doubt, any other third party that receives a Supplied Product from
CareDx (directly or indirectly), including any distributor or third party that
is an end provider or supplier to customers of the Supplied Products that are
not acting on CareDx’s behalf or as its agent, will be, and will be deemed to
be, CareDx’s customer and be subject to the [...***...]. In the event that: (a)
CareDx becomes aware of any distributor, agent, or third party re-Seller: (i)
re-Selling the Supplied Products [...***...], (ii) using the Supplied Products
with

 

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a [...***...] that does not [...***...] in the Licensed Field, or (iii) using
the Supplied Products [...***...], or (b) Illumina sends CareDx written notice
of the same, CareDx shall promptly send a written notice to the applicable
distributor or third party requesting that such distributor or third party
ceases such activity. In the event that such distributor or third party does not
cease such activity within thirty (30) days or such other reasonable period of
time as may be set forth in any written agreement between CareDx and such
distributor or third party, the Parties will promptly meet to discuss a
resolution in good faith, which may include CareDx’s enforcement of any one or
more of its rights or remedies that may be available to it under any such
written agreement for the benefit of Illumina.

 

5.6Service and Support.  Absent any express language in the Transition Services
Agreement, Illumina’s warranty-related obligations to CareDx for Supplied
Products shall be as set forth in Exhibit B.  CareDx will be solely responsible
for service and support of Supplied Products that it re-Sells.  Illumina and
CareDx will enter into a Transition Services Agreement containing the services
set forth in Exhibit E, without any additions or expansions, as promptly as
possible after the Effective Date, but no later than 10 days after the Effective
Date (or such longer period of time as may otherwise be agreed upon by the
Parties).

 

5.7Discontinuation/Changes to Illumina [...***...] Reagents.  Supplied Products
will not be manufactured in their current configurations indefinitely as a
result of product life cycle or other business considerations.  A given Supplied
Product may be phased out of production and no longer available and/or there may
be a new, reconfigured, or repackaged version of a Supplied Product that
embodies a Material Change (such discontinued or Materially Changed Supplied
Product is referred to as a “Discontinued Product”).  Any product or combination
of products that is intended by Illumina to replace such Discontinued Product
shall be referred to as a “Substitute Product”; provided that: (i) in no event
will there be a [...***...] and (ii) in addition to and without limiting the
generality of its obligations under this Agreement, Illumina will [...***...].
Illumina will [...***...] at least [...***...] and will [...***...]. Subject to
the foregoing, in some instances a Substitute Product may [...***...].  In other
instances the Substitute Product may [...***...].  Upon receipt of the
[...***...], and at any time prior to or on the [...***...], CareDx may
[...***...] for the period between the [...***...] and the [...***...] but
otherwise in accordance with [...***...]. In the case of a Discontinued Product
that will have [...***...], Illumina will [...***...].  In the case of a
Discontinued Product that will have [...***...], Illumina will
[...***...].  Once a Discontinued Product is no longer available for purchase
[...***...], Illumina will [...***...] and either of the following will occur:
(i) [...***...]

 

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or (ii) [...***...].  The price for a Substitute Product will be
[...***...].  Use of Substitute Products shall be subject to the terms and
conditions of this Agreement.

 

5.8Branding.  

(a)Branding for Supplied Products shall be performed by Illumina.  Branding for
products or services containing Supplied Products that are re-Sold by CareDx
shall be governed by Exhibit C, Section 3 (Labeling).

 

(b)CareDx shall market, promote and Sell the Licensed Products under one or more
trademarks selected by CareDx (the “CareDx Marks”) either alone or, if requested
by Illumina in combination with the Illumina logo and branding for Licensed
Products that include Illumina [...***...] Reagents.  The CareDx Marks shall be
owned solely and exclusively by CareDx.  Illumina shall have no rights to use
the CareDx Marks.  Any use of the CareDx Marks and all associated goodwill will
inure solely to the benefit of CareDx.  If Illumina requests the inclusion of
Illumina’s logo or branding, the Parties will discuss in good faith the manner
in which it will be incorporated, including but not limited to compliance with
Illumina’s branding guidelines, Illumina’s right to approve prior to each use,
and execution of a personal, limited, non-exclusive, royalty-free, and
non-transferable trademark license.

 

5.9Illumina HLA Existing Product Software.  CareDx shall, [...***...], provide
to its customers [...***...] approximately every [...***...] months (including
an [...***...] in [...***...]).

 

5.10Illumina Sequencing Instruments. Illumina shall sell Illumina Sequencing
Instruments and related sequencing consumables, in its reasonable discretion,
separately to CareDx's customers in accordance with Illumina’s standard
practices for such products.

 

6.MEETINGS

 

6.1Information Sharing Meetings.  Each Party shall designate one representative
as the relationship managers for this Agreement.  The representatives shall be
the primary points of contact for the Parties regarding the activities
contemplated by this Agreement and shall facilitate all such activities
hereunder. Each Party’s representative will meet quarterly or as otherwise
mutually agreed upon by the Parties to discuss each Party’s activities under
this Agreement.  Attendance at such meetings may be in person or by telephone
although the Parties shall meet in person at least once a year.  The location of
such meetings shall alternate between locations designated by Illumina and
locations designated by CareDx.  At each meeting the Parties will discuss the
following topics at the request of the other Party:

 

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(a)Updates on CareDx’s marketing and commercialization efforts for Licensed
Products;

(b)Updates on CareDx’s development efforts for Licensed Products;

(c)Updated list of individuals that possess Trade Secret Information or any
third parties to whom Confidential Information was disclosed;

(d)Updates on CareDx’s progress for internalizing functions governed by the
Transition Services Agreement, if applicable;

(e)Written notice of any Improvements that are intended for commercial launch or
to be patented (all or any material portion of such Improvement);

(f)Ongoing and future market trends and developments in the Licensed Field.

 

6.2Good Faith Discussions. In addition to and not in lieu or limitation of
Section 3.3 and otherwise the Agreement, in the event that there are any
additional [...***...] that CareDx would like to add non-exclusively to the
Licensed Field then the Parties will discuss in good faith, at the request of
either Party, including during any information sharing meetings whether or not
to add any additional [...***...], as applicable, to the Licensed Field.

 

6.3Minutes.  The representatives from the Parties shall designate one person to
be responsible for preparing and circulating minutes of each meeting, setting
forth an overview of the discussions at the meeting and a list of any actions,
decisions or determinations made at such meeting.

 

7.OWNERSHIP; PROSECUTION; AND ENFORCEMENT OF LICENSED IP

 

7.1Ownership of License IP.  As between Illumina and CareDx, Illumina and its
licensors own all rights, title, and interest in and to all Licensed IP.  CareDx
will not represent that it has any ownership interest in or to any Licensed
IP.  

 

7.2Prosecution and Enforcement.  Illumina retains the sole right to file,
prosecute, maintain, defend, and enforce, in its sole discretion, the Licensed
IP; provided that for Licensed Field Specific Patents and any Licensed Field
Copyrights to the extent exclusively licensed to CareDx (“Exclusive IP”):

 

(a)If CareDx provides Illumina with written notice (including a detailed
description) of [...***...] and Illumina does not [...***...], then CareDx shall
[...***...] and, in such a case, Illumina will [...***...], and, to the extent
necessary [...***...].  If CareDx [...***...], it shall not [settle such lawsuit
in any manner that could be detrimental to Illumina’s rights in Licensed IP or
Illumina’s ability to enforce Licensed IP].  Illumina shall have the right to
[...***...].  Any [...***...] from any such [...***...] in the Licensed Field,
including from [...***...].

 

(b)If Illumina elects to: (i) abandon on-going prosecution of a patent
application or (ii) stop maintenance of a patent, in each case, that is part of
the Licensed Field Specific Patents, it shall

 

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notify CareDx in a reasonable timeframe and CareDx shall have the option to
elect to continue prosecution of such patent application or maintenance of such
patent, in each case, [...***...]; provided that Illumina shall agree to assign
to CareDx, if CareDx so desires, any such patent application and patent that
Illumina desires to abandon or no longer wants to maintain, as applicable.
Effective as of the effective date of the assignment, such patent application
and patent, as applicable, shall no longer be a Licensed Patent and CareDx shall
not have any further royalty or other payment obligation to Illumina for such
patent application or patent.

 

8.TECHNOLOGY TRANSFER

 

8.1Knowledge Transfer.  The Parties have agreed on a knowledge transfer for
Licensed Know-How relating to the Illumina HLA v3 [...***...], Illumina HLA v3
Software, Illumina Chimerism Formulations, and Illumina Chimerism Software, the
details of which are expressly set forth in Exhibit D (“Knowledge
Transfer”).  The Parties shall use commercially reasonable efforts to complete
the Knowledge Transfer no later than two (2) months after the Effective
Date.  The Parties acknowledge that Illumina is not required to provide anything
that is not in its possession or control or which cannot be accessed,
identified, and/or located using commercially reasonable efforts, and is not
required to provide additional manufacturing, new materials, or quality control
or other processes beyond what exists as of the Effective Date. Notwithstanding
the foregoing, and subject to Illumina’s using commercially reasonable efforts
to complete the Knowledge Transfer in accordance with this Section 8.1,if at any
time prior to the [...***...] of the Effective Date CareDx identifies any
documents, data, information or materials that are within the Licensed IP and
either (a) reasonably necessary for CareDx to exercise its rights or perform its
obligations under this Agreement or (b) used by Illumina or any of its
Affiliates prior to the Effective Date to exercise their rights in and to the
Licensed IP for the library preparation phase (including, for the avoidance of
doubt, Know-How relating to the [...***...] licensed under this Agreement) or
[...***...] in the Licensed Field or (c) in the case of Illumina HLA v3
[...***...], prior versions of such [...***...] that were used by Illumina or
any of its Affiliates prior to the Effective Date for the Licensed Field but
were not, in any of the foregoing cases, previously delivered to CareDx, then in
such a case, CareDx shall identify such documents, data, information or
materials to Illumina and the Parties will discuss in good faith as to whether
or not such documents, data, information, or materials should have been included
in the Knowledge Transfer.  If the Parties in good faith determine that
inclusion is appropriate, Illumina will provide CareDx in a reasonable timeframe
with such documents, data, information or materials that are in its possession
or control or that Illumina can access and/or locate using commercially
reasonable efforts.

 

8.2Third Party Components.  CareDx acknowledges that certain components of the
Illumina technology described in Section 8.1 are sourced by Illumina from third
parties as listed on Exhibit G attached hereto and incorporated herein (“Third
Party Knowledge Transfer Components”).  CareDx acknowledges that Illumina will
be limited in its ability to provide certain materials and information in the
Knowledge Transfer relating to the Third Party Knowledge Transfer Components,
and CareDx must negotiate its own supply and rights to obtain any necessary
information relating to Third Party Knowledge Transfer Components and to obtain
Third Party Knowledge Transfer Components themselves.  No Intellectual Property
rights, information, or materials relating to Third Party Knowledge Transfer
Components are included in the licenses granted in Section 2.1.  

 

9.PAYMENTS; MINIMUM PURCHASE OBLIGATIONS

 

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9.1Upfront Fee.  No later than 10 days after the Effective Date, CareDx shall
pay to Illumina a one-time, non-refundable fee in the amount of $5,000,000.

