Exhibit 10.1

EXECUTION VERSION

CONFIDENTIAL

 

 

 

ASSET PURCHASE AGREEMENT

by and between

ICAD, INC.,

as Seller,

AND

INVIVO CORPORATION,

as Buyer

Dated as of December 16, 2016

 

 

 

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TABLE OF CONTENTS

 

ARTICLE I

 

PURCHASE AND SALE OF ASSETS

     1   

1.1

 

Purchase and Sale of Assets

     1   

1.2

 

Assumed Liabilities

     2   

1.3

 

Closing

     3   

1.4

 

Transfer Documents

     3   

1.5

 

Consents of Third Parties

     4   

1.6

 

Shared Books and Records

     4   

1.7

 

Delivery of Acquired Assets

     4   

1.8

 

Further Assurances

     5   

1.9

 

Optional Assets

     5   

1.10

 

Retained Contracts

     5   

ARTICLE II

 

PURCHASE PRICE

     6   

2.1

 

Purchase Price

     6   

2.2

 

Closing Payment

     6   

2.3

 

Holdback Payments

     6   

2.4

 

Intentionally Omitted

     6   

2.5

 

Allocation of Purchase Price

     6   

ARTICLE III

 

REPRESENTATIONS AND WARRANTIES OF SELLER

     7   

3.1

 

Organization and Good Standing of Seller

     7   

3.2

 

Authorization; Binding Obligation

     7   

3.3

 

Consents

     8   

3.4

 

No Violation

     8   

3.5

 

Title to and Condition of Acquired Assets; Sufficiency of Assets

     8   

3.6

 

Legal Proceedings

     8   

3.7

 

Compliance with Laws

     9   

3.8

 

Contracts

     9   

3.9

 

Intellectual Property

     10   

3.10

 

Regulatory Matters

     14   

3.11

 

Privacy

     16   

3.12

 

Product and Service Warranties

     16   

3.13

 

Books and Records; Disclosure

     16   

ARTICLE IV

 

REPRESENTATIONS AND WARRANTIES OF BUYER

     17   

4.1

 

Organization and Good Standing

     17   

4.2

 

Authorization; Binding Obligation

     17   

4.3

 

Consents

     18   

4.4

 

No Violation

     18   

4.5

 

Legal Proceedings

     18   

ARTICLE V

 

COVENANTS

     19   

5.1

 

Conduct of Business Pending Closing

     19   

5.2

 

Cooperation

     19   

5.3

 

Access to Information

     19   

 

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5.4

 

Notice of Certain Events

     19   

5.5

 

Public Announcements

     20   

5.6

 

No Solicitation of Other Proposals

     20   

5.7

 

Non-Competition, Non-Solicitation and Confidentiality

     20   

5.8

 

Mutual Post-Closing Cooperation

     22   

5.9

 

510(k) Notices

     22   

5.10

 

Use of Names

     22   

5.11

 

Existing License Agreement

     22   

5.12

 

Warranty Obligations for Pre-Closing Products

     23   

5.13

 

Recalls of Pre-Closing Products

     23   

5.14

 

Waiver of Consulting Agreement Restrictive Covenants

     24   

ARTICLE VI

 

CONDITIONS PRECEDENT TO CLOSING

     24   

6.1

 

Conditions to Obligation of Each Party

     24   

6.2

 

Additional Conditions to Obligations of Buyer

     24   

6.3

 

Additional Conditions to Obligations of Seller

     25   

ARTICLE VII

 

SURVIVAL; INDEMNIFICATION

     26   

7.1

 

Survival

     26   

7.2

 

Indemnification by Seller

     26   

7.3

 

Indemnification by Buyer

     27   

7.4

 

Indemnification Process

     28   

7.5

 

Right of Set-off

     29   

7.6

 

Indemnification Limitations

     29   

7.7

 

Fraud and Related Claims; Characterization of Payments

     30   

7.8

 

Knowledge and Investigation

     30   

7.9

 

Remedies Cumulative

     30   

ARTICLE VIII

 

TERMINATION, AMENDMENT, WAIVER AND EXPENSES

     31   

8.1

 

Termination

     31   

8.2

 

Procedure of Termination

     31   

8.3

 

Effect of Termination

     31   

8.4

 

Expenses

     31   

8.5

 

Amendment and Waiver

     31   

ARTICLE IX

 

MISCELLANEOUS

     32   

9.1

 

Entire Agreement

     32   

9.2

 

Assignment

     32   

9.3

 

Counterparts

     32   

9.4

 

Governing Law; Jurisdiction; Venue; Service of Process

     32   

9.5

 

Specific Performance

     33   

9.6

 

Interpretation

     33   

9.7

 

Severability

     33   

9.8

 

Notices

     34   

9.9

 

Representation by Counsel

     35   

9.10

 

Construction

     35   

9.11

 

Third Party Beneficiaries

     35   

9.12

 

Bulk Sales Law

     35   

9.13

 

Waiver of Jury Trial

     36   

 

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EXHIBITS AND SCHEDULES EXHIBITS:    Exhibit A    Form of Transition Services
Agreement Exhibit B    Form of Cross-License Agreement Exhibit C-1    Form of
Consulting Agreement Exhibit C-2    Form of Consulting Agreement SCHEDULES:   
Schedule 1.1(a)(i)    Acquired Intellectual Property Schedule 1.1(a)(ii)   
Excluded Intellectual Property Schedule 1.1(d)    Acquired Books and Records
Schedule 1.1(e)    Approvals and Orders Schedule 1.1(f)    Assigned Contracts
Schedule 1.1(h)    Tangible Assets Schedule 1.6    Shared Books and Records
Schedule 5.7(c)    Remaining Employees Schedule 6.2(d)    Third Party Approvals
Schedule I    Table of Definitions Schedule II    Knowledge Schedule III    Key
Personnel Disclosure Schedule   

 

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ASSET PURCHASE AGREEMENT

THIS ASSET PURCHASE AGREEMENT (this “Agreement”), dated as of December 16, 2016,
is made by and between iCAD, INC., a Delaware corporation (“Seller”), and INVIVO
CORPORATION, a Delaware corporation (“Buyer”).

WHEREAS, Seller has developed and licensed to Buyer certain Intellectual
Property relating to the VersaVue Software and the DynaCAD Product pursuant to
the Existing License Agreement;

WHEREAS, pursuant to the terms and conditions of this Agreement, Seller wishes
to sell and convey to Buyer, and Buyer wishes to purchase from Seller, all
right, title and interest in such Intellectual Property and related assets, and
in connection therewith Buyer and Seller wish to terminate the Existing License
Agreement;

WHEREAS, in connection with the transactions contemplated hereby, Seller and
Buyer will enter into a Cross-License Agreement and a Transition Services
Agreement, as described herein; and

WHEREAS, capitalized terms used and not otherwise defined herein shall have the
meanings set forth on Schedule I.

NOW, THEREFORE, in consideration of the foregoing and the mutual
representations, warranties, covenants and agreements herein contained, and
intending to be legally bound hereby, the parties hereby agree as follows:

ARTICLE I

PURCHASE AND SALE OF ASSETS

1.1 Purchase and Sale of Assets. Upon the terms and subject to the conditions
set forth in this Agreement, at the Closing, Seller shall sell, transfer,
assign, deliver and relinquish to Buyer in perpetuity, free and clear of all
Liens, all right, title and interest in and to, and only to, the Acquired
Assets. As used in this Agreement, “Acquired Assets” means the following assets,
properties, rights and interests:

(a) the VersaVue Software (and its predecessors) and the DynaCAD Product, all
Intellectual Property associated therewith, including the Intellectual Property
set forth on Schedule 1.1(a)(i), and all other Intellectual Property used in or
that relates to that portion of Seller’s business to which the VersaVue Software
and the DynaCAD Product relate (the “Business”), including all Intellectual
Property developed pursuant to or in connection with the Existing License
Agreement, and all files and disclosures relating to the foregoing and all
goodwill associated with the foregoing, together with all claims against third
parties for profits and all claims and Losses (including interest which may be
imposed in connection therewith), including any such claims or Losses incurred
by reason of the past infringement, alleged infringement, unauthorized use or
disclosure or alleged unauthorized use or disclosure of any such Intellectual
Property, together with the right to sue for, and collect the same, or to sue
for injunctive relief, for Buyer’s own use and benefit, and for the use and
benefit of its successors,

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assigns or other legal representatives (all of the foregoing, collectively, the
“Acquired Intellectual Property”), but excluding the Intellectual Property
listed on Schedule 1.1(a)(ii) (the “Excluded Intellectual Property”);

(b) all rights to the information, materials, data and work product in respect
of research and development activities conducted or being conducted in
connection with the Acquired Intellectual Property;

(c) all inventory of the VersaVue Software and the DynaCAD Product as of the
Closing Date (the “Inventory”) and all raw materials with respect thereto
(including packaging, labels and similar supplies);

(d) all Books and Records that relate exclusively to, or are used exclusively in
connection with, the Business or the Acquired Intellectual Property, including
all of the materials identified on Schedule 1.1(d) (collectively, the “Acquired
Books and Records”);

(e) all Approvals and Orders listed on Schedule 1.1(e), in each case to the
extent their transfer is permitted by Law;

(f) all right, title and interest in, to and under all Contracts listed on
Schedule 1.1(f) (collectively, the “Assigned Contracts”);

(g) all goodwill of the Business;

(h) all tangible personal property listed on Schedule 1.1(h)
(the “Tangible Assets”); and

(i) all other assets, properties, rights and interests of every kind and nature
whatsoever, whether tangible or intangible, wherever located, owned, used, held
for use or developed for use by Seller or its Affiliates, that relate
exclusively to, or are used exclusively in, the Business.

1.2 Assumed Liabilities. Upon the terms and subject to the conditions set forth
in this Agreement, at the Closing, Buyer shall assume from Seller the
obligations of Seller under the Assigned Contracts as and to the extent
transferred to Buyer under Section 1.1(f), but only to the extent such
obligations (a) are to be performed after the Closing and (b) do not arise from
or relate to any breach or default by Seller of any provision of any of such
Assigned Contracts or any event, circumstance or condition occurring or existing
on or prior to the Closing that, with notice or lapse of time, would constitute
or result in a breach or default thereof (the “Assumed Liabilities”). Buyer is
not assuming and shall not have any liability or obligation whatsoever for any
other Liabilities of Seller or any of its Affiliates (or any predecessors of
Seller or any of its Affiliates) whatsoever, all of which will be retained and
satisfied when due by Seller or any of its Affiliates, as applicable
(collectively, the “Excluded Liabilities”). The disclosure of any Liability on
any schedule to this Agreement shall not create an Assumed Liability or other
Liability of Buyer, except where such disclosed Liability has been expressly
assumed by Buyer as an Assumed Liability pursuant to this Section 1.2.

 

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1.3 Closing. Subject to the terms and conditions hereof, the closing of the
transactions contemplated by this Agreement (the “Closing”) will take place on
the later of (a) January 31, 2017 or (b) the third (3rd) Business Day following
the date on which all of the conditions set forth in Article VI have been
satisfied or waived (other than any such conditions that by their terms cannot
be satisfied until the Closing Date, which conditions shall be required to be so
satisfied or waived on the Closing Date), unless another time and/or date is
agreed to in writing by Seller and Buyer (the “Closing Date”). The Closing shall
be held at the offices of Mintz, Levin, Cohn, Ferris, Glovsky and Popeo, P.C.,
One Financial Center, Boston, Massachusetts, unless another place is agreed to
in writing by Seller and Buyer (it being understood that the Closing may be
effected by the delivery of documents via e-mail, facsimile and/or overnight
courier).

1.4 Transfer Documents. At the Closing, in addition to the other deliverables
contemplated by Article VI, the parties shall execute and deliver, or cause to
be executed and delivered, the following documents (collectively, the “Transfer
Documents”):

(a) Seller and Buyer shall execute and deliver to each other a bill of sale and
assignment and assumption agreement in a form mutually agreeable to Buyer and
Seller, pursuant to which Seller will assign and convey to Buyer the Acquired
Assets and Buyer will assume from Seller the Assumed Liabilities;

(b) Seller shall execute and deliver to Buyer a patent assignment in a form
mutually agreeable to Buyer and Seller, pursuant to which the Patents included
in the Acquired Intellectual Property will be transferred and assigned to Buyer
or an Affiliate thereof, as designated by Buyer;

(c) Seller shall execute and deliver to Buyer a trademark assignment in a form
mutually agreeable to Buyer and Seller, pursuant to which the Trademarks
included in the Acquired Intellectual Property will be transferred and assigned
to Buyer or an Affiliate thereof, as designated by Buyer;

(d) Seller shall execute and deliver to Buyer a copyright assignment in a form
mutually agreeable to Buyer and Seller, pursuant to which the Copyrights
included in the Acquired Intellectual Property will be transferred and assigned
to Buyer or an Affiliate thereof, as designated by Buyer;

(e) Seller and Buyer shall execute and deliver to one another the Transition
Services Agreement between Seller and Buyer in substantially the form of Exhibit
A (the “Transition Services Agreement”);

(f) Seller and Buyer (or an Affiliate of Buyer) shall execute and deliver to one
another the Software Cross-License Agreement between Seller and Buyer (or an
Affiliate of Buyer) in substantially the form of Exhibit B (the “Cross-License
Agreement”) (for the avoidance of doubt, the Cross-License Agreement shall apply
solely with respect to the Intellectual Property set forth therein and shall not
apply to any Intellectual Property not explicitly licensed to Seller or Buyer
thereunder); and

 

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(g) Seller will execute and deliver all such other bills of sale, assignments,
endorsements, Intellectual Property right assignments, trade name assignments,
domain name assignments, certificates of title, consents and other good and
sufficient instruments and documents of conveyance and transfer in a form
reasonably satisfactory to Buyer, as Buyer reasonably shall deem necessary or
appropriate to vest in or confirm to Buyer (or an Affiliate of Buyer) full and
complete right, title and interest in and to all of the Acquired Assets.

1.5 Consents of Third Parties. Notwithstanding anything in this Agreement or in
any Related Agreement to the contrary, neither this Agreement nor any such
Related Agreement shall constitute an agreement to assign or otherwise transfer,
or require Buyer to assume any obligations under, any Assigned Contract if an
attempted assignment or transfer thereof would, without the consent of a third
party to such assignment or transfer, constitute a breach thereof, would be
ineffective, would affect adversely the rights of Buyer thereunder or would
violate any applicable Law. If any such consent has not been obtained as of the
Closing Date and Buyer in its sole discretion nevertheless determines to proceed
with the Closing, Buyer may waive the closing condition that such consent be
delivered at the Closing, and Seller shall use its commercially reasonable
efforts to obtain such consent following the Closing, and Buyer shall provide
commercially reasonable cooperation to Seller in seeking to obtain any such
consent. Seller shall pay and discharge any and all out-of-pocket costs or
expenses of seeking to obtain or obtaining any such consent or approval whether
before or after the Closing Date. If any Assigned Contract is not transferred to
Buyer at the Closing pursuant to this Agreement, Seller shall cooperate with
Buyer in any reasonable arrangement designed to provide Buyer all of the
benefits of such Assigned Contract until such consent has been obtained. Nothing
in this Section 1.5 shall be deemed to modify in any respect any of Seller’s
representations or warranties set forth herein or the conditions to Buyer’s
obligations contained in Article VI, be deemed a waiver by Buyer of its right to
have received on or before the Closing Date an effective assignment of all of
the Acquired Assets or be deemed to constitute an agreement to exclude from the
Acquired Assets any assets described under Section 1.1.

1.6 Shared Books and Records. In addition to the Acquired Books and Records,
Buyer shall also be entitled to receive, and Seller shall provide to Buyer in
accordance with the terms of this Agreement and the Transition Services
Agreement, copies of all other Books and Records that relate to, or are used in
connection with, the Business or the Acquired Intellectual Property, including
the materials described on Schedule 1.6 (the “Shared Books and Records”).
Further, from and after the Closing, Seller shall, upon reasonable advanced
notice, provide Buyer and its Representatives reasonable access, during normal
business hours, to the Shared Books and Records. Buyer and its Affiliates shall
have the non-exclusive right to use the Shared Books and Records following the
Closing.

1.7 Delivery of Acquired Assets.

(a) Any of the Acquired Assets (including the Acquired Books and Records, to the
extent in electronic form) or Shared Books and Records that exist in electronic
form will be delivered electronically to Buyer at or promptly following the
Closing. Any Acquired Books and Records or Shared Books and Records that exist
in electronic format will be transferred in their native, electronic format.
Promptly following any electronic transmission, Seller shall execute and deliver
to Buyer a written certificate containing the following information: (i) the

 

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date of transmission; (ii) the name of the individual who made the transmission;
and (iii) a general description of the nature of the items transmitted
sufficient to distinguish the transmission from other transmissions.

(b) Without limiting Buyer’s obligations pursuant to Section 1.7(a), Seller will
deliver all other Acquired Assets (including the Acquired Books and Records, to
the extent in paper format) and copies of all Shared Books and Records that
exist in paper format to Buyer at or promptly following the Closing to such
location or locations as specified by Seller at least two (2) Business Days
prior to Closing, in each case without limiting Seller’s obligations pursuant to
Section 1.7(a)).

1.8 Further Assurances. At any time and from time to time after the Closing, at
the request of Buyer and without further consideration, Seller and its
Affiliates shall execute and deliver such other instruments of sale, transfer,
conveyance, assignment and confirmation, and shall take such further action, as
may be reasonably requested in order to more effectively transfer, convey and
assign to Buyer, and to confirm Buyer’s title in and to, the Acquired Assets,
and each of the parties shall execute such other documents and take such further
action as may be reasonably required or desirable to carry out the provisions of
this Agreement and the Related Agreements and the transactions contemplated
hereby and thereby. Further, if at any time following the Closing, Seller shall
receive any payment in respect of any Assigned Contract, Seller shall hold such
payment in constructive trust for the benefit of Buyer and shall promptly remit
such payment to Buyer without offset or deduction.

1.9 Optional Assets. To the extent that Seller or Buyer discovers, prior to the
Closing Date or during the eighteen (18) month period following the Closing
Date, any asset, property, right or Contract (other than any asset, property,
right or Contract of a type described in Section 1.1(a)) used or held for use by
Seller in connection with the Business, including the development, manufacture,
license or sale of the Acquired Intellectual Property (other than the Excluded
Intellectual Property), but that was not transferred or assigned to Buyer as an
Acquired Asset (each an “Optional Asset”), then the discovering party shall
provide written notice to the other party identifying such Optional Asset within
ninety (90) days of discovery (an “Optional Asset Notice”). If Buyer desires to
accept the transfer of such Optional Asset, then (a) Buyer shall give written
notice thereof to Seller within thirty (30) days after delivery of the Optional
Asset Notice relating to such Optional Asset and (b) promptly following receipt
of such notice, Seller shall, without further consideration, and subject to the
receipt of any applicable consents of third parties, sell, transfer, convey,
assign and deliver to Buyer, and Buyer shall purchase and accept from Seller,
free and clear from any Liens, all right, title and interest of Seller or any of
its Affiliates in and to such Optional Asset. Buyer and Seller shall cooperate
and promptly execute and deliver any instruments of transfer or assignment
reasonably requested by Buyer to effect such transfer and assignment to Buyer.
If Buyer fails to deliver to Seller notice of its intent to accept the transfer
of such Optional Asset within such thirty (30)-day period, then such Optional
Asset will be considered an Excluded Asset hereunder. The Parties acknowledge
and agree that the giving of notice or the transfer of any Optional Asset under
this Section 1.9 shall not in itself constitute a breach of Section 3.5 of this
Agreement.

1.10 Retained Contracts. The parties acknowledge that Seller and/or its
Subsidiaries are parties to Contracts that are not being assigned to Buyer
hereunder at the Closing that contain

 

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non-disclosure, non-solicitation, non-competition, assignment of inventions
and/or similar provisions (each, a “Restrictive Provision”) in favor of, or that
benefit, in whole or in part, the Business (collectively, the “Retained Business
Contracts”). For a period of three (3) years after the Closing, (i) upon the
request of Buyer, Seller shall provide copies of all Retained Business Contracts
to Buyer and (ii) if Buyer or Seller discovers a breach of any Restrictive
Provision by a Person subject to such Restrictive Provision (Seller shall
provide written notice to Buyer of any such breach promptly after its discovery
thereof), Seller shall, or shall cause its Subsidiaries to, upon the written
request of Buyer, assign to Buyer any rights under such Restrictive Provision
without further consideration; provided, however, that any such assignment need
not be exclusive unless failure of such assignment to be exclusive would impair
Buyer’s rights under such Restrictive Provision following such assignment; and
provided, further, if in the judgment of Buyer any such assignment would
constitute a breach thereof or would be ineffective, would affect adversely the
rights of Buyer under such Restrictive Provision or would violate or be
unenforceable under any applicable Law, then Seller shall, and shall cause its
Subsidiaries to, (A) use commercially reasonable efforts to obtain any requisite
consent to assignment if requested by Buyer and (B) if such consent is not
obtained or if Buyer elects not to have such Restrictive Provision assigned for
any of the reasons set forth in the foregoing proviso, take any and all
commercially reasonable action necessary to enforce such Restrictive Provision
on behalf of Buyer at the direction and cost of Buyer. If Seller or any of its
Subsidiaries is required to enforce a Restrictive Provision in accordance with
the foregoing clause (B), the parties shall work in good faith to establish
reasonable processes governing the obligations of Seller and the cooperation
between the parties with respect thereto.

