Exhibit 10.1

PATENT OPTION AGREEMENT

Duke University File(s) #4719, 5000, 5191, 5204, 6381, 6382, 6478,

6479, 6480, 6622, 6623, 6624, 6625 and 7094

This Patent Option Agreement (“Agreement”) is entered into on June 9, 2020
(“EFFECTIVE DATE”), between Duke University, a nonprofit educational and
research institution organized under the laws of North Carolina (“DUKE”) having
the address in Article 8 below and Cryo-Cell International, Inc. (“COMPANY”), a
corporation incorporated in the state of Delaware, located at 700 Brooker Creek
Blvd, Suite 1800, Oldsmar, Florida 34677.

DUKE desires to grant COMPANY the right to license DUKE’s patent rights,
regulatory data, and proprietary processes related to cord blood, cord tissue
and DUOC-01 on substantially the terms set forth in this Agreement and the
SUMMARY TERM SHEET attached hereto at Attachment A, and COMPANY desires a period
of time in which to enter into such license (the “License Agreement”). DUKE and
COMPANY therefore agree as follows:

ARTICLE 1 - DEFINITIONS

The following definitions apply to this Agreement:

1.1 “EXCLUDED FIELDS OF USE” means autologous specific therapeutics for autism,
cerebral palsy and stroke.

1.2 “EXCLUDED TERRITORY” means Japan, South Korea, and Taiwan.

1.3 “FIELD OF USE” means the treatment, prevention, cure, reduction, mitigation
or other management of any and all diseases and conditions in humans.

1.4 “LICENSED PRODUCT(S)” means any product sold by LICENSEE or SUBLICENSEE
that: (a) but for the license under the License Agreement comprises an
infringement of (including contributory or inducement), or is covered by, a
VALID CLAIM contained in the PATENT RIGHTS in the country in which any such
product or product part is made, used, imported, offered for SALE or sold; or
(b) is manufactured or is required to be administered to a patient in the
process of conducting a LICENSED PROCESS or is required to be employed to
practice a LICENSED PROCESS; or (c) uses any of the REGULATORY DATA or TECHNICAL
INFORMATION. For clarity, any product lawfully sold by a third party without
license or authorization from LICENSEE or a SUBLICENSEE shall not be a LICENSED
PRODUCT.

1.5 “LICENSED PROCESS(ES)” means any process or method or service employed by
LICENSEE or SUBLICENSEE that: (a) but for the license under the License
Agreement comprises an infringement of (including contributory or inducement),
or is covered by a VALID CLAIM contained in the PATENT RIGHTS in the country in
which such process or method or service is performed; or (b) employs a LICENSED
PRODUCT; or (c) uses any of the REGULATORY DATA or TECHNICAL INFORMATION .

 

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1.6 “LICENSED RIGHTS” means individually and collectively, REGULATORY DATA,
TECHNICAL INFORMATION, and PATENT RIGHTS.

1.7 “PATENT RIGHTS” means DUKE’s legal rights under the patent laws of the
United States or relevant foreign countries for all of the following:

(a) the following United States and foreign patents and/or patent applications,
and divisionals, continuations (including continuations-in-part only to the
extent such continuations-in-part are entitled to claim priority to such patents
or patent applications), and foreign counterparts of the same:

Patent Rights Group (A)

 

  •  

METHODS OF TREATING BRAIN INJURY USING CORD BLOOD OR A COMPONENT THEREOF, US
Application 16/477,110 (4719)

 

  •  

COMPOSITIONS AND METHODS OF THE TREATMENT OF DEMYLINATING CONDITIONS, US
Application 16/477,167, EP 18738872.3 (5000/5191)

 

  •  

METHODS FOR THE TREATMENT OF AUTISM SPECTRUM DISORDERS, PCT/US2018/022174, US
Application 16/493,754 (5204)

Patent Rights Group (B)

 

  •  

METHODS OF TREATING CEREBRAL PALSY USING HIGH DOSE ALLOGENEIC UMBILICAL CORD
BLOOD, US Application 16/510,387 (6479)

 

  •  

METHODS OF TREATING CEREBRAL PALSY AND HYPOXIC-ISCHEMIC ENCEPHALOPATHY USING
HUMAN UMBILICAL CORD TISSUE-DERIVED MESENCHYMAL STROMAL CELLS, PCT/US2019/025796
(6381)

 

  •  

METHODS FOR THE TREATMENT OF AUTISM SPECTRUM DISORDERS USING HUMAN UMBILICAL
CORD TISSUE-DERIVED MESENCHYMAL STROMAL CELLS, PCT/US2019/025716 (6382)

 

  •  

COMPOSITIONS AND METHODS FOR THE TREATMENT OF DEMYELINATING CONDITIONS US
Application 16/510,395

 

  •  

COMPOSITIONS COMPRISING MESESCHYMAL STROMAL CELLS FOR THE TREATMENT OF VIRAL
INFECTIONS US application 63/017,290

(b) United States and foreign patents issued from the applications listed in
subsection 1.8(a) above, including any reissued or reexamined patents based upon
the same and all extensions, renewals, restorations and supplementary protection
or any equivalent thereof.