 

9.2Minimum Purchase Obligation.  CareDx shall purchase at least the following
amounts of Supplied Products for each Contract Year listed in the table below,
subject to the following:

 

(a)Royalties paid under Section 9.3 in a Contract Year shall count towards the
minimum amounts required in the table below for such Contract Year;

 

(b)If in a Contract Year, CareDx exceeds the minimum amount set forth below for
such Contract Year, the amount in excess shall be counted towards future
Contract Years until it is exhausted; and

 

(c)If CareDx fails to meet the minimum amount set forth below in a Contract
Year, it shall have until [...***...] after the expiration of the applicable
Contract Year to remedy such shortfall (in addition to the minimum amount set
forth for the following Contract Year).

 

(d)The minimum purchase obligations under this Section may terminate earlier
pursuant to Section 4.2(c) above.

 

(e)Illumina may, in its sole discretion any time after the third anniversary of
the Effective Date, terminate the minimum purchase obligations under this
Section by providing written notice to CareDx.

 

Contract Year

Minimum Amount

1

$[...***...]

2

$[...***...]

3

$[...***...]

4

$[...***...]

5

$[...***...]

 

9.3Royalties.  CareDx shall pay Illumina the following earned royalties during
the Term:

 

(a)[...***...]% on [Net Sales of Non-Chimerism Royalty Products minus
($[...***...] * quantity of Non-Chimerism Royalty Products included in such Net
Sales calculation)]; and

 

(b)[...***...]% on Net Sales of Chimerism Royalty Products.

 

Earned royalties are not owed for Sales of Illumina HLA Existing Products.  If
this Agreement is still in effect at the time of expiration of the
last-to-expire Licensed Patent, and if applicable law requires decreased royalty
rates due to such expiration, then the Parties will negotiate such new rates in
good faith.

 

9.4Payments and Reports.  CareDx will pay the amounts due under Section 9.2 and
concurrently submit a written royalty report to Illumina within 30 days after
the end of each 3 month period of the Contract Year.  This report will state the
quantity, description and aggregate Net Sales of each Licensed Product on a
country-by country basis during the completed 3 month period, along with

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any applicable deductions applied in deriving the Net Sales amount.  Royalty
reports are to be sent to:  Director, Accounting at the address as given in
Section 14.7.  Royalty payments shall be made by wire transfer as directed by
Illumina in writing.  If no royalty-bearing Sales are made during the applicable
period, a report shall still be sent in accordance with this Section 9.4 stating
that no Sales were made.

 

9.5Audit Rights.  CareDx agrees to, and will cause its Affiliates to, keep
complete and accurate records of Sales and use (for Licensed Services) of
Licensed Products in sufficient detail to enable evaluation of CareDx’s
compliance with this Agreement and to enable the royalties due hereunder to be
determined.  Such records shall be maintained for five years following the end
of the calendar year to which they pertain.  Upon at least 30 days’ prior
written notice from Illumina (unless such audit is “for cause,” in which case no
more than 5 business days’ prior written notice is required), CareDx agrees to
permit during CareDx’s regular business hours an independent certified public
accountant, who is subject to written obligations of confidentiality at least as
protective as those provided in this Agreement, to periodically examine, at
Illumina’s expense and not more frequently than once every calendar year, books,
ledgers and records for the sole purpose of verifying the payments made by
CareDx pursuant to this Agreement.  If any amounts due to Illumina are
ultimately determined to have been underpaid in an amount equal to or greater
than [...***...]% of the total amount due during the period examined, then
CareDx will pay the reasonable cost of the examination and the balance of the
total amount due. Any undisputed amount due a Party under this Section 9.5 shall
be paid within 30 days after receipt of an invoice for same.  

 

9.6Currency Conversion.  All payments made under this Agreement will be in U.S.
Dollars.  If any amount applicable to a payment under this Agreement is
initially received or invoiced or calculated in a currency other than U.S.
Dollars, then the amount will first be determined in the applicable foreign
currency and then converted into equivalent U.S. Dollars using the exchange rate
quoted on www.oanda.com or its successor site, or another well recognized
currency exchange rate service in the event that www.oanda.com or a successor
site is no longer available.  

 

9.7Interest.  If CareDx fails to make any royalty payment under this Agreement
after the date such payment is due as set forth in this Agreement, then interest
will accrue on such payment amount on a daily basis from the date such payment
was originally due until such payment is paid in full to Illumina at a rate of
1.5% per month or, if lower, the maximum interest rate allowed by applicable
law.  CareDx will pay such interest to Illumina when such payment is actually
made.  CareDx’s obligation to pay interest on such late payments as set forth in
this Section 9.7 will not be construed to limit or restrict Illumina’s right to
any other rights or remedies which may be available to it, including any right
Illumina may have to terminate this Agreement.

 

9.8Taxes.

 

(a)Each Party is and will be responsible for payment of all taxes, duties,
levies, fees, excises or tariffs (“Taxes”) that it is obligated to pay pursuant
to applicable laws, and no Party is or will be responsible for, or incur any
liability on account of, any Taxes payable by any other Party.

 

(b)If CareDx is required to withhold any Taxes from any payment made to Illumina
or any of its Affiliates under this Agreement, CareDx will remit and provide
Illumina with evidence that CareDx has remitted such Taxes to the relevant
taxing authority and pay Illumina or the applicable Affiliate the remaining
amount.  Each Party shall provide reasonable assistance and cooperation to the
other Party to, as permitted by law, reduce the amount of any withholding taxes
or enable the recovery of any value

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added tax or tax credit, or similar obligations resulting from payments made
under this Agreement, including providing any tax forms requested by the other
Party; provided that neither Party shall have any obligation to provide
assistance or cooperation that may reasonably expose it to any liability.  

 

10.CONFIDENTIAL INFORMATION

 

10.1Disclosure and Use Restriction.

 

(a)Except to the extent expressly authorized in this Agreement for a Party to
exercise its rights or perform its obligations or as otherwise agreed in writing
by the Parties, a Party (“Receiving Party”) receiving, obtaining or otherwise
having access to any Confidential Information of the other Party (“Disclosing
Party”) will keep confidential and may not publish or otherwise disclose or
transfer any of the Disclosing Party’s Confidential Information to any third
party.  Licensed Know-How is the Confidential Information of Illumina.

 

(b)The Receiving Party will use at least the same standard of care as it uses to
protect proprietary or confidential information of its own to ensure that it and
its Representatives do not make any unauthorized disclosures or use of the
Disclosing Party’s Confidential Information.  The Receiving Party will promptly
notify the Disclosing Party upon discovery of any unauthorized disclosure or use
of the Disclosing Party’s Confidential Information.

 

(c)Each Party’s confidentiality and non-use obligations in this Agreement with
respect to the Confidential Information of the other Party will continue
throughout the Term and for 5 years thereafter.

 

10.2Authorized Disclosure.  The Receiving Party may disclose the Disclosing
Party’s Confidential Information to the extent that such disclosure is:

 

(a)made in response to a valid order of a court of competent jurisdiction or
other governmental authority; provided, however, that such Receiving Party will,
to the extent permitted by applicable law, give written notice to the Disclosing
Party within 5 business days after receipt of such order and give the Disclosing
Party a reasonable opportunity to quash such order and to obtain a protective
order requiring that the Confidential Information and documents that are the
subject of such order be held in confidence by such court or governmental or
regulatory body or, if disclosed, be used only for the purposes for which the
order was issued; and provided, further, that if such disclosure order is not
quashed or a protective order is not obtained, the Confidential Information
disclosed in response to such court or governmental order will be limited to
that information which is legally required to be disclosed in response to such
court or governmental order;

 

(b)otherwise required by applicable law, rule, or regulation (other than the
laws, rules or regulations of the Securities and Exchange Commission or a
nationally recognized stock exchange, which is governed by Section 10.5 below);
provided, that the Disclosing Party will provide the Receiving Party with
written notice of such disclosure at least 30 days in advance thereof to the
extent practicable and permitted by applicable law, rule, or regulation and will
reasonably consider any comments received from the Disclosing Party;

 

(c)made for purposes of defending or enforcing the Licensed IP in a litigation,
legal proceeding, or administrative case; or

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(d)made by the Receiving Party with the prior written consent of the Disclosing
Party.

 

10.3Authorized Use.  The Receiving Party may use the Disclosing Party’s
Confidential Information solely to the extent necessary for the Receiving Party
to perform its obligations and exercise its express rights under this Agreement
without obtaining the Disclosing Party’s prior written consent (except to the
extent such Confidential Information constitutes Trade Secret Information of the
Disclosing Party); provided that any affiliates, distributors or third parties
who need to know such Confidential Information for the performance of the
Receiving Party’s obligations or exercise of the Receiving Party’s express
rights will, in each case, be bound by restrictions regarding disclosure and use
of such Confidential Information.

 

10.4Trade Secret Information.  In addition to the protections afforded to
Confidential Information in Section 10.1, each Party shall also abide by the
following for the other Party’s Trade Secret Information:

 

(a)Trade Secret Information shall not be shared, without the prior written
consent of the disclosing Party with any individuals that are not employees of
the recipient Party;

 

(b)Each Party shall identify, in accordance with Section 6.1, the individuals
that have access to the other Party’s Trade Secret Information; and

 

(c)Each Party will treat Trade Secret Information with the same degree of care
with which it treats its own trade secrets, which shall be a higher degree of
care than that afforded to other Confidential Information.

 

10.5Agreement; Publicity.  The Parties agree to keep the existence and terms of
this Agreement confidential and not disclose such existence or terms except (i)
with the other Party’s written consent, which consent shall not be unreasonably
withheld, conditioned or delayed, (ii) as may be required by law or rules or
regulations of the Securities and Exchange Commission or a nationally recognized
stock exchange (including the filing of a Current Report on Form 8-K with the
Securities and Exchange Commission), (iii) to legal counsel, accountants ,
lenders and financial advisors, (iv) in connection with any action or claim to
enforce its rights hereunder or in any related transaction, and (v) in
connection with a financing or transaction in which all or substantially all of
the other Party’s business, assets or equity is proposed to be sold, assigned or
otherwise transferred.  Subject to Section 10.2 above, each Party must obtain
the prior written consent of the other Party for all press releases or other
public announcements relating to this Agreement; provided that notwithstanding
the foregoing or otherwise, neither Party needs to obtain the prior written
consent of the other Party if the Party is repeating a public announcement that
is substantially similar to a public statement that the other Party previously
approved and provided further that notwithstanding the foregoing or otherwise,
neither Party needs to obtain the prior written consent of the other Party to
the extent such press release or other public announcement is required by law or
rules or regulations of the Securities and Exchange Commission or a nationally
recognized stock exchange (including the filing of a Current Report on Form 8-K
with the Securities and Exchange Commission).

 

10.6Post-Termination.  Following expiration or termination of this Agreement for
any reason, upon the written request of the Disclosing Party, the Receiving
Party will, at the Disclosing Party’s option, promptly (i) return all materials
containing any of the Disclosing Party’s Confidential Information to the
Disclosing Party or (ii) destroy all materials containing any of the Disclosing
Party’s Confidential

 

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Information and certify such destruction in writing to the Disclosing Party;
provided that the Receiving Party will be authorized to retain one copy of the
Disclosing Party’s Confidential Information in its Legal Department for the sole
purpose of determining any continuing obligation of the Receiving Party with
respect to the Disclosing Party’s Confidential Information.  Notwithstanding the
foregoing, the Receiving Party will not be required to destroy or delete
electronic copies (including emails) that have become embedded in its electronic
storage systems through routine backup processes.  Any of the Disclosing Party’s
Confidential Information so retained by the Receiving Party will continue to be
subject to all of the confidentiality, non-use, and other terms of this
Agreement.