ARTICLE II

PURCHASE PRICE

2.1 Purchase Price. The aggregate purchase price (the “Purchase Price”) payable
for the Acquired Assets shall be the sum of (a) the Closing Payment plus (b) the
Initial Holdback Payment, if any, and the Final Holdback Payment, if any,
payable in accordance with Section 2.3.

2.2 Closing Payment. Subject to the terms and conditions of this Agreement, at
the Closing, Buyer shall pay to Seller the Closing Payment in cash by wire
transfer of immediately available U.S. funds in accordance with the wire
transfer instructions delivered to Buyer in writing at least two (2) Business
Days prior to the Closing.

2.3 Holdback Payments. Within five (5) Business Days following the Initial
Holdback Payment Date, Buyer shall deliver to Seller the Initial Holdback
Payment, if any. Within five (5) Business Days following date of the final
determination (in accordance with Article VII) of all claims to which the
Initial Holdback Reserve relates, Buyer shall deliver to Seller the Final
Holdback Payment, if any.

2.4 Intentionally Omitted.

2.5 Allocation of Purchase Price. The Purchase Price shall be allocated among
the Acquired Assets in the manner to be mutually agreed to by the parties prior
to the Closing

 

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(the “Allocation Methodology”). Buyer and Seller and their respective Affiliates
shall file all tax returns (including IRS Form 8594) consistent with the
Allocation Methodology (as reasonably adjusted to account for events occurring
after the determination of the allocation of the Purchase Price), and none of
Buyer, Seller or their respective Affiliates shall take any Tax position
inconsistent with the Allocation Methodology unless required to do so by a
change in applicable Laws or a good faith resolution of a Tax contest.

ARTICLE III

REPRESENTATIONS AND WARRANTIES OF SELLER

Except as disclosed by Seller in the disclosure schedule, dated as of the date
hereof and delivered by Seller to Buyer (the “Disclosure Schedule”), Seller
hereby represents and warrants to Buyer that the representations and warranties
contained in this Article III are true, complete and correct as of the date
hereof and as of the Closing Date.

3.1 Organization and Good Standing of Seller. Seller is a corporation duly
formed, validly existing and in good standing under the Laws of the State of
Delaware.

3.2 Authorization; Binding Obligation. Seller has all necessary corporate power
and authority to execute and deliver this Agreement, each Related Agreement and
each other instrument or document required to be executed and delivered by it
pursuant to this Agreement or any Related Agreement, and to perform each of its
obligations hereunder and thereunder and to consummate the transactions
contemplated hereby and thereby. The execution and delivery by Seller of this
Agreement and each Related Agreement, the performance of its obligations
hereunder and thereunder, and the consummation by Seller of the transactions
contemplated hereby and thereby, have been duly and validly authorized by all
requisite action on the part of Seller and no other corporate proceedings on
Seller’s part are necessary to authorize this Agreement or any Related Agreement
or to consummate the transactions so contemplated herein and therein. This
Agreement has been duly and validly executed and delivered by Seller, and each
Related Agreement, when executed and delivered by Seller, is or will be duly and
validly executed and delivered by Seller, and this Agreement and each Related
Agreement constitutes or will constitute, a legal, valid and binding obligation
of Seller, enforceable against Seller in accordance with its respective terms,
except (a) as limited by applicable bankruptcy, insolvency, reorganization,
moratorium and other Laws of general application affecting enforcement of
creditors’ rights generally, and (b) as limited by Laws relating to the
availability of specific performance, injunctive relief or other equitable
remedies.

 

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3.3 Consents. Except as set forth in Schedule 3.3 of the Disclosure Schedule,
the execution and delivery by Seller of this Agreement, the Related Agreements
or any other instrument or document required by this Agreement or any Related
Agreement to be executed and delivered by Seller do not, and the performance of
this Agreement, the Related Agreements and any other instrument or document
required by this Agreement or any Related Agreement to be executed and delivered
by Seller shall not, require Seller to provide notice to, obtain any consent of
or take any other action in respect of any Person or obtain Approval of, observe
any waiting period imposed by, make any filing with or notification to, or take
any other action in respect of any Governmental Authority.

3.4 No Violation. Except as set forth in Schedule 3.4 of the Disclosure
Schedule, the execution and delivery by Seller of this Agreement, the Related
Agreements or any other instrument or document required by this Agreement or any
Related Agreement to be executed and delivered by Seller do not, and the
performance of this Agreement, the Related Agreements or any other instrument or
document required by this Agreement or any Related Agreement to be executed and
delivered by Seller will not, (a) conflict with, violate or breach the
Organizational Documents of Seller, (b) conflict with or violate any Law or
Order applicable to Seller or by which it or any of the Acquired Assets is bound
or affected, (c) conflict with or result in any breach or violation of or
constitute a default (or an event that with notice or lapse of time or both
would become a breach, violation or default) under, or impair the rights of
Seller or alter the rights or obligations of any third party under, or result in
or give to others any rights of termination, amendment, modification,
acceleration or cancellation of, or result in the creation of a Lien on any of
the Acquired Assets pursuant to, any Contract or other instrument or obligation
to which Seller is a party or is otherwise bound, or any Approval to which
Seller is a party or by which Seller, the Acquired Assets are bound or affected,
or (d) result in any Person being provided with access, through an escrow or
otherwise, to source code of any Software included in the Acquired Assets.

3.5 Title to and Condition of Acquired Assets; Sufficiency of Assets.

(a) Seller is the sole and exclusive legal and equitable owner of all right,
title and interest in, and has good, valid and marketable title to, all of the
Acquired Assets, free and clear of all Liens. Seller has the power and the right
to sell, assign and transfer, Seller will sell and deliver to Buyer, and upon
consummation of the transactions contemplated by this Agreement Buyer will
acquire, good, valid, exclusive and marketable title to all of the Acquired
Assets, free and clear of all Liens. This Section 3.5(a) shall not be construed
as a representation or warranty regarding Acquired Intellectual Property or any
Licensed Intellectual Property, which will be addressed solely by Section 3.9.

(b) All tangible assets and personal property included in the Acquired Assets
have been maintained in accordance with normal industry practice and are in
operating condition and repair, subject to ordinary wear and tear.

(c) The Acquired Assets, together with the Excluded Intellectual Property,
comprise all assets, properties, rights and Contracts used or held for use by
Seller in connection with the operation of the Business, including the
development, manufacture, license, offer for sale and sale of the Acquired
Intellectual Property, which are all of the assets, properties, rights

 

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and Contracts necessary for Buyer to operate the Business and develop,
manufacture, license, offer for sale and sell the Acquired Intellectual Property
following the Closing in the manner in which the Business was, during the four
(4)-year period preceding the date hereof, and is currently operated and the
Acquired Intellectual Property was, during the four (4)-year period preceding
the date hereof, and is currently developed, manufactured, licensed, offered for
sale and sold.

3.6 Legal Proceedings.

(a) Except as set forth on Schedule 3.6(a) of the Disclosure Schedule, there is
no Action pending or, to the Knowledge of Seller, threatened by or against
Seller or any of its officers, directors or employees (in their capacities as
such) involving, relating to or affecting any of the Acquired Assets, and Seller
has not received any written or, to Seller’s Knowledge, oral claim, complaint,
incident, report, threat or notice of any such Action. There is no such Action
pending or threatened against any other Person by Seller.

(b) Schedule 3.6(b) of the Disclosure Schedule sets forth all Actions within the
past four (4) years involving, relating to or affecting any of the Acquired
Assets that are no longer pending (the “Prior Actions”). To the Knowledge of
Seller, all of the Prior Actions have been concluded in their entirety. Seller
has made available to Buyer all material formal written communications relating
to the Prior Actions between Seller and a Governmental Authority and any Orders
related thereto.

(c) To the Knowledge of Seller, there are no outstanding Orders against Seller
involving, relating to or directly affecting the Acquired Assets, and Seller is
not in default with respect to any such Order of which it has knowledge or was
served upon it.

3.7 Compliance with Laws. Except as set forth on Schedule 3.7(i) of the
Disclosure Schedule, Seller has complied in all material respects during the
four (4) years prior to the date hereof and is in compliance in all material
respects with all Laws applicable to, involving or affecting any of the Acquired
Assets, including product liability Laws. Except as set forth on Schedule
3.7(ii) of the Disclosure Schedule, in the four (4) years prior to the date
hereof, Seller has not received any written or, to Seller’s Knowledge, oral
notice to the effect that, or, to Seller’s Knowledge, otherwise been advised
that, Seller is not in compliance with any such Laws, and to the Knowledge of
Seller, there exists no event, condition or occurrence that constitutes
noncompliance with any such Law in any material respect, and to the Knowledge of
Seller, no investigation or review by any Governmental Authority with respect to
any Acquired Assets is pending or, to the Knowledge of Seller, threatened, nor
has any Governmental Authority indicated in writing or, to Seller’s Knowledge,
orally an intention to conduct the same.

3.8 Contracts. Seller is not in breach or default under the terms of any
Assigned Contract, and to the Knowledge of Seller there exists no event,
condition or occurrence that (with or without due notice or lapse of time, or
both) would constitute such a breach or default, nor has Seller received any
notice of any breach or default or alleged breach or default under any Assigned
Contract. To the Knowledge of Seller, no other party to any Assigned Contract is
in breach or default under the terms thereof, and, to the Knowledge of Seller,
there exists no event, condition or occurrence that (with or without due notice
or lapse of time, or both) would

 

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constitute such a breach or default by any such party, nor has Seller received
any notice of any breach or default by any such party. The Assigned Contracts
are in full force and effect and are valid and binding obligations of Seller
and, to the Knowledge of Seller, the other parties thereto. Seller has not
received any notice from any other party to an Assigned Contract of the
termination or threatened termination thereof, or of any claim, dispute or
controversy with respect thereto, nor, to the Knowledge of Seller, is there any
basis therefor. Seller has delivered to Buyer complete and accurate copies of
all Assigned Contracts, including all amendments and other changes thereto. This
Section 3.8 shall not be construed as a representation or warranty regarding any
IP Agreements, which will be addressed solely by Section 3.9, regardless of
whether such IP Agreements are listed on Schedule 1.1(f).

3.9 Intellectual Property.

(a) Schedule 3.9(a)(i) of the Disclosure Schedule sets forth a complete and
accurate list of all United States and foreign Patents, Trademarks (including
unregistered Trademarks), Internet domain names and registered Copyrights
included in the Acquired Intellectual Property, indicating for each, the
applicable jurisdiction, registration number (or application number), date
issued (or date filed) and status (including the next action or payment and date
due). All registered and applied for Trademarks, Patents and Copyrights included
in the Acquired Intellectual Property that are currently pending are in
compliance with all legal requirements (including the timely filing of
responses, statements or affidavits of use and incontestability and renewal
applications and required fees with respect to Trademarks and the payment of
filing, examination, maintenance and other fees and the filing of responses,
declarations and affidavits with respect to Patents), are valid and enforceable,
have not been adjudged to be invalid or unenforceable in whole or in part, and
are not subject to any fees, responses or actions falling due within ninety
(90) days after the Closing Date. To the Knowledge of Seller, Seller and its
Affiliates have complied with their respective duties of disclosure to the
United States Patent and Trademark Office, and to any foreign office having a
similar such requirement in connection with the Acquired Intellectual Property.
During the four (4)-year period prior to the Closing Date, no Trademark included
in the Acquired Intellectual Property has been or is now involved in any
cancellation proceeding before the United States Patent and Trademark Office or
any similar foreign authority and, to the Knowledge of Seller, no such Action is
threatened with respect to any of such Trademarks. During the four (4)-year
period prior to the Closing Date, to the Knowledge of Seller, there has been no
prior use of any Trademarks included in the Acquired Intellectual Property by
any Person that would confer upon such Person superior rights in such
Trademarks. Except as set forth on Schedule 3.9(a)(ii) of the Disclosure
Schedule, no Patent included in the Acquired Intellectual Property has been or
is now involved in any litigation, infringement, interference, reissue,
re-examination, opposition, invalidity or nullity proceeding before the United
States Patent and Trademark Office or any similar foreign authority, and Seller
has not received any written or, to the Knowledge of Seller, oral notice
threatening the commencement of any such proceeding. No Copyright registration
or copyrightable work included in the Acquired Intellectual Property has been or
is now involved in any litigation. To the Knowledge of Seller, there are no
(i) Trademarks of any third party potentially conflicting with the Trademarks
included in the Acquired Intellectual Property, or (ii) Patents of any third
parties potentially interfering with the Patents included in the Acquired
Intellectual Property.

 

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(b) Schedule 3.9(b)(A) of the Disclosure Schedule sets forth a complete and
accurate list of all Contracts relating to Acquired Intellectual Property,
including all license agreements granting any right to use or practice any
rights under any Acquired Intellectual Property, other than the Existing License
Agreement, the Contracts set forth in Schedule 1.1(a)(ii) and off-the shelf,
shrink-wrapped or “click to accept” software licenses or other licenses to
generally commercially available software obtained in the ordinary course of
business (“Licensed Intellectual Property”), whether Seller or any of its
Affiliates is the licensee or licensor thereunder, to which Seller or any of its
Affiliates is a party or otherwise bound (collectively, the “IP Agreements”),
indicating for each the title, the parties and the date executed. Except as set
forth on Schedule 3.9(b)(B) of the Disclosure Schedule, with respect to each IP
Agreement, subject to Section 6.2(f), (i) the IP Agreement is valid and binding
and in full force and effect and represents the entire understanding between the
respective parties with respect to the subject matter of such IP Agreement;
(ii) the IP Agreement will remain valid and binding and in full force and effect
on terms identical to those currently in effect following the consummation of
the transactions contemplated by this Agreement; (iii) (a) neither Seller nor
any of its Affiliates is in breach or default under the terms of the IP
Agreement and, to the Knowledge of Seller, there exists no event, condition or
occurrence that (with or without due notice or lapse of time, or both) would
constitute such a breach or default and (b) Seller has not received any written
or, to the Knowledge of Seller, oral notice of any breach or default or alleged
breach or default under such IP Agreement; (iv) (a) to the Knowledge of Seller,
no other party to such IP Agreement is in breach or default under the terms
thereof and there exists no event, condition or occurrence that (with or without
due notice or lapse of time, or both) would constitute such a breach or default
by any such party and (b) Seller has not received any written or, to the
Knowledge of Seller, oral notice of any breach or default by any such party;
(v) Seller has not received any written or, to the Knowledge of Seller, oral
notice from any other party to the IP Agreement of the termination or threatened
termination thereof, or of any claim, dispute or controversy with respect
thereto, nor, to the Knowledge of Seller, is there any basis therefor; and
(vi) no consent of, or notice to, any third party is required under the IP
Agreement as a result of or in connection with, and neither the enforceability
nor any of the terms or provisions of such IP Agreement will be affected in any
manner by, the execution, delivery and performance of this Agreement or any
Related Agreement, or the transactions contemplated hereby or thereby. Seller
has delivered to Buyer complete and accurate copies of all IP Agreements,
including all amendments and other changes thereto.

(c) Except as set forth on Schedule 3.9(c)(i) of the Disclosure Schedule, Seller
is the sole and exclusive owner of the entire and unencumbered right, title, and
interest in and to the Acquired Intellectual Property, and the Acquired
Intellectual Property is free and clear of any covenants not to sue, Liens,
joint ownership rights, obligations and duties, Orders and any determination of
an arbiter. Except as set forth on Schedule 3.9(c)(i) of the Disclosure
Schedule, Seller has the right to use the Licensed Intellectual Property in
accordance with the terms and conditions of the applicable IP Agreements. (For
the avoidance of doubt, the foregoing sentences will not be construed as
representations or warranties regarding Intellectual Property infringement or
misappropriation matters, which will be addressed solely by Section 3.9(e).)
Seller has not used any Licensed Information (as defined in Schedule 3.9(c)(ii)
of the Disclosure Schedule) in connection with the operation of the Business,
including the development, manufacture, license, offer for sale or sale of the
Acquired Intellectual Property.

 

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(d) Except as set forth on Schedule 3.9(d)(i) of the Disclosure Schedule, no
royalties, honoraria or other fees are payable to any third parties for the use
of or right to use any Acquired Intellectual Property. Except as set forth on
Schedule 3.9(d)(i) of the Disclosure Schedule, all inventions, discoveries,
Trade Secrets, ideas and works included in the Acquired Intellectual Property,
whether or not patented or patentable or otherwise protectable under Law, were
created, prepared, developed or conceived by employees or independent
contractors of Seller or any of its Affiliates and were either created,
prepared, developed or conceived by (i) employees within the scope of their
employment or (ii) by independent contractors who have duly assigned their
rights to Seller or an Affiliate thereof pursuant to enforceable written
agreements. Except as set forth on Schedule 3.9(d)(ii) of the Disclosure
Schedule, none of the Acquired Intellectual Property is involved in any
inventorship challenge, interference, reexamination, conflict, nullity or
opposition proceeding, and there has been, to the Knowledge of Seller, no threat
to Seller that any such proceeding will hereafter be commenced.

(e) The Acquired Intellectual Property does not infringe upon, violate,
misappropriate or make unlawful use of any Intellectual Property or other
similar rights of any other Person, the use of the Acquired Intellectual
Property does not constitute unfair trade practices and there is no Action
pending or, to the Knowledge of Seller, threatened alleging that any Acquired
Intellectual Property infringes upon, violates or constitutes the unauthorized
use of the Intellectual Property or other similar rights of any other Person,
nor is Seller aware of any basis for such a claim. Except as set forth in
Schedule 3.9(e)(i) of the Disclosure Schedule, in the four (4) years prior to
the Closing Date, Seller has not received any written or, to the Knowledge of
Seller, oral notice of any allegation that any Acquired Intellectual Property
infringes upon, violates, misappropriates or makes unlawful use of any
Intellectual Property or other similar rights of any other Person, nor is Seller
aware of any basis for such a claim. To the Knowledge of Seller, no Person is
misappropriating, infringing, violating or making unlawful use of any Acquired
Intellectual Property, nor is Seller aware of any basis for such a claim. Except
as set forth in Schedule 3.9(e)(i) of the Disclosure Schedule, in the four
(4) years prior to the Closing Date, neither Seller nor any of its Affiliates
has threatened to bring and neither Seller nor any of its Affiliates has brought
any Action regarding the ownership, use, validity or enforceability of any
Acquired Intellectual Property.

(f) Except as set forth on Schedule 3.9(f) of the Disclosure Schedule, the
consummation of the transactions contemplated hereby will not result in the loss
or impairment of Seller’s or any of its Affiliates’ ownership or other rights in
and to any of the Acquired Intellectual Property or under any of the IP
Agreements, require Seller or any of its Affiliates to grant to any third party
any right to any Acquired Intellectual Property or obligate Seller or any of its
Affiliates to pay any royalties or other amounts to any third party in excess of
any amounts payable to such third parties prior to the Closing, nor will the
consummation of the transactions contemplated hereby require the approval or
consent of any Governmental Authority or other Person in respect of any Acquired
Intellectual Property.

