EXHIBIT 10.29

 

LICENSE/ JOINT DEVELOPMENT AGREEMENT

 

This LICENSE/ JOINT DEVELOPMENT AGREEMENT (this “Agreement”) is entered into as
of November 4, 2005 (the “Effective Date”), by and among CYTORI THERAPEUTICS,
INC., a Delaware corporation, located at 3020 Callan Road, San Diego, CA 92121,
U.S.A. (“Cytori”), OLYMPUS CORPORATION, a Japanese corporation, with its
principal office at 2-43-2 Hatagaya Shibuya-ku, Tokyo, Japan (“Olympus”), and
Olympus-Cytori, Inc. a Delaware corporation, located at 3020 Callan Road, San
Diego, CA 92121, U.S.A. (“NewCo”).

 

Cytori, Olympus and NewCo shall each be referred to individually as a “Party”
and collectively as the “Parties.”

 

RECITALS

 

A. Cytori has acquired and possesses, through the expenditure of considerable
time, effort and money, certain intellectual property rights (including patents,
patent applications and technical information) to regenerative cell technology,
including scientific equipment used to carry out regenerative cell therapies and
treatments.

 

B. On and subject to the terms and conditions set forth herein and pursuant to
Section 2.3 of a Joint Venture Agreement by and between Cytori and Olympus
Corporation, dated as of November 4, 2005 (the “JVA”), Olympus is prepared to
grant to NewCo, and NewCo desires to obtain from Olympus, an exclusive license
to use such intellectual property rights of Olympus for purposes of developing,
manufacturing and selling to Cytori the Licensed Product(s) (as defined below).

 

C. The obligations of the Parties under the JVA and the Ancillary Agreements (as
defined in the JVA) is conditioned on Cytori, NewCo and Olympus entering into
this Agreement, which sets forth, among other things, certain terms and
conditions under which the Parties will jointly develop the Licensed Product(s)
for sale in the Licensed Field (as defined below).

 

D. NewCo desires Cytori and Olympus to jointly develop Licensed Product(s), and
Cytori and Olympus are willing to perform such Licensed Product(s) development
under the terms and conditions provided for herein.

 

NOW, THEREFORE, in consideration of the foregoing, the mutual promises herein
contained, and for other good and valuable consideration, the receipt and
adequacy of which are acknowledged, the Parties agree as follows

 

SECTION 1

DEFINITIONS

 

1.1           Definitions. As used in this Agreement, the capitalized terms set
forth in this Section 1 shall have the following meanings, and may be read in
the singular, plural or an alternative tense as the context requires.

 

“Acceptance” means NewCo’s express written acceptance and acknowledgement (which
shall not be unreasonably withheld) of the completion of development of a given
Licensed Product in accordance with the Development Plan and in satisfaction of
the Specifications.

 

“Acceptance Procedures” means the procedures and criteria under which NewCo
shall test each Licensed Product Deliverable, as set forth in further detail in
Exhibit 1A. [These procedures to be mutually agreed between the Parties in
connection with the final determination of the Development Plan and
Specification.]

 

“Affiliate” means, as to any Party, any Person that, directly or indirectly,
controls, or is controlled by, or is

 

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under common control with, such Party, where “control” (including, with its
correlative meanings, “controlled by” and “under common control with”) means (a)
the beneficial ownership of fifty percent (50%) or more of the outstanding
voting securities of such Party, or (b) the possession, directly or indirectly,
of the power to direct or cause the direction of management or policies of such
Party, whether through the ownership of securities or partnership or other
ownership interests, by contract or otherwise.

 

“Agreement” shall have the meaning ascribed thereto in the Preamble, and shall
include this Agreement and each Exhibit attached hereto, as each such Exhibit
may be amended, varied, novated or substituted from time to time by written
mutual agreement of the Parties.

 

“Cytori” shall have the meaning ascribed thereto in the preamble.

 

“Cytori Indemnitees” shall have the meaning ascribed thereto in Section 11.3.

 

“Cytori IP” shall mean all Intellectual Property Rights licensed to NewCo by
Cytori in accordance with the License/ Commercial Agreement, any Ancillary
Agreement or otherwise.

 

“Cytori Development Fees” shall mean     ***     United States Dollars (USD  
***     ).

 

“Deliverables” shall mean the information, data, equipment, prototypes and
components listed and described in the Development Plan.

 

“Development Plan” shall mean the written research and development plan for the
Licensed Product(s), as set forth in (or to be set forth in) Exhibit 1B.

 

“Developer(s)” shall mean both Cytori and Olympus, and when used in a singular
form, either Cytori or Olympus, as the context requires.

 

“Effective Date” shall have the meaning ascribed thereto in the Preamble.

 

“Exhibit” shall refer to each of the exhibits attached to this Agreement, each
of which is hereby incorporated by reference.

 

“Final Product(s)” shall mean a Licensed Product(s) developed hereunder in full
accordance with the Development Plan and the Specifications, and that has
received Acceptance by NewCo.