 

11.REPRESENTATIONS AND WARRANTIES; WARRANTY DISCLAIMER

 

11.1Representations and Warranties.  Each Party represents and warrants that:

 

(a)it is duly organized, validly existing and in good standing under the laws of
jurisdiction of domicile, and has all requisite power and authority to carry on
its business as such business is now being conducted;

 

(b)this Agreement has been duly authorized, executed, and delivered by such
Party and constitutes the legal, valid and binding obligation of such Party,
enforceable against such Party in accordance with its terms, except as
enforceability may be limited by applicable law relating to bankruptcy,
receivership, or similar laws affecting creditors’ rights generally or by
equitable principles relating to enforceability;

 

(c)it has all necessary rights, powers, and authority to enter into this
Agreement and to carry out its obligations hereunder; and

 

(d)It will comply with all applicable law and regulations in exercising its
rights or performing its obligations under this Agreement, including all
applicable trade, corruption, commercial bribery, anti-money laundering and
anti-terrorism laws such as the U.S. Foreign Corrupt Practices Act.

 

11.2Illumina Representations and Warranties.  Illumina hereby represents and
warrants to CareDx that (i) it (or its Affiliate) holds all right, and title to,
or otherwise has the right to license or sublicense the Licensed IP; (ii) the
grant of the licenses hereunder do not violate the terms of any agreement it has
entered into with a third party relating to the Licensed IP; (iii) there are no
written Claims or, to the best of its knowledge, other Claims pending related to
the Supplied Products or use or Sale thereof; and (iv) throughout the Term,
Illumina will maintain ownership of the Licensed Field Specific Patents and will
not assign or abandon any such Licensed Field Specific Patents except as
expressly permitted under Section 7.2(b) above.

 

11.3CareDx Representation and Warranty.  CareDx hereby represents and warrants
to Illumina that (a) for any Licensed Product, CareDx shall have obtained all of
the necessary rights directly from the suppliers of the Third Party Knowledge
Transfer Components to conduct such activities as they relate to Third Party
Knowledge Transfer Components prior to conducting such activities; and (b) for
any open source software transferred in the Knowledge Transfer or used in a
Licensed Product that are specified in any related documentation or identified
by Illumina, in each case, as part of the Knowledge Transfer, CareDx shall not
take any action or inaction that would obligate Illumina or affect any of
Illumina’s assets or rights.

 

 

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11.4WARRANTY DISCLAIMER.  THE EXPRESS WARRANTIES IN THIS SECTION 11 AND IN THE
OTHER PROVISIONS OF THIS AGREEMENT ARE THE PARTIES’ EXCLUSIVE WARRANTIES WITH
RESPECT TO THIS AGREEMENT AND, TO THE MAXIMUM EXTENT PERMITTED BY APPLICABLE
LAW, EACH PARTY HEREBY DISCLAIMS ALL OTHER EXPRESS OR IMPLIED WARRANTIES
(INCLUDING THE IMPLIED WARRANTIES OF MERCHANTABILITY, NONINFRINGEMENT OF THIRD
PARTY RIGHTS except as expressly provided otherwise in this Agreement, AND
FITNESS FOR A PARTICULAR PURPOSE).  

 

12.ALLOCATION OF RISKS  

 

12.1CareDx’s Indemnification Obligation.  CareDx will defend, indemnify, and
hold Illumina, each of its Affiliates, and Illumina’s and each of its
Affiliates’ respective Representatives harmless from and against any and all
suits, claims, proceedings, and causes of action, in each of the foregoing
cases, brought by any third party (“Claim(s)”), and all damages, liabilities,
expenses, and losses, including reasonable legal expenses and reasonable
attorneys’ fees, arising out of or resulting from such Claims (“Losses”),
arising out of or resulting from: (i) CareDx’s gross negligence, willful
misconduct, or failure to comply with any applicable law, in each case in
connection with its performance under this Agreement; (ii) CareDx’s breach of
this Agreement (including any representation or warranty of CareDx set forth in
this Agreement); or (iii) the manufacture, use, offer for Sale, Sale,
commercialization, or other exploitation of any of the Licensed Products by or
on behalf of CareDx, its Affiliates, or its agents or distributors; in each case
(i), (ii) and (iii), except to the extent arising out of or resulting from (x)
the conduct of Illumina or its Affiliates described in Section 12.2 or (y) any
Claim that Licensed IP as and in the form delivered to CareDx infringes,
misappropriates or otherwise violates the Intellectual Property or proprietary
rights of a third party (other than infringement of any patent to the extent
that such Licensed IP was not previously commercialized or otherwise exploited
in a commercially available product or service by or for Illumina prior to the
Effective Date).

 

12.2Illumina’s Indemnification Obligations.  Illumina will defend, indemnify,
and hold CareDx, its Affiliates and CareDx’s and its Affiliates’ respective
Representatives harmless from and against any and all Claims and Losses arising
out of or resulting from: (i) Illumina’s or its Affiliate’s gross negligence,
willful misconduct, or failure to comply with applicable law, in each case in
connection with its performance under this Agreement; (ii) Illumina’s breach of
this Agreement (including any representation or warranty set forth in this
Agreement); (iii) any Claim that the Licensed IP as and in the form delivered to
CareDx infringes, violates, or misappropriates the Intellectual Property or
proprietary rights of any third party (other than infringement of a third
party’s patent right to the extent that such Licensed IP was not previously
commercialized or otherwise exploited in a commercially available product or
service by or for Illumina prior to the Effective Date); (iv) product liability,
personal injury or other tort arising from Illumina’s supply of the Supplied
Products or the negligence of Illumina, its Affiliates, their respective
Representatives or any other party for whom Illumina is responsible; or (v) any
Claim that the Supplied Products infringe, misappropriate or otherwise violate
the Intellectual Property rights of a third party where, for Illumina
[...***...] Products only, such claim is not brought specifically for the
Licensed Field, except that Illumina will not have any indemnity obligation with
respect to (w) any modifications made to a Supplied Product by CareDx or a third
party not in accordance with the Documentation or specifications for such
Supplied Products if such Supplied Product would not be infringing but for such
modification, (x) combination of Supplied Products with other products that are
not Supplied Products and not in accordance with the Documentation or
specifications for such Supplied Products if such Supplied Product would not be
infringing but for such combination; (y) use of the Supplied Products by CareDx
or a third party not in accordance with the Documentation or specifications for
such Supplied Products or such use that is not part of the normal or

 

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intended use of such Supplied Products, or (z) Claims arising out of or
resulting from conduct of CareDx or its Affiliate described in Section 12.1.

 

12.3THE FOREGOING CONSTITUTES THE SOLE INDEMNIFICATION OBLIGATIONS OF EACH PARTY
AND THEIR AFFILIATES IN CONNECTION WITH THIS AGREEMENT.

 

12.4Indemnification Procedures.  Each Party’s obligations under Section 12.1 and
Section 12.2 are conditioned on the Party seeking indemnification: (i) giving
the indemnifying Party reasonably prompt written notice of the Claim; provided,
however, that failure to provide such notice will not relieve the indemnifying
Party from its liability or obligations under this Section 12, except to the
extent of any material prejudice as a direct result of such failure; (ii)
reasonably cooperating with the indemnifying Party, at the indemnifying Party’s
expense, in connection with the defense and settlement of the Claim, including
using commercially reasonable efforts to provide accurate and complete
information requested by the indemnifying Party; and (iii) permitting the
indemnifying Party to solely control the defense and settlement of the Claim;
provided, however, that the indemnifying Party may not settle the Claim, enter
into or otherwise consent to an adverse judgment or order, or make any admission
as to liability or fault that would adversely affect the indemnified Party,
without the indemnified Party’s prior written consent, which will not be
unreasonably withheld or delayed.  Further, the indemnified Party will have the
right to participate (but not control) and be represented in any legal
proceeding by counsel of its selection at its own cost.

 

12.5Insurance.  Each Party will obtain and maintain insurance coverage as
follows: a policy for commercial general liability and insurance (including
product liability insurance) in the amount of no less than $[...***...] per
occurrence to protect the other Party’s indemnitees under the indemnification
provided under this Agreement.  Upon a Party’s request, the other Party will
provide appropriate certificates of insurance.  The Parties will maintain such
insurance at all times during the Term.

 

13.TERM AND TERMINATION

 

13.1Term.  This Agreement will commence on the Effective Date and, unless
terminated earlier in accordance with this Agreement, will continue in full
force and effect.  The period from the Effective Date to the date this Agreement
terminates or expires is the “Term.”

 

13.2Termination.  In addition to and without limiting any other rights of
termination expressly provided in this Agreement or under applicable law, this
Agreement may be terminated as follows:

 

(a)Breach of Provision.  If a Party materially breaches any provision of this
Agreement and fails to cure such breach within 30 days after receiving written
notice of such breach from the other Party, the non-breaching Party may
terminate this Agreement with immediate effect by providing written notice of
termination to the breaching Party.  If a material breach is not reasonably
capable of being cured within such 30 day period, and the breaching Party is
taking reasonable steps to cure such breach, the non-breaching Party will
provide a commercially reasonable extension of the cure period, not to exceed 30
additional days. For the avoidance of doubt, CareDx will not be deemed to have
breached its obligations under Sections 2.4 and 9.2 of this Agreement to the
extent that such failure is caused by Illumina’s failure to: (i) complete the
Knowledge Transfer in accordance with Section 8.1, (ii) supply the Supplied
Products on the timing specified in this Agreement or (iii) provide a Substitute
Product to replace any Discontinued Product that both passes CareDx’s reasonable
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are no more stringent than those used to validate the Discontinued Product) and
is not at a higher cost to CareDx on a per sample basis pursuant to Section 5.7.

 

(b)Bankruptcy and Insolvency.  A Party may terminate this Agreement, effective
immediately upon written notice, if the other Party becomes the subject of a
voluntary or involuntary petition in bankruptcy, for winding up of that Party,
or any proceeding relating to insolvency, receivership, administrative
receivership, administration liquidation, or similar proceeding that is not
dismissed or set aside within 60 days.

 

(c)Failure to Satisfy Minimum Purchase Obligation.  Illumina may [...***...] to
CareDx if CareDx fails to satisfy any of its minimum purchase obligations in
Section 9.2 except to the extent that such a failure arises from: (i) Illumina’s
failure to: (x) complete the Knowledge Transfer in accordance with Section 8.1,
(y) supply the Supplied Products on the timing specified in this Agreement or
(z) [...***...] or (ii) CareDx’s minimum purchase obligations are otherwise
excused, suspended or extended under this Agreement, including under Sections
4.2(c), 5.7 or 9.2 of this Agreement and/or Section 3 of Exhibit F.

 

(d)Failure by Assignee.  If this Agreement is assigned or otherwise transferred
by a party other than Illumina under Section 14.5(a), and such assignee or
transferee fails to satisfy the conditions set forth in Section 14.5(a),
[...***...].

 

13.3Effect of Termination; Survival.  