(g) Schedule 3.9(g)(i) of the Disclosure Schedule lists all Software included in
the Acquired Intellectual Property (the “Acquired Software”) and indicates
whether such Software is subject to an escrow agreement or IP Agreement and, if
so, indicates where such Software is held in escrow and identifies such IP
Agreement. Except as set forth on Schedule 3.9(g)(ii) of the Disclosure
Schedule, Seller is the sole and exclusive owner of, or has the right to

 

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use, all software development tools, library functions, compilers, and other
software included in the Acquired Software (which, for the avoidance of doubt,
shall not include the Excluded Intellectual Property). Except as set forth on
Schedule 3.9(g)(ii) of the Disclosure Schedule, in the four (4) years prior to
the Closing Date, (i) no rights in the Acquired Software have been transferred
or assigned to any third party (other than licenses granted in the ordinary
course of business in connection with the sale of the Seller’s or its
Affiliates’ products), and (ii) no licenses or rights (including contingent
rights) have been granted by Seller to any Person to access, use or distribute
any source code of any owned Acquired Software. Except as set forth on Schedule
3.9(g)(ii) of the Disclosure Schedule, (a) Seller has maintained and protected
all owned Acquired Software (including all source code and system
specifications) with proprietary notices, confidentiality and non-disclosure
agreements and such other measures as are reasonably necessary to protect the
Intellectual Property contained therein or relating thereto, and (b) none of the
source code of any owned Acquired Software has been published, disclosed or
delivered to any Person by Seller or any of its Affiliates or any of their
Representatives. All Acquired Software is free from any material software defect
or programming or documentation error, operates and runs in a reasonable and
efficient business manner and the applications can be compiled from their
associated source code without undue burden. Seller has delivered to Buyer all
required documentation that exists relating to the use, maintenance and
operation of the Acquired Software. Seller maintains its Source Code Materials
for all versions of the Acquired Software that are currently supported by Seller
to the extent such Source Code Materials exist. With the exception of the
Excluded Intellectual Property, the Source Code Materials or the applicable
documentation (to the extent such Source Code Materials and documentation exist)
contain all of the tangible embodiments of the material know-how, materials and
information that Seller and its Affiliates use to develop, maintain, support,
compile and deploy all versions of the Acquired Software that are currently
supported by Seller. The Acquired Software does not contain programming code or
instructions constructed with the ability or intent to damage, interfere with,
or otherwise adversely affect computer programs, data files or hardware, and
does not contain any disabling code that will activate on a predetermined date
or that can be remotely activated by Seller or any third party.

(h) Neither Seller nor any of its Affiliates has used Open Source Materials that
create, or purport to create, obligations for Seller or any of its Affiliates
with respect to the Acquired Assets or grant, or purport to grant, to any third
party, any rights or immunities under any Acquired Intellectual Property
(including using any Open Source Materials that require, as a condition of use,
modification or distribution of the Open Source Materials that other Software
incorporated into, derived from or distributed with the Open Source Materials be
(x) disclosed or distributed in source code form, (y) be licensed for the
purpose of making derivative works or (z) be redistributable at no charge).

(i) Except as set forth on Schedule 3.9(i) of the Disclosure Schedule, all of
the copyrightable materials incorporated in, underlying or used with the
Acquired Assets have been created or authored by employees of Seller or its
Affiliates within the scope of their employment by Seller or its Affiliates or
by independent contractors of Seller who have executed agreements expressly
assigning all right, title and interest in such copyrightable materials to
Seller. Except with respect to the Existing License Agreement and independent
contractors of Seller who have executed agreements expressly assigning all
right, title and interest in such copyrightable materials to Seller, no portion
of such copyrightable material was jointly developed with any third party.

 

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(j) Seller and its Affiliates have taken all reasonable steps in accordance with
normal industry practice to protect the Acquired Intellectual Property,
including all rights in confidential information and Trade Secrets included in
the Acquired Intellectual Property. Except pursuant to enforceable
confidentiality obligations in favor of Seller, there has been no disclosure to
any third party of any confidential information or Trade Secrets included in the
Acquired Intellectual Property. To the Knowledge of Seller, no current or former
employee, consultant, contractor or potential partner or investor of Seller or
any of its Affiliates is in unauthorized possession of any of the confidential
information, Trade Secrets or Software included in the Acquired Intellectual
Property.

3.10 Regulatory Matters.

(a) Schedule 3.10(a)(i) of the Disclosure Schedule contains a correct and
complete list of all Approvals currently held by Seller with respect to the
Acquired Assets (the “Governmental Approvals”), which are all the Approvals that
are necessary for the ownership, operation, design, development, testing,
marketing, sale or use of the Acquired Intellectual Property as and to the
extent such activities are currently conducted by Seller. Each Governmental
Approval is valid and in full force and effect, no Governmental Approval is
subject to any Lien, limitation, restriction, probation or other qualification,
and there is no material default under any Governmental Approval or, to the
Knowledge of Seller, any event, condition or occurrence that could reasonably be
expected to form the basis for the assertion of any such default. There is no
Action pending or, to the Knowledge of Seller, threatened that would reasonably
be expected to result in the termination, cancellation, modification,
non-renewal, revocation, limitation, suspension, restriction or impairment of
any Governmental Approval or the imposition of any fine, penalty or other
sanctions for violation of any legal or regulatory requirements relating to any
Governmental Approval nor, to the Knowledge of Seller, is there any event,
condition or occurrence that could reasonably be expected to form the basis
therefor. Seller is in compliance in all material respects with the terms and
conditions of each Governmental Approval. Seller has, and for the four (4) years
prior to the date hereof has had, all Approvals and Orders that are or were
necessary in order to own and operate the Acquired Assets.

(b) Except as set forth on Schedule 3.10(b)(ii) of the Disclosure Schedule, with
respect to the Acquired Assets, Seller (i) is and has been for the five
(5) years prior to the date hereof in compliance in all material respects with
all Laws, including those administered by the United States Food and Drug
Administration (“FDA”) and similar Governmental Authorities, applicable to the
ownership, testing, development, manufacture, packaging, distribution,
marketing, labeling, promotion, sale, import or export of the Acquired
Intellectual Property and all applicable standards issued by a Governmental
Authority and having the effect of Law that govern good manufacturing and
clinical practice (collectively, “Applicable Laws”); (ii) has not received in
the four (4) years prior to the date hereof any warning letter or other
correspondence or written or, to the Knowledge of Seller, oral notice from the
FDA or any other Governmental Authority alleging or asserting material
noncompliance with any Applicable Laws or any Governmental Approvals; (iii) has
not received written or, to the Knowledge of Seller, oral

 

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notice of any Action from any Governmental Authority or other Person alleging a
violation by Seller of any Applicable Laws or Governmental Approvals and has no
knowledge that any such Governmental Authority or Person is considering any such
Action; (iv) has not received written or, to the Knowledge of Seller, oral
notice that the FDA or any other Governmental Authority has taken, is taking or
intends to take action to limit, suspend, modify or revoke any Governmental
Approvals and has no knowledge that any such Governmental Authority or Person is
considering any such Action; (v) has filed, obtained, maintained or submitted
all material reports, documents, forms, notices, applications, records, claims,
submissions and supplements or amendments as required by any Applicable Laws or
Governmental Approvals and that all such reports, documents, forms, notices,
applications, records, claims, submissions and supplements or amendments were
complete and correct on the date filed (or were corrected or supplemented by a
subsequent submission); (vi) has not, either voluntarily or involuntarily,
initiated, conducted, or issued or caused to be initiated, conducted or issued,
any safety alert, post-sale warning, recalls or other notice or action relating
to any Acquired Intellectual Property or any alleged product defect or violation
with respect thereto and, to the Knowledge of Seller, no Person has initiated,
conducted or intends to initiate any such notice or action; and (vii) has not,
and none of its employees or Representatives has, made an untrue statement of
material fact or fraudulent statement to the FDA or similar Governmental
Authority or failed to disclose a material fact required to be disclosed to the
FDA or similar Governmental Authority in connection with the Acquired
Intellectual Property.

(c) Seller has made available, and prior to the Closing will deliver to Buyer, a
true and correct copy of each of the following with respect to the last four
(4) calendar years and the period from January 1, 2016 to the date hereof:
(i) the numbers of all 510(k)s and premarket approval applications submitted to
the FDA or similar applications submitted to other Governmental Authorities in
connection with the Acquired Intellectual Property; (ii) all justifications by
Seller or any of its Affiliates or any of their respective predecessors for not
filing a 510(k) or similar filing for a change or modification to a marketed
device in connection with the Acquired Intellectual Property; (iii) all
premarket notification submissions (including 510(k)s) relating to the Acquired
Intellectual Property and copies of all correspondence, including e-mails and
records of conversations with the FDA, including all substantially equivalent or
not substantially equivalent letters received by Seller or its Affiliates or any
of their respective predecessors in connection with the Acquired Intellectual
Property; (iv) all correspondence, meeting notes or minutes, or related
documents concerning material communications between the FDA and Seller or its
Affiliates or any of their respective predecessors as they relate to 510(k) or
similar submissions in connection with the Acquired Intellectual Property,
including requests for additional information and responses thereto, and
compliance matters; (v) all management review reports, management review
actions, and management review follow activity relating to the Acquired
Intellectual Property; (vi) all documents in response to FDA regulatory
action(s) relating to the Acquired Intellectual Property, including all
documents showing corrective actions undertaken by Seller or any of its
Affiliates or any of their respective predecessors in response to FDA regulatory
action(s); (vii) all FDA reports of inspection (Establishment Inspection Reports
and Form FDA 483s) or analogous documents from other Governmental Authorities,
including foreign Governmental Authorities, in connection with the Acquired
Intellectual Property; (viii) all MedWatch forms received by Seller or its
Affiliates or any of their respective predecessors for the Acquired Intellectual
Property; (ix) all written reports of QSR audits of Seller or any of its
Affiliates or any

 

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of their respective predecessors and their suppliers in Seller’s or its
Affiliates’ possession or control in connection with the Acquired Intellectual
Property; (x) all information and documents pertaining to the Acquired
Intellectual Property required under FDA’s Regulations pertaining to complaints,
medical device reports, and removals and corrections, including complaint files,
corrective and preventive actions, adverse event files, all medical device
reports and vigilance reports filed by Seller or any of its Affiliates or any of
their respective predecessors, and correction and removal records and reports;
(xi) for Acquired Intellectual Property, design history files, including design
and development planning, design input and output, design review, design
verification and validation, including software validation and risk analysis
where appropriate, design transfer and design changes; and (xii) all documents
and communications in Seller’s or its Affiliates’ possession (including written
correspondence, telephone notes, memoranda, meeting notes or minutes reflecting
oral communications, between Seller or any of its Affiliates or any of their
respective predecessors and any Governmental Authority) that pertain to any
recall of the Acquired Intellectual Property, including health hazard
evaluations, recall strategies, public warnings, customer communications,
effectiveness checks, status reports and termination letters. Seller has made
available, and prior to the Closing Date will deliver, to Buyer a true and
correct copy of all product labeling and advertising currently in use, including
that posted on Seller’s or any of its Affiliates’ websites and in Seller’s or
any of its Affiliates’ user’s manuals.

(d) With respect to the Acquired Assets, Seller has not solicited, received,
paid or offered to pay any remuneration, directly or indirectly, overly or
covertly, in cash or kind for the purpose of inducing any referral which
violated any applicable anti-kickback Law, including the Federal Health Care
Program Anti-Kickback Statute, 42 U.S.C. § 1320a-7b(b), or any applicable state
anti-kickback Laws or foreign Laws with similar effect or purpose.

(e) Neither Seller nor any of its Affiliates has been required to file any
notification or other report with or provide information to any Governmental
Authority or product safety standards group concerning actual or potential
defects or hazards with respect to the Acquired Intellectual Property or any
services performed by Seller or any of its Affiliates in connection therewith,
and, to the Knowledge of Seller, there exist no grounds for the recall of the
Acquired Intellectual Property. The Acquired Intellectual Property contains and
presents warnings in compliance with the applicable requirements under the
Existing License Agreement. There are no statements, citations or decisions by
any Governmental Authority declaring the Acquired Intellectual Property
defective or unsafe nor, to the knowledge of Seller, is there any fact or
circumstance that could reasonably be expected to be a basis for such a
statement, citation or decision. The Acquired Intellectual Property does not
fail to meet any standards promulgated by any applicable Governmental Authority
that have the effect of Law. Except as set forth on Schedule 3.10(b) of the
Disclosure Schedule, there have been no recalls ordered by any Governmental
Authority with respect to the Acquired Intellectual Property, nor, to the
knowledge of Seller, is there any fact or circumstance that could reasonably be
expected to be a basis for such a recall.

3.11 Privacy. The use and dissemination by Seller of any Personal Data included
in the Acquired Assets is in compliance in all material respects with Seller’s
privacy policies and terms of use, all applicable Law (including, to the extent
applicable, the Health Insurance Portability and Accountability Act of 1996,
California Computer Security Breach Act (Cal. Civ.

 

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Code §§ 1798.29, 1798.80 - 1798.84), California Assembly Bill 1950 (Cal. Civ.
Code § 1798.81.5), Massachusetts Standards for the Protection of Personal
Information of Residents of the Commonwealth (201 CMR 17.00), and the Personal
Information Protection and Electronic Documents Act) and each Acquired Contract.
To the Knowledge of Seller, there have been no security breaches relating to, or
violations of, any security policy or related Law regarding, or any unauthorized
access disclosure, or use of, any data or information used by Seller in
connection with the Acquired Assets, including Personal Data, nor has Seller
received notice of any such breach, violation, disclosure or use. No Person has
commenced any Action relating to Seller’s information privacy or data security
practices, or to the knowledge of Seller, threatened any such Action or made any
complaint, investigation or inquiry relating to such practices.

3.12 Product and Service Warranties. There exist no express product or service
warranties or guarantees, whether written or oral, with respect to the Acquired
Intellectual Property other than those warranties and guarantees provided to
Buyer and end users of the Acquired Intellectual Property pursuant to the
Existing License Agreement. No product or service warranty or similar claims
have been made against Seller or any of its Affiliates with respect to the
Acquired Intellectual Property.

3.13 Books and Records; Disclosure. The books and records of Seller which have
been delivered or made available to Buyer in connection with the transactions
contemplated hereby are complete and accurate in all material respects. Neither
this Agreement (including the exhibits and schedules hereto) nor any other
agreement, document or certificate delivered or to be delivered to Buyer by or
on behalf of Seller pursuant to the terms of this Agreement, including the
Related Agreements, knowingly contains or will contain any untrue statement of a
material fact or knowingly omits or will omit to state a material fact
necessary, including with respect to the Acquired Assets or the Assumed
Liabilities, in order to make the statements contained herein or therein not
misleading in light of the circumstances under which they were made.

ARTICLE IV

REPRESENTATIONS AND WARRANTIES OF BUYER

Buyer hereby represents and warrants to Seller that the representations and
warranties contained in this Article IV are true, complete and correct as of the
date hereof and as of the Closing Date.

4.1 Organization and Good Standing. Buyer is a corporation duly organized,
validly existing and in good standing under the Laws of the State of Delaware.

4.2 Authorization; Binding Obligation. Buyer has all necessary corporate power
and authority to execute and deliver this Agreement and each Related Agreement
to which it is a party and each other instrument or document required to be
executed and delivered by it pursuant to this Agreement or any such Related
Agreement, to perform all of its obligations hereunder and thereunder and to
consummate the transactions contemplated hereby and thereby. The execution and
delivery by Buyer of this Agreement and each Related Agreement to which it is a
party, the performance of its obligations hereunder and thereunder and the
consummation by Buyer of the

 

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transactions contemplated hereby and thereby have been duly authorized by all
requisite action on the part of Buyer and no other corporate proceedings on the
part of Buyer are necessary to authorize this Agreement or any Related Agreement
to which it is, or will become, a party or to consummate the transactions so
contemplated herein and therein. This Agreement has been duly and validly
executed and delivered by Buyer, and each Related Agreement to which Buyer is a
party, when executed and delivered by Buyer, is or will be duly and validly
executed and delivered by Buyer, and this Agreement constitutes, and each
Related Agreement to which Buyer is or will become a party when executed and
delivered by Buyer constitutes or will constitute, a legal, valid, and binding
obligation of Buyer enforceable against Buyer in accordance with its respective
terms, except (a) as limited by applicable bankruptcy, insolvency,
reorganization, moratorium and other Laws of general application affecting
enforcement of creditors’ rights generally and (b) as limited by Laws relating
to the availability of specific performance, injunctive relief or other
equitable remedies.

4.3 Consents. The execution and delivery by Buyer of this Agreement, the Related
Agreements to which Buyer is a party or any other instrument or document
required by this Agreement or any Related Agreement to be executed and delivered
by Buyer do not, and the performance of this Agreement, the Related Agreements
to which Buyer is a party and any other instrument or document required by this
Agreement or any Related Agreement to be executed and delivered by Buyer do not,
require Buyer to provide notice to, obtain any Approval of or take any other
action in respect of any Person or obtain consent of, observe any waiting period
imposed by, make any filing with or notification to, or take any other action in
respect of any Governmental Authority.

4.4 No Violation. The execution and delivery by Buyer of this Agreement, the
Related Agreements to which Buyer is a party or any other instrument or document
required by this Agreement or any Related Agreement to be executed and delivered
by Buyer do not, and the performance of this Agreement, the Related Agreements
to which Buyer is a party or any other instrument or document required by this
Agreement or any Related Agreement to be executed and delivered by Buyer will
not, (a) conflict with or violate the Organizational Documents of Buyer,
(b) conflict with or violate any Law or Order applicable to Buyer or (c) result
in a breach or violation of or constitute a default (or an event that with
notice or lapse of time or both would become a default) under, any material
Contract to which Buyer is a party, in any case, except where such conflict or
breach would not reasonably be likely to have a material adverse effect on
Buyer’s ability to consummate the transactions contemplated hereby.

4.5 Legal Proceedings. There is no Action pending or, to the knowledge of Buyer,
threatened by or against or affecting Buyer that would (a) give any Person the
right to enjoin or rescind the transactions contemplated by this Agreement or
(b) otherwise prevent Buyer from (i) executing and delivering this Agreement or
the Related Agreements to which it is a party or (ii) performing Buyer’s
obligations pursuant to, or observing any of the terms and provisions of, this
Agreement or the Related Agreements to which it is a party.

 

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ARTICLE V

COVENANTS

5.1 Conduct of Business Pending Closing.

(a) Between the date hereof and the Closing Date, or the earlier termination of
this Agreement, Seller shall (i) preserve intact the Acquired Assets; (ii) use
its commercially reasonable efforts to keep available the services of the Key
Personnel; (iii) use its commercially reasonable efforts to maintain in effect
the Assigned Contracts; and (iv) maintain in effect the Governmental Approvals
and Licensed Intellectual Property in accordance with the terms thereof and
renew any Governmental Approval and Licensed Intellectual Property that would
otherwise expire pursuant to the terms thereof between the date hereof and the
Closing.

(b) Between the date hereof and the Closing Date, or the earlier termination of
this Agreement, Seller shall not (i) sell, transfer, lease, license, sublicense,
grant or otherwise dispose of any Acquired Asset, amend or modify in any
material way, or terminate, any Assigned Contract or Licensed Intellectual
Property or omit to take any action the consequence of which adversely affects
or could adversely affect any rights of Seller to any Acquired Intellectual
Property, including Licensed Intellectual Property, amend or modify in any
material way any existing agreements with respect to any Acquired Intellectual
Property, disclose Trade Secrets to a third party or abandon or permit to lapse
any rights of Seller to any Acquired Intellectual Property; (ii) knowingly
create, incur, suffer to exist or assume any Lien on any of the Acquired Assets;
or (iii) take any action or fail to take any action that would result in any of
the representations and warranties set forth in Article III becoming false or
inaccurate or that would impair the ability of Seller to consummate the
transactions contemplated hereby in accordance with the terms hereof or delay
such consummation.

5.2 Cooperation. Upon the terms and subject to the conditions set forth in this
Agreement, each party hereto shall use commercially reasonable efforts to take,
or cause to be taken, all actions, and do, or cause to be done, and to assist
and cooperate with the other party or parties in doing, all things necessary,
proper or advisable to consummate the transactions contemplated hereby and to
satisfy or cause to be satisfied all of the conditions precedent that are set
forth in Article VI, as applicable to each of them.

5.3 Access to Information. Prior to the Closing Date and upon reasonable notice,
Seller shall afford to the Representatives of Buyer reasonable access during
normal working hours to all of its properties, books, Contracts and records
concerning the Acquired Assets, and Seller shall furnish promptly to Buyer all
information concerning the Acquired Assets, as Buyer may reasonably request.
Seller shall make available to Buyer and its Representatives upon Buyer’s
reasonable request (made with reasonable prior notice) and during normal
business hours each of Kenneth Ferry, Jonathan Go, John DeLucia and the Key
Personnel.