 

“Intellectual Property Rights” or “IP” shall mean (a) all inventions (whether
patentable or unpatentable and whether or not actually reduced to practice), all
improvements thereto (but only if such improvements relate to inventions in
existence as of the Closing), and all patents, provisional and non-provisional
patent applications and patent disclosures, together with all reissuances,
divisions, continuations, continuations-in-part, renewals, extensions and
reexaminations thereof, (b) all copyrightable works, all works of authorship,
all copyrights, and all applications, registrations and renewals in connection
therewith, (c) all mask works and all applications, registrations and renewals
in connection therewith, (d) all trademarks, service marks, trade names, service
names, brand names, trade dress rights, logos, Internet domain names and
corporate names, together with the goodwill associated with any of the
foregoing, (e) all trade secrets and confidential business information
(including, but not limited to, ideas, research and development information,
know-how, formulas, compositions, biochemical and biological materials,
reagents, assays, manufacturing and production processes and techniques,
technical data, data base rights, designs, drawings, specifications, customer
and supplier lists, pricing and cost information and business and marketing
plans and proposals, and (f) any and all applications and registrations of the
foregoing (in any jurisdiction).

 

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*** Material has been omitted pursuant to a request for confidential treatment
filed separately with the Securities and Exchange Commission.

 

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“Indemnifying Party” shall have the meaning ascribed thereto in Section 11.1.

 

“Indemnified Party” shall have the meaning ascribed thereto in Section 11.1.

 

“Indemnity Claim” shall have the meaning ascribed thereto in Section 11.5.1.

 

“Indemnity Claim Notice” shall have the meaning ascribed thereto in Section
11.5.1.

 

“JVA” shall have the meaning ascribed thereto in Recital B.

 

“License/ Commercial Agreement” shall mean the License/ Commercial Agreement to
be entered into by and between Cytori and NewCo at Closing.

 

 “Licensed Field” shall mean the use of the Licensed IP for the purpose of
designing, developing, manufacturing, testing and servicing Licensed Products
for sale exclusively from NewCo to Cytori.

 

“Licensed IP” means all Intellectual Property Rights owned or controlled by a
Party which are necessary or useful to design, develop, manufacture, test,
analyze, market, offer to sell to Cytori, sell to Cytori and service all current
and future generations of the Licensed Product(s). The term “Licensed IP” shall
include Cytori IP, Olympus IP and NewCo IP.

 

“Licensed Product(s)” shall mean any automated devices (and related component
parts) that                    ***                   separate and
concentrate                   ***                   cells (including stem cells
and other regenerative cells) from harvested adipose tissue (fat tissue). The
device components include, but are not limited
to                   ***                   

***

 

***

 

“Milestone” means a specific stage of the Development Plan.

 

“NewCo” shall have the meaning ascribed thereto in the Preamble.

 

“NewCo Indemnitees” shall have the meaning ascribed thereto in Section 11.4.

 

“NewCo IP” means all Intellectual Property Rights owned by or acquired by NewCo
in connection with and during the term of the JVA, including licenses granted to
NewCo with respect to Cytori IP and Olympus IP.

 

“Olympus Indemnitees” shall have the meaning ascribed thereto in Section 11.2.

 

 “Olympus IP” shall mean all Intellectual Property Rights owned by Olympus and
licensed to NewCo in accordance with this Agreement, any Ancillary Agreement or
otherwise, including, without limitation, those patents, patent applications and
other Intellectual Property Rights.

 

“Olympus Development Fees” shall mean   ***    United States Dollars (USD  
***   )

 

“Party” and “Parties” shall have the meaning ascribed thereto in the Preamble.

 

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*** Material has been omitted pursuant to a request for confidential treatment
filed separately with the Securities and Exchange Commission.

 

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“Person” shall mean an association, corporation, individual, partnership, trust
or any other entity or organization, including a governmental entity, other than
a Party to this Agreement.

 

“Rules” shall have the meaning ascribed thereto in Section 16.3

 

“Specifications” shall mean (a) the technical specifications of the commercially
acceptable Licensed Product(s) and each Deliverable, as set forth in the
Development Plan, or (b) the technical specifications of the commercially
acceptable Licensed Product(s) and each Deliverable which has received
Acceptance by NewCo.

 

“Survival Period” shall have the meaning ascribed thereto in Section 11.6.

 

“Three-Way NDA” shall mean the Three-Way Non-Disclosure Agreement, dated
[                ], entered into by and among Cytori, Olympus and NewCo.

 

SECTION 2

LICENSE GRANT

 

2.1                                 Olympus License Grant. Subject to the terms,
conditions and limitations set forth in this Agreement and the JVA (with its
Ancillary Agreements), Olympus hereby agrees to grant to NewCo with respect to
any Intellectual Property of Olympus, that Olympus incorporates into the
Licensed Products, a non-exclusive, sublicenseable, irrevocable, worldwide,
fully paid-up license under the Olympus IP (including any improvements thereto)
so incorporated, in the Licensed Field, for the term of the Joint Venture, to
design, develop, make, have made, use, translate, perform, service, maintain,
import, offer to sell and sell Licensed Product(s), each Deliverable and any
part or component thereof, as contemplated by the JVA to the extent not subject
to any third party restrictions applicable to Olympus IP. The right of NewCo to
grant sublicenses to any third party other than Cytori under such Olympus IP
shall be subject to the written consent of Olympus, which shall not be
unreasonably withheld or delayed. If Olympus wishes to incorporate any Olympus
IP (including any third-party IP rights licensed to Olympus and any Olympus IP
exclusively licensed to a third party) into a Licensed Product (or into any
Licensed Product-related process) that (i) would require a further license or
sublicense to NewCo and/or Cytori in order for Newco and/or Cytori to practice
such Intellectual Property Right in making, using, selling, offering for sale,
importing or otherwise exploiting Licensed Products; or (ii) would require
royalty or other payments by NewCo, Cytori or Olympus to any third party; or
(iii) is not available for licensing or sublicensing to NewCo and/or Cytori,
then Olympus must first obtain Cytori’s approval (after full disclosure by
Olympus of all applicable terms and conditions associated therewith). For
avoidance of doubt, Olympus shall not be required to grant any license to NewCo
except in so far as Olympus, in its sole discretion, elects to incorporate such
Olympus IP into the Licensed Products.