 

(a)The following provisions will survive any termination or expiration of this
Agreement: Sections 1, 5.8(b) (but only with respect to the second, third and
fourth sentences), 7.1, 9.5, 9.6, 9.7, 9.8, 10, 11, 12.1, 12.2, 12.3, 12.4,
13.3, 13.4, 13.5, 14, and Section (h) of Exhibit B.  For clarity, upon any
termination or expiration of this Agreement, all licenses and rights granted by
Illumina to CareDx will immediately terminate and revert back to Illumina,
except with respect to CareDx’s sell-off right set forth in Section 13.3(b).

 

(b)Upon termination or expiration of this Agreement, CareDx shall have the right
to sell off any Licensed Products and Illumina HLA Existing Products that have
been manufactured or are in the process of being manufactured at the time of
termination or expiration and to perform any Licensed Services for which it has
accepted purchase orders prior to the effective date of termination or
expiration, provided that, such sales and services are made in the normal course
consistent with CareDx’s past practice and CareDx continues to comply with all
of the provisions of this Agreement governing its manufacture, use, and Sale of
Licensed Products and Illumina HLA Existing Products (including its payment,
reporting and audit obligations under Section 9).

 

(c)Termination or expiration of this Agreement will not (i) relieve either Party
of any liability or obligation that accrued under this Agreement prior to the
effective date of such termination or expiration (including any payment
obligations) or (ii) preclude either Party from pursuing all rights and remedies
it may have under this Agreement, at law, or in equity with respect to any
breach of this Agreement.

 

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13.4NO DAMAGES FOR TERMINATION OR EXPIRATION.  NEITHER PARTY WILL BE LIABLE TO
THE OTHER PARTY FOR ANY DAMAGES OF ANY KIND (INCLUDING DAMAGES ON ACCOUNT OF
PRESENT OR PROSPECTIVE PROFITS, OR ON ACCOUNT OF EXPENDITURES, INVESTMENTS OR
COMMITMENTS MADE IN CONNECTION WITH THIS AGREEMENT, OR IN CONNECTION WITH THE
DEVELOPMENT OR MAINTENANCE OF THE BUSINESS OR GOODWILL OF THE OTHER PARTY) BY
REASON OF EXPIRATION OF THIS AGREEMENT OR PROPER EXERCISE OF ITS RIGHT TO
TERMINATE THIS AGREEMENT IN ACCORDANCE WITH THE TERMS AND CONDITIONS SET FORTH
IN THIS AGREEMENT, AND EACH PARTY HEREBY EXPRESSLY WAIVES ANY RIGHT IT MAY HAVE
TO RECEIVE ANY SUCH DAMAGES.  NOTWITHSTANDING THE FOREGOING, NOTHING HEREIN
SHALL PROHIBIT EITHER PARTY FROM COLLECTING DAMAGES RESULTING FROM A PARTY’S
FRAUDULENT OR FAILED ATTEMPT TO TERMINATE THIS AGREEMENT AS DETERMINED BY A
COURT OF COMPETENT JURISDICTION.

 

13.5LIMITATION OF LIABILITY.  EXCEPT FOR (1) A BREACH OF SECTION 10, (2) CLAIMS
OF A THIRD PARTY THAT ARE SUBJECT TO INDEMNIFICATION UNDER SECTION 12, OR (3) IN
THE CASE OF GROSS NEGLIGENCE OR WILLFUL MISCONDUCT OF A PARTY, NEITHER PARTY,
NOR ANY OF THEIR RESPECTIVE AFFILIATES, WILL BE LIABLE TO THE OTHER PARTY OR ITS
AFFILIATES FOR ANY INDIRECT, CONSEQUENTIAL, SPECIAL OR PUNITIVE DAMAGES OR LOST
PROFITS OR ROYALTIES, LOST DATA OR COST OF PROCUREMENT OF SUBSTITUTE GOODS OR
SERVICES, WHETHER LIABILITY IS ASSERTED IN CONTRACT, TORT (INCLUDING NEGLIGENCE
AND STRICT PRODUCT LIABILITY) OR CONTRIBUTION, AND IRRESPECTIVE OF WHETHER THAT
PARTY OR ANY REPRESENTATIVE OF THAT PARTY HAS BEEN ADVISED OF, OR OTHERWISE
MIGHT HAVE ANTICIPATED THE POSSIBILITY OF, ANY SUCH LOSSes OR DAMAGES.

 

14.GENERAL

 

14.1Dispute Resolution; Governing Law; Jurisdiction.  Either Party shall have
the right to refer any dispute between the Parties in writing to a senior
executive officer of each Party, and such senior executive officers shall
attempt in good faith to resolve such dispute.  If the Parties are unable to
resolve a given dispute within 30 days after referring such dispute to the
senior executive officers, either Party may have the given dispute settled in
court pursuant to this Section 14.1.  This Agreement and any dispute or claim
arising out of, in connection with or related to this Agreement or its subject
matter or formation will be governed and construed in accordance with the laws
of the State of California, without regard to provisions on the conflicts of
laws. Any legal action to resolve any dispute under this Agreement will take
place in Los Angeles, California, and the Parties expressly waive any objections
to such venue. The Parties agree that the United Nations Convention on Contracts
for the International Sale of Goods does not apply to this Agreement.

 

14.2Injunctive Relief; Cumulative Remedies. Each Party acknowledges that its
breach of Section 10 or any actual or potential infringement or misappropriation
of the other Party’s Intellectual Property rights may cause irreparable injury
to the other Party for which monetary damages would not be an adequate remedy,
and the other Party will therefore be entitled to seek injunctive relief
(including specific performance) with respect to any breach or threatened breach
without posting a bond or other security as a condition for obtaining any such
relief. The rights and remedies provided to each Party in this Agreement are
cumulative and in addition to any other rights and remedies available to each
Party under this Agreement, at law or in equity.

 

14.3Affiliates; Rights of Third Parties.  Illumina may delegate or subcontract
any or all of its rights and obligations under this Agreement to one or more of
its Affiliates; provided that Illumina shall remain fully responsible and liable
for any act or omission on the part of its Affiliates (relating to their

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performance for Illumina under this Agreement).  Illumina invoices and other
documentation may come from any Affiliate of Illumina, and CareDx will honor
those just as if they came directly from Illumina.  Except to the extent
expressly stated otherwise, this Agreement is personal to CareDx.  Except as
expressly provided with respect to each Party’s indemnification obligations,
there are no third party beneficiaries to this Agreement, and no term of this
Agreement is enforceable by a Person who is not a Party to this Agreement. The
Parties may rescind or terminate this Agreement or vary any of its terms in
accordance with their rights under this Agreement and by applicable law,
including in accordance with Section 14.9 below, but without the consent of any
third party.

 

14.4Severability; No Waiver.  If any term or provision of this Agreement is
invalid, illegal or unenforceable in any jurisdiction, such invalidity,
illegality or unenforceability will not affect any other term or provision of
this Agreement or invalidate or render unenforceable such term or provision in
any other jurisdiction.  Upon a determination that any term or provision is
invalid, illegal or unenforceable, the Parties will negotiate in good faith to
modify this Agreement to effect the original intent of the Parties as closely as
possible in order that the transactions contemplated by this Agreement be
consummated as originally contemplated by the Parties to the greatest extent
possible.  The failure or delay of either Party to exercise any right or remedy
provided in this Agreement or to require any performance of any term of this
Agreement may not be construed as a waiver, and no single or partial exercise of
any right or remedy provided in this Agreement, or the waiver by either Party of
any breach of this Agreement, will prevent a subsequent exercise or enforcement
of, or be deemed a waiver of any subsequent breach of, the same or any other
term of this Agreement.  No waiver of any right, condition, or breach of this
Agreement will be effective unless in writing and signed by both Parties.  

 

14.5Assignment.

 

(a)Neither Party may assign or otherwise transfer, or delegate any of its
obligations under, this Agreement or any rights or obligations under this
Agreement without the prior written consent of the other Party; provided that
(i) Illumina may assign or otherwise transfer this Agreement without prior
consent to an Affiliate which is capable of performing all of Illumina’s
obligations hereunder (including the granting of rights to Licensed IP);
provided that (x) Illumina will provide written notice to CareDx of the same,
and (y) the assignee agrees in writing to be bound by the terms and conditions
of this Agreement, and (ii) CareDx may assign or otherwise transfer this
Agreement without prior consent to an acquirer of all or substantially all of
CareDx’s [...***...]. For the avoidance of doubt, upon CareDx’s assignment of
this Agreement [...***...], [...***...], Illumina may [...***...].

 

(b)Any purported assignment or other transfer of this Agreement (in whole or in
part) in violation of this Section 14.5 will be null and void.  

 

(c)Subject to this Section 14.5, this Agreement will be binding upon and inure
to the benefit of each of the Parties and their permitted successors and
assigns.  

 

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14.6Export.  Notwithstanding anything to the contrary in this Agreement, each
Party and its agents and distributors may not disclose, export or re-export,
directly or indirectly, any Licensed Products, Supplied Products, embodiments of
Licensed IP or any related software, technology or know-how relating to this
Agreement to any country or party which is ineligible to receive such items
under law (including regulations of the U.S. Department of Commerce and the U.S.
Department of the Treasury).  

 

14.7Notices.  All notices required or permitted under this Agreement will be in
writing, in English, and will be deemed received only when: (i) delivered
personally; or (ii) one day after deposit with a commercial express courier
specifying next day delivery or, for international courier packages, two days
after deposit with a commercial express courier specifying two-day delivery,
with written verification of receipt.  All notices will be sent to the following
or any other address designated by a Party using the procedures set forth in
this Section 14.7:

 

If to Illumina:

 

Illumina, Inc.

[...***...]

Attn: General Counsel

 

With a copy to: [...***...]

If to CareDx:

 

CareDx, Inc.

[...***...]

Attn: Chief Executive Officer

 

With a copy to: Paul Hastings LLP

[...***...]

 

Attn: Jeff Hartlin and Matthew Berger

 

14.8Force Majeure. Neither Party will be in breach of this Agreement nor liable
for any failure to perform or delay in the performance of this Agreement
attributable in whole or in part to any cause beyond its reasonable control,
including any change in applicable law or interpretation thereof (each an event
of “Force Majeure”).  In the event of any such delay the delivery date for
performance will be deferred for a period equal to the time lost by reason of
the delay.  Notwithstanding anything in this Agreement to the contrary, neither
Party’s payment obligations shall be affected by this provision except to the
extent the Force Majeure affects financial institutions and, as a result, the
financial institutions cannot complete the transaction necessary for the
applicable Party to satisfy its payment obligations.

 

14.9Application of the Code.

 

(a)The Parties agree that all rights and licenses granted to CareDx under this
Agreement are rights and licenses to "intellectual property" as defined in
Section 101(35A) (or its successors) of Title 11 of the United States Bankruptcy
Code or its successor (“Code”). CareDx will, during the Term of the Agreement,
have the rights set forth in this Agreement with respect to the Licensed IP of
Illumina, when and as such Licensed IP of Illumina is developed or created by or
for Illumina. In addition and without limitation to the foregoing, Illumina
acknowledges and agrees that CareDx, as a licensee of Illumina’s Intellectual
Property under this Agreement, will have and may fully exercise all rights
available to it under the Code, including under Section 365(n) of the Code. In
the event Illumina files for protection under the Code and the trustee for
Illumina rejects this Agreement and, pursuant to Section 365(n) of

29

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the Code, CareDx elects to retain its rights under this Agreement as described
in Section 365(n)(1)(B) of the Code, not in lieu or limitation of any other
rights or remedies available to CareDx, Illumina or the trustee for Illumina or
its assets will, at CareDx's written request, deliver to CareDx any Licensed IP
of Illumina licensed to CareDx under this Agreement that Illumina is obligated
to deliver or transfer to CareDx pursuant to Section 8.1 but that has not yet
been delivered or transferred to CareDx in accordance with Section 8.1.