5.4 Notice of Certain Events. During the period from the date hereof until the
Closing or the earlier termination of this Agreement, Seller or Buyer shall
promptly notify the other party in writing of (i) the discovery by either party
of any event, condition, fact or circumstance that occurred or existed on or
prior to the date hereof and that caused or constitutes

 

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an inaccuracy in or breach of any representation or warranty made by such party
in this Agreement, (ii) any Action, event, condition, fact or circumstance that
occurs, arises or exists after the date hereof and that causes or constitutes,
or could reasonably be expected to cause or constitute, an inaccuracy in or
breach of any representation or warranty made by such party in this Agreement,
(iii) the occurrence or non-occurrence of any event the occurrence or
non-occurrence of which has caused or may reasonably be expected to cause any
condition to the obligations of any party hereto to effect the transactions
contemplated by this Agreement to not be satisfied, and (iv) any breach of any
covenant or obligation of the party; provided that, no such notice shall be
deemed to supplement or amend the Disclosure Schedule for any purpose
whatsoever, including for the purpose of determining the accuracy of any of the
representations and warranties made by Seller in this Agreement, including for
purposes of Article VI or Article VII.

5.5 Public Announcements. No party shall issue or permit any of its respective
Affiliates to issue any press release or other public announcement with respect
to this Agreement or the transactions contemplated hereby without the prior
consent of the other parties hereto, such consent not to be unreasonably
withheld, delayed or conditioned. Notwithstanding anything to the contrary in
this Section 5.5, neither Buyer, Seller or any of their respective Affiliates
shall be prohibited from making any disclosure (a) required by applicable Laws
(in which case the party required to make the release or statement shall allow
the other parties reasonable time to comment on such release or statement in
advance of such issuance to the extent permitted by applicable Laws) or (b) made
in connection with the enforcement of any rights or remedies relating to this
Agreement or the transactions contemplated hereby.

5.6 No Solicitation of Other Proposals. From the date hereof until the earlier
of the Closing Date or the termination of this Agreement in accordance with its
terms, none of Seller or any of its Affiliates or Representatives (collectively,
the “Seller Representatives”) shall directly or indirectly, (i) solicit,
facilitate, initiate, entertain, encourage or take any action to solicit,
facilitate, initiate, entertain or encourage, any inquiries or communications or
the making of any proposal or offer that constitutes or may constitute an
Acquisition Proposal, (ii) participate or engage in any discussions or
negotiations with, or provide any information to or take any other action with
the intent to facilitate the efforts of, any Person concerning any possible
Acquisition Proposal or any inquiry or communication that might reasonably be
expected to result in an Acquisition Proposal or (iii) approve or enter into any
letter of intent, agreement in principle, acquisition agreement or other similar
agreement related to any Acquisition Proposal.

5.7 Non-Competition, Non-Solicitation and Confidentiality.

(a) From the Closing Date until the thirty (30)-month anniversary thereof,
Seller shall not, and Seller shall not permit, cause or encourage any of its
Affiliates to, engage, manage, direct, assist or participate in, directly or
indirectly, or otherwise advise, consult with, invest in, lend money to or have
any other financial interest in, directly or indirectly, any business or
activity in the field of Computer Aided Diagnosis image analysis software for
MRI Computer Aided Diagnosis for breast cancer anywhere in the world or for MRI
Computer Aided Diagnosis for prostate cancer anywhere in the United States (the
“Restricted Business”).

 

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(b) From the Closing Date until the two (2)-year anniversary thereof, Seller
shall not, and Seller shall not permit, cause or encourage any other Person to,
recruit, solicit, offer employment to, employ or engage as a consultant, any Key
Personnel.

(c) From the Closing Date until the two (2)-year anniversary thereof, Buyer
shall not, and Buyer shall not permit, cause or encourage any other Person
acting on behalf of Buyer, to, recruit, solicit, offer employment to, employ or
engage as a consultant, any Person who is an employee of Seller as of the date
hereof and listed on Schedule 5.7(c) (“Remaining Employees”); provided, however,
that the foregoing shall not prevent Buyer from recruiting, soliciting, offering
employment to, employing or engaging any such Remaining Employee (i) whose
employment has been terminated by Seller at least twelve (12) months prior to
such Person’s employment or engagement by Buyer or (ii) who responds to a
general solicitation or advertisement or who initiates an inquiry with Buyer or
an Affiliate thereof regarding employment with Buyer or an Affiliate thereof.

(d) Buyer is acquiring from Seller certain Trade Secrets and other confidential
and proprietary information relating to, or used in connection with, the
Acquired Assets, including confidential information included in the Acquired
Intellectual Property and the Acquired Books and Records (collectively, the
“Confidential Information”), and that Buyer expects Seller and its Affiliates to
protect the confidentiality of the Confidential Information. Accordingly, Seller
covenants and agrees that, from and after the date hereof, it shall, and shall
cause its Affiliates to, hold the Confidential Information in the strictest
confidence and shall not use or disclose to any Person, directly or indirectly,
any Confidential Information for any purpose whatsoever; provided, however, that
Seller may disclose Confidential Information (i) as is required by Law or by
legal, judicial or regulatory process; or (ii) that has become available to the
public generally other than by acts by Seller, its Affiliates or any of their
respective Representatives in violation of this Agreement or any other
obligation of confidentiality; provided that, prior to making any such
disclosure in the case of the foregoing clause (i), it shall provide reasonable
advance notice to Buyer and reasonable assistance to Buyer in attempting to
obtain a protective order or other appropriate remedy concerning such
disclosure. Seller agrees that it shall be responsible for any breach or
violation of the provisions of this Section 5.7 by any of its Affiliates or its
or its Affiliates’ Representatives. The parties agree that the Shared Books and
Records shall be “Confidential Information” hereunder.

(e) Seller acknowledges that the covenants contained in this Section 5.7 are a
material and substantial part of the transaction contemplated by this Agreement
and are entered into in connection with and as an inducement to the acquisition
by Buyer of the Acquired Assets and the other transactions contemplated by this
Agreement, without which Buyer would be unwilling to enter into this Agreement
or consummate the transactions contemplated hereby.

(f) Seller acknowledges and agrees that (i) the provisions of this Section 5.7
are necessary and reasonable to protect the Confidential Information and the
goodwill being acquired by Buyer pursuant to this Agreement; (ii) the specific
time, geography and scope of the provisions set forth in this Section 5.7 are
reasonable and necessary to protect the business interests of Buyer and its
Affiliates as they relate to the Acquired Assets; and (iii) in the event of a
breach of any agreement set forth in this Section 5.7, Buyer would suffer
substantial irreparable harm and would not have an adequate remedy at law for
such breach. In recognition of the

 

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foregoing, Seller agrees that in the event of a breach or threatened breach of
any of the provisions set forth in this Section 5.7, in addition to such other
remedies as Buyer may have at Law, without posting any bond or security or
requirement for proof of actual damages, Buyer shall be entitled to seek
equitable relief, in the form of specific performance, or temporary, preliminary
or permanent injunctive relief, or any other equitable remedy which then may be
available. The seeking of such injunction or Order shall not affect Buyer’s
right to seek and obtain damages or other equitable relief on account of any
such actual or threatened breach.

(g) If any provision of this Section 5.7 is held by a Court to be overly broad
in duration, geographical coverage, substantive scope, or otherwise, that
provision will be narrowed to the broadest term permitted by applicable Law and
enforced as so narrowed, and such Court is hereby given express authority by the
undersigned to modify the offending provisions hereof without the signature or
prior consent of Seller or Buyer to the extent necessary to make them
enforceable to the fullest extent permitted under applicable Law. Each provision
of this Section 5.7 restricting the activities of Seller or Buyer in any way is
intended to be separate from and enforceable separately from each such other
provision

5.8 Mutual Post-Closing Cooperation. From the Closing Date until the fourth
(4th) anniversary thereof, Seller and Buyer shall use their respective
reasonable efforts to provide to the other party(ies) (the “requesting party”)
such books, records and information and make available to the requesting party
such personnel (such party(ies) providing such books, records or information or
making available such personnel to the requesting party, the “providing party”),
in each case as may be reasonably requested in writing by the requesting party
and subject to customary confidentiality obligations, for the purpose of
reasonably assisting the requesting party in responding to Governmental
Authority or professional inquiries, making required Governmental Authority
filings (including Tax filings) or defending or prosecuting any Action relating
to or arising out of the Acquired Assets or the Assumed Liabilities prior to or
after the Closing Date; provided that subject to the provisions of Article VII,
the requesting party shall promptly reimburse the providing party for any
reasonable out-of-pocket expenses incurred by the providing party in connection
with the provision of any such assistance (including reasonable legal fees and
disbursements), but the requesting party shall not be required to reimburse the
providing party for such party’s time spent in such cooperation or the salaries
or costs of fringe benefits or other similar expenses paid by the providing
party to its Affiliates or related Persons or their respective Representatives
while such Persons are providing any such assistance.

5.9 510(k) Notices. Following the Closing, Seller shall promptly notify the FDA
of the transfer to Buyer of the 510(k)s included in the Acquired Assets and take
such other actions as are required to effectuate the transfer of such 510(k)s.

5.10 Use of Names. From and after the Closing, none of Seller or any of its
Affiliates shall use or permit to be used any names or other Trademarks included
in the Acquired Assets or any derivations thereof.

5.11 Existing License Agreement. From the date hereof until the Closing, Seller
and Buyer shall perform and comply with all of their obligations under the
Existing License Agreement. Effective upon the Closing, the Existing License
Agreement, and all rights and obligations therein, shall terminate automatically
and be of no further force or effect, other than

 

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the following provisions thereof, which shall survive such termination and
continue in effect following the Closing in accordance with their respective
terms: (a) Article 12 (Confidentiality) (solely with respect to the Confidential
Information (as defined in the Existing License Agreement) of Buyer);
(b) Section 13.2 (IP Warranty and Indemnity) (solely with respect to Pre-Closing
Products and any alleged or actual Intellectual Property Rights infringement by
the iCAD Marks (each as defined in the Existing License Agreement) occurring
before the Closing); (c) Section 14.1 (Indemnity by iCAD) (solely with respect
to (i) any breach by Seller of any express covenant, representation or warranty
of the Existing License Agreement occurring before the Closing, (ii) any
negligent act or omission or willful misconduct of Seller or its employees
before the Closing that causes or results in tangible property damage, personal
injury or death, (iii) any failure by Seller to comply with applicable law
before the Closing and (iv) any defective or non-compliant Pre-Closing Product
or any defect in any Documents (as defined in the Existing License Agreement)
existing before the Closing; (d) Section 16.3 (Effect of Termination) and
(e) Article 18 (General Provisions), but excluding Sections 18.4, 18.6, 18.8,
18.9, 18.18 and 18.19 except as otherwise expressly set forth herein
(collectively, the “Surviving Existing License Agreement Provisions”). For the
avoidance of doubt, Seller hereby acknowledges and agrees that any license to
the Customized Products (as defined in the Existing License Agreement) granted
to a Customer (as defined in the Existing License Agreement) prior to the
Closing Date shall survive the termination of the Existing License Agreement and
continue in effect following the Closing. As of the date hereof, (i) Buyer has
no knowledge of any violations or any actions that would give rise to any claim
under the Surviving Existing License Agreement Provisions referred to in clauses
(a), (b) (except as set forth on Schedule 5.11), (c) and (d) of this
Section 5.11 (for purposes of the foregoing, “knowledge” means the actual
knowledge of Thomas Tynes, Samuel Coons and Amy Gilchrist) and (ii) Seller has
no Knowledge of any violations or any actions that would give rise to any claim
under any such Surviving Existing License Agreement Provision.

5.12 Warranty Obligations for Pre-Closing Products. If, at any time following
the Closing, an End User (as defined in the Existing License Agreement) makes a
warranty claim with respect to a Pre-Closing Product for which Buyer would have
had a claim under the Warranty (as defined in the Existing License Agreement) (a
“Warranty Claim”) but for the termination of the Existing License Agreement
pursuant to Section 5.11, Buyer shall satisfy such Warranty Claim in such a
commercially reasonable manner as it may determine in its sole discretion.

5.13 Recalls of Pre-Closing Products. If, at any time following the Closing,
Buyer, in its reasonable discretion (including at the request or recommendation
of a Governmental Authority), or any Governmental Authority initiates a recall
of any Pre-Closing Product (each, a “Recall”), Buyer shall be responsible for
the design, implementation and administration of such Recall. Seller shall
notify Buyer promptly of any facts or circumstances that could result in a
Recall. Buyer shall notify Seller promptly of any Recall and Seller shall
cooperate with Buyer as Buyer may request with respect to any Recall, including
supplying Buyer with such information as Buyer may request in connection
therewith. Seller shall promptly reimburse Buyer, upon demand, for Losses
incurred by Buyer in connection with any Recall that constitutes a “Class I
recall” or “Class II recall” (each as defined under applicable Regulations of
the FDA), including all costs and expenses incurred by Buyer in connection
therewith (other than any Recall that results from (a) any combination by Buyer
of any Pre-Closing Product with any other product or

 

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service, (b) the adaptation or modification by Buyer of any Pre-Closing Product
not authorized in writing by Seller, (c) the misuse of any Pre-Closing Product
or the use of any Pre-Closing Product in an application for which it was not
designed by Seller, or (d) Seller’s compliance with specifications and
directions provided by Buyer to Seller), up to an aggregate amount of $200,000.

5.14 Waiver of Consulting Agreement Restrictive Covenants. Seller hereby
irrevocably (a) waives all restrictive covenants set forth in each of the
Consulting Agreement by and between Seller and Nomisoo Software Company
(the “Nomisoo Consulting Agreement”) and the Consulting Agreement by and between
Seller and Polaris Computer Consultants (the “Polaris Consulting Agreement”) and
(b) consents to each Key Personnel entering into a Consulting Agreement.

ARTICLE VI

CONDITIONS PRECEDENT TO CLOSING

6.1 Conditions to Obligation of Each Party. The respective obligations of each
party to consummate the transactions contemplated by this Agreement shall be
subject to the satisfaction at or prior to the Closing of the following
conditions:

(a) Governmental Approvals. All necessary notifications, declarations and
filings with and Approvals from Governmental Authorities, if any, shall have
been obtained or made and any applicable waiting periods shall have expired.

(b) No Injunctions or Restraints; Illegality. No temporary restraining order,
preliminary or permanent injunction or other Order (whether temporary,
preliminary or permanent) issued by any Court of competent jurisdiction or other
legal restraint or prohibition shall be in effect that prevents the consummation
of the transactions contemplated hereby, nor shall any Action brought by any
Governmental Authority or any other Person seeking any of the foregoing be
pending, and there shall not be any action taken, or any Law or Order enacted,
entered, enforced or deemed applicable to the transactions contemplated hereby,
that makes the consummation of such transactions, as contemplated herein
illegal.

6.2 Additional Conditions to Obligations of Buyer. The obligations of Buyer to
consummate the transactions contemplated by this Agreement shall be subject to
the satisfaction at or prior to the Closing of the following additional
conditions, unless waived in writing by Buyer:

(a) Representations and Warranties. Each of the representations and warranties
of Seller set forth in Article III that is qualified by “materiality” or a
similar qualifier shall be true and correct in all respects, and each of such
representations and warranties that is not so qualified shall be true and
correct in all material respects, in each case, as of the date hereof and as of
the Closing Date as though made on and as of the Closing Date (except for
representations and warranties made as of a specified date, the accuracy of
which will be determined only as of the specified date).

 

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(b) Agreements and Covenants. Seller shall have performed or complied in all
material respects with each obligation, agreement and covenant to be performed
or complied with by it under this Agreement on or prior to the Closing Date.

(c) Officer’s Certificate. Seller shall have delivered to Buyer a certificate of
an executive officer of Seller, dated as of the Closing Date, in form and
substance reasonably satisfactory to Buyer, certifying that the conditions set
forth in Sections 6.2(a) and 6.2(b) have been satisfied.

(d) Consents and Approvals. All consents and Approvals from any Persons, that,
in the reasonable discretion of Buyer, are necessary for the consummation of the
transactions contemplated hereby on the terms, and conferring upon Buyer all of
the rights and benefits, as contemplated herein, including those consents and
Approvals set forth on Schedule 6.2(d), shall have been received in form and
substance satisfactory to Buyer.

(e) Related Agreements. Seller shall have executed and delivered to Buyer each
of the Related Agreements and the actions required to be taken under the Related
Agreements by Seller at or prior to the Closing shall have been taken.

(f) Consulting Agreements. As of the Closing:

(i) each of the Consulting Agreements shall be in full force and effect and
neither Key Personnel shall have given notice to Buyer of his or her intention
to terminate his or her Consulting Agreement or indicated an intention not to
perform under such Consulting Agreement after the Closing; and

(ii) Seller shall have terminated the Nomisoo Consulting Agreement and the
Polaris Consulting Agreement, and each such agreement, including the restrictive
covenants therein, shall be of no further force or effect.

(g) Other Documents. Seller shall have delivered to Buyer such other
instruments, certificates, documents or materials as may be reasonably requested
by Buyer in connection with the consummation of the transactions contemplated
hereby.

6.3 Additional Conditions to Obligations of Seller. The obligations of Seller to
consummate the transactions contemplated by this Agreement shall be subject to
the satisfaction at or prior to the Closing of the following additional
conditions, unless waived in writing by Seller:

(a) Representations and Warranties. Each of the representations and warranties
of Buyer set forth in Article IV that is qualified by “materiality” or a similar
qualifier shall be true and correct in all respects, and each of such
representations and warranties that is not so qualified shall be true and
correct in all material respects, in each case, as of the date hereof and as of
the Closing Date as though made on and as of the Closing Date (except for
representations and warranties made as of a specified date, the accuracy of
which will be determined only as of the specified date).

 

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(b) Agreements and Covenants. Buyer shall have performed or complied in all
material respects with each obligation, agreement and covenant to be performed
or complied with by them under this Agreement on or prior to the Closing Date.

(c) Officer’s Certificate. Buyer shall have delivered to Seller a certificate of
an officer of Buyer, dated as of the Closing Date, certifying that the
conditions set forth in Sections 6.3(a) and 6.3(b) have been satisfied.

(d) Related Agreements. Buyer shall have executed and delivered to Seller each
of the Related Agreements to which it is a party and the actions required to be
taken thereunder by Buyer at or prior to the Closing thereunder shall have been
taken.

ARTICLE VII

SURVIVAL; INDEMNIFICATION

7.1 Survival. Each of the representations and warranties contained in this
Agreement, any Related Agreement or any exhibit or certificate delivered by or
on behalf of Seller or Buyer pursuant to this Agreement shall survive for a
period of eighteen (18) months following the Closing Date; provided, however,
that (i) the representations and warranties set forth in Section 3.9
(Intellectual Property) (excluding the Fundamental IP Representations) shall
survive for a period of three (3) years following the Closing Date and (ii) the
representations and warranties set forth in Sections 3.1 (Organization and Good
Standing of Seller), 3.2 (Authorization; Binding Obligation), 3.5 (Title to and
Condition of Acquired Assets; Sufficiency), 3.9(c) and the first sentence of
3.9(e) (Title to Intellectual Property; Infringement) (such representations,
the “Fundamental IP Representations”), 4.1 (Organization and Good Standing) and
4.2 (Authorization; Binding Obligation) (the representations referred to in this
clause (ii), collectively, the “Fundamental Representations”) shall remain in
full force and effect for the applicable statute of limitations period. The
covenants and agreements in this Agreement shall survive in accordance with the
terms thereof.

7.2 Indemnification by Seller.

(a) From and after the Closing, Seller shall indemnify, defend and hold harmless
Buyer, its Affiliates and their respective successors and assigns and the
respective Representatives of each of the foregoing (the “Buyer Indemnified
Persons”) from and against any and all Losses of every kind, nature or
description asserted against, or sustained, incurred, suffered or accrued
directly or indirectly by, such Buyer Indemnified Person that arise out of,
relate to or result from or as a consequence of any of the following:

(i) the breach or inaccuracy of any representation or warranty of Seller
contained in this Agreement, any Related Agreement or any exhibit or certificate
delivered hereunder; provided, however, in the event the Buyer Indemnified
Persons would otherwise be entitled to indemnification for Losses, Seller shall
not be obligated (under this Section 7.2(a)(i) or otherwise) to indemnify the
Buyer Indemnified Persons or otherwise be liable to Buyer to the extent of such
Losses that arise out of, relate to or result from (a) any combination by Buyer
of any Pre-Closing Product with any other product or service, (b) the adaptation
or modification by

 

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Buyer of any Pre-Closing Product where infringement would not have occurred but
for such adaptation or modification by Buyer, (c) the misuse of any Pre-Closing
Product or the use of any Pre-Closing Product in an application for which it was
not designed by Seller or (d) Seller’s compliance with specifications and
directions provided by Buyer to Seller;

(ii) the breach or non-fulfillment of, or non-compliance with, any agreement,
obligation or covenant of Seller or any of its Affiliates contained in this
Agreement or in any Related Agreement;

(iii) any Excluded Liability;

(iv) the ownership, possession or operation of the Acquired Assets by Seller or
any Action with respect to or arising from any Acquired Intellectual Property
delivered, installed or used prior to the Closing;

(v) any Taxes of any kind relating to or arising in connection with the transfer
of the Acquired Assets to Buyer;

(vi) the failure of Seller to comply with, or perform any of its obligations
under, (a) the Existing License Agreement prior to the Closing or (b) the
Surviving Existing License Agreement Provisions following the Closing as set
forth herein; or

(vii) the failure of Seller or any of its Affiliates to comply with any Laws
applicable to the import or export of the Acquired Software in the United
States, Canada and the European Union.