 

2.2                                 NewCo License Grant. Subject to the terms,
conditions and limitations set forth in this Agreement and the JVA (with its
Ancillary Agreements), NewCo hereby grants to Olympus and to Cytori a
non-exclusive, perpetual, sublicenseable, irrevocable, fully paid-up, worldwide
license (or sublicense, as applicable) under all NewCo IP (including any
improvements thereto) in the Licensed Field, to design, develop,  make, have
made, use, translate, perform, service, maintain, import, offer to sell and
sell, Licensed Product(s), each Deliverable and any part or component thereof,
as contemplated by the JVA. Each of Olympus and Cytori may grant sublicenses to
a third party only with the prior consent of NewCo.

 

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2.3                                 No Reverse Engineering. Each Party agrees
not to reverse engineer, disassemble or decompile the whole or any part of any
other Party’s IP , or to use any other Party’s IP in any manner not expressly
authorized or contemplated by this Agreement and the JVA. If a Party and/or its
end users believe that they are entitled to reverse engineer the IP of another
Party by virtue of rights that may be granted as a matter of applicable law,
such as the Council Directive of 14 May 1991 of the Council of the European
Communities (as amended), such Party represents that (a) such Party and its end
users shall first request the technical information from such other Party; and
(ii) such technical information shall be used only to the extent permitted under
such applicable law.

 

SECTION 3

DEVELOPMENT COMMITTEE

 

3.1                                 Development Committee. From time to time,
the Developers may establish a development committee (the “Development
Committee”) to oversee, review and coordinate the research and development of
Licensed Product(s) and the implementation of the Development Plan. From time to
time, the Development Committee may establish subcommittees, to oversee
particular projects or activities (such as separate committees to oversee
product development), and such subcommittees will be constituted as the
Development Committee agrees.

 

3.2                                 Membership. In the event that the
Development Committee is established under Section 3.1, the Development
Committee shall be comprised of an equal number of representatives from each of
Olympus and Cytori, as appointed by each Developer. Subject to the foregoing
provisions of this Section 3.2, each Developer may replace any of its respective
Development Committee representatives at any time, with prior written notice to
the other Developer. The Parties agree and acknowledge that the representatives
appointed by each Developer to the Development Committee have no authority to
legally bind any Developer.

 

3.3                                 Meetings. In the event that the Development
Committee is established under Section 3.1, the Development Committee shall meet
as agreed by the Developers, at such locations as the Developers mutually agree.
At its meetings, the Development Committee shall (a) formulate and review (but
not modify) the Development Plan objectives; (b) monitor the Parties’ progress
under the Development Plan toward those objectives; and/or (c) discuss any
problems that arise in the implementation of the Development Plan. With the
consent of both Developers, other representatives of each Developer may attend
Development Committee meetings. The Development Committee shall prepare written
minutes of each Development Committee meeting and a written record of all
Development Committee discussions, whether made at a Development Committee
meeting or otherwise. Such minutes of the Development Committee meeting shall
only be effective when they are subsequently approved in writing by all of the
appointed representatives on the Development Committee. Each Developer shall
bear its own costs and expenses, including without limitation travel costs and
expenses, associated with its appointed representatives’ attendance at
Development Committee meetings. The Parties agree and acknowledge that the
Development Committee shall not have any authority to bind any of the Parties to
any contractual obligations or to otherwise amend this Agreement.

 

SECTION 4

DEVELOPMENT OF THE FINAL PRODUCT(S)

 

4.1                                 Joint Development. Immediately following the
Effective Date, the Developers shall commence

 

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development of Final Product(s) in accordance with, and as described in further
detail in, the Development Plan.

 

4.2                                 Disclosure of Olympus IP. Subject to the
terms, conditions and limitations set forth in this Agreement, Olympus shall to
its best knowledge deliver and disclose to NewCo, and NewCo shall be entitled to
share with Cytori, all Olympus IP that is incorporated into or with the Final
Product(s), NewCo shall provide Cytori with any other technical information and
assistance in this regard, as set forth in the Development Plan.

 

4.3                                 Disclosure of Cytori IP. Subject to the
terms, conditions and limitations set forth in this Agreement, Cytori shall
deliver and disclose to NewCo, and NewCo shall be entitled to share with
Olympus, all Cytori IP that is necessary or useful for (or related to) the
development of Final Product(s), or which is necessary or useful for NewCo’s or
Olympus’ performance of its obligations under this Agreement. NewCo shall
provide Olympus with any other technical information and assistance in this
regard, as set forth in the Development Plan.

 

4.4                                 Changes to Development Plan. The Development
Plan and Specifications shall set forth the base requirements and specifications
for each Final Product. If the requirements or specifications for the Final
Product(s) need to be amended in order to further the Developers’ objectives
hereunder, the Developers will use their own respective commercially reasonable
efforts to negotiate such necessary amendments to the Development Plan, while
minimizing the impact to the cost and timing of the development of the Final
Product(s).