1.8 “PRINCIPAL INVESTIGATOR” means Dr. Joanne Kurtzberg.

1.9 “REGULATORY DATA” means the underlying data, including any correspondence,
records, filings and other documentation with any regulatory authority with
respect to any LICENSED PROCESS,, to the extent owned by and/or (if any)
licensed (with the right to license COMPANY) to DUKE under United States and
international law, in any protocols, Standard Operating Procedures, and case
report forms collected or created in connection with DUKE’s

 

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pre-clinical studies, regulatory submissions, and clinical trials (specifically
IND numbers 14360, 16615, 15949, 17313, 17921, 16274, and 14753) and further
includes any additional relevant TECHNICAL INFORMATION related to studies with
Protocol Numbers 00017801, 00065043, 00052449, 00070514, 00079241, 00059284,
00077580, 00000412, and 00066647 including related reports, manuscripts and
correspondence and other records of regulatory interactions communicated by DUKE
to LICENSEE under the License Agreement and at DUKE’s sole discretion, with
initial reference in DUKE Office of Licensing and Ventures File Nos: 6480, 6622,
6623, 6624, and 6625. REGULATORY DATA and TECHNICAL INFORMATION shall not
include the private medical records of individuals, and shall not include any
data or information that allows such individuals to be directly identified.

1.10 “TECHNICAL INFORMATION” means any non-patented scientific, technical,
regulatory and other information to the extent owned by and/or (if any) licensed
(with the right to license to COMPANY) to DUKE and necessary or used by the
PRINCIPAL INVESTIGATOR for the conduct of any process covered by the PATENT
RIGHTS. TECHNICAL INFORMATION does not include information in the public domain,
as LICENSEE can show by documentary evidence.

1.11 “VALID CLAIM” means: (a) a claim in an issued patent within the PATENT
RIGHTS which has not (i) expired, (ii) been finally adjudicated or admitted by
DUKE as invalid or unenforceable, or (iii) been abandoned, or (b) a claim in a
pending application within the PATENT RIGHTS which is still under prosecution;
provided that if a claim of a pending patent application has not issued as a
claim of an issued patent within seven (7) years after the filing date from
which such claim takes priority, such claim shall not be a VALID CLAIM for
purposes of this Agreement from the seven (7) year anniversary date of such
priority date until such time as such claim does issue (at which point such
claim shall be a VALID CLAIM for purposes of this Agreement). It is understood
and agreed that a claim in a pending application that is subject to a
restriction requirement during prosecution and is not yet being prosecuted as
part of a divisional patent application will still be considered a VALID CLAIM
until it is finally rejected or abandoned and subject to the prior sentence.

ARTICLE 2 - EVALUATION

2.1 During the OPTION PERIOD, COMPANY shall use commercially reasonable efforts
to evaluate the market potential for LICENSED PRODUCTS and LICENSED PROCESSES in
the FIELD OF USE.

ARTICLE 3 - PATENT PROSECUTION AND MAINTENANCE

3.1 DUKE shall control all aspects of filing, prosecuting, and maintaining all
of the patents and patent applications included within the PATENT RIGHTS.
COMPANY shall fully cooperate in such activities. The parties shall negotiate in
good faith the foreign countries in which to pursue patent protection. COMPANY
shall not have any rights under this Agreement in countries with respect to
which COMPANY does not agree to reimburse DUKE’s documented, out-of-pocket
patent expenses with respect to the prosecution and maintenance of the PATENT
RIGHTS.

 

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3.2 DUKE shall notify COMPANY of any significant information (including proposed
responses or filings) received by DUKE relating to the filing, prosecution and
maintenance of the patents and patent applications included within the PATENT
RIGHTS, and shall make reasonable efforts to allow COMPANY to review, comment,
and advise upon such information. COMPANY agrees to hold such information,
including such information received before the EFFECTIVE DATE, confidential and
to use the information provided by DUKE only for the purpose of advancing PATENT
RIGHTS and shall return all such information to DUKE if the parties do not enter
into the License Agreement hereunder. With written permission from DUKE (not to
be unreasonably withheld), COMPANY may share such information with third parties
who are obligated as to confidentiality and use to the same extent as COMPANY.