(b) Subject to the other terms and conditions of this Article VII, any Losses
that a Buyer Indemnified Person is entitled to recover pursuant to
Section 7.2(a)(i) shall be satisfied by reducing the Holdback Reserve Amount
that would otherwise be payable to Seller pursuant to Section 2.3. Any Losses
that become payable to a Buyer Indemnified Person pursuant to Section 7.2(a)
that are not satisfied in accordance with the preceding sentence shall be
payable by Seller upon demand, by wire transfer of immediately available funds
to an account designated in writing by such Buyer Indemnified Person.

7.3 Indemnification by Buyer.

(a) From and after the Closing, Buyer shall indemnify, defend and hold harmless
Seller and its Affiliates, successors and assigns and the respective
Representatives of each of the foregoing (the “Seller Indemnified Persons”) from
and against any and all Losses of every kind, nature or description asserted
against, or sustained, incurred, suffered or accrued directly or indirectly by,
such Seller Indemnified Person which arise out of, relate to or result from or
as a consequence of any of the following:

(i) the breach or inaccuracy of any representation or warranty of Buyer
contained in this Agreement, any Related Agreement or any certificate delivered
by Buyer hereunder;

 

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(ii) the breach or non-fulfillment of, or non-compliance with, any agreement,
obligation or covenant of Buyer or any of its Affiliates contained in this
Agreement or in any Related Agreement; or

(iii) any Assumed Liability.

(b) Any Losses that a Seller Indemnified Person is entitled to recover pursuant
to Section 7.3(a) shall be payable by Buyer, upon demand, by wire transfer of
immediately available funds to an account designated in writing by such Seller
Indemnified Person.

7.4 Indemnification Process.

(a) Any Buyer Indemnified Person or Seller Indemnified Person (an “Indemnified
Person”) seeking indemnification under this Article VII shall give each party
from whom indemnification is being sought (each, an “Indemnifying Person”)
notice of any matter (a “Notice of Claim”) which such Indemnified Person has
determined has given rise to or would reasonably be expected to give rise to a
right of indemnification under this Agreement, stating the amount of the Loss,
if known (a “Loss Estimate”), describing the breach or inaccuracy and other
material facts and circumstances upon which such claim is based and containing a
reference to the provisions of this Agreement in respect of which such right of
indemnification is claimed or arises as promptly as practicable after becoming
aware of such matter; provided, however, that the failure so to provide such
Notice of Claim or any defect in such Notice of Claim will not affect the rights
of any Indemnified Persons to obtain indemnification hereunder, except to the
extent such failure to include information actually and materially prejudices
such Indemnifying Person.

(b) Claims for indemnification hereunder resulting from the assertion of
liability by third parties (each, a “Third Party Claim”) shall be subject to the
following terms and conditions:

(i) The Indemnified Person may defend any Third Party Claim with counsel of its
own choosing, at the Indemnifying Person’s cost, and shall act reasonably and in
accordance with its good faith business judgment in handling such Third Party
Claim. If the Indemnified Person elects not to defend such Third Party Claim,
the Indemnified Person shall promptly provide notice to the Indemnifying Person.
The Indemnifying Person shall have ten (10) days to advise the Indemnified
Person whether the Indemnifying Person accepts the defense of such claim, and
the Indemnifying Person shall have no obligation to the Indemnified Person for
legal fees incurred by the Indemnified Person after the date of any assumption
of the defense by the Indemnifying Person. If the Indemnifying Person determines
to accept the defense of such Third Party Claim, it shall defend such Third
Party Claim with counsel of its own choice that is reasonably satisfactory to
the Indemnified Person and at its own expense, provided that, the Indemnified
Person shall have the right to be represented by its own counsel at its own
expense. If the Indemnifying Person fails to undertake the defense of or settle
or pay any such Third Party Claim within ten (10) days after the Indemnified
Person has given written notice to the Indemnifying Person of the claim, or if
the Indemnifying Person, after having given such notification to the Indemnified
Person, fails within ten (10) days, or at any time thereafter, to defend to the
reasonable satisfaction of the Indemnified Person, settle or pay such claim,
then the Indemnified Person may take any and all necessary action to dispose of
such claim at the Indemnifying Person’s cost.

 

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(ii) The Indemnifying Person and the Indemnified Person shall make available to
each other and their counsel and accountants all books and records and
information relating to any Third Party Claims, keep each other apprised as to
the details and progress of all proceedings relating thereto and render to each
other such assistance as may be reasonably required to ensure the proper and
adequate defense of any and all Third Party Claims.

(iii) The party controlling the defense of a Third Party Claim may settle such
Third Party Claim on any terms that it may deem reasonable, provided that, an
Indemnifying Person shall not, without the Indemnified Person’s prior written
consent, settle or compromise such proceeding, claim or demand, or consent to
the entry of any judgment that does not include as an unconditional term thereof
the delivery by the claimant or plaintiff to the Indemnified Person of a written
release from all liability in respect of such proceeding, claim or demand.

7.5 Right of Set-off. Buyer may offset any amounts owed (or to become due and
owing) by Buyer or any of its Affiliates, on the one hand, to Seller, on the
other hand, pursuant to this Agreement or any Related Agreement against any
amounts owed (or to become due and owing) by Seller to Buyer pursuant to this
Agreement or any Related Agreement and Seller may offset any amounts owed (or to
become due and owing) by Seller or any of its Affiliates, on the one hand, to
Buyer, on the other hand, pursuant to this Agreement or any Related Agreement
against any amounts owed (or to become due and owing) by Buyer to Seller
pursuant to this Agreement or any Related Agreement following a formal
determination that any such amounts are due and owing to either party.

7.6 Indemnification Limitations.

(a) Subject to Section 7.7, any Losses that shall become payable under
Section 7.2(a)(i) or Section 7.3(a)(i) (other than such Losses arising out of,
based upon, caused by, relating or with respect to, or by reason of any breach,
alleged breach or inaccuracy of any Fundamental Representation) shall not exceed
the Purchase Price (the “Ceiling”). The Ceiling shall not apply in the case of
any Losses arising out of, based upon, caused by, relating or with respect to,
or by reason of any breach, alleged breach or inaccuracy of any Fundamental
Representation or any fraud, willful misconduct or intentional
misrepresentation.

(b) The Indemnifying Person shall not be liable to the Indemnified Person for
indemnification for Losses arising under Section 7.2(a)(i) or Section 7.3(a)(i),
as the case may be, until the aggregate amount of such Losses exceeds $15,000
(the “Deductible”), in which event the Indemnifying Person shall be responsible
for all Losses in excess of the Deductible; provided, however, that the
foregoing Deductible shall not apply to any breach, alleged breach or inaccuracy
of any Fundamental Representation or any fraud, willful misconduct or
intentional misrepresentation.

(c) Nothing in this Agreement shall preclude a Buyer Indemnified Person from
making a claim for indemnification for Losses under both this Agreement and the

 

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Surviving Existing License Agreement Provisions. Subject to the foregoing, any
Losses in respect of which a Buyer Indemnified Person is entitled to
indemnification under both this Agreement and any Surviving Existing License
Agreement Provision shall be recoverable, at such Buyer Indemnified Person’s
election, under this Agreement or the Existing License Agreement, provided that,
(i) in no event may such Buyer Indemnified Person recover such Losses under both
this Agreement and the Existing License Agreement and (ii) such Losses shall be
subject to the limitation set forth in Section 7.6(a).

7.7 Fraud and Related Claims; Characterization of Payments. Notwithstanding any
provision of this Agreement to the contrary, nothing contained in this Agreement
shall in any way limit, impair, modify or otherwise affect the rights of an
Indemnified Person to bring any claim, demand, suit or cause of action otherwise
available to such Indemnified Person based upon, or to seek or recover any
Losses arising from or related to, nor shall any of the limitations set forth in
Section 7.1, an allegation or allegations of fraud, willful misconduct, willful
or intentional misrepresentation or omission of a material fact in connection
with this Agreement or any of the Related Agreements or the transactions
contemplated hereby or thereby. The parties agree that any payment pursuant to
an indemnification obligation under this Article VII shall be treated for Tax
purposes as an adjustment to the Purchase Price, unless otherwise required by
Law. If, notwithstanding the treatment required by the preceding sentence, any
indemnification payment under this Article VII is determined to be taxable to an
Indemnified Person, the Indemnifying Party shall also indemnify the Indemnified
Person for any Taxes incurred by reason of the receipt of such payment and any
Losses incurred by the Indemnified Person in connection with such Taxes (or any
asserted deficiency, claim, demand, action, suit, proceeding, judgment or
assessment, including the defense or settlement thereof, relating to such
Taxes).

7.8 Knowledge and Investigation. The right of any Indemnified Person to
indemnification pursuant to this Article VII will not be affected by any
investigation conducted or knowledge acquired (or capable of being acquired) at
any time, whether before or after the execution and delivery of this Agreement
or the Closing, with respect to the accuracy of any representations or warranty,
or performance of or compliance with any covenant or agreement hereunder. The
waiver of any condition contained in this Agreement or in any Related Agreement
based on the breach of any such representation or warranty, or on the
performance of or compliance with any such covenant or agreement, will not
affect the right of any Indemnified Person to indemnification pursuant to this
Article VII based on such representation, warranty, covenant or agreement.

7.9 Remedies Cumulative. The rights of each Indemnified Person under this
Article VII are cumulative, and each Indemnified Person shall have the right in
any particular circumstance, in its sole discretion, to enforce any provision of
this Article VII without regard to the availability of a remedy under any
provision of this Article VII.

 

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ARTICLE VIII

TERMINATION, AMENDMENT, WAIVER AND EXPENSES

8.1 Termination. This Agreement may be terminated and the transactions
contemplated hereby may be abandoned at any time prior to the Closing:

(a) By written consent of Buyer and Seller;

(b) By either Buyer or Seller, if the Closing shall not have occurred on or
before February 15, 2017, which date may be extended from time to time by mutual
written consent of Buyer and Seller (the “Outside Date”); provided, however,
that the right to terminate this Agreement under this Section 8.1(b) shall not
be available to any party whose failure to fulfill any obligation, including the
satisfaction of any closing condition, under this Agreement has been the cause
of, or resulted in, the failure of the Closing to occur on or before such date;
or

(c) By either Buyer or Seller, if a Court or Governmental Authority shall have
issued an Order or taken any other action, in each case, which has become final
and non-appealable and which permanently restrains, enjoins or otherwise
prohibits the Closing.

8.2 Procedure of Termination. Termination of this Agreement by any party shall
be by delivery of a written notice to the other parties (a “Notice of
Termination”). A Notice of Termination shall state the termination provision in
this Agreement that such terminating party is claiming provides a basis for
termination of this Agreement. Termination of this Agreement pursuant to the
provisions of Section 8.1 shall be effective upon and as of the date of delivery
of a Notice of Termination as determined pursuant to Section 9.8.

8.3 Effect of Termination. In the event of the termination of this Agreement
pursuant to Section 8.1, this Agreement (other than this Article VIII and
Article IX, which shall survive such termination) will forthwith become void,
and there will be no Liability on the part of any party hereto or any of their
respective officers or directors to the other and all rights and obligations of
any party hereto will cease, except that nothing herein will relieve any party
from any Losses arising out of, resulting from or relating to any breach, prior
to termination of this Agreement in accordance with its terms, of any
representation, warranty, covenant or agreement contained in this Agreement or
any Related Agreement. If terminated, all governmental filings, applications and
submission made pursuant to this Agreement are to be withdrawn to the extent
practicable.

8.4 Expenses. All fees, costs and expenses incurred by such party to third
parties in connection with this Agreement and the transactions contemplated
hereby including legal, accounting and broker’s fees (collectively, “Transaction
Expenses”), shall be paid by the party incurring such Transaction Expenses,
whether or not the Closing occurs, unless expressly otherwise contemplated in
this Agreement. Notwithstanding the foregoing, in the event that a party
institutes an Action to enforce its rights under this Agreement or any Related
Agreement, the prevailing party in such Action shall be entitled to recover its
reasonable costs and expenses (including reasonable attorneys’ fees) incurred in
connection with such Action from the losing party.

8.5 Amendment and Waiver. This Agreement may be amended only by an instrument in
writing specifically amending this Agreement signed by duly authorized
Representatives of Buyer and Seller. At any time prior to the Closing Date, any
party hereto may extend the time for the performance of any of the obligations
or other acts required hereunder, waive any inaccuracies in the representations
and warranties contained herein or in any document delivered pursuant hereto and
waive compliance with any of the agreements or

 

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conditions contained herein. Any such extension or waiver shall be valid if set
forth in an instrument in writing specifically waiving such inaccuracies or
compliance under this Agreement signed by the party or parties to be bound
thereby. No waiver by any party of any breach or violation of, default under or
inaccuracy in any representation, warranty or covenant hereunder, whether
intentional or not, will be deemed to extend to any prior or subsequent breach
or violation of, default under, or inaccuracy in, any such representation,
warranty or covenant hereunder or affect in any way any rights arising by virtue
of any prior or subsequent such occurrence. No delay or omission on the part of
any party in exercising any right, power or remedy under this Agreement will
operate as a waiver thereof.

ARTICLE IX

MISCELLANEOUS

9.1 Entire Agreement. This Agreement, together with the schedules and exhibits
hereto, the Related Agreements and all other ancillary agreements, documents and
instruments to be delivered in connection herewith contain the entire
understanding of the parties hereto with respect to the subject matter hereof
and supersede all prior discussions, negotiations, proposals, undertakings,
understanding and agreements, either oral or written, with respect thereto;
provided, however, that the Confidentiality Agreement shall survive the
execution of this Agreement until the consummation of the transactions
contemplated hereby, at which time it shall terminate, other than the provisions
thereof that survive such termination in accordance with the terms of the
Confidentiality Agreement.

9.2 Assignment. Seller may not assign, delegate or otherwise transfer this
Agreement or any of its rights, interests or obligations hereunder, without the
prior written consent of Buyer, and any attempt to do so will be null and void
ab initio. Notwithstanding the foregoing, Seller may assign, delegate or
otherwise transfer this Agreement or assign its rights, interests or obligations
hereunder in each case to an Affiliate of Seller, provided, however, that Seller
shall remain liable for its obligations hereunder. Subject to the foregoing,
this Agreement and the rights and obligations set forth herein shall inure to
the benefit of, and be binding upon the parties hereto, and each party’s
successors, heirs, estates, executors, administrators and permitted assigns.

9.3 Counterparts. This Agreement may be executed in any number of counterparts,
any one of which need not contain the signatures of all parties, but all of
which counterparts when taken together will constitute one and the same
agreement. This Agreement shall become effective when duly executed and
delivered by each party hereto. Counterpart signature pages to this Agreement
may be delivered by facsimile or electronic delivery, including by email of a
PDF signature page, and each such counterpart signature page will constitute an
original for all purposes.

9.4 Governing Law; Jurisdiction; Venue; Service of Process.

(a) This Agreement shall be governed by the Laws of the State of Delaware
without giving effect to any choice of law or conflict of law provision or rule
(whether of the State of Delaware or any other jurisdictions) that would cause
application of the Laws of any jurisdiction other than the State of Delaware.

 

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(b) All Actions arising out of or relating to this Agreement shall be heard and
determined in any state or federal Court sitting in the State of Delaware. Each
of the parties to this Agreement irrevocably submits to the exclusive
jurisdiction of the state Courts of Delaware and to the jurisdiction of the
United States District Court for the District of Delaware, for the purpose of
any Action arising out of or relating to this Agreement and each of the parties
to this Agreement irrevocably agrees that all claims in respect of such Action
may be heard and determined exclusively in any Delaware state or federal Court
sitting in the State of Delaware. Each of the parties to this Agreement consents
to service of process by delivery pursuant to Section 9.8 and agrees that a
final judgment in any Action shall be conclusive and may be enforced in other
jurisdictions by suit on the judgment or in any other manner provided by Law.

9.5 Specific Performance. The rights and remedies of the parties hereto shall be
cumulative. The transactions contemplated by this Agreement are unique
transactions and any failure on the part of any party to complete the
transactions contemplated by this Agreement on the terms of this Agreement will
not be fully compensable in damages and the breach or threatened breach of the
provisions of this Agreement would cause the other parties hereto irreparable
harm. Accordingly, in addition to and not in limitation of any other remedies
available to the parties hereto for a breach or threatened breach of this
Agreement, the parties shall be entitled to seek specific performance of this
Agreement and seek an injunction restraining any such party from such breach or
threatened breach. Each party further agrees that, in the event of any action
for specific performance in respect of such breach or violation, it will not
assert as the defense that a remedy at law would be adequate.

9.6 Interpretation. The schedules and exhibits attached hereto are an integral
part of this Agreement. All schedules and exhibits attached to this Agreement
are incorporated herein by this reference and all references herein to this
“Agreement” shall mean this Agreement together with all such schedules and
exhibits. When a reference is made in this Agreement to Sections, subsections,
schedules or exhibits, such reference shall be to a Section, subsection,
schedule or exhibit to this Agreement unless otherwise indicated. The words
“include,” “includes” and “including” when used herein shall be deemed in each
case to be followed by the words “without limitation.” The word “herein” and
similar references mean, except where a specific Section or Article reference is
expressly indicated, the entire Agreement rather than any specific Section or
Article. The table of contents and the headings contained in this Agreement are
for reference purposes only and shall not affect in any way the meaning or
interpretation of this Agreement. The term “$” shall mean Dollars of the United
States of America. As used herein, all pronouns shall include the masculine,
feminine, neuter, singular and plural thereof whenever the context and facts
require such construction.

9.7 Severability. If any term or other provision of this Agreement is invalid,
illegal or incapable of being enforced by any rule of Law, or public policy, all
other conditions and provisions of this Agreement shall nevertheless remain in
full force and effect so long as the economic or legal substance of the
transactions contemplated hereby is not affected in any manner adverse to any
party. Upon such determination that any term or other provision is invalid,
illegal or incapable of being enforced, the parties hereto shall negotiate in
good faith to modify this Agreement so as to effect the original intent of the
parties as closely as possible in an acceptable manner to the end that
transactions contemplated hereby are fulfilled to the extent possible.

 

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9.8 Notices. All notices or other communications which are required or permitted
hereunder shall be in writing and sufficient if delivered personally or sent by
nationally-recognized overnight courier or by registered or certified mail,
postage prepaid, return receipt requested or by facsimile, with confirmation as
provided above addressed as follows:

If to Buyer:

Invivo Corporation

3545 SW 47th Avenue

Gainesville, FL 32608

Attention: General Manager

and

Philips Healthcare, Legal Department

595 Miner Road

Cleveland, OH 44143

Fax: (440) 483-2452

Attention: Amy S. Gilchrist, Esq.

with copies to (which shall not constitute notice):

Mintz, Levin, Cohn, Ferris, Glovsky and Popeo, P.C.

One Financial Center

Boston, MA 02111

Fax: (617) 542-2241

Attention: Dean G. Zioze, Esq.

If to Seller:

iCAD, Inc.

98 Spit Brook Road, Suite 100

Nashua, NH 03062

Attention: Kenneth Ferry

with copies to (which shall not constitute notice):

Blank Rome LLP

405 Lexington Avenue

New York, NY 10174-0208

Fax: (212) 885-5001

Attention: Michael S. Mullman, Esq.

 

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or to such other address as the party to whom notice is to be given may have
furnished to the other party in writing in accordance herewith. All such notices
or communications shall be deemed to be received (a) in the case of personal
delivery, on the date of such delivery, (b) in the case of nationally-recognized
overnight courier, on the next Business Day after the date when sent, (c) in the
case of facsimile transmission, upon confirmed receipt, and (d) in the case of
mailing, on the second Business Day following the date on which the piece of
mail containing such communication was posted. Rejection or other refusal to
accept or the inability to deliver a notice, request, demand, claim or other
communication hereunder because of a changed address or changed facsimile number
(if a facsimile number had been given) of which no notice was given as herein
required shall be deemed to be receipt of the notice, request, demand, claim or
other communication sent.