 

4.5                                 Third Party Assistance. In performing its
obligations under this Agreement (more specifically, in developing and
manufacturing the Final Product(s) and in providing each Deliverable), a
Developer shall not cooperate or collaborate with any third party without the
prior written consent of the other Developer, which consent may be withheld at
the other Developer’s sole discretion, provided that, either Developer may
retain subcontractors or may subcontract in performing its obligations under
this Agreement. For the avoidance of doubt, either Developer may hire
contract-based engineers as needed for its performance under this Agreement.

 

4.6                                 Exclusivity. Each Developer shall not,
during the term of this Agreement, the JVA or for a two (2) year period
thereafter, (a) engage in or otherwise participate in (i) product development
activities with or on behalf of any third party that are the same as the
activities set forth in the Development Plan, or (ii) development of any product
that is the same (or performs a substantially similar function using adipose
tissue) as the Final Product(s), or (b) enter into any agreement or
understanding with any third party to engage in or otherwise participate in such
development activities. For the avoidance of doubt, this Section 4.6 is and
remains subject to the reservation of rights by Cytori set forth in Section
2.1.5 of the License/ Commercial Agreement.

 

4.7                                 Regulatory Filings. The Parties shall
discuss in good faith the responsibilities of each Party with respect to all
appropriate, prudent and necessary governmental filings, including, without
limitation, Japan’s Yakuji application, Food and Drug Administration
applications and CE mark applications, provided that, in cooperation and
collaboration with Olympus, Cytori shall be responsible for using commercially
reasonable efforts to seek Food and Drug Administration approval in the Licensed
Field for the Prototype of Celution set forth in Schedule 1 of the Joint Venture
Agreement.

 

4.8                                 Manufacturing Capabilities. Olympus (or a
third party acting on behalf of Olympus) shall be responsible for acquiring
and/or developing all necessary Final Product(s) manufacturing capabilities,
including equipment and facilities, as provided in the Development Plan.

 

4.9                                 Responsibilities. The Parties agree and
acknowledge that each Developer shall be solely responsible for

 

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the performance of its respective duties and responsibilities set forth in this
Agreement and the Development Plan. Except as otherwise set forth in this
Agreement, neither Developer shall have any liability whatsoever with respect to
any failure by the other Developer to fulfill its obligations under this
Agreement and the Development Plan in a timely manner. Without limiting the
generality of the foregoing, the Parties agree and acknowledge that neither
Developer shall be responsible to the other Developer or to NewCo for any delays
in meeting any milestones or other agreed upon development schedule or
objectives, if such delay is caused by the other Developer or by NewCo’s failure
to perform its obligations in a timely fashion.

 

SECTION 5

ACCEPTANCE

 

5.1                                 Acceptance by NewCo. NewCo shall conduct the
Acceptance Procedures at its sole cost and expense. NewCo shall complete all the
Acceptance Procedures within ninety (90) days from its receipt of each proposed
Final Product from the Developers. NewCo shall record the results of all
Acceptance Procedures in sufficient detail and on appropriate logging sheets,
and shall provide such results to the Developers within thirty (30) days after
the conclusion thereof.

 

5.2                                 Issuance of Acceptance Certificate. If
Acceptance Procedures conducted by NewCo pursuant to Section 5.1 indicate that
the relevant Specifications have been satisfied within the tolerances set forth
in the Acceptance Procedures, then NewCo shall, within ten (10) days after the
conclusion of such Acceptance Procedures, issue an appropriate Acceptance
Certificate to the Developers. The Acceptance Certificate shall be conclusive
evidence of NewCo’s acceptance and acknowledgment of the satisfaction of the
Specificationswithin the tolerances set forth in the Acceptance Procedures, and
shall be binding upon NewCo for all purposes. If NewCo fails to conduct the
Acceptance Procedures and/or fails to inform the Developers of the results
thereof in accordance with and within the timeframes specified in the Acceptance
Procedures, an Acceptance Certificate shall be deemed to have been issued by
NewCo.

 

SECTION 6

PAYMENT FOR DEVELOPMENT ACTIVITIES

 

6.1                                 Payment by NewCo to Olympus. For and in
consideration of the development activities to be undertaken by Olympus
hereunder, NewCo shall, within ninety (90) days of the Effective Date, pay to
Olympus the Olympus Development Fees in immediately available funds, by wire
transfer to the bank account designated by Olympus.

 

6.2                                 Payment by NewCo to Cytori. For and in
consideration of the development activities undertaken by Cytori, and upon
receipt by Cytori of the EC design examination certificate in accordance with
Annex II of Directive93/42/EEC (“CE Mark”) for the Prototype Celution Device (as
described in Exhibit 1C), NewCo shall immediately pay to Cytori the Cytori
Development Fee.

 

SECTION 7

OWNERSHIP OF INTELLECTUAL PROPERTY RIGHTS

 

7.1                                 Ownership. All Intellectual Property Rights
arising from the joint research and development of Licensed Product(s) under
this Agreement, including the transferability thereof, shall be as set forth on
Exhibit 7.1.

 

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7.2                                 Cytori IP Outside of the Licensed Field. The
Parties agree and acknowledge that all Intellectual Property Rights in and to
the Cytori IP outside of the Licensed Field, if any, shall at all times belong
exclusively to Cytori.

 

SECTION 8

DELIVERY

 

8.1                                 Delivery of the Deliverables. The Developers
shall deliver any and all Deliverables to NewCo in accordance with and in the
manner set forth in the Development Plan.