ARTICLE 4 - OPTION

DUKE grants COMPANY an exclusive option to obtain:

(a) an exclusive worldwide license under Patent Rights B to make, have made,
use, import, offer for sale, sell and otherwise commercially exploit LICENSED
PRODUCTS and to practice LICENSED PROCESSES, and the exclusive right to use
REGULATORY DATA and TECHNICAL INFORMATION in connection with such licensed
patent rights, in the FIELD OF USE and TERRITORY; and

(b) an exclusive license under Patent Rights A to make, have made, use, import,
offer for sale, sell and otherwise commercially exploit LICENSED PRODUCTS and to
practice LICENSED PROCESSES, and the exclusive right to use REGULATORY DATA and
TECHNICAL INFORMATION in connection with such licensed patent rights, in the
FIELD OF USE and TERRITORY except for the EXCLUDED FIELDS OF USE in the EXCLUDED
TERRITORY. For clarity, COMPANY shall have no LICENSED RIGHTS under Patent
Rights A for the EXCLUDED FIELDS OF USE in the EXCLUDED TERRITORY; and

(c) in each case above with the right to sublicense; and

(d) subject to DUKE’s reserved rights to practice the LICENSED RIGHTS for all
research, public service, internal (including clinical) and/or educational
purposes; provided that PRINCIPLE INVESTIGATOR shall keep COMPANY reasonably
informed with respect to any such practice and the results thereof and the
COMPANY agrees to such activities, not to be unreasonably withheld.

The following terms shall apply to the option:

4.1 OPTION FEE. As consideration for the option granted herein, COMPANY shall
pay DUKE a non-refundable, option fee of Three Hundred Fifty Thousand Dollars
($350,000) within three (3) days of execution of this Agreement. Such option fee
and the extension fee (described below), if paid, shall be fully credited
against the License Fee under the future

 

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License Agreement. Payments drawn directly on a U.S. bank may be made by either
check made payable to “Duke University” or wire transfer. Any payment drawn on a
foreign bank or foreign branch of a U.S. bank shall be made only by wire
transfer. Wire transfers shall be made in accordance with the following or any
other instructions as may be specified by DUKE. If payments are made by wire,
the wiring instructions below must be followed. The option granted herein shall
not be effective until such delivery.

 

Bank:    Wells Fargo Bank, N.A.    301 S. Tryon Street    Charlotte, NC 28282,
USA ABA #:    121000248 (Domestic wires only) Swift Code:    WFBIUS6S (Foreign
wires only) Beneficiary:    Duke University Concentration Account Account #:   
202374-0253053 Attention:    Office of Licensing & Ventures, 919-681-7583* FILE
NUMBER: 4719, 5000, 5191, 5204, 6381, 6382, 6478, 6479, 6480, 6622, 6623, 6624,
6625 and 7094

4.2 OPTION PERIOD. This exclusive option shall be for a period of six (6) months
from the EFFECTIVE DATE, subject to extension by COMPANY as provided below (the
“OPTION PERIOD”). Until expiration of the OPTION PERIOD, DUKE shall not enter
into any discussions with any third party for any arrangement that if
consummated would prevent from or interfere with DUKE negotiating or entering
into or carrying out the obligations contemplated in the terms and conditions
described in Attachment A.

4.3 LIMITED LICENSE. During the OPTION PERIOD, DUKE grants COMPANY the license
to make, have made, or use the LICENSED PRODUCTS, LICENSED PROCESSES, REGULATORY
DATA and TECHNICAL INFORMATION for the purposes described in Article 2 above.
This limited license does not include the right to grant any sublicenses, or to
sell or otherwise provide LICENSED PRODUCTS or LICENSED PROCESSES to any third
party.

4.4 LICENSE NEGOTIATION. For a reasonable period of up to six (6) months after
the EFFECTIVE DATE, (as may be extended by COMPANY for an additional six
(6) months by payment of a non-refundable $150,000 extension fee on or before
the expiration of such six (6) months) the parties agree to negotiate
exclusively in good faith to enter into the License Agreement granting COMPANY
exclusive rights to make, have made, import, use, market, offer for sale, and
sell LICENSED PRODUCTS, and practice LICENSED PROCESSES under terms customary in
the trade and including substantially the definitions and terms in Attachment A.

4.5 NOTIFICATION OF LACK OF COMMERCIAL INTEREST: COMPANY shall promptly notify
DUKE, during the OPTION PERIOD, in the event that it determines that it has no
commercial interest in the PATENT RIGHTS.