9.9 Representation by Counsel. Each party hereto acknowledges that it has been
or has had an opportunity to be advised by legal counsel retained by such party
in its sole discretion. Each party acknowledges that such party has had a full
opportunity to review this Agreement and all related exhibits, schedules and
ancillary agreements and to negotiate any and all such documents in its sole
discretion, without any undue influence by any other party hereto or any third
party.

9.10 Construction. The parties have participated jointly in the negotiation and
drafting of this Agreement and in the event of any ambiguity or question of
intent or interpretation, no presumption or burden of proof shall arise favoring
or disfavoring any party by virtue of the authorship of any of the provisions of
this Agreement.

9.11 Third Party Beneficiaries. Nothing express or implied in this Agreement is
intended to confer, nor shall anything herein confer, upon any Person other than
the parties hereto and their respective successors and permitted assigns, any
rights, remedies, obligations or liabilities whatsoever, except to the extent
that such third person is an Indemnified Person in respect of the
indemnification provided in accordance with Article VII. The representations and
warranties contained in this Agreement are for the sole benefit of the parties
hereto and no other Person may rely on such representations and warranties for
any purpose whatsoever.

9.12 Bulk Sales Law. Each party hereby waives compliance by each other party
with the so-called “bulk sales law” and other similar Law in any jurisdiction in
respect of the transactions contemplated by this Agreement.

 

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9.13 Waiver of Jury Trial. EACH PARTY ACKNOWLEDGES AND AGREES THAT ANY
CONTROVERSY THAT MAY ARISE UNDER THIS AGREEMENT, THE RELATED AGREEMENTS OR THE
TRANSACTIONS CONTEMPLATED HEREBY OR THEREBY IS LIKELY TO INVOLVE COMPLICATED AND
DIFFICULT ISSUES, AND THEREFORE, TO THE EXTENT NOT PROHIBITED BY APPLICABLE LAW
THAT CANNOT BE WAIVED, IT HEREBY IRREVOCABLY AND UNCONDITIONALLY WAIVES ANY
RIGHT IT MAY HAVE TO A TRIAL BY JURY IN RESPECT OF ANY LITIGATION DIRECTLY OR
INDIRECTLY ARISING OUR OF OR RELATING TO THIS AGREEMENT, THE RELATED AGREEMENTS
OR THE TRANSACTIONS CONTEMPLATED HEREBY OR THEREBY.

[Remainder of page intentionally left blank; signature page follows]

 

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NOW THEREFORE, the parties hereto have executed, or caused this Asset Purchase
Agreement to be executed by their duly authorized representatives, as of the
date first written above.

 

BUYER: INVIVO CORPORATION By:  

/s/ Joseph E. Innamorati

Name:  

Joseph E. Innamorati

Title:  

Vice President and Secretary

SELLER: ICAD, INC. By:  

/s/ Kenneth Ferry

Name:  

Kenneth Ferry

Title:  

Chief Executive Officer

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Schedule I

TABLE OF DEFINITIONS

“Action” means any suit, action, arbitration, cause of action, claim, complaint,
prosecution, audit, inquiry, investigation, governmental or other proceeding,
whether civil, criminal, administrative, investigative or informal, at law or at
equity, before or by any Court, Governmental Authority, arbitrator or other
tribunal.

“Affiliate” means, with respect to any Person, any other Person that directly or
indirectly, through one or more intermediaries, controls, is controlled by, or
is under common control with, the first mentioned Person, including any
partnership or joint venture in which one Person (either alone, or through or
together with any other Subsidiary) has, directly or indirectly, an interest of
ten percent (10%), or more; and “control” (including the terms “controlled by”
and “under common control with”) means the possession, directly or indirectly,
of the power to direct or cause the direction of the management or policies of a
Person, whether through the ownership of stock or other securities, as trustee
or executor, by Contract or credit arrangement or otherwise.

“Approval” means any license, permit, consent, approval, authorization,
registration, filing, waiver, exemption, clearance, qualification or
certification, including all pending applications therefor or renewals or
amendments thereof, issued by, made available by or filed with any Government
Authority, and including for the avoidance of doubt all Regulatory Approvals.

“Acquisition Proposal” means any inquiry, proposal or offer from any Person
(other than Buyer and its Affiliates and their respective Representatives)
relating to the acquisition or license of any portion of the Acquired Assets or
any other transaction, the consummation of which would reasonably be expected to
impede, interfere with, prevent or materially delay the consummation of the
transactions contemplated hereby.

“Books and Records” means all books, records, information, documents,
correspondence, files, manuals, studies, reports, databases and other materials,
including any portions thereof, maintained in any medium (including, where
available, digital media) that relate to, or are used in connection with, the
Business or the Acquired Intellectual Property, including all Regulatory
Documentation and quality assurance documentation, design history files, device
master records, device history records, technical document files, corrective and
preventive actions and medical device directive documentation; technical
documentation (design specifications, functional requirements, operating
instructions, logic manuals, flow charts, etc.); user documentation (guides,
manuals, training materials, release notes, working papers, etc.); equipment
repair, maintenance and service records; customer lists, records, histories,
invoices and databases; sales order files; price lists; mailing lists and
databases; advertising literature and materials; research files and
correspondence; market research studies and surveys; operating data and plans;
sales and promotional materials and records; catalogues; photographs; media
materials and plates; creative materials; purchasing and billing records;
research and development files; accounting files and records; all lists of and
all rights in and to the information contained therein.

“Business Day” means any day other than a Saturday, Sunday or day on which banks
are permitted to close in the State of Delaware.

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“Closing Payment” means the sum of (a) Three Million Two Hundred Thousand
Dollars ($3,200,000), less (b) the Holdback Reserve Amount.

“Code” means the Internal Revenue Code of 1986, as amended, and all Regulations
promulgated thereunder.

“Confidentiality Agreement” means that certain Confidentiality Agreement, dated
as of October 31, 2015, between Buyer and Seller.

“Consulting Agreements” means, collectively, the Consulting Agreements, dated as
of the date hereof, by and between Buyer and the Key Personnel, attached hereto
as Exhibit C-1 and Exhibit C-2.

“Contract” means any loan agreement, indenture, letter of credit (including
related letter of credit applications and reimbursement obligations), mortgage,
security agreement, pledge agreement, deed of trust, bond, note, guarantee,
surety obligation, warranty, license, franchise, permit, power of attorney,
invoice, quotation, purchase order, sales order, lease, endorsement agreement,
and any other agreement, contract, instrument, obligation, offer, commitment,
plan, arrangement, understanding or undertaking, written or oral, express or
implied, to which a Person is a party or by which any of its properties, assets
or Acquired Intellectual Property may be bound or affected, in each case as
amended, supplemented, waived or otherwise modified.

“Court” means any court or arbitration tribunal of any country or territory, or
any state, province or other subdivision thereof.

“DynaCAD Product” means all versions of, and Source Code Materials for, the MR
post-processing packages and diagnostic solutions for prostate cancer and breast
cancer developed by Seller and customized specifically for and with Buyer under
the Existing License Agreement.

“Existing License Agreement” means the License Agreement, dated as of July 16,
2012, by and between Buyer and Seller, as amended.

“Final Holdback Payment” means the sum of the remainder, if any, of (a) the
Initial Holdback Reserve minus (b) the aggregate amount finally determined to be
payable to the Buyer Indemnified Persons pursuant to Article VII in respect of
all claims to which the Initial Holdback Reserve relates.

“GAAP” means United States generally accepted accounting principles.

“Governmental Authority” means: (a) any nation, state, county, city, town,
municipality, district, territory or other jurisdiction of any nature; (b) any
federal, state, municipal or local governmental or quasi-governmental entity or
authority of any nature; (c) any Court exercising or entitled to exercise
judicial authority or power of any nature; (d) any multinational organization or
body exercising any administrative, executive, judicial, legislative, police,
regulatory or taxing authority or power of any nature; and (e) any department or
subdivision of any of the foregoing, including any commission, branch, board,
bureau, agency, official or other instrumentality exercising or entitled to
exercise any administrative, executive, judicial, legislative, police,
regulatory or taxing authority or power of any nature.

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

“Holdback Reserve Amount” means $350,000.

“Initial Holdback Payment” means the sum of the remainder, if any, of (a) the
Holdback Reserve Amount minus (b) the aggregate amount finally determined prior
to the Initial Holdback Payment Date to be payable to the Buyer Indemnified
Persons pursuant to Article VII, minus (c) the Initial Holdback Reserve.

“Initial Holdback Payment Date” means such date that is eighteen (18) months
following the Closing Date.

“Initial Holdback Reserve” means the aggregate of all Loss Estimates set forth
in any Notice of Claim that has been made, but has not been finally determined
(in accordance with Article VII), prior to the Initial Holdback Payment Date.

“Intellectual Property” means (a) worldwide trademarks, service marks, trade
names, trade dress, designs, logos, slogans and general intangibles of like
nature, together with all goodwill related to the foregoing (whether registered
or not, but including any registrations and applications for any of the
foregoing) (collectively, “Trademarks”); (b) patents (including the ideas,
inventions and discoveries described therein, any pending applications, any
registrations, patents or patent applications based on applications that are
continuations, continuations-in-part, divisional, reexamination, reissues,
renewals of any of the foregoing and applications and patents granted on
applications that claim the benefit of priority to any of the foregoing)
(collectively, “Patents”); (c) works of authorship or copyrights (including any
registrations, applications and renewals for any of the foregoing) and other
rights of authorship (collectively, “Copyrights”); (d) trade secrets and other
confidential or proprietary information, know-how, confidential or proprietary
technology, processes, work flows, formulae, algorithms, models, user
interfaces, customer, supplier, vendor, distributor and user lists, databases,
pricing and marketing information, inventions, marketing materials, inventions
and discoveries (whether patentable or not), which in each case derives
independent economic value from not being generally known and not being readily
ascertainable and is subject to reasonable efforts to maintain secrecy
(collectively, “Trade Secrets”); (e) computer programs and other Software,
macros, scripts, source code, object code, binary code, methodologies,
processes, work flows, architecture, structure, display screens, layouts,
development tools, instructions and templates; (f) published and unpublished
works of authorship, including audiovisual works, databases and literary works;
(g) rights of attribution and integrity and other moral rights; (h) Uniform
Resource Locators (“URLs”) and Internet domain names and applications therefor
(and all interest therein), ad words, key word associations and related rights;
and (i) (i) all other proprietary, intellectual property and other rights
relating to any or all of the foregoing, (ii) all copies and tangible
embodiments of any or all of the foregoing (in whatever form or medium,
including electronic media) and (iii) all rights to sue for and any and all
remedies for past, present and future infringements of any or all of the
foregoing and rights of priority and protection of interests therein under the
Laws of any jurisdiction.

“Key Personnel” means the Persons listed on Schedule III.

“Knowledge of Seller” (and similar terms and phrases) means (a) the actual
knowledge of any individual listed on Schedule II or (b) any knowledge which was
or could reasonably have

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

been obtained by any such Person in the prudent exercise of his or her duties or
upon due inquiry of those employees reporting thereto, whose duties would, in
the normal course of business affairs, result in such employees having knowledge
concerning the subject in question.

“Laws” means all laws, statutes, codes, ordinances and Regulations of any
Governmental Authority including all Orders having the effect of law in each
such jurisdiction.

“Liabilities” means any debts, liabilities, obligations, claims, charges,
damages, demands and assessments of any kind, including those with respect to
any Governmental Authority, whether accrued or not, known or unknown, disclosed
or undisclosed, fixed or contingent, asserted or unasserted, liquidated or
unliquidated, whenever or however arising (including, those arising out of any
Contract or tort based on negligence or strict liability) and whether or not the
same would be required by generally accepted accounting principles in the United
States to be reflected in financial statements or disclosed in the notes
thereto.

“Lien” means any mortgage, easement, right of way, charge, claim, community
property interest, condition, equitable interest, lien, option, pledge, security
interest, right of first refusal, or restriction or adverse claim of any kind,
including any restriction on use, voting, transfer, receipt of income, or
exercise of any other attribute of ownership, or any other encumbrance or
exception to title of any kind.

“Losses” means losses, damages, Liabilities, demands, Taxes, sanctions,
deficiencies, assessments, judgments, costs, interest, penalties, Orders, Liens,
Actions, bonds, dues, fines, fees costs (including costs of investigation,
defense and enforcement of this Agreement and the Related Agreements), amounts
paid in settlement and expenses (in each case, including reasonable attorneys’
and experts’ fees and expenses, which shall include a reasonable estimate of the
allocable costs of in-house legal counsel and staff), whether or not involving a
Third Party Claim.

“Open Source Materials” means all Software included in the Acquired Software or
other material relating to the Acquired Intellectual Property that qualifies as
Open Source Software.

“Open Source Software” means any Software that is (a) distributed as free
software or as open source software (e.g., Linux), (b) subject to any licensing
or distribution model that includes as a term thereof any requirement for
distribution of source code to licensees or third parties, license requirements
on distribution, restrictions on future patent licensing terms or other
abridgement or restriction of the exercise or enforcement of any Intellectual
Property through any means or (c) derived in any manner (in whole or in part)
from any Software described in clause (a) or (b), and includes any Software
licensed or distributed under any Public Software License.

“Order” means any judgment, order, writ, injunction, ruling, decision or decree
of, or any settlement under the jurisdiction of any Court or Governmental
Authority.

“Organizational Documents” means, with respect to any corporation, those
instruments that at the time constitute its corporate charter as filed or
recorded under the Laws of the jurisdiction of its incorporation, including the
articles or certificate of incorporation, organization or association, and its
by-laws or memorandum of association, in each case including all amendments
thereto, as the same may have been restated and, with respect to any other
entity, the equivalent organizational or governing documents of such entity.

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

“Person” means an individual, corporation, partnership, association, trust,
unincorporated organization, limited liability company or other legal entity.

“Personal Data” means any information collected or used by Seller or an
Affiliate thereof that can be used to specifically identify a natural person
(including but not limited to name, address, telephone number, electronic mail
address, social security number or other government-issued number, bank account
number or credit card number) and any special categories of personal information
regulated under or covered under any applicable Law.

“Pre-Closing Product” means any Product or Customized Product (including any
Upgrade or Update thereof) (each as defined in the Existing License Agreement)
developed, designed, manufactured, sold and/or delivered by Seller or an
Affiliate thereof before the Closing pursuant to the Existing License Agreement
(including the Inventory).

“Public Software License” means any of the following licenses or distribution
models, or licenses or distribution models similar to any of the following:
(a) GNU’s General Public License (GPL) or Lesser/Library GPL (LGPL); (b) the
Artistic License (e.g., PERL); (c) the Mozilla Public License; (d) the Netscape
Public License; (e) the Sun Community Source License (SCSL); (f) the Sun
Industry Standards License (SISL); (g) the Apache License; and (h) any licenses
that are defined as OSI (Open Source Initiative) licenses as listed on the
opensource.org website. Other less restrictive free or open source licensing and
distribution models such as those obtained under the BSD, MIT, Boost Software
License and Beer-Ware Public Software Licenses or any similar licenses, and any
Software that is a public domain dedication, also qualify as “Public Software
Licenses”.

“Regulation” means any rule or regulation of any Governmental Authority.

“Regulatory Approval” means, with respect to a country, any and all approvals,
licenses, permits registrations or authorizations of any Governmental Authority
necessary in order to commercially distribute, sell or market the Acquired
Intellectual Property in such country, including, but not limited to, where
applicable and as required, (a) pricing or reimbursement approval in such
country, (b) pre- and post-approval investigational and marketing authorizations
(including any prerequisite manufacturing approval or authorization related
thereto), (c) labeling approval and (d) technical, medical and scientific
licenses.

“Regulatory Documentation” means all applications, registrations, licenses,
authorizations and Approvals (including all Regulatory Approvals), all
correspondence submitted to or received from Governmental Authorities (including
minutes and official contact reports relating to any communications with any
Governmental Authority) and all supporting documents and all clinical trials and
nonclinical studies and tests related to the Acquired Intellectual Property
(whether or not submitted to a Governmental Authority), and all data contained
in any of the foregoing, including all 510(k)s, PMAs, supplements to any 510(k)s
and PMAs, letters to file concerning device modifications, pre- and
post-approval marketing authorizations, investigational device exemptions,
product labeling, advertising and promotion documents, manufacturing data,
compliant files, adverse event files, correction and removal records and
reports, and all documents pertaining to recalls of the Acquired Intellectual
Property.

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

“Related Agreements” means the Transfer Documents, the Transition Services
Agreement, the Cross-License Agreement and the Consulting Agreements.

“Representative” means, with respect to any specified Person, such Person’s
officers, directors, employees, accountants, counsel and other representatives
or agents.

“Software” means computer programs, known by any name, including all versions
thereof (including work-in-progress), source code and object code, code
libraries, debugging files, linking files, program files, data files, computer
and related data, field and date definitions and relationships, data definition
specifications, data models, program and system logic, interfaces, program
modules, routines, sub-routines, algorithms, macros, scripts, compiler
directives, program architecture, system designs, program structure, sequence
and organizations, screen displays and all other computer programs.

“Source Code Materials” means, as it pertains to the Acquired Software, (a) all
computer programming code of the Acquired Software in the form written by a
computer programmer in a computer programming language, and that can be readily
understood, maintained or enhanced by a qualified computer programmer, including
all software libraries used in connection with the Acquired Software and a
complete build environment (including a compiler) necessary or useful to turn
the source code and libraries into executable software; (b) the software, tools
and materials utilized for the operation, development and maintenance of the
Acquired Software; (c) documentation describing the names, vendors and version
numbers of (i) the development tools used to maintain or develop such Acquired
Software; and (ii) any Acquired Software licensed from third parties by Seller
or any of its Affiliates that form part of any Acquired Software owned by Seller
or any of its Affiliates and are therefore required in order to compile,
assemble, translate, bind and load such owned Acquired Software into executable
releases; (d) all programmers’ notes, bug lists and technical information,
systems and user manuals and documentation for such Acquired Software, to the
extent such materials exist, including all job control language statements,
descriptions of data structures, diagrams, flow charts, technical
specifications, schematics, statements or principles of operations, architecture
standards and annotations describing the operation of such Acquired Software
created and maintained by Seller or any of its Affiliates in the ordinary course
of business, and all instructions necessary to execute the build and create
executable software; and (e) all test data, test cases and test automation
scripts used for the testing and validating the functioning of such Acquired
Software created and maintained by Seller or any of its Affiliates in its
ordinary course of business.

“Subsidiary” means, with respect to any Person, any corporation, partnership,
joint venture, limited liability company, trust or other legal entity of which
such Person (either alone or through or together with any other Subsidiary)
owns, directly or indirectly, at least fifty percent (50%) of the stock or other
equity interests in such entity.

“Taxes” means all taxes and governmental impositions of any kind in the nature
of (or similar to) taxes, payable to any Governmental Authority, including those
on or measured by or referred to as income, franchise, profits, gross receipts,
capital, ad valorem, custom duties,

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alternative or add-on minimum taxes, estimated, environmental, disability,
registration, value added, sales, use, service, real or personal property,
capital stock, license, payroll, withholding, employment, social security,
workers’ compensation, unemployment compensation, health insurance, utility,
severance, production, excise, stamp, occupation, premiums, windfall profits,
transfer and gains taxes, and interest, penalties and additions to tax imposed
with respect thereto.

“VersaVue Software” means all versions of Seller’s Software and Source Code
Materials for detecting and diagnosing cancer and for porting MR diagnostic
solutions provided by Seller under the Existing License Agreement.

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Exhibit A

Form of Transition Services Agreement

(attached)

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

FINAL FORM

TRANSITION SERVICES AGREEMENT

by and between

INVIVO CORPORATION

and

ICAD, INC.

Dated: [●]

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

Table of Contents

 

Clause

        Page  

1.

  

INTERPRETATION

     1  

2.

  

TRANSITION SERVICES

     2  

3.

  

INTELLECTUAL PROPERTY

     3  

4.

  

INVOICE; PAYMENTS

     4  

5.

  

EMPLOYEES

     5  

6.

  

INDEMNIFICATION

     5  

7.

  

FORCE MAJEURE

     5  

8.

  

CONFIDENTIALITY

     5  

9.

  

TERM AND TERMINATION OF SERVICES

     6  

10.

  

ASSIGNMENT

     7  

11.