 

(b)The Parties agree that all rights and licenses granted to Illumina under this
Agreement are rights and licenses to “intellectual property” as defined in
Section 101(35A) (or its successors) of the Code. Illumina will, during the Term
of the Agreement, have the rights set forth in this Agreement with respect to
the Improvements of CareDx, when and as such Improvements of CareDx are
developed or created by or for CareDx. In addition and without limitation to the
foregoing, CareDx acknowledges and agrees that Illumina, as a licensee of
CareDx’s Intellectual Property under this Agreement, will have and may fully
exercise all rights available to it under the Code, including under
Section 365(n) of the Code. In the event CareDx files for protection under the
Code and the trustee for CareDx rejects this Agreement and, pursuant to Section
365(n) of the Code, Illumina elects to retain its rights under this Agreement as
described in Section 365(n)(1)(B) of the Code, not in lieu or limitation of any
other rights or remedies available to Illumina, CareDx or the trustee for CareDx
or its assets will, at Illumina’s written request, notify and provide to
Illumina any Improvements of CareDx licensed to Illumina under this Agreement
that CareDx is obligated to notify and provide to Illumina pursuant to Section
3.1 but that has not yet been provided to Illumina in accordance with Section
3.1.

 

14.10Entire Agreement; Amendment.  This Agreement and a related Transition
Services Agreement entered into by the Parties after the Effective Date,
together with the exhibits hereto and thereto, represent the entire agreement
between the Parties regarding the subject matter hereof and supersede all prior
discussions, communications, agreements, and understandings of any kind and
nature between the Parties.  The Parties acknowledge and agree that by entering
into this Agreement, they do not rely on any statement, representation,
assurance or warranty of any Person other than as expressly set forth in this
Agreement or the above-referenced Transition Services Agreement.  Each Party
agrees that it will have no right or remedy (other than for breach of contract)
in respect of any statement, representation, assurance or warranty (whether made
negligently or innocently) other than as expressly set forth in this Agreement
or the above-referenced Transition Services Agreement.  Nothing in this Section
14.10 will exclude or limit any liability for fraud.  No amendment to this
Agreement will be effective unless in writing and signed by both Parties.

 

14.11Relationship of the Parties.  The Parties are independent contractors under
this Agreement and nothing in this Agreement may be construed as creating a
partnership, joint venture or agency relationship between the Parties, or as
granting either Party the authority to bind or contract any obligation in the
name of the other Party or to make any statements, representations, warranties
or commitments on behalf of the other Party.

 

14.12Headings; Interpretation; Miscellaneous.  Sections, titles and headings in
this Agreement are for convenience only and are not intended to affect the
meaning or interpretation of this Agreement.  Whenever required by the context,
the singular term includes the plural, the plural term includes the singular,
and the gender of any pronoun includes all genders.  As used in this Agreement,
except as the context may otherwise require, the words “include,” “includes,”
“including,” and “such as” are deemed to be followed by “without limitation” or
“but not limited to,” whether or not they are in fact followed by such words or
words of like import, and “will” and “shall” are used synonymously.  Except as
expressly

30

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stated, any reference to “days” will be to calendar days, and “business day”
means all days other than Saturdays, Sundays, or a national or local holiday
recognized in the United States, any reference to “calendar month” will be to
the month and not a 30 day period, and any reference to a “quarter” will mean
the relevant three month period based upon the Contract Year.  Whenever the last
day for the exercise of any right or the discharge of any obligation hereunder
falls on, or any notice is deemed to be given on, a Saturday, Sunday or national
or local holiday recognized in the United States, the Party having such right or
obligation will have until 5:00 pm PT on the next succeeding business day to
exercise such right or to discharge such obligation or the Party giving notice
will be deemed to have given notice on the next succeeding business day.  No
usage of trade, course of performance, or other regular practice between the
Parties may be used to interpret or alter the terms or conditions of this
Agreement.  Unless otherwise expressly provided in this Agreement, any
agreement, instrument or statute defined or referred to means such agreement,
instrument or statute as from time to time amended, modified, or supplemented,
including (in the case of agreements or instruments) by waiver or consent and
(in the case of statutes) by succession of comparable successor statutes and
references to all attachments thereto and instruments incorporated therein.  The
Parties have participated jointly in the negotiation and drafting of this
Agreement.  If an ambiguity or question of intent or interpretation arises, this
Agreement will be construed as if drafted jointly by the Parties, and no
presumption or burden of proof will arise favoring or disfavoring any Party
because of the authorship of any provision of this Agreement.  

 

14.13Counterparts.  This Agreement may be executed in one or more counterparts,
each of which will be deemed to be an original, and all of which will constitute
one and the same instrument.

 

14.14Costs. Except as expressly provided in this Agreement, each Party will pay
its own costs incurred in connection with the negotiation, preparation, and
execution of this Agreement and any documents referred to in this Agreement.

 

[SIGNATURE PAGE FOLLOWS.]

 

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Signature Page to

license and commercialization Agreement

 

IN WITNESS WHEREOF, the Parties have executed this Agreement effective as of the
Effective Date.

 

 

Illumina

 

Illumina, Inc.

 

 

By:/s/ Jonathan Seaton

 

Name:Jonathan Seaton

 

Title:SVP Corporate & Business Development

 

Date:4 May 2018

 

 

CareDx

 

CareDx, Inc.

 

 

By:/s/ Peter Maag

 

Name:Peter Maag

 

Title:President & CEO

 

Date:_ May 4, 2018

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

[Signature Page to License and Commercialization Agreement]

 

 

--------------------------------------------------------------------------------

 

EXHIBIT A

LICENSED FIELD SPECIFIC PATENTS

 

[...***...]

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

* Confidential Treatment Requested

 

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EXHIBIT B

 

Illumina HLA Existing Product Pricing

 

Catalogue Number

Description

Kit Size

Base Price (USD)*

Discount off Base Price

Standard Lead Time**

FC-142-1001

TruSight HLA Seq Panel (24 smp)

24 samples

$[...***...]

[...***...]%

[...***...]

20006995

TruSight HLA v1 Boxes 3 and 4

192 libraries

$[...***...]

[...***...]%

20010179

TruSight HLA-B Primers v2

96 samples

$[...***...]

[...***...]

20010190

TruSight HLA-DRB Primers v2

96 samples

$[...***...]

[...***...]

20000215

TruSight HLA v2 Seq Panel (24 samples)

24 samples

$[...***...]

[...***...]%

20005170

TruSight HLA v2 (24 samples Automated)

24 samples

$[...***...]

[...***...]%

 

Illumina [...***...] Reagent Pricing

 

[...***...] reagent kits for library preparation that can be used for
preparation of up to [...***...] samples including [...***...] [...***...] (for
which a part number will be provided prior to sale to CareDx when available):

 

Number of Such Products Purchased in Prior Calendar Year

Base Price per Product

Standard Lead Time**

1-625

$[...***...]

[...***...]

626-1,250

$[...***...]

1,251-1,875

$[...***...]

1,876-2,500

$[...***...]

≥ 2,501

$[...***...]

 

[...***...] reagent kits for library preparation in [...***...] only that can be
used for preparation of up to [...***...] samples including [...***...]
[...***...] (for which a part number will be provided prior to sale to CareDx
when available):

 

Number of Such Products Purchased in Prior Calendar Year

Base Price per Product (USD)*

Standard Lead Time**

1-100

$[...***...]

[...***...]

101-250

$[...***...]

251-500

$[...***...]

501-1,000

$[...***...]

≥ 1,001

$[...***...]

 

*Price Adjustments for Supplied Products

 

 

 

* Confidential Treatment Requested

 

--------------------------------------------------------------------------------

 

Illumina reserves all right to adjust base prices of Supplied Products in the
usual course of its business, provided that the base prices (i.e., the price
prior to application of any applicable discounts) under this Agreement shall:
(a) not be adjusted more than once per calendar year and (b) (i) such annual
adjustment shall not increase the base price by more than [...***...]% during
any calendar year and shall not, in any event, be a higher percentage price
increase than substantially all of Illumina’s other customers for the same
Supplied Product.  Any adjusted base prices will be reflected in the quotation
provided for sale of the products being purchased.

 

** Standard Lead Times listed in the table above assume that the order for
Supplied Products materially complies with the terms and conditions of this
Agreement and is within [...***...] of the applicable forecast.  If the order is
outside of such range, the Lead Time may exceed those listed in the table above.

 

Development, Validation and Verification Kits. One time each quarter during the
Term, CareDx may purchase Supplied Products that shall only be used for CareDx’s
internal development, validation, and verification of Licensed Products.  Such
Supplied Products will be sold to CareDx at a discount of [...***...]% off of
the base price in this Agreement, and the quarterly purchase shall not exceed
[...***...]% of the quantity of such Supplied Products forecasted (on a Supplied
Product-by-Supplied Product basis) in accordance with Exhibit B for the
applicable quarter. The Parties acknowledge and agree that any Supplied Products
purchased under this provision for development, validation or verification
cannot be re-Sold without Illumina’s prior written approval.

 

Additional Terms and Conditions for Supplied Products

 

(a)Software.  All software, whether provided separately, installed on, or
embedded in a Supplied Product, is licensed not sold.  

 

(b)Forecasts.  CareDx shall, no later than the first day of each month during
the Contract Year, provide Illumina with a non-binding forecast representing
CareDx’s good faith estimate of the amount of Supplied Products that CareDx
expects to purchase from Illumina on a monthly basis during the Contract
Year.  The first two months of each such forecast shall represent a binding
commitment by CareDx to purchase and Illumina to supply such amounts of Supplied
Products in accordance with this Agreement.

 

(c)Purchase Orders.  CareDx, the United States entity, shall order Supplied
Products from Illumina, the United States entity, under this Agreement using
written purchase orders.  Purchase orders shall state, at a minimum, the
Illumina catalogue or part number, the Illumina-provided quote number (or other
reference provided by Illumina), the quantity ordered, price, requested delivery
date, and address for delivery.  All purchase orders shall be sent in writing to
Illumina Customer Support and be placed with Illumina, the United States entity,
and any payment for the shipment of Supplied Products ordered under such
purchase orders shall be paid for in US Dollars to Illumina, the United States
entity, pursuant to Section 9.6 of this Agreement and subsection (d)
below.  Acceptance of a purchase order occurs when Illumina provides a written
confirmation of acceptance to CareDx.  Acceptance of a purchase order will be
deemed to have occurred absent a confirmation of acceptance or rejection
delivered in writing from Illumina to CareDx within 10 business days of
Illumina’s receipt of the purchase order. Illumina shall not reject, and shall
timely fulfill, any purchase order that meets the following: (i) CareDx has not
failed to cure a material breach of the terms and conditions of this Agreement
after Illumina has provided written notice of such material breach to CareDx;
provided that,

 

* Confidential Treatment Requested

 

--------------------------------------------------------------------------------

 

solely for purposes of this Subsection (c): (x) there is no cure period for any
material breach by CareDx of Sections 4.1 or 5.4 of the Agreement or Section 6
of Exhibit C with respect to violation of Anti-Corruption Laws and (y) for all
other material breaches, such cure period will be 10 business days from CareDx’s
receipt of such written notice (provided that the applicable Lead Time is tolled
during such cure period) and (ii) the total monthly amount ordered by CareDx
under such purchase order is within [...***...]%-[...***...]% of the forecasted
amount of the relevant month in the most recent forecast in which the order is
placed and the delivery date is at or outside of the applicable Lead Time.  All
purchase orders are non-cancelable and may not be modified without the prior
written consent of Illumina; provided that notwithstanding the foregoing, in the
event that CareDx terminates this Agreement pursuant to Section 13.2 then CareDx
may elect, at its option, to cancel one or more outstanding purchase orders
without penalty or obligation to Illumina.