 

SECTION 9

REPORTING

 

9.1                                 Reporting. Each Developer shall provide to
the other Parties project progress reports, as set forth in the Development
Plan.

 

SECTION 10

REPRESENTATIONS AND WARRANTIES

 

10.1                           Olympus Representations and Warranties. Olympus
represents and warrants to each of Cytori and NewCo that:

 

10.1.1                  It is a corporation duly organized, validly existing and
in good standing under the laws of its place of incorporation, and that it has
full power and authority, and has taken all action necessary, to execute and
deliver this Agreement, and to fulfill its obligations under, and to consummate
the transactions contemplated by, this Agreement;

 

10.1.2                  The execution, delivery and performance of this
Agreement by it will not result in any breach or violation of, or conflict with,
any contract, agreement, undertaking, judgment, decree, order, law, regulation
or rule to which it is a party, or by which it or any of its assets are bound;
and

 

10.1.3                  This Agreement has been duly and validly executed and
delivered by it and is binding upon and enforceable against it in accordance
with its terms, except as enforceability may be limited or affected by
applicable bankruptcy, insolvency, reorganization or other laws of general
application relating to or affecting the rights of creditors and except as
enforceability may be limited by rules of law governing specific performance,
injunctive relief or other equitable remedies.

 

10.2                           Cytori Representations and Warranties. Cytori
represents and warrants to each of Olympus and NewCo that:

 

10.2.1                  It is a corporation duly organized, validly existing and
in good standing under the laws of its place of incorporation, and that it has
full power and authority, and has taken all action necessary, to execute and
deliver this Agreement and to fulfill its obligations under, and to consummate
the transactions contemplated by, this Agreement;

 

10.2.2                  The execution, delivery and performance of this
Agreement by it will not result in any breach or violation of, or conflict with,
any contract, agreement, undertaking, judgment, decree, order, law, regulation
or rule to which it is a party, or by which it or any of its assets are bound;
and

 

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10.2.3                  This Agreement has been duly and validly executed and
delivered by it and is binding upon and enforceable against it in accordance
with its terms, except as enforceability may be limited or affected by
applicable bankruptcy, insolvency, reorganization or other laws of general
application relating to or affecting the rights of creditors and except as
enforceability may be limited by rules of law governing specific performance,
injunctive relief or other equitable remedies.

 

10.3                           Cytori Intellectual Property. Cytori represents
and warrants that it owns, or has the right to use, any and all Cytori IP which
is or may be used in the performance of its obligations under this Agreement.

 

10.4                           Olympus Intellectual Property. Olympus represents
and warrants that it owns, or has the right to use, any and all Olympus IP which
is or may be used in the performance of its obligations under this Agreement.

 

SECTION 11

 

INDEMNIFICATION

 

11.1                           Indemnification. Each Party (“Indemnifying
Party”) agrees to indemnify, defend and hold harmless each other Party
(“Indemnified Party”), together with such other Party’s officers, directors,
shareholders, employees, agents or affiliates, from and against any and all
damages, losses, liabilities, costs and expenses, whether or not involving a
third party claim, including, but not limited to, legal fees and reasonable
attorney costs, interest, penalties and disbursements, asserted against,
resulting to, imposed upon or incurred by the Indemnified Party, its officers,
directors, shareholders, employees, agents or affiliates, by reason of or
resulting from a breach by the Indemnifying Party of any of its obligations or
its representations and warranties under this Agreement.

 

11.2                           Cytori Intellectual Property Indemnification
Obligation. In addition to the indemnification obligations set forth in Section
11.1, Cytori shall indemnify Olympus, NewCo and their respective officers,
directors, shareholders, employees, agents or affiliates (the “Olympus
Indemnitees”), from and against any and all damages, losses, liabilities, costs
and expenses, whether or not involving a third party claim, including, but not
limited to, legal fees and reasonable attorney costs, interest, penalties and
disbursements, and royalities or other license payments, asserted against,
resulting to, imposed upon or incurred by the Olympus Indemnitees in any manner
arising out of, in connection with, with respect to or relating to any
Intellectual Property Rights infringement claims asserted or claimed by a third
party(ies) asserting infringement of such third party’s(ies’) Intellectual
Property Rights or any other proprietary right by use or practice of the Cytori
IP.

 

11.3                           Olympus Intellectual Property Indemnification
Obligation. In addition to the indemnification obligations set forth in Section
11.1, Olympus shall indemnify Cytori, NewCo and their respective officers,
directors, shareholders, employees, agents or affiliates (the “Cytori
Indemnitees”), from and against any and all damages, losses, liabilities, costs
and expenses, whether or not involving a third party claim, including, but not
limited to, legal fees and reasonable attorney costs, interest, penalties and
disbursements, asserted against, resulting to, imposed upon or incurred by the
Cytori Indemnitees in any manner arising out of, in connection with, with
respect to or relating to any Intellectual Property Rights infringement claims
asserted or claimed by a third party(ies) asserting infringement of such third
party’s(ies’) Intellectual Property Rights or any other proprietary right by use
or practice of the Olympus IP.