 

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ARTICLE 5 - TERMINATION

5.1 Except as otherwise provided herein, this Agreement shall terminate at the
end of the OPTION PERIOD or upon execution of the License Agreement, whichever
occurs first.

5.2 If COMPANY ceases to operate its business, this Agreement shall immediately
terminate upon DUKE’s delivery of a termination notice to the address for
notices provided herein.

5.3 Except as otherwise provided herein, if COMPANY fails to make any payment
due to DUKE within ten (10) days’ written notice by DUKE, this Agreement shall
automatically terminate unless DUKE specifically extends such date in writing.
Such termination shall not foreclose DUKE from collection of any amounts
remaining unpaid or seeking other legal relief.

5.4 Upon any material breach or default of this Agreement by COMPANY (other than
as specifically provided herein, including Section 5.3 above), the terms of
which shall take precedence over the handling of any other material breach or
default under this Section 5.4), DUKE has the right to terminate this Agreement
effective on thirty (30) days’ written notice to COMPANY, unless COMPANY cures
the material breach or default before the period expires.

5.5 If COMPANY asserts the invalidity or unenforceability of any claim included
in the PATENT RIGHTS, including by way of litigation or administrative
proceedings, either directly or through any other party, then DUKE shall have
the right to immediately terminate this Agreement upon written notice to
COMPANY.

ARTICLE 6 - NO WARRANTIES; LIMITATION ON DUKE’S LIABILITY

6.1 DUKE, including its trustees, fellows, officers, employees and agents, makes
no representations or warranties that PATENT RIGHTS are or will be held valid,
or that the manufacture, importation, use, offer for sale, sale or other
distribution of any LICENSED PRODUCTS or LICENSED PROCESSES will not infringe
upon any patent or other rights.

6.2 DUKE, INCLUDING ITS TRUSTEES, FELLOWS, OFFICERS, EMPLOYEES AND AGENTS, MAKES
NO REPRESENTATIONS, EXTENDS NO WARRANTIES OF ANY KIND, EITHER EXPRESS OR
IMPLIED, INCLUDING BUT NOT LIMITED TO THE IMPLIED WARRANTIES OF MERCHANTABILITY
OR FITNESS FOR A PARTICULAR PURPOSE, AND ASSUMES NO RESPONSIBILITIES WHATEVER
WITH RESPECT TO DESIGN, DEVELOPMENT, MANUFACTURE, USE, SALE OR OTHER DISPOSITION
BY COMPANY OF LICENSED PRODUCTS OR LICENSED PROCESSES. COMPANY ASSUMES THE
ENTIRE RISK AS TO PERFORMANCE OF LICENSED PRODUCTS AND LICENSED PROCESSES. It is
expected that DUKE will make standard and customary representations and
warranties with respect to the subject matter of the License Agreement.

6.3 DUKE including its respective trustees, fellows, officers, employees and
agents, shall not be responsible or liable for any indirect, special,
incidental, or consequential damages or lost profits or other economic loss or
damage with respect to LICENSED PRODUCTS, LICENSED PROCESSES, or the PATENT
RIGHTS licensed to COMPANY under this Agreement, or other subject matter
thereof, regardless of legal or equitable theory. The above limitations on
liability apply even though DUKE, its trustees, fellows, officers, employees or
agents may have been advised of the possibility of such damage or such damage
may have been foreseeable.

 

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ARTICLE 7 - INDEMNIFICATION

7.1 COMPANY shall defend, indemnify and hold harmless DUKE, including its
trustees, officers, fellows, employees, students, contractors, subcontractors,
and agents against any and all damages, losses, and expenses of any nature
(including attorney’s fees and other litigation expenses), resulting from
including, but not limited to as a result of, death, personal injury, illness,
property damage, economic loss or products liability, including errors and
omissions, arising from or in connection with any of the following: (1) any
manufacture, use, sale, or other disposition by COMPANY of LICENSED PRODUCTS or
LICENSED PROCESSES; (2) the use by any person of LICENSED PRODUCTS or LICENSED
PROCESSES made, used, sold, authorized, or otherwise distributed by COMPANY;
(3) the use or practice of any invention related to the PATENT RIGHTS; provided
that DUKE provides COMPANY with prompt written notice of any such Claim, and
cooperates with COMPANY as reasonably requested in any such defense or
settlement; except in each case, to the extent a court of competent jurisdiction
finds the sole cause of said Claim to have been DUKE’s breach of this Agreement
or the gross negligence or willful misconduct of DUKE, its employees or agents.
This section does not confer any license rights on COMPANY, and shall survive
termination or expiration of the Agreement.