 

(d)Payment terms.  Illumina shall issue invoices upon shipment of Supplied
Products to CareDx.  All payments of undisputed amounts by CareDx on such
invoices are due within 30 days after the date of the invoice.  Any payment of
an undisputed amount not paid when due may accrue interest at the rate of
[...***...] per month, or the maximum amount allowed by law, if lower.  In the
event that payment of any undisputed amounts that are due and payable is not
made when due, CareDx may request that the Parties promptly meet to discuss and
attempt in good faith to discuss the reasons for the lack of payment. Unless
otherwise agreed to in writing by the Parties, within 14 days after the
commencement of such discussions, Illumina shall have the right to take any
action allowed in law and equity for such non-payment of undisputed amounts in
addition to any rights under this Agreement, including without limitation,
suspend shipment of the Supplied Products until all outstanding undisputed
payments are made current.  Each purchase order is a separate, independent
transaction under this Agreement, and neither Party has any right of set-off
against or transfer to other purchase orders, payments or other transactions
with the other.

 

(e)Taxes.  All prices and other amounts payable to Illumina hereunder are
exclusive of and are payable without deduction for taxes, GST, VAT, customs
duties, tariffs or charges now or hereafter claimed or imposed by any
governmental authority upon the sale of the product, all of which will be either
(i) added to the purchase price (with no mark-up) upon prior written notice to
CareDx, which notice will include the itemized taxes and the corresponding
increase in purchase price or (ii) subsequently itemized and invoiced to
CareDx.  With respect to New Zealand customers only, CareDx and Illumina agree
that subsection 8(4) Goods and Services Tax Act 1985 does not apply.

 

(f)Shipping; Risk of Loss.  Supplied Products shall only be shipped to CareDx’s
U.S. location on the purchase order, unless otherwise agreed upon in writing by
the Parties.  All shipments will be made under a usual and typical Incoterm
(2010) that Illumina specifies (e.g., ExW or DAP), and CareDx is responsible for
typical third party freight and insurance costs which will be added to the
invoice and paid by CareDx. To the extent the Parties agree to in writing to
make any shipments to countries outside of the U.S., CareDx agrees to cover all
costs associated with freight and insurance. In addition, if Illumina ships to
any CareDx location in any country outside of the U.S. specified on the purchase
order where there are import duties, import taxes, or any other importation or
customs-related costs incurred, CareDx will be responsible to pay those expenses
in full.

 

(g)Inspection; Rejection.  CareDx shall inspect all the Supplied Products for
obvious physical damage upon receipt thereof, and shall note any such damage,
including on a lot-by-lot basis based on samples from any such lot, on all
accompanying shipping and other carrier documents, and CareDx shall notify
Illumina of any such damage within 15 days of receipt by CareDx.  Any Supplied
Product not rejected

* Confidential Treatment Requested

 

 

--------------------------------------------------------------------------------

 

within the 15-day period shall be deemed accepted.  To reject a Supplied
Product, CareDx shall notify Illumina in writing of its rejection and request a
Returned Material Authorization (“RMA”), and shall comply with Illumina’s repair
and return procedures as provided by Illumina to CareDx, as may be amended by
Illumina for all (but a copy of which need only be distributed to all or
substantially all) of its customers from time to time but will be commercially
reasonable at all times.  Within 10 days of receipt of the RMA number, CareDx
shall return to Illumina the rejected Supplied Product, freight prepaid, in its
original shipping carton with the RMA number displayed on the outside of the
carton. Illumina reserves the right to refuse to accept any rejected Supplied
Products that do not bear an RMA number on the outside of the carton.  Upon
receipt by Illumina of properly rejected Supplied Products, Illumina shall, at
its option and expense, either repair or replace the returned Supplied Products
as promptly as possible given the applicable Lead Times.  Shipment of such
repaired or replacement Products to CareDx shall be at Illumina’s expense. For
the avoidance of doubt, non-compliance with Illumina’s repair and return
procedures will not limit, modify, or condition, or act as a waiver of,
Illumina’s obligations under this Subsection (g) unless Illumina provided
written notice to CareDx of its non-compliance and CareDx failed to remedy its
non-conformance within a reasonable amount of time given the applicable Lead
Times. To the extent there is any conflict or inconsistency between this
Agreement and the RMA, this Agreement will govern. In addition, any acceptance
of such Supplied Products will not, and will not be deemed to, waive or affect
any rights CareDx may have under the warranties for such Supplied Products or
any other rights of CareDx with respect to such Supplied Products under this
Agreement or at law or in equity.

 

(h)Warranties.  All warranties are personal to CareDx and may not be transferred
or assigned to a third-party, including an Affiliate of CareDx; provided that,
the warranty applies to any breach of warranties to any of the Supplied
Products, whether such Supplied Products have been sold, re-sold or distributed
or otherwise disposed of to third parties; provided that only CareDx shall have
the right to enforce the warranties for such Supplied Products. All warranties
are facility specific and do not transfer if the Supplied Product is moved to
another facility, unless Illumina conducts or supervises such move.  The
warranties described in these terms and conditions exclude any stand-alone third
party goods that are not provided by Illumina.

 

(i)Warranty for Reagents.  Illumina warrants that reagents (including the
[...***...] Reagents but excluding Illumina HLA Existing Products), other than
custom reagents, will conform to their written, published technical
specifications (in effect on the date that the Supplied Product ships from
Illumina) until the later of (x) [...***...] from the date of shipment from
Illumina, or (y) any expiration date or the end of the shelf-life pre-printed on
such Supplied Product by Illumina, but in either event, no later than
[...***...] from the date of shipment.  With respect to custom reagents (i.e.,
reagents made to specifications or designs made by CareDx or provided to
Illumina by, or on behalf of, CareDx), Illumina only warrants that the custom
reagents will be made and tested in accordance with Illumina’s standard
manufacturing and quality control processes which will be consistent with
industry best practices.  Illumina makes no warranty that custom reagents will
work as intended by CareDx or for CareDx’s intended uses.

 

(ii)Warranty for Illumina HLA Existing Products. Illumina warrants that from the
time of delivery of any Illumina HLA Existing Product to CareDx until the later
of: (x) 3 months from the date of shipment from Illumina, or (y) any expiration
date or the end of the shelf-life pre-printed on such Illumina HLA Existing
Product by Illumina, but in either event, no later than 12 months from the date
of shipment, the Illumina HLA Existing Products shall: (1) be free from errors
or defects and comply with the Documentation and their specifications; (2) have
been manufactured, shipped and stored in

accordance with the Documentation and their specifications, any applicable
governmental approvals and

* Confidential Treatment Requested

 

 

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all applicable laws and regulations; and (3) not be adulterated or misbranded
under any applicable laws and regulations.

 

(iii)Exclusions from Warranty Coverage.  The foregoing warranty does not apply
to the extent a non-conformance after Illumina delivers the Illumina HLA
Existing Product to CareDx is due to (i) CareDx’s negligence, (ii) improper
storage or use by CareDx except to the extent required or recommended by the
Documentation, applicable specifications or product labeling, (iii) improper
handling, installation, maintenance, or repair (other than if performed by
Illumina’s personnel, contractors or agents and, for the avoidance of doubt,
“improper” does not include any handling, installation, maintenance or repair
performed to the extent required or recommended by the Documentation, applicable
specifications or product labeling), (iv) unauthorized modification by CareDx
other than in conformity with the applicable Documentation, specifications or
product labeling, or (v) use of the Supplied Product with a third party’s good
not supplied by or on behalf of Illumina (unless the Supplied Product’s
Documentation, specifications or product labeling expressly states such third
party’s good is for use with the Supplied Product).

 

(iv)Procedure for Warranty Coverage. In order to be eligible for repair or
replacement under this warranty CareDx must (i) promptly contact Illumina’s
support department to report the non-conformance and in any event contact the
support department during the applicable warranty period, (ii) reasonably
cooperate with Illumina in confirming or diagnosing the non-conformance, and
(iii) return the Supplied Product if requested by Illumina, transportation
charges prepaid by Illumina following Illumina’s reasonable instructions or, if
agreed by Illumina and CareDx, grant Illumina’s authorized repair personnel
access to the Supplied Product in order to confirm the non-conformance and make
repairs; provided that such authorized repair personnel will comply with all
reasonable security, confidentiality, safety and health policies of CareDx
applicable to persons present on CareDx’s facilities. In the event of a
non-conformance Illumina will be solely responsible for all of its costs and
expenses in connection with the repair or replacement.

 

(v)Sole Remedy under Warranty.  Illumina will, at its option, repair or replace
non-conforming Supplied Product that is covered by this warranty at its sole
cost and expense (including reasonable shipping costs incurred by CareDx for
shipping such non-conforming Supplied Product to Illumina).  The warranty period
for repaired or replaced reagents or HLA Existing Products is 90 days from the
date of shipment, or the remaining period on the original reagent warranty or
the applicable warranty for the HLA Existing Products, as applicable and
whichever is later. Instruments may be repaired or replaced with functionally
equivalent, reconditioned, or new instruments or components.  If the instrument
is replaced in its entirety, the warranty period for the replacement is 90 days
from the date of shipment or the remaining period on the original instrument
warranty, whichever is later.  If only a component is being repaired or
replaced, the warranty period for such component is 90 days from the date of
shipment or the remaining period on the original instrument warranty, whichever
ends later.  Without limiting the generality of Illumina’s indemnification
obligations and other obligations under this Agreement, the preceding states
CareDx’s sole remedy and Illumina’s sole obligations under the foregoing
warranties in this Exhibit B.

 

(i)Regulatory acknowledgement.  CareDx acknowledges that the Supplied Products
have not been subjected to regulatory review or approved or cleared by the
United States Food and Drug Administration or any other regulatory entity
whether foreign or domestic, or otherwise reviewed, cleared or approved under
any statute, law, rule or regulation for any purpose, whether research,
commercial, diagnostic or otherwise.  The products are labeled For Research Use
Only.  Illumina does not

 

--------------------------------------------------------------------------------

 

make any representation, warranty, or covenant that pertains in any way to the
regulatory status of the products.  CareDx agrees to use the Supplied Products
in compliance with all applicable laws and regulations.  

 

 

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EXHIBIT C

 

CAREDX’S RE-SALE OF ILLUMINA PRODUCTS

 

1.

General.

Scope.  CareDx may only market and Sell Supplied Products for use with the
Illumina Sequencing Instruments in the Licensed Field.  The Parties’ activities
described in this Agreement shall be at their own cost and expense unless
expressly stated otherwise.