 

11.4                           Developers Intellectual Property Indemnification
Obligation. In addition to the indemnification obligations set forth in Section
11.1, the Developers shall jointly and severally indemnify NewCo and its
officers, directors, shareholders, employees or agents (the “NewCo
Indemnitees”), from and against any and all damages, losses, liabilities, costs
and expenses, whether or not involving a third party claim, including, but not
limited to, legal fees and reasonable attorney costs, interest, penalties and
disbursements, asserted

 

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against, resulting to, imposed upon or incurred by the NewCo Indemnitees in any
manner arising out of, in connection with, with respect to or relating to any
Intellectual Property Rights infringement claims asserted or claimed by a third
party(ies) asserting infringement of such third party’s(ies’) Intellectual
Property Rights or any other proprietary right by manufacture, use or practice
of the Final Product(s), but specifically excluding such claims that are
provided for under Sections 11.2 and 11.3.

 

11.5                           Administration of Indemnification. For purposes
of administering the indemnification provisions set forth in Sections 11.1,
11.2, 11.3 and 11.4, the following procedure shall apply:

 

11.5.1                  Whenever a claim (each, an “Indemnity Claim”) shall
arise for indemnification under this Section 11.5, the Indemnified Party shall,
reasonably promptly after acquiring knowledge of the Indemnity Claim, give
written notice (each, an “Indemnity Claim Notice”) to the Indemnifying Party,
Cytori, Olympus or the Developers, as the case may be, setting forth in
reasonable detail, to the extent then available, the facts concerning the nature
of the Indemnity Claim and the basis upon which the Indemnified Party, Cytori,
Olympus or the Developers, as the case may be, believes that it is entitled to
indemnification under this Section 11.

 

11.5.2                  In the event of any Indemnity Claim resulting from or in
connection with any claim by a third party, the Indemnifying Party, Cytori,
Olympus or the Developers, as the case may be, shall be entitled, at its sole
expense, either (a) to participate in defending against such claim or (b) to
assume the entire defense with counsel who is selected by it and who is
reasonably satisfactory to the Indemnified Party, Cytori Indemnitees or Olympus
Indemnitees, as the case may be, provided that (A) the Indemnifying Party,
Cytori, Olympus or the Developers, as the case may be, agrees in writing that it
does not and will not contest its responsibility for indemnifying the
Indemnified Party, Cytori Indemnitees or Olympus Indemnitees, as the case may
be, in respect of such claim or proceeding, and (B) no settlement shall be made
and no judgment consented to without the prior written consent of the
Indemnified Party, Cytori Indemnitees or Olympus Indemnitees, as the case may
be, which consent shall not be unreasonably withheld, conditioned or delayed
(except that no such consent shall be required if the claimant is entitled under
the settlement to only monetary damages actually paid by the Indemnifying Party,
Cytori, Olympus or the Developers, as the case may be). If, however, (i) the
claim, action, suit or proceeding would, if successful, result in the imposition
of damages for which the Indemnifying Party, Cytori, Olympus or the Developers,
as the case may be, would not be responsible, or (ii) representation of both the
Indemnified Party, Cytori Indemnitees or Olympus Indemnitees, as the case may
be, and the Indemnifying Party, Cytori, Olympus or the Developers, as the case
may be, by the same counsel would otherwise be inappropriate due to actual or
potential differing interests between them, then the Indemnifying Party, Cytori,
Olympus or the Developers, as the case may be, shall not be entitled to assume
the entire defense, and each Party shall be entitled to retain counsel who shall
cooperate with one another in defending against such claim. In the case of item
(i) of the preceding sentence, the Indemnifying Party, Cytori, Olympus or the
Developers, as the case may be, shall be obligated to bear only that portion of
the expense of the Indemnified Party’s, Cytori’s, Olympus’ or the Developers’,
as the case may be, counsel that is in proportion to the claimed damages
indemnifiable by the Indemnifying Party, Cytori, Olympus or the Developers, as
the case may be, compared to the total amount of the third-party claim against
the Indemnified Party, Cytori Indemnitees or Olympus Indemnitees, as the case
may be.

 

11.5.3                  If, within ten (10) days after receipt of an Indemnity
Claim Notice, the Indemnifying Party, Cytori, Olympus or the Developers, as the
case may be, fails to give the Indemnified Party, Cytori Indemnitees or Olympus
Indemnitees, as the case may be, written notice of the Indemnifying Party’s,
Cytori’s, Olympus’ or the Developers’, as the case may be, election to undertake
the defense of the related Indemnity Claim, or if the Indemnifying Party,
Cytori, Olympus or the Developers, as the case may be, subsequently fails to
diligently prosecute such defense, the Indemnified Party, Cytori Indemnitees or
Olympus Indemnitees, as the case may be, may defend in such manner as it
reasonably deems appropriate or settle the claim (after giving notice thereof to
the Indemnifying Party, Cytori, Olympus or the Developers, as the case may be)
on

 

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such terms as the Indemnified Party, Cytori Indemnitees or Olympus Indemnitees,
as the case may be, may deem appropriate, and the Indemnified Party, Cytori
Indemnitees or Olympus Indemnitees, as the case may be, shall be entitled to
periodic reimbursement of defense expenses incurred and prompt indemnification
from the Indemnifying Party, Cytori, Olympus or the Developers, as the case may
be, in accordance with this Section 11.

 

11.5.4                  Failure or delay by an Indemnified Party, Cytori
Indemnitees or Olympus Indemnitees, as the case may be, to give a reasonably
prompt notice of any Indemnity Claim (if given prior to expiration of the
applicable Survival Period) shall not release, waive or otherwise affect an
Indemnifying Party’s, Cytori’s, Olympus’ or the Developers’, as the case may be,
obligations with respect to the Indemnity Claim, except to the extent that the
Indemnifying Party, Cytori, Olympus or the Developers, as the case may be, can
demonstrate actual loss or prejudice as a result of such failure or delay.