  

MISCELLANEOUS

     7  

 

Schedules   

Schedule A

  

Research and Development Services

Schedule B

  

Supply Chain / Purchasing / Logistics Services

Schedule C

  

Manufacturing Services

Schedule D

  

Customer Handover/Customer Service Services

Schedule E

  

Quality and Regulatory Services

 

i

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TRANSITION SERVICES AGREEMENT

THIS TRANSITION SERVICES AGREEMENT, DATED AS OF [●], IS MADE BY AND BETWEEN:

 

(1) iCAD, Inc., a Delaware corporation (the “Supplier”); and

 

(2) Invivo Corporation, a Delaware corporation (the “Receiver,” and together
with the Supplier, each a “Party,” and collectively, the “Parties”).

WHEREAS:

 

(1) The Supplier and the Receiver entered into an Asset Purchase Agreement dated
as of December 16, 2016 (the “APA”) pursuant to which the Receiver agreed to
purchase certain of the assets of the Supplier;

 

(2) The Supplier and the Receiver wish to enter into a transition services
agreement for the provision of certain transition services by the Supplier to
the Receiver; and

 

(3) This Agreement sets out the terms and conditions for such provision of
transition services.

IT IS, THEREFORE, AGREED AS FOLLOWS:

 

1. INTERPRETATION

 

1.1 Definitions

Unless the context otherwise requires:

“Affiliate” has the meaning set forth in the APA;

“Agreement” means this Transition Services Agreement by and between the Parties,
including the Schedules hereto (including all Service Level Agreements as may be
entered into pursuant to this Agreement), as may be amended from time to time;

“APA” has the meaning set forth in the recitals;

“Charge” means, with respect to a Service, the amount specified as such in the
relevant Service Level Agreement;

“Closing” has the meaning set forth in the APA;

“Closing Date” has the meaning set forth in the APA;

“Confidential Information” means any confidential and/or proprietary information
of the Supplier, the Supplier’s Affiliates, the Receiver or the Receiver’s
Affiliates and which has been obtained or received by the Supplier, the Receiver
or any of their Affiliates prior to the Closing or in the course of performance
of either Party’s obligations pursuant to this Agreement;

 

1

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“Force Majeure” means any earthquake, flood, fire, riot, war, terrorism, strike,
embargo or any other act of God or similar event which is beyond the control of
the Supplier;

“Intellectual Property” has the meaning set forth in the APA;

“Invoice” means an invoice sent by or on behalf of the Supplier to the relevant
address set out in the relevant Service Level Agreement or, in the absence of
such address, to the Receiver;

“Project Manager” has the meaning set forth in Clause 2.3;

“Service Level Agreement” means any service level agreement in effect as of the
Closing and attached as a Schedule hereto and any and all other service level
agreements entered into pursuant to this Agreement after the date hereof;

“Services” means the services described in the relevant Service Level Agreement,
as amended from time to time, and “Service” means any one of the Services, as
the context requires;

“Service Term” means the term of the provision of a Service, as specified in the
relevant Service Level Agreement or, if no term or only an estimated term has
been specified in the relevant Service Level Agreement, a term of ninety
(90) days after the Closing Date; and

“Technology” means all inventions, discoveries, materials, information, data,
formulations, techniques and know-how, including computer programs, whether or
not patentable or copyrightable.

Unless otherwise defined herein, capitalized terms shall have the meaning given
in the APA.

 

2. TRANSITION SERVICES

 

2.1 Master Agreement

This Agreement is a master agreement that sets out the general terms and
conditions relating to the provision of the Services from the Supplier to the
Receiver.

 

2.2 Service Level Agreements; Provision and Acceptance of Services

2.2.1 For each Service, the Supplier and the Receiver hereby agree to the
Service Level Agreements attached as Schedules hereto, as the same may be
amended, restated, modified or supplemented by one or more new Service Level
Agreements, in each case in writing upon the mutual agreement of the Parties
from time to time.

2.2.2 If, during the eighteen (18) months following the signing of this
Agreement, the Receiver reasonably determines that any services necessary to use
or operate the Acquired Assets in a manner consistent with the use or operation
of the Acquired Assets immediately prior to the Closing are not included in the
Services, the Parties shall in good faith negotiate a new Service Level
Agreement(s) providing for the provision of and payment for such services in a
manner consistent with the manner in which such services were provided and paid
for with respect to the Acquired Assets prior to Closing.

 

2

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2.2.3 The Supplier shall provide the Services to the Receiver in accordance with
the terms of this Agreement and the relevant Service Level Agreement(s). The
Receiver shall accept the Services from the Supplier in accordance with the
terms of this Agreement and the relevant Service Level Agreement(s).

2.2.4 The Parties shall cooperate with each other in all reasonable respects
relating to the provision and receipt of the Services.

2.2.5 In case any of the contents of the body of this Agreement conflicts with
any of the contents of one or more Service Level Agreements, the contents of the
body of this Agreement shall prevail, except if and to the extent any such
Service Level Agreement expressly states that it shall prevail in the event of
any such conflict.

 

2.3 Management of Services

Each Party shall designate a project manager (a “Project Manager”) to report and
discuss issues with respect to the provision of the Services, and shall give
prior written notice to the other Party in the event it designates a replacement
Project Manager. The Supplier’s initial Project Manager shall be [●] and the
Receiver’s initial Project Manager shall be [●]. The Project Managers shall
discuss the performance of the Services as often as reasonably necessary to
ensure the orderly provision of the Services. The Parties agree that the
Receiver shall submit questions or requests for or regarding the Services to the
Supplier’s Project Manager through its own Project Manager.

 

2.4 Standard of Services

The Supplier shall provide the Services in accordance with applicable Law and in
substantially the same manner and at the same standard as the Services were
performed by the Supplier prior to the Closing, and in a professional and
workmanlike manner, using personnel with sufficient training and experience in
providing the Services.

 

2.5 Third Party Service Providers

The Supplier may subcontract or outsource any of the Services to a third party
only with the prior written consent, with such consent not to be unreasonably
withheld, of the Receiver, provided that (a) such subcontracting or outsourcing
will not result in any material change in the Service and/or the terms
applicable to such Service and (b) the Supplier shall remain responsible for the
performance of such Services provided hereunder. The Supplier shall give the
Receiver timely notice of its intent to subcontract or outsource one or more of
the Services.

 

3. INTELLECTUAL PROPERTY

3.1.1 Nothing in this Agreement shall be construed to give either Party any
right, title or interest in Intellectual Property rights of the other Party. A
Party’s rights to use Intellectual Property rights owned or used by the other
Party shall be limited to the performance of the Services.

3.1.2 It is agreed by the Parties that all right, title and interest in and to
any and all Technology, and all Intellectual Property rights in and to such
Technology throughout the world,

 

3

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

that is developed, discovered, adapted, improved and/or conceived during the
term of this Agreement by one or more employees, agents, partners or independent
contractors of the Supplier or its Affiliates in the provision of the Services
shall be solely owned by the Receiver. The Supplier represents that none of the
individuals designated to perform the Services will have any claim or title in
and to any such Technology or Intellectual Property rights in and to such
Technology.

3.1.3 The Supplier, on behalf of itself and its Affiliates, irrevocably and
unconditionally waive all moral rights to which Supplier and/or its Affiliates
may be entitled in respect of any works protected by copyright created and/or
adapted by Supplier and/or its Affiliates pursuant to or in the performance of
Services.

3.1.4 The Supplier shall, and shall cause each third party that performs any
Services to, provide all necessary plans, drawings, formulae, and models, and
execute any and all documents, applications, bills of sale, assignments, and
other instruments which the Receiver shall deem reasonably necessary to
(a) apply for and obtain letters, patent or other protection for the Technology
and (b) assign and convey to the Receiver or its nominee the sole and exclusive
and royalty-free right, title and interest in and to the Technology and all
Intellectual Property rights in and to such Technology.

3.1.5 Notwithstanding the foregoing, the Supplier shall retain all right, title
and interest in and to (a) the Retained Software and Retained Licensed Patents
in accordance with the Software Cross-License Agreement entered into by Supplier
and Receiver’s Affiliate, Koninklijke Philips N.V. (“Philips”), pursuant to the
APA (“Software Cross-License Agreement”) and (b) all methods, tools, analyses,
or processes developed or used by Supplier, which items were not created
specifically for the Receiver and which are generally applicable to projects
other than as contemplated by this Agreement (“Methods and Tools”). Any Methods
and Tools shall be deemed Retained Software under the Software Cross-License
Agreement and licensed to Philips thereunder.

 

4. INVOICE; PAYMENTS

All Services provided during any given month shall be invoiced by the Supplier
to the Receiver in the month following the month during which such Services were
provided (which Invoices shall each set forth an itemized list of each Service
provided by the Supplier during such month and the number of hours of each
Service provided during such month), unless a different arrangement has been
agreed in the relevant Service Level Agreement. Within sixty (60) days after the
date on which an Invoice has been sent to the Receiver, the Receiver shall pay
to the Supplier an amount equal to the sum of:

(a) the Charge in respect of the Services to which the Invoice relates; and

(b) any applicable tax that becomes due in relation to the Services. For the
avoidance of doubt, for the purpose of this Clause 4(b), “tax” means tax that is
imposed in relation to the Services, the amount paid by the Supplier to third
parties in connection with provision of the Services or any other activities
related to the provision of the Services.

 

4

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5. EMPLOYEES

5.1.1 The employees of the Supplier who provide the Services shall solely remain
employees of the Supplier and shall remain subject only to the supervision of
the Supplier.

5.1.2 In the event that employees, subcontractors, representatives or agents of
the Supplier are on the premises of the Receiver, the Supplier shall be solely
responsible for all acts or omissions of such persons.

5.1.3 The Supplier shall maintain staffing levels necessary to provide the
Services and shall provide for the prompt replacement, if necessary, of any of
its employees or consultants necessary for the provision of any of the Services
hereunder.

 

6. INDEMNIFICATION

The Supplier shall indemnify, defend and hold the Receiver, its Affiliates and
their respective officers, directors, employees, agents and representatives
harmless from and against any and all losses, damages, claims, costs or expenses
(including attorney’s fees) (“Losses”) arising out of or resulting from the
Supplier’s or its Affiliates’ performance of (or failure to perform) its
obligations hereunder, except to the extent such Losses are due to the actions
or omissions of the Receiver, including, but not limited to, gross negligence,
bad faith or willful misconduct. The Parties acknowledge and agree that the
Parties’ rights and obligations under this Clause 6 shall be separate from, and
in addition to, those set forth in the APA.

 

7. FORCE MAJEURE

7.1 Should the Supplier be affected by a Force Majeure, it shall inform the
Receiver in writing specifying the Force Majeure as well as its expected
duration and the obligations hereunder that the Supplier cannot fulfill as a
result thereof. The Supplier shall be excused by the Receiver from performance
under this Agreement (or any Service Level Agreement) to the extent the Force
Majeure prevents such performance.

7.2 In the event the Supplier claims the benefit of Clause 7.1, it shall attempt
in good faith to resume performance as soon as reasonably practicable; provided,
however, that in case a Force Majeure lasts for more than thirty (30) days,
either Party shall be entitled to terminate the relevant Service Level
Agreement.

 

8. CONFIDENTIALITY

 

8.1 Confidentiality Obligation

Subject to Clause 8.2, the Supplier and the Receiver shall, and shall cause its
respective Affiliates to, treat as strictly confidential any Confidential
Information relating to the other Party or its Affiliates, and shall not
disclose any such Confidential Information to any third party. The Supplier and
Receiver shall, and shall cause its respective Affiliates to, not use the
Confidential Information (or any portion thereof) for any purpose other than the
fulfillment and provision of the Services.

 

5

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8.2 Exceptions

Clause 8 shall not prohibit disclosure or use of Confidential Information to the
extent:

8.2.1 such disclosure or use is required by law or on the basis of a binding
order of a court or other competent governmental authority;

8.2.2 such disclosure or use is required for the purpose of any judicial
proceedings arising out of this Agreement;

8.2.3 such disclosure or use is made to the Supplier’s professional advisors on
terms that such professional advisors undertake in writing to comply with this
Clause 8; or

8.2.4 the Confidential Information becomes publicly available (other than as a
result of a breach by the Supplier of this Clause 8);

provided, however, that prior to disclosure or use of any Confidential
Information pursuant to Clauses 8.2.1 to 8.2.3, the Supplier or the Receiver, as
applicable, shall promptly notify the other Party of such requirement with a
view to providing the Supplier or Receiver with the opportunity to contest such
disclosure or use or otherwise agree to the timing and content of such
disclosure or use. If any conflict arises between any provision in this Clause 8
and Section 5.7 of the APA, Section 5.7 of the APA shall govern.

 

9. TERM AND TERMINATION OF SERVICES

 

9.1 Term

9.1.1 This Agreement commences at Closing and, with respect to each Service,
shall automatically terminate at the end of its Service Term, unless earlier
terminated in accordance with Clause 9.3 or in accordance with this Clause 9.1.
The Receiver may terminate any of the Services before expiry of the applicable
Service Term, taking into account (a) a notice period of thirty (30) days or
(b) other applicable termination terms (if any) as specified in the relevant
Service Level Agreement.

9.1.2 Subject to the foregoing, this Agreement shall terminate on the date on
which the provision of all Services has been terminated pursuant hereto.

9.1.3 In the event that the Supplier continues to provide any Services after the
expiration of the applicable Service Term, this Agreement will be deemed to
survive for such additional period with respect to such Services.

 

9.2 Interdependency

The Parties acknowledge and agree that if a Service has been terminated and, as
a consequence thereof, other Services can no longer be provided because of the
interdependency between these Services, such other Service shall be terminated
as well.

 

6

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9.3 Material Breach

Notwithstanding the other provisions of this Clause 9, this Agreement may be
terminated with immediate effect by either Party by providing written notice to
the breaching Party of such Party having committed a material breach of the
performance of its obligations under this Agreement, which breach has not been
cured within thirty (30) days after written notice specifying such breach is
given by the non-breaching Party to the breaching Party.

 

9.4 Effect of Termination

9.4.1 Upon termination of this Agreement, (a) the Receiver shall be obligated to
pay to the Supplier any Charges for Services performed prior to such termination
and (b) each Party shall deliver all property belonging to the other Party
provided pursuant to this Agreement as soon as is reasonably practicable.

9.4.2 The following Clauses shall survive the termination of this Agreement:
Clauses 1, 3, 6, 8, 9.4, 10 and 11.

9.4.3 Termination of this Agreement will not affect the rights and obligations
of the Parties under any other agreement between the Parties.

 

10. ASSIGNMENT

A Party may assign any of its rights and obligations under this Agreement to any
other Person only with the prior written consent of the other Party.

 

11. MISCELLANEOUS

 

11.1 Entire Agreement

This Agreement (including the Schedules hereto), along with the APA, contain the
entire agreement between the Parties relating to the subject matter of this
Agreement and supersede any previous written or oral agreement between the
Parties in relation to matters dealt with in this Agreement. If there is any
inconsistency or conflict between the terms of this Agreement and any Schedule
hereto, the terms of this Agreement shall prevail, except if and to the extent
any such Schedule expressly states that it shall prevail in the event of any
such conflict.

 

11.2 Amendment

No amendment, modification or extension of this Agreement shall be binding upon
either Party unless made in writing and signed by an authorized signatory of
each Party.

 

11.3 No Waiver

A Party’s failure to enforce at any time or for any period of time of the
provisions of this Agreement shall not be construed a waiver of such provisions
nor of the right of such Party hereafter to enforce each and every provision
herein contained.

 

7

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11.4 Third Party Rights

Except as expressly provided for in this Agreement, nothing in this Agreement
shall confer any rights upon any person that is not a Party or the successor or
permitted assignee of a Party.

 

11.5 Severability

The provisions of this Agreement shall be deemed severable and the invalidity or
unenforceability of any provision shall not affect the validity or
enforceability of the other provisions hereof.

 

11.6 Notices

11.6.1 All notices or other communications hereunder shall be given in
accordance with the notice provision of the APA, provided that all notices and
communications relating to any specific Service, including all requests from the
Receiver for Services to be provided under this Agreement, shall be directed to
the contact person(s) specified with respect to such Service (if any), with a
copy to the Project Managers.

11.6.2 Any notice to the Supplier’s Project Manager shall be sent to such
Project Manager at the following address, or such other address as the Supplier
may notify to the Receiver from time to time:

[●]

With a copy to:

[●]

11.6.3 Any notice to the Receiver’s Project Manager shall be sent to such
Project Manager at the following address, or such other address as the Receiver
may notify to the Supplier from time to time:

[●]

With a copy to:

[●]

 

11.7 No Partnership or Agent Created

The relationship of the Supplier and the Receiver shall be that of independent
contractors only. Nothing in this Agreement shall be construed as making one
Party an agent, legal representative, partner or joint venture of the other or
otherwise as having the power or authority to bind the other in any manner.

 

8

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11.8 Certain References

11.8.1 Any reference in this Agreement to a liability or obligation of a Party
shall be deemed to incorporate an obligation on the part of such Party to ensure
that the relevant liability is discharged or obligation is performed by such
Party or any relevant Affiliate of such Party, subject to the terms set out in
this Agreement.

11.8.2 Whenever used in this Agreement, (a) the words “include”, “includes” and
“including” shall be deemed to be followed by the phrase “without limitation”
and (b) the words “herein,” “hereof,” “hereby,” “hereto” and “hereunder” refer
to this Agreement as a whole.

 

11.9 Drafting Party

No provision of this Agreement shall be interpreted against a Party solely as a
result of the fact that such Party was responsible for the drafting of such
provision, it being acknowledged that the Parties and representatives of the
Parties have participated jointly in the drafting and negotiating of this
Agreement.

 

11.10 Headings and References

The clause and paragraph headings and table of contents contained in this
Agreement are for reference purposes only and shall not in any way affect the
meaning or interpretation of this Agreement.

 

11.11 Dispute Resolution

11.11.1 The Parties will attempt in good faith to resolve promptly any dispute
arising out of or relating to this Agreement by negotiation. If the matter is
not resolved in the normal course of business, the dispute will be referred to
the Project Managers, who will meet as soon as reasonably possible but in any
case within one (1) week of such referral, in order to attempt to resolve the
dispute. If the respective Project Managers do not resolve the dispute within
such timeframe (as may be extended by mutual agreement of the Parties), then the
dispute shall be escalated to designated members of senior management of each
Party.

11.11.2 If the dispute is not resolved in accordance with Clause 11.11.1, then
either Party may initiate litigation in any State or Federal court located
within the State of Delaware, which the Parties agree shall be the exclusive
venue for any litigation arising under this Agreement.

11.11.3 Until such time as the dispute has been resolved pursuant to
Clause 11.11.1 or a final decision has been rendered pursuant to Clause 11.11.2,
the Parties shall continue to fulfill their obligations set out in this
Agreement.

 

11.12 Governing Law

This Agreement shall be governed by and construed in accordance with the laws of
the State of Delaware without giving effect to conflicts of laws provisions.

 

9

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11.13 Counterparts

This Agreement, including any and all Service Level Agreements entered into
pursuant to this Agreement, may be executed in counterparts, each of which shall
be deemed an original, but all of which together shall be deemed to be one and
the same instrument. A signed copy of this Agreement or any such Service Level
Agreement delivered by facsimile, e-mail or other means of electronic
transmission shall be deemed to have the same legal effect as delivery of an
original signed copy thereof.

[Remainder of Page Intentionally Left Blank]

 

10

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IN WITNESS WHEREOF, the Parties hereto have caused this Transition Services
Agreement to be executed as of the date first written above by their respective
officers thereunto duly authorized.

 

INVIVO CORPORATION By:  

 

Name:   [                    ] Title:   [                    ] ICAD, INC. By:  

 

Name:   [                    ] Title:   [                    ]

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

Exhibit B

Form of Cross-License Agreement

(attached)

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

FINAL FORM

SOFTWARE CROSS-LICENSE AGREEMENT

This Software Cross-License Agreement is made and entered into as on
            , 2017 (the “Effective Date”) by and between

iCAD, Inc., a Delaware Corporation, with offices at 98 Spit Brook Road, Suite
100, New Hampshire 03063 (“ICAD”),

and

Koninklijke Philips N.V., a company duly incorporated under the laws of The
Netherlands, having its registered office in Eindhoven, The Netherlands
(“Philips”).

iCAD and Philips are hereinafter collectively referred to as the “Parties” and
each individually as a “Party”.