 

Customer Agreements.  CareDx shall [...***...] using Customer Agreements and
will [...***...] the terms and conditions of such Customer Agreements; provided
that notwithstanding the foregoing, CareDx shall have a period of [...***...] to
transition any existing customers with whom it already has written agreements to
[...***...].  All Customer Agreements [...***...] CareDx must use commercially
reasonable efforts to ensure that such standard terms and conditions
[...***...].  “Customer Agreement” means a [...***...] to such customer. Any
Customer Agreement will include, at a minimum, (i) [...***...], (ii)
[...***...], and (iii) Illumina’s standard terms and conditions for Research Use
Only products (as published on Illumina’s website at the time of Sale).

 

Advertising.  CareDx shall not make any representations, warranties or
guarantees with respect to the specifications, features or capabilities of the
Supplied Products that are not consistent with Illumina’s then-current
Documentation, published specifications or product labeling for or literature
describing the Supplied Products, including without limitation the limited
warranty and disclaimers, as well as Illumina’s Ad/Promo Guidelines, a copy of
which will be promptly provided to CareDx after the Effective Date and
thereafter from time to time upon any updates thereto.  CareDx will have in
place a mechanism that ensures it uses only Illumina’s most current published
materials in any advertising and promotional activities.  

 

Service and Support.  CareDx shall be solely responsible, at its cost, for
service and support of Supplied Products.

 

2.

Quality.

Product Complaints.  Each Party shall promptly investigate, monitor, and report
to the other Party (in a reasonable format required by such Party that is
provided to the other Party in advance and in writing) any communication from a
purchaser (written, electronic, or oral) alleging deficiencies related to the
identity, quality, durability, reliability, safety, effectiveness, or
performance of the Supplied Products (“Complaint(s)”).  CareDx is responsible
for receiving, documenting, and initially investigating any Complaints in the
Licensed Field and Illumina is responsible for receiving, documenting and
initially investing any Complaints outside of the Licensed Field.  Each Party
shall notify the other Party as soon as possible but at least within 2 business
days of any Complaints which involve an adverse event or

 

* Confidential Treatment Requested

 

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potential adverse event (those events which lead, or having the potential to
lead, to serious injury or death).  

 

Product Returns.  CareDx shall make reasonable efforts to secure Supplied
Product returns as requested by Illumina.  CareDx will perform decontamination
of Supplied Product returns, including those it receives without notice.  CareDx
will follow any packaging requirements set forth by Illumina.  Returned Supplied
Products shall not be re-Sold without Illumina’s prior written approval.  CareDx
will provide certificates of destruction for returned Supplied Products that
were destroyed under instruction by Illumina.  All product returns will be at
Illumina’s sole cost and expense except to the extent that any product return is
caused by one or more of the exceptions to the warranty coverage set forth in
Section (h)(iii) of Exhibit B.

 

Supplier Corrective Action Request (SCAR) Process.  CareDx may issue Illumina a
SCAR if there is a material issue that reasonably warrants a formal SCAR process
and response. Illumina shall thereafter use commercially reasonable efforts to
promptly: (i) investigate and respond to SCAR within thirty (30) business days
(or as otherwise specified on the SCAR); (ii) develop and undertake
corrective/preventive action plans as warranted; and (iii) implement such
action(s) within a mutually agreed-upon timeframe appropriate to the specific
SCAR at Illumina’s sole cost and expense. SCARs are not intended to resolve
normal business relationship issues.

 

Advisory Notices (Product Recall, Correction or Removal).  Illumina shall have
responsibility and final authority for initiating Product Advisory Notices and
Product Quality Notifications (or similar communications) for Supplied Products.
Both Parties shall reasonably cooperate in the handling and disposition of such
actions.  CareDx shall carry out commercially reasonable activities as defined
in written instructions from Illumina, including without limitation distribution
of field safety notices. If CareDx is required by law to report participation in
advisory notices to local authorities, it will inform Illumina in writing when
it does so via email at RA@illumina.com.  In the event Illumina becomes aware of
issues that may adversely affect the performance of safety of Supplied Products,
Illumina shall use commercially reasonable efforts to promptly provide to CareDx
a Product Quality Notification addressing such issues, and instructions
concerning Supplied Product disposition.  CareDx shall use commercially
reasonable efforts to execute disposition instructions.  Should CareDx be
required to provide the Product Quality Notification to Qualified Entities, it
will do so without translation unless obliged to by local law.  CareDx must
create and maintain records of its actions performed in support of advisory
notices.

 

Product Traceability.  CareDx shall establish a “customer by product” and
“product by customer” tracking system to maintain direct traceability from
CareDx to the customer (at product, lot/serial number, quantity, and shipment
date levels, at a minimum).

 

Product Labeling; Branding; Related Documentation.  CareDx shall not make
changes to Supplied Product labeling, instructions, promotional materials, or
similar materials, without prior written approval from Illumina.  If
translations are necessary, CareDx shall use qualified suppliers approved by
Illumina in writing and provide Certificates of Translation to Illumina upon
request.  

 

Controls, Product Storage, and Handling.  CareDx shall use appropriate packaging
material and employ appropriate controls to control, store and handle products
in accordance with the applicable specifications (including but not limited to
storing Products at the specified temperatures) during

41

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storage, handling, and transportation to the customer.  CareDx shall also employ
appropriate controls to avoid Supplied Product mix-ups.  

 

Nonconforming Materials.  Upon notification from Illumina, CareDx will take
action to contain potentially nonconforming materials pending further
instruction from Illumina.  All affected materials shall be segregated and
quarantined, physically and in any inventory management system used by CareDx,
until instructions concerning its disposition are provided by Illumina in
writing.  In the event that CareDx identifies a nonconformance that may impact a
Supplied Product, CareDx will contain any potentially impacted materials and
obtain material disposition approval in writing from Illumina prior to releasing
the Supplied Product.  CareDx and Illumina will reasonably cooperate in
performing investigations or needed corrections and/or corrective actions with
respect to the material. The costs of such segregation and quarantine will be at
Illumina’s sole cost and expense (after prior written approval of such costs is
obtained from Illumina which upon, such approval, CareDx will perform its
obligations under this section) except to the extent that any non-conformance is
caused by one or more of the exceptions to the warranty coverage set forth in
Section (h)(iii) of Exhibit B.

 

Control of Changes. CareDx shall promptly notify Illumina, via email at
[...***...], of any significant changes that may reasonably impact its business
involving Supplied Products.  The notice shall include specifics about the
change, how the change arose, and the anticipated impact to the Supplied Product
or business. CareDx will reasonably cooperate with Illumina by providing
requested information related to the change as soon reasonably
practicable.  Events subject to notice under this provision include, but are not
limited to:

(i) changes in CareDx’s corporate status, organization, ownership, and similar
matters; and

(ii) changes in key personnel.

In addition to and not in lieu or limitation of the foregoing, each Party shall
promptly notify the other Party (in the case of CareDx to Illumina, via email at
[...***...]) of any changes to the facility or processes used to manufacture,
store or support the Supplied Products, including without limitation significant
or material changes to facilities, additions of new locations, significant or
material changes to processes with respect to the Supplied Products and changes
to the status of ISO certifications.

 

3.

Regulatory.

 

Regulatory Inspections.  Each Party shall permit any regulatory authority to
inspect its premises for compliance with the terms and conditions of this
Agreement, and applicable law.  To the extent permitted by applicable law,
CareDx shall promptly inform Illumina by e-mail at [...***...] and Illumina
shall promptly inform CareDx by e-mail at regulatory@caredx.com, as applicable,
in either case, of any regulatory inspections that may involve the Supplied
Product(s) and permit representatives from the other Party to be present during
the inspection.  To the extent possible, CareDx will consult with Illumina in
good faith and provide Illumina with the opportunity to provide input and
comments prior to making any commitment to a regulatory agency regarding the
Supplied Product(s), to the extent that the foregoing does not jeopardize
CareDx’s obligations under applicable law.  Additionally, each Party will
promptly inform the other Party upon receipt of any regulatory correspondence or
actions regarding the Supplied Product(s) and promptly provide the other Party
with a copy of any such regulatory correspondence (which may be redacted for
confidentiality purposes).

 

Regulatory Approvals and Product Registration.  CareDx shall obtain or process
(as applicable) any and all permits, listings, licenses, registrations,
approvals or other similar documentation required by a government, or any other
administrative agency or otherwise, to Sell the Supplied Products in the

 

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corresponding countries (together referred to as the “Approval(s)”).  CareDx
will pay any costs and fees associated with obtaining and maintaining any
required licenses, permits, registrations or approvals related to Supplied
Products. Notwithstanding the foregoing, Illumina will promptly provide (and
cause its Affiliates to promptly provide): (a) any data, information or other
materials relating to the Supplied Products that it owns or controls or can
access and make available to CareDx using commercially reasonable efforts and
(b) any filing or correspondence that Illumina had with any government or any
other administrative agency in connection with the Supplied Product, in each of
the foregoing cases, to the extent necessary for CareDx, or used by Illumina or
any of its Affiliates, to obtain Approvals.  CareDx may modify the labelling of
an Illumina [...***...] Product solely as necessary to obtain an Approval
provided that in such a case CareDx will give a reasonable amount of prior
written notice to Illumina and will give good faith consideration of any
reasonable concerns from Illumina.  Illumina hereby grants CareDx the right to
access and use any of such foregoing data, information, materials, filing or
correspondence to the extent necessary for, or used by Illumina or any of its
Affiliates, to support the Approvals, including the right to cross-reference,
file or incorporate any of the foregoing.  CareDx will give Illumina a copy of
such submission to obtain Approvals at least 30 days prior to use and will
consider in good faith any reasonable comment by Illumina on any such submission
(provided that any edits from Illumina intended to for reasons relating to
confidentiality or protection of its Intellectual Property rights must be
implemented). Upon termination or expiration of this Agreement, CareDx shall
initiate, within 10 business days, the transfer of ownership of any required
Approval related to any Supplied Product. If, upon termination or expiration of
this Agreement, CareDx fails to transfer and assign any Approvals to Illumina or
its third Party designate, CareDx shall be deemed to have appointed Illumina as
its Attorney with a full Power of Attorney to execute any such transfer or
assignment of an Approval on CareDx’s behalf.  At no time during the term of
this Agreement or thereafter shall CareDx take any action that would result in
the cancellation, revocation, annulment or rescission (or similar action) of any
existing or future Approval for Supplied Products, unless directed in writing by
an authorized representative of Illumina.  

 

Labeling.  CareDx shall not modify Illumina’s labeling (including logos),
private label or co-label the Supplied Products without the prior written
consent of Illumina or unless otherwise expressly permitted under this
Agreement.  

 

Export and Import Licenses.  Illumina will, at its own cost, obtain any and all
permits, approvals and licenses required for its export of the Supplied Products
from the point of manufacture/distribution, and CareDx will, at its own cost,
obtain any and all permits, approvals and licenses required for its importation
of the Supplied Products.

 

4.

Competitive Pricing.  CareDx agrees, to the extent permitted by applicable law,
that it will not to re-Sell, or permit its distributors or agents to Sell or
re-Sell, Illumina HLA Existing Products at a local currency equivalent more than
[...***...] for the corresponding Illumina HLA Existing Product.

 

5.

Sales and Marketing.

Materials.  Illumina shall provide CareDx with access to electronic versions of
existing marketing, sales and/or technical information, regardless of the form
or media in which distributed (e.g., paper, audio, video, electronic, internet)
concerning the Illumina HLA Existing Products which Illumina deems appropriate
for the promotion, distribution, and sale of such products.  Information and
claims within the technical, sales, and marketing materials provided by Illumina
may not be modified or supplemented without Illumina’s prior written approval.