 

11.6                           This Section 11 shall survive the expiration or
sooner termination of this Agreement, and shall continue for a period of five
(5) years from the date of expiration or sooner termination hereof, as
applicable (the “Survival Period”).

 

SECTION 12

LIMITATION ON RECOVERABLE DAMAGES

 

12.1                           Limitation of Liability.

 

TO THE MAXIMUM EXTENT PERMITTED BY APPLICABLE LAW, IN NO EVENT SHALL ANY PARTY
BE LIABLE TO THE OTHER PARTY OR TO ANY THIRD PARTY FOR SPECIAL, INCIDENTAL,
CONSEQUENTIAL OR PUNITIVE DAMAGES OF ANY NATURE (INCLUDING, BUT NOT LIMITED TO,
DAMAGES FOR LOSS OF BUSINESS, LOSS OF PROFIT OR REVENUES, LOSS OF USE OF THE
PRODUCTS OR ANY ASSOCIATED EQUIPMENT, COST OF CAPITAL, COST OF SUBSTITUTE
PRODUCTS, FACILITIES OR SERVICE, DOWNTIME, PERSONAL PROFITS, BUSINESS
INTERRUPTION, OR ANY OTHER PECUNIARY LOSS) ARISING OUT OF OR IN ANY WAY RELATED
TO THE PARTIES’ PERFORMANCE OR FAILURE TO PERFORM UNDER THIS AGREEMENT, WHETHER
SUCH LIABILITY IS ASSERTED ON THE BASIS OF CONTRACT, TORT (INCLUDING NEGLIGENCE
OR STRICT LIABILITY) OR OTHERWISE, EVEN IF THE OTHER PARTY HAS BEEN WARNED OF
THE POSSIBILITY OF SUCH DAMAGES.  EXCEPT TO THE EXTENT SPECIFICALLY PROVIDED
OTHERWISE IN THIS AGREEMENT, ALL REMEDIES PROVIDED FOR HEREUNDER, INCLUDING, BUT
NOT LIMITED TO, THE RIGHT TO TERMINATE THIS AGREEMENT AND ALL OF THE REMEDIES
PROVIDED BY LAW (AND NOT EXCLUDED PURSUANT TO THE FOREGOING SENTENCE), SHALL BE
DEEMED CUMULATIVE AND NON EXCLUSIVE.

 

SECTION 13

FURTHER RIGHTS UPON TERMINATION

 

13.1                           Accrued Liabilities. The expiration or earlier
termination of this Agreement for any cause shall not release any Party hereto
from any liability which, at the time of such expiration or termination, has
already accrued against such Party (or which thereafter may accrue against such
Party in respect of any act or omission occurring prior to such expiration or
termination), nor shall any such expiration or termination of this Agreement
affect in any way the survival of any right, duty or obligation of any Party
hereto which is

 

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expressly stated elsewhere in this Agreement to survive expiration or earlier
termination hereof.

 

SECTION 14

MISCELLANEOUS PROVISIONS

 

14.1                           Export Regulations. Each Party shall be
responsible for observing and abiding by any and all export control laws and
regulations (including, without limitation, any and all costs associated
therewith) applicable to the Cytori IP, Olympus IP, NewCo IP, the Deliverables
and/or the Final Product(s), as applicable.

 

14.2                           Governing Law. This Agreement shall be governed
in all respects by the laws of New York without regard to provisions regarding
choice of laws.

 

14.3                           Dispute Resolution. All disputes arising out of
or in connection with this Agreement, or any relationship created by or in
accordance with this Agreement, shall be finally settled under the Rules of
Arbitration of the International Chamber of Commerce (the “Rules”) by three
arbitrators. Judgment on the award rendered by the panel of arbitrators shall be
binding upon the Parties and may be entered in any court having jurisdiction
thereof. Olympus shall nominate one arbitrator and Cytori shall nominate one
arbitrator. The arbitrators so nominated by Cytori and Olympus, respectively,
shall jointly nominate the third arbitrator within fifteen (15) days following
the confirmation of arbitrators nominated by Cytori and Olympus. If the
arbitrators nominated by Cytori and Olympus cannot agree on the third
arbitrator, then such third arbitrator shall be selected as provided in the
Rules. The place of the arbitration and all hearings and meetings shall be in
Singapore unless the parties to the arbitration otherwise agree. In addition to
the Rules and except as otherwise provided herein, the Parties agree that the
arbitration shall be conducted according to the International Bar Association
Rules on the Taking of Evidence in International Commercial Arbitration. The
arbitrators may order pre-hearing production or exchange of documentary
evidence, and may require written submissions from the relevant parties hereto,
but may not otherwise order pre-hearing depositions or discovery. The
arbitrators shall apply the laws of the state of New York as set forth in this
Section 16.3; provided, however, that the Federal Arbitration Act shall govern.
The language of the arbitral proceedings shall be English. The arbitrators shall
not issue any award, grant any relief or take any action that is prohibited by
or inconsistent with the provisions of this Agreement.