Whereas, iCAD and Invivo, an affiliate of Philips, have entered into an Asset
Purchase Agreement on even date herewith pursuant to which iCAD sold and
conveyed Acquired Assets to Invivo and/or Philips and iCAD retained ownership of
the Retained Software and the Retained Licensed Patents;

WHEREAS, in connection with the Asset Purchase Agreement, iCAD desires to use
the Acquired Software as set forth below and Philips is willing to license to
iCAD the Acquired Software for such limited, non-exclusive use in accordance
with the terms and conditions set forth in this Agreement;

WHEREAS, in connection with the Asset Purchase Agreement, Philips desires to use
the Retained Software as set forth below and iCAD is willing to license to
Philips the Retained Software and the Retained Licensed Patents for such
limited, non-exclusive use in accordance with the terms and conditions set forth
in this Agreement;

WHEREAS, iCAD and Philips are willing to license the Acquired Software, the
Retained Software, and the Retained Licensed Patents for such limited use in
accordance with the terms and conditions set forth in this Agreement.

NOW THEREFORE, in consideration of the mutual promises and covenants contained
herein, the Parties hereby agree as follows:

 

1 DEFINITIONS

The following terms used in this Agreement (as hereinafter defined) have the
following meanings, which shall be applicable equally to both the singular forms
and the plural forms of the terms defined:

“Acquired Assets” shall have the meaning given in the Asset Purchase Agreement.

“Affiliate” means any corporation, company, or other entity, which: (i) is under
the Control of a Party hereto; or (ii) has Control of a Party hereto; or
(iii) is under common Control with a Party hereto, at any time during the Term
of this Agreement. For purposes of this definition, “Control” means that more
than fifty percent (50%) of the controlled entity’s shares or ownership interest
representing the right to make decisions for such entity are owned or
controlled, directly or indirectly, by the controlling entity.

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

“Agreement” means this Software Cross-License Agreement, including all Annexes
hereto.

“Asset Purchase Agreement” means that certain Asset Purchase Agreement entered
into by and between Invivo Corporation and iCAD, Inc., and including its
Exhibits, Attachments and Related Agreements.

“Confidential Information” means information: (i) that is marked or labeled
“Confidential”, “Secret” or the like at the moment of disclosure or, in case of
oral information, is identified as confidential and confirmed in writing within
thirty (30) calendar days after disclosure thereof; or (ii) of which the
confidential nature is reasonably apparent.

“Closing” shall have the meaning given in the Asset Purchase Agreement.

“Derivative Work” means any changes and or modifications to the Licensed
Acquired Software.

“DynaCAD Product” shall have the meaning given in the Asset Purchase Agreement.

“Effective Date” means the date first written above.

“Excluded Provider” means a legal entity with is debarred, excluded, suspended
or otherwise ineligible to participate in a U.S. federal health care program, or
convicted of any U.S. health care related crime.

“Executable Code” means the machine-executable version of the Licensed Acquired
Software, in whole or in part, which results from compiling the Source Code into
Object Code and linking, loading or assembling (or other similar process), as
required, the Object Code into machine language.

“Intellectual Property” shall have the meaning given in the Asset Purchase
Agreement.

“Licensed Acquired Software” means the VersaVue Software and the DynaCAD Product
including all Intellectual Property therein (including the Acquired Intellectual
Property, as defined in the Asset Purchase Agreement) and all Source Code,
Object Code and the Executable Code.

“Object Code” means all or any portion of the machine-readable or machine
language version of the Licensed Acquired Software.

“Restricted Business” shall have the meaning given in the Asset Purchase
Agreement.

“Restricted Customer” shall have the meaning given in the Asset Purchase
Agreement.

“Retained Licensed Patents” shall mean patents, patent applications, utility
models, as well as any divisionals, re-issues, renewals, re-examinations,
continuations, continuations-in-part and foreign counterparts related to U.S.
Patent No. 8,805,122 and U.S. Patent No. 7,903,853.

“Retained Software” shall mean low level algorithm code for motion correction
and organ segmentation provided to Philips by Licensee under this Agreement,
including all Intellectual Property therein and all Object Code and Executable
Code. For the avoidance of doubt, Retained Software and the license to Retained
Software herein will not include Source Code.

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

“Source Code” means the compilable and human-readable version of the Licensed
Software, including without limitation, all comments and procedural code,
associated flow charts, concepts, algorithms, libraries, instructions and all
related preparatory materials.

“VersaVue Software” shall have the meaning given in the Asset Purchase
Agreement.

 

2 LICENSE GRANT

 

2.1 License to Acquired Software. Philips hereby grants to iCAD a limited,
non-exclusive, non-transferable, perpetual, royalty-free right and license, to
use access, distribute, perform, reproduce, display, modify, create derivative
works, and sublicense the Licensed Acquired Software, including all Intellectual
Property Rights therein, subject to the use restrictions set forth in Sections
2.1.1-2.1.3 and the non-competition restrictions set forth in Section 5.7 of the
Asset Purchase Agreement. Subject to the use restrictions set forth in Sections
2.1.1-2.1.3 and the non-competition restrictions set forth in Section 5.7 of the
Asset Purchase Agreement, iCad may sublicense the right to use the Licensed
Acquired Software, stand-alone or as part of other iCad software, to iCad’s
distributors, resellers and other partners and customers in accordance with this
Agreement. Except for the license rights granted to iCAD under this Section, all
rights, title and interests in and to the Acquired Software shall at all times
remain with and be vested in Philips. iCAD shall use proper proprietary notices,
including copyright notices, in connection with all use of the Licensed Acquired
Software in accordance with good commercial practice and as reasonably directed
by Philips from time to time.

2.1.1 iCAD may use for internal purposes only the current (as of the Effective
Date) version of the VersaVue Software and the DynaCAD Product.

2.1.2 iCAD may enhance the VersaVue Software and DynaCAD Software for the
limited purposes of data collection and storage; and products used in such data
collection and storage will be owned by iCAD (the “Data Collection/Storage
Enhancements”).

2.1.3 iCAD may use the Retained Software in all areas other than MRI prostate
and MRI breast uses (the “Motion Correction/Organ Segmentation Use”).

2.1.4 Copies. iCAD shall have the right to create a reasonable number of copies
of the Licensed Acquired Software to exercise its rights under this Agreement
and for disaster recovery and/or archival and other contingency purposes.

2.1.5 iCAD will use commercially reasonable efforts to cause each authorized
user of the Licensed Acquired Software to abide by the terms and conditions of
this Agreement and Section 5.7 of the Asset Purchase Agreement, as if each were
a party hereto.

2.1.6 Reservation of Rights. Except as expressly provided in this Agreement,
(i) no right, title or interest in or to the Licensed Acquired Software is
granted, whether express

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

or implied, by Philips, and Philips hereby retains all ownership of the Licensed
Acquired Software and all Intellectual Property rights therein; (ii) nothing in
this Agreement shall be deemed to grant to iCAD rights in any other products or
technology of Philips; (iii) iCAD shall have no right to use, license,
distribute or otherwise transfer the Licensed Acquired Software in any manner or
for any purpose except as specifically permitted under this Agreement.

 

2.2 License to Retained Software and Retained Licensed Patents. iCAD hereby
grants to Philips a non-exclusive, perpetual, royalty-free right and license to
use access, distribute, perform, reproduce, display, modify, create derivative
works, and sublicense the Retained Software in the conduct of its business.
Philips may sublicense the right to use the Retained Software, stand-alone or as
part of Philips’ Software, to Philips’ distributors, resellers and other
partners and customers in accordance with this Agreement. iCAD hereby grants to
Philips a non-exclusive, royalty-free right and license to the Retained Licensed
Patents for Philips to make, have made, use, purchase, sell, offer for sale,
distribute, license, and lease the DynaCAD Product and/or the VersaVue Software
until expiration of the applicable Retained Licensed Patent. Except for the
license rights granted to Philips under this Section, all rights, title and
interests in and to the Retained Software and Retained Licensed Patents shall at
all times remain with and be vested in iCAD. Philips shall use proper
proprietary notices, including copyright notices, in connection with all use of
the Retained Software in accordance with good commercial practice and as
reasonably directed by iCAD from time to time.

2.2.1 Copies. Philips shall have the right to create a reasonable number of
copies of the Retained Software to exercise its rights under this Agreement and
for disaster recovery and/or archival and other contingency purposes.

2.2.2 Philips will use commercially reasonable efforts to cause each authorized
user of the Retained Software to abide by the terms and conditions of this
Agreement, as if each were a party hereto.

2.2.3 Reservation of Rights. Except as expressly provided in this Agreement,
(i) no right, title or interest in or to the Retained Software is granted,
whether express or implied, by iCAD, and iCAD hereby retains all ownership of
the Retained Software and all Intellectual Property rights therein; (ii) nothing
in this Agreement shall be deemed to grant to Philips rights in any other
products or technology of iCAD; (iii) Philips shall have no right to use,
license, distribute or otherwise transfer the Retained Software in any manner or
for any purpose except as specifically permitted under this Agreement.

 

3 DELIVERY OF THE LICENSED SOFTWARE, RETAINED SOFTWARE, AND MATERIALS

 

3.1

Delivery. If requested by iCAD, Philips shall deliver the Licensed Acquired
Software and Documentation to iCAD at Closing by means of secured electronic
transfer or on a physical carrier, as specified by iCAD or otherwise as may be
mutually agreed by the Parties. If requested by Philips, iCAD shall deliver the
Retained Software and any

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

  documentation to Philips at Closing by means of secured electronic transfer or
on a physical carrier, as specified by Philips or otherwise as may be mutually
agreed by the Parties. For purposes of this Section 3, time is of the essence
under this Agreement.

 

4 AUDIT

 

4.1 For a period of five (5) years from the Execution Date, Philips, or its
designated representative, shall have the right, to audit the relevant books and
records of iCAD to verify iCAD’s compliance with the terms and conditions of
this Agreement, including subject to the conditions listed here below. Such
audits may be performed only once per calendar year, shall be conducted by
independent professional auditors bound by confidentiality obligations at least
as stringent as those in this Agreement, upon no less than 3 weeks written
notice, during normal business hours and in such manner as not to interfere
unreasonably with iCAD’s normal business activities. iCAD shall reasonably
co-operate and provide all such assistance in connection with such audit as
Philips and/or its auditors may require. Audits shall be restricted in scope to
compliance with Use restrictions set forth in Section 2. The audit will be
conducted at Philips’ expense.

 

5 REPRESENTATIONS AND WARRANTIES

Except as otherwise provided in the Asset Purchase Agreement, the Licensed
Acquired Software, Retained Licensed Patents, Retained Software, and related
documentation is provided to, and accepted by, each Party “AS IS” without
warranty of any kind.

 

6 SUPPORT SERVICES

 

6.1 Support Services. To the extent iCAD supports the Retained Assets, iCAD
shall make available an annual support offering for the Retained Assets
including telephone support, and remote access support, under iCAD’s standard
time and materials rates.

 

7 LIMITATION OF LIABILITY

 

7.1 Disclaimer of Damages. EXCEPT AS OTHERWISE PROVIDED IN THE ASSET PURCHASE
AGREEMENT, IN NO EVENT SHALL EITHER PARTY OR ANY OF ITS AFFILIATES BE LIABLE FOR
ANY DIRECT, INDIRECT, PUNITIVE, INCIDENTAL, CONSEQUENTIAL, OR SPECIAL DAMAGES
(INCLUDING LOST PROFITS LOSS OF REVENUE, LOSS OF BUSINESS OPPORTUNITY OR DAMAGE
TO REPUTATION) WHETHER ARISING FROM BREACH OF THE TERMS IN THIS AGREEMENT,
NEGLIGENCE, STRICT LIABILITY OR OTHER TORT, REGARDLESS OF IT BEING FORESEEABLE.

 

8 CONFIDENTIALITY

 

8.1

Each Party shall maintain as confidential any Confidential Information of the
other Party (or its Affiliates) for any purpose other than to perform its
obligations or exercise its rights under this Agreement. Each Party shall use
the same degree of care to protect the confidentiality of the disclosed
information as that Party uses to protect the confidentiality of its own
information, but not less than reasonable care. Each Party shall

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

  disclose such Confidential Information only to its employees (or its
Affiliates’ employees) having a need to know such information to perform the
transactions contemplated by this Agreement.

 

8.2 The confidentiality obligations under this Agreement shall not apply to
Confidential Information of which the receiving Party can demonstrate by means
of dated documentation that such Confidential Information: (i) was already in
the public domain at the time it was disclosed or subsequently enters the public
domain through no fault of the receiving Party; (ii) was known to the receiving
Party or in its possession, as evidenced by dated documentation prior to receipt
of such Confidential Information, (iii) was developed by the receiving Party
independently and without use of Confidential Information provided by the
disclosing Party under this Agreement and without any breach of this Agreement;
or (iv) was lawfully received by the receiving Party on a non-confidential basis
from a third party who was not bound by a similar obligation of confidentiality
in relation to the Confidential Information.

 

8.3 The terms of this Agreement are hereby designated as Confidential
Information of both parties. The Licensed Acquired Software is hereby designated
as Confidential Information of Philips. The Retained Software is hereby
designated as Confidential Information of iCAD.

 

9 FORCE MAJEURE

Each Party shall be excused from performing its obligations arising from any
delay or default caused by events beyond its reasonable control including, but
not limited to, acts of God, acts of third parties, acts of the other Party,
acts of any civil or military authority, fire, floods, war, embargoes, labor
disputes, acts of sabotage, riots, accidents, delays of carriers, subcontractors
or suppliers, voluntary or mandatory compliance with any government act,
downtime of the internet, regulation or request, shortage of labor, materials or
manufacturing facilities. In the event a delay remains for more than thirty
(30) calendar days, the non-delaying Party may terminate this Agreement.

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

10 NOTICES

 

10.1 All notices or other communications which are required or permitted
hereunder shall be in writing and sufficient if delivered personally or sent by
nationally-recognized overnight courier or by registered or certified mail,
postage prepaid, return receipt requested or by facsimile, with confirmation as
provided above addressed as follows:

If to Philips:

Invivo Corporation

3545 SW 47th Avenue

Gainesville, FL 32608

Attention: General Manager

and

Philips Healthcare, Legal Department

595 Miner Road

Cleveland, OH 44143

Fax: (440) 483-2452

Attention: Amy S. Gilchrist, Esq.

with copies to (which shall not constitute notice):

Mintz, Levin, Cohn, Ferris, Glovsky and Popeo, P.C.

One Financial Center

Boston, MA 02111

Fax: (617) 542-2241

Attention: Dean G. Zioze, Esq.

If to iCAD:

iCAD, Inc.

98 Spit Brook Road, Suite 100

Nashua, NH 03062

Attention: Chief Financial Officer

with copies to (which shall not constitute notice):

Blank Rome LLP

405 Lexington Avenue

New York, NY 10174-0208

Fax: (212) 885-5001

Attention: Michael S. Mullman, Esq.

or to such other address as the party to whom notice is to be given may have
furnished to the other party in writing in accordance herewith. All such notices
or communications shall be deemed to be received (a) in the case of personal
delivery, on the date of such delivery, (b) in the case of nationally-recognized
overnight courier, on the next Business Day after the date when sent, (c) in the
case of facsimile transmission, upon confirmed receipt, and (d) in the case of
mailing, on the second Business Day following the date on which the piece of
mail containing such communication was posted. Rejection or other refusal to
accept or the inability to deliver a notice, request, demand, claim or other
communication hereunder because of a changed address or changed facsimile number
(if a facsimile number had been given) of which no notice was given as herein
required shall be deemed to be receipt of the notice, request, demand, claim or
other communication sent.

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11 GENERAL PROVISIONS

 

11.1 Authority. Each Party represents and warrants that it is a legal business
entity duly organized and validly existing in good standing under the laws of
the jurisdiction of its formation, and that it has full power and authority to
enter into and perform this Agreement. Each Party further represents and
warrants that the person signing this Agreement on its behalf has been properly
authorized and empowered to do so.

 

11.1.1 No Assignment. Neither Party may assign, delegate or otherwise transfer
this Agreement or any of its rights, interests or obligations hereunder, without
the prior written consent of the other Party and any attempt to do so will be
null and void ab initio; provided, however, that a Party may assign or transfer
this Agreement or its rights, interests or obligations under this Agreement
without the other Party’s consent (a) to an Affiliate or (b) to a purchaser of
all or substantially all of the business or assets of such Party relating to
this Agreement, whether by merger or otherwise, so long as such Party provides
written notice to the other Party of such assignment or transfer within thirty
(30) days following such assignment or transfer. Any assignment or transfer of
this Agreement is subject to the conditions on use set forth in Provision 2 of
this Agreement and Section 5.7 of the Asset Purchase Agreement. Subject to the
foregoing, this Agreement will be binding upon and will inure to the benefit of
the Parties, their successors and permitted assigns.

 

11.2 Independent Contractors. The relationship of Philips and iCAD created by
this Agreement is that of independent contractors, and nothing herein contained
is intended or shall be construed in any manner whatsoever to give either Party
to create or assume any obligation on behalf of the other Party for any purpose,
or constitute the Parties as partners, joint venturers, principal and agent,
employer and employee, or otherwise as participants in a joint undertaking.

 

11.3 Excluded Provider. Each Party represents and warrants that it, and, to the
best of its knowledge, its employees and subcontractors are not an Excluded
Provider. For purposes of this Agreement, “Excluded Provider” means a legal
entity which is debarred, excluded, suspended, or otherwise ineligible to
participate in a U.S. federal healthcare program, or convicted of any U.S.
health care related crime. Each Party will promptly notify the other Party in
writing if it becomes aware that any of its employees or subcontractors has
become an Excluded Provider, and thereupon either Party may terminate this
Agreement upon written notice citing the fact that the other Party or its
subcontractors or employees has become an Excluded Provider.

 

11.4 Publicity. Neither Party will, without the prior written consent of the
other Party, (a) make any news release, public announcement, relating to this
Agreement or its subject matter, nor (b) in any manner advertise or publish the
fact that they have entered into this Agreement.

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

11.5 Compliance with Laws. The Licensed Acquired Software and the Retained
Software shall be provided in compliance with all applicable laws.

 

11.6 Governing Law and Dispute Resolution

11.6.1 This Agreement shall be governed by the Laws of the State of Delaware
without giving effect to any choice of law or conflict of law provision or rule
(whether of the State of Delaware or any other jurisdictions) that would cause
application of the Laws of any jurisdiction other than the State of Delaware.

11.6.2 All actions arising out of or relating to this Agreement shall be heard
and determined in any state or federal Court sitting in the State of Delaware.
Each of the Parties to this Agreement irrevocably submits to the exclusive
jurisdiction of the state Courts of Delaware and to the jurisdiction of the
United States District Court for the District of Delaware, for the purpose of
any action arising out of or relating to this Agreement and each of the Parties
to this Agreement irrevocably agrees that all claims in respect of such action
may be heard and determined exclusively in any Delaware state or federal Court
sitting in the State of Delaware. Each of the Parties to this Agreement agrees
that a final judgment in any action shall be conclusive and may be enforced in
other jurisdictions by suit on the judgment or in any other manner provided by
Law.

11.6.3 The Parties have participated jointly in the negotiation and drafting of
this Agreement and in the event of any ambiguity or question of intent or
interpretation, no presumption or burden of proof shall arise favoring or
disfavoring any party by virtue of the authorship of any of the provisions of
this Agreement.

 

11.7 Entire Agreement; Amendments. This Software Cross-License Agreement is
entered into as a material part of the Asset Purchase Agreement, is an Exhibit
thereto, and together, with the Asset Purchase Agreement, constitute the entire
understanding and agreement by and between the Parties with respect to the
transactions contemplated by this Agreement, and supersede any previous
understandings or agreements between the Parties, whether written or oral,
regarding the transactions contemplated by this Agreement. This Agreement may
not be modified except by a written instrument in writing signed by an
authorized representative of each of the Parties.

 

11.8 Third Party Beneficiaries. Nothing express or implied in this Agreement is
intended to confer, nor shall anything herein confer, upon any entity or person
other than the Parties hereto and their respective successors and permitted
assigns.

 

11.9 Counterparts; Construction. This Agreement may be executed in any number of
counterparts, any one of which need not contain the signatures of all parties,
but all of which counterparts when taken together will constitute one and the
same agreement. When used herein, the words “includes” and “including” and their
syntactical variations shall be deemed followed by the words “without
limitation.”

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

NOW THEREFORE, the Parties hereto have executed, or caused this Software
Cross-License Agreement to be executed by their duly authorized representatives,
as of the date first written above.

 

KONINKLIJKE PHILIPS N.V. By:  

 

Name:  

Brian Hinman

Title:  

Chief Intellectual Property Officer

ICAD, INC. By:  

 

Name:  

 

Title:  

 

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Exhibit C-1

Form of Consulting Agreement

(attached)

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

Exhibit omitted.

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Exhibit C-2

Form of Consulting Agreement

(attached)

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Exhibit omitted.