 

* Confidential Treatment Requested

 

 

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Guidelines.  In all cases and at all times, CareDx will follow Illumina’s
Ad/Promo Guidelines and Trademark Policies and Usage Guidelines, a copy of which
will be promptly provided to CareDx after the Effective Date and thereafter from
time to time upon any updates thereto.  Illumina reserves the right to update
these guidelines at any time and any such updates shall be binding on CareDx
within a reasonable period of time following receipt by CareDx of the updated
guideline.

 

Expenses.  All expenses incurred by CareDx with respect to creating advertising
materials and advertising the Supplied Products, including materials ordered
from Illumina, shall be CareDx’s responsibility.  CareDx represents and warrants
that all documentation related to the Supplied Products made by or for CareDx
(and, for the avoidance of doubt, not made or provided by or for Illumina or any
of its Affiliates) shall be accurate and shall be made in a professional
manner.  

 

Copies to Illumina.  CareDx, promptly upon disseminating any marketing materials
relating to the Supplied Products, shall provide Illumina with a complete copy
of the disseminated marketing materials except if such marketing materials are
made or provided by or for Illumina or any of its Affiliates.  If Illumina
reasonably objects to or comments on any such marketing materials in good faith,
CareDx shall promptly implement any Illumina-requested changes or corrections to
such marketing materials or, if requested by Illumina, will promptly withdraw
such materials from public circulation; provided that the foregoing will not
require CareDx or any of its Affiliates to jeopardize their compliance with
applicable law.

 

6.

Miscellaneous.

Sole source.  If requested by Illumina, the Parties will discuss any
commercially reasonable ways to minimize any negative impact caused by CareDx’s
activities on Illumina’s ability to represent to other purchasers of its
products that Illumina is the sole source of such products.

 

Security Interest.  To the extent applicable under local law, CareDx hereby
grants Illumina and its Affiliates a purchase money security interest or right
of repossession in each Illumina HLA Existing Products Sold under this
Agreement.  If CareDx Sells any such Illumina HLA Existing Products to another
party prior to CareDx’s paying the full amount of CareDx’ purchase price for
such Supplied Product, then the security interest shall cover the proceeds from
such Sale.  These interests shall be satisfied by payment in full of CareDx’s
purchase price.  Illumina or its Affiliate may file a financing statement or the
equivalent for such security interest and CareDx shall sign any such statements
or other documentation necessary to perfect Illumina or its Affiliate’s security
interest.

 

Anti-Bribery and Anti-Corruption Laws; Code of Ethics.  In conformity with the
United States Foreign Corrupt Practices Act and the UK Bribery Act, any local
anti-competition and anti-bribery laws (together, “Anti-Corruption Laws”), in
each case, to the extent applicable, CareDx shall not directly or indirectly
make an offer, payment, promise to pay, or authorize payment, or offer a gift,
promise to give, or authorize the giving of anything of value for the purpose of
influencing an act or decision of an official of any government (including a
decision not to act) or inducing such a person to use his influence to affect
any such governmental act or decision in order to assist CareDx, its
distributors and agents, or Illumina in obtaining, retaining or directing any
such business or any other third party, with the intent to influence an act or
decision of that third party in order to assist CareDx or Illumina in obtaining,
or retaining or directing any such business.  CareDx shall ensure that its
employees and agents, and employees and agents of its distributors and agents
are advised of their obligations under the Anti-Corruption Laws, and shall
provide a list of all distributors and agents if requested and certification
that

 

--------------------------------------------------------------------------------

 

adequate due diligence has been performed to ensure compliance with
Anti-Corruption Laws, embargo restrictions, prohibited and excluded persons
requirements, and all regulatory requirements.  CareDx’s efforts in this regard
shall include, at a minimum, requiring its employees and agents who are
conducting activities outside the United States to complete Illumina’s
distributor Anti-Corruption Laws training program no later than 60 days after
the Effective Date and ensuring that all Anti-Corruption Law training provided
by Illumina shall be disseminated and certified to all sub-agents, dealers, and
distributors and shall have in place appropriate controls to ensure adherence to
such trainings, such as monitoring and auditing.  Upon Illumina’s request,
CareDx shall provide to Illumina written confirmation that its applicable
employees and agents have conducted such training and any subsequent required
training provided to CareDx from Illumina including certification that such
training was completed within 60 days of receipt. In addition, Illumina is
committed to conducting its business with the highest degree of ethics and
honesty, as described in more detail in Illumina’s Code of Ethics, as provided
in advance and in writing to CareDx.  CareDx shall not receive inappropriate
gifts, payments or other compensation, and shall report relationships or
transactions that could be reasonably expected to give rise to a conflict of
interest. CareDx shall ensure that it keeps all accurate books and records in
accordance with the Anti-Corruption Laws. No payments shall be made in cash or
from any sources that are off the books, or through any indirect sources not
recorded accurately in the financials of CareDx. CareDx shall make available all
records, transactions, and employees to Illumina to the extent reasonably
necessary for Illumina to perform routine audits on CareDx’s compliance with
this Section in a timely manner upon notification from Illumina.  If a violation
is found, CareDx shall inform Illumina’s Legal department within 24 hours of
knowledge of the violation and shall terminate any relationship with sub-agents,
distributors, or dealers if such violations are substantiated.

 

 

 

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EXHIBIT D

 

KNOWLEDGE TRANSFER

 

[...***...]

 

* Confidential Treatment Requested

 

 

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EXHIBIT E

 

OUTLINE OF TRANSITION SERVICES

 

 

SERVICES

Subject Matter*

Illumina Employee**

Service Commitment***

Illumina Chimerism Formulation and assay

[...***...]

[...***...]% FTE for [...***...] after Transition Effective Date

Illumina Chimerism Software

[...***...]

[...***...]% FTE for [...***...] after Transition Effective Date + [...***...]%
FTE for [...***...] after Transition Effective Date

Bioinformatics algorithm in Illumina Chimerism Software

[...***...]

[...***...] sessions to answer specific questions provided in advance

Illumina HLA Existing Software

[...***...]

[...***...]% FTE for [...***...] after Transition Effective Date + [...***...]%
FTE for [...***...] after Transition Effective Date

Illumina HLA Existing Product assay training

[...***...]

[...***...] training workshop

Illumina HLA v3 Primer design

[...***...]

[...***...]% FTE for [...***...] after Transition Effective Date + [...***...]%
FTE for [...***...] after Transition Effective Date

Transition Manager

[...***...]

[...***...]% FTE for [...***...] after Transition Effective Date + [...***...]%
FTE for [...***...] after Transition Effective Date + [...***...]% FTE for
[...***...] after Transition Effective Date

 

* “Transition Effective Date” means the earlier of a date of CareDx’s choosing
and the date that Knowledge Transfer relating to the relevant transition service
under Section 8.1 is complete (e.g., for [...***...], the date of completion of
transfer of the Illumina Chimerism Software contents in Exhibit D). Capitalized
terms used in this column otherwise have the meaning given in this Agreement.

 

** If an Illumina employee who is designated in the table above to provide a
transition service terminates his or her employment with Illumina or changes the
functional area of their employment such that it is no longer applicable, or if
Illumina terminates such Illumina employee for good cause or changes the
functional area of employment for good reason such that it is no longer
applicable, Illumina shall not be obligated to provide such transition service.
Notwithstanding the foregoing, in the case where an Illumina employee or
Illumina changes the functional area of such employee’s employment, Illumina
will use good faith efforts to find a suitable replacement for such employee.

 

 

* Confidential Treatment Requested

 

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*** Transition services will be provided telephonically or via email unless
otherwise agreed to by the Parties (in which case reimbursement of expenses as
agreed upon by the Parties may be required).  

 

The Transition Manager shall be CareDx’s point of contact and all communications
relating to the Services should be made through the Transition Manager unless
otherwise agreed to by the Transition Manager.

 

 

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EXHIBIT F

 

TRANSITION MATTERS RELATED TO ILLUMINA HLA EXISTING PRODUCTS

1.

Ongoing sales commitments agreed to by Illumina prior to the Effective Date.

 

Tenders.  Illumina has participated in the following tenders involving Illumina
HLA Existing Products:

 

[...***...]

[...***...]

[...***...]

[...***...]

[...***...]

  

Standing Orders, Quotes, or Other Supply Commitments.  Illumina has accepted (i)
standing orders for Illumina HLA Existing Products to be shipped after the
Effective Date, or (ii) otherwise agreed to supply customers with Illumina HLA
Existing Products after the Effective Date, for the following customers (or
their Affiliates):

 

[...***...]

[...***...]

[...***...]

[...***...]

[...***...]

[...***...]

[...***...]

[...***...]

[...***...]

[...***...]

[...***...]

[...***...]

[...***...]

[...***...]

 

In addition, any orders received under a quote issued by Illumina or its
Affiliate prior to June 1, 2018 shall be included in this subsection 1 of
Exhibit F and will be governed by this Exhibit F.

 

Reagent Rental. Illumina has existing rights and obligations with respect to the
following reagent rental agreements involving Illumina HLA Existing Products:

 

[...***...]

[...***...]

[...***...]

 

2.Transition Process. Within five (5) days after the Effective Date, Illumina
and CareDx shall issue a joint communication to [...***...] of Illumina HLA
Existing Products, including each customer set forth in Section 1 of this
Exhibit F. Such joint communication shall inform the applicable customer that
Illumina and CareDx have entered into an agreement under which CareDx will

* Confidential Treatment Requested

 

 

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Sell Illumina HLA Existing Products to customers worldwide. The Parties
acknowledge that [...***...] will need to be obtained for the transfer to CareDx
of existing agreements and obligations requiring Illumina to supply Illumina HLA
Existing Products to customer, which shall primarily be the responsibility of
[...***...] unless otherwise stated by Illumina. Illumina will assign an
employee to be CareDx’s main point of contact as the Transition Manager to
assist with transition of customers and existing sales and support
obligations.  As of the Effective Date, the Transition Manager is
[...***...].  In the event a [...***...], the Parties agree that notwithstanding
anything in this Agreement to the contrary, Illumina shall have the right to
Sell Illumina HLA Existing Products to such customer, to the extent Illumina is
contractually required to do so in its documentation in effect at the Effective
Date with such customer, and Illumina will not renew or otherwise extend the
term of such documentation or other agreement with such customer.

 

 

3.Revenues from Sales by Illumina of Illumina HLA Existing Products following
the Effective Date. In the event Illumina Sells Illumina HLA Existing Products
to a customer following the Effective Date, as set forth in Section 2 of this
Exhibit F, Illumina shall pass along to CareDx [...***...]% of the revenue from
such Sale, and CareDx shall be entitled to credit [...***...] such revenue from
such Sale against its minimum purchase obligations in Section 9.2.

 

 

4.Instrument Sales for Reagent Rentals.  If the reagent rental agreements listed
in Section 1 of this Exhibit F are transferred to CareDx, as described in
Section 2 of this Exhibit F, CareDx shall purchase the instruments subject to
such agreements from Illumina at the following discount off list price:
[...***...]% for each year that has passed since the instrument was
manufactured.

 

 

* Confidential Treatment Requested

 

 

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EXHIBIT G

 

THIRD PARTY KNOWLEDGE TRANSFER COMPONENTS

 

[...***...]

 

 

 

* Confidential Treatment Requested

 

 

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EXHIBIT H

 

[...***...]

[...***...]

 

 

 

* Confidential Treatment Requested