 

No arbitration pursuant to this Section 16.3 shall be commenced until the Party
intending to request arbitration has first given thirty (30) days written notice
of its intent to the other Party or Parties, as the case may be, and has offered
to meet and confer with one or more responsible executives of such other Party
or Parties, as the case may be, in an effort to resolve the dispute(s) described
in detail in such written notice. If one or more of such responsible executives
agree, within thirty (30) days after receipt of such written notice, to meet and
confer with the requesting Party, then no arbitration shall be commenced until
the Parties have met and conferred in an effort to resolve the dispute(s) or
until sixty (60) days have elapsed from the date such written notice has been
given.

 

14.4                           Successors and Assigns. Except as otherwise
expressly provided herein, the provisions hereof shall inure to the benefit of,
and be binding upon, the successors, assigns, heirs, executors and
administrators of the Parties hereto whose rights or obligations hereunder are
affected by such amendments. Neither this Agreement nor any right, license,
privilege or obligation provided herein may be assigned or transferred by either
Party without the other Party’s prior written consent, and any such assignment
or transfer shall constitute a Change of Control of either Cytori or Olympus.

 

14.5                           Entire Agreement. This Agreement, including the
attachments, schedules and exhibits hereto and the Ancillary Agreements
contemplated by the JVA, all of which are hereby expressly incorporated herein
by this reference, together with the Confidentiality Agreement (as defined in
the JVA), constitutes the entire

 

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understanding and agreement among the Parties with regard to the subject matter
hereof; and supersedes in its entirety all prior agreements and understandings,
express or implied, oral or written among them with respect thereto. No
alteration, modification, interpretation or amendment of this Agreement shall be
binding on the Parties unless in writing designated as an amendment hereto, and
executed with equal formality by each of the Parties.

 

14.6                           Notices. Except as may be otherwise provided
herein, all notices, requests, waivers and other communications made pursuant to
this Agreement shall be in writing and shall be conclusively deemed to have been
duly given (a) when hand delivered to the other Party(ies); (b) when received,
if sent by facsimile at the address and number set forth below, with a written
confirmation copy of such facsimile sent the next business day in accordance
with (c) below; (c) the third business day after deposit with an international
courier service, postage prepaid, addressed to the other Party(ies) as set forth
below, provided that the sending Party receives a confirmation of delivery from
the courier service provider, or (d) if earlier, when actually received.

 

To Cytori:

 

To Olympus:

 

 

 

3020 Callan Road, San Diego, CA 92121,
U.S.A.

 

2-3 Kuboyama-cho,
Hachioji-shi, Tokyo, 192-8512, Japan

 

 

 

Attn: Christopher J. Calhoun

 

Attn: Yasunobu Toyoshima

Fax: 858-458-0995

 

Fax: +81-426-91-7350

 

 

 

To NewCo:

 

 

 

 

 

3020 Callan Road, San Diego, CA 92121,
U.S.A.

 

2-3 Kuboyama-cho,
Hachioji-shi, Tokyo, 192-8512, Japan

 

 

 

Attn: Christopher J. Calhoun

 

Attn: Masaaki Terada

Fax: 858-458-0995

 

Fax: +81-426-91-7350

 

A Party hereto may change or supplement its address set forth above, or may
designate additional addresses, for purposes of this Section 16.6 by giving the
other Parties hereto written notice of the new address in the manner set forth
above.

 

14.7                           Amendments and Waivers. No term or provision of
this Agreement may be amended, waived, discharged or terminated orally but only
by an instrument in writing signed by the Party against whom the enforcement of
such amendment, waiver, discharge or termination is sought. Any waiver shall be
effective only in accordance with its express terms and conditions.

 

14.8                           Cumulative Remedies. Unless expressly so stated
in this Agreement in respect of any particular right or remedy, the rights and
remedies herein provided are cumulative and not exclusive of any rights or
remedies provided by law.

 

14.9                           Titles and Subtitles. The titles of the sections
and subsections of this Agreement are for convenience of reference only and are
not to be considered in construing this Agreement.

 

14.10                 Relationship of Parties. This Agreement shall not be
deemed to constitute any Party, the agent, the partner, the licensee, the
affiliate or the representative of another Party, and a Party shall not
represent to any third party that it has any such relationship or right of
representation.

 

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14.11                 Press Release. No public announcements or press releases
shall be issued by any Party regarding this Agreement or any of the activities
engaged in by the Parties pursuant to this Agreement, the JVA and/or any
Ancillary Agreement without the prior written approval of the other Parties;
provided, however, that any Party shall have the right to make such public
disclosure as may be necessary or appropriate to comply with applicable
securities or other laws.

 

14.12                 Counterparts. This Agreement may be executed by facsimile
signature in any number of counterparts, each of which shall be an original, but
all of which together shall constitute one instrument.

 

14.13                 Severability. Should any provision of this Agreement be
determined to be illegal or unenforceable, such determination shall not affect
the remaining provisions of this Agreement.

 

 

IN WITNESS WHEREOF, the Parties have executed this License/ Joint Development
Agreement as of the Effective Date.

 

 

CYTORI THERAPEUTICS, INC.

OLYMPUS CORPORATION

 

 

By: 

/s/ Christopher J. Calhoun

 

By:

/s/ Tsuyoshi Kikukawa

 

 

 

 

 

 

 

Title: CEO

Title: President

 

 

Date: November 4, 2005

Date: November 4, 2005

 

 

OLYMPUS-CYTORI, INC.

 

 

 

BY:

/S/ MASAAKI TERADA

 

 

 

 

 

 

Title: CEO

 

 

 

Date: November 4, 2005

 

 

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