ARTICLE 8 - NOTICES

8.1 Any notice, request, or report required or permitted to be given or made
under this Agreement by either party is effective when mailed if sent by
recognized overnight carrier, certified or registered mail, or electronic mail
followed by confirmation by U.S. mail, to the address set forth below or such
other address as such party specifies by written notice given in conformity
herewith. Any notice, request, or report not so given is not effective until
actually received by the other party.

 

To DUKE:    To COMPANY: For delivery via the U.S. Postal Service    Office of
Licensing & Ventures    Cryo-Cell International, Inc. Box 90083    700 Brooker
Creek Blvd Durham, NC 27708    Oldsmar, FL 34677 Attention: Agreement
Manager/File No.    Attn: CEO 4719, 5000, 5191, 5204, 6381, 6382, 6478, 6479,
6480, 6622, 6623, 6624, and 6625   

 

For delivery via nationally/internationally recognized courier

 

DUKE UNIVERSITY

Office of Licensing & Ventures

 

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2812 Erwin Road, Suite 406

Durham, NC 27705

Attn: Agreement Manager/File No. 4719, 5000, 5191, 5204, 6381, 6382, 6478,

6479, 6480, 6622, 6623, 6624, and 6625

For delivery via electronic mail

agreements-olv@duke.edu

ARTICLE 9 – MISCELLANEOUS PROVISIONS

9.1 Each party agrees to accept all information, samples, documents, and other
disclosures from the other party hereunder (hereinafter “Confidential
Information”) on a confidential basis only, and may not use Confidential
Information of the other party for such party’s commercial benefit (except for
technical and economic evaluation internal to COMPANY). Each party further
agrees that it will keep in confidence and not disclose Confidential Information
of the other party to a third party or parties for a period of five (5) years
from the end of the OPTION PERIOD. Any obligation set forth in this Section 9.1
does not apply to any information which: (a) are or hereafter become a part of
the public knowledge through no fault of the receiving party; (b) the receiving
party can demonstrate were in its possession prior to the time of disclosure by
the disclosing party; (c) the receiving party can demonstrate were received by
it from a third party who has a legal right to make such a disclosure; or
(d) the receiving party can demonstrate by written evidence were developed by it
independently of the disclosure of Confidential Information by the disclosing
party.

9.2 COMPANY shall not use, either directly or indirectly, the name of DUKE or
any of its trustees, officers, fellows or employees in any publicity or
advertising unless a copy of the same is submitted to and approved in writing by
DUKE prior to any such use.

9.2 This Agreement shall be governed by and construed under the laws of the
state of North Carolina without regard for principles of choice of law. Any
claims, demands, or actions asserted against DUKE, its trustees, fellows,
officers, employees or agents shall only be brought in the North Carolina Court
of Claims. COMPANY, its successors, and assigns consent to the jurisdiction of a
court with applicable subject matter jurisdiction sitting in the state of North
Carolina with respect to any claims arising under this Agreement or the
relationship between the parties.

9.3 COMPANY may not assign this Agreement without the prior written consent of
DUKE and shall not pledge any of the license rights granted in this Agreement as
security for any creditor; . Any attempted pledge of any of the rights under
this Agreement or assignment of this Agreement without the prior consent of DUKE
will be void from the beginning. No assignment by COMPANY will be effective
until the intended assignee agrees in writing to accept all of the terms and
conditions of this Agreement, and such writing is provided to DUKE.

 

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9.4 DUKE and COMPANY agree that this Agreement, together with Attachment A, sets
forth their entire understanding concerning the subject matter of this
Agreement, and no modification of the Agreement will be effective unless both
DUKE and COMPANY agree to it in writing.

9.5 If a court of competent jurisdiction finds any term of this Agreement
invalid, illegal or unenforceable, that term will be curtailed, limited or
deleted, but only to the extent necessary to remove the invalidity, illegality
or unenforceability, and without in any way affecting or impairing the remaining
terms.

The authorized signatures for DUKE and COMPANY below signify their acceptance of
the terms of this Agreement.

 

FOR COMPANY     FOR DUKE UNIVERSITY By:  

/s/ David Portnoy

    By:  

/s/ Robin L. Rasor

  (authorized representative)       Robin L. Rasor       Executive Director
Typed Name David Portnoy       Title   Chairman & Co-CEO       Date   June 9,
2020       Date June 9, 2020

 

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APPENDIX A. SUMMARY TERMSHEET

DUKE FILE #’s 4719, 5000, 5191, 5204, 6381, 6382, 6478,

6479, 6480, 6622, 6623, 6624, and 6625

General

 

Technology:    Kurtzberg Cord Blood and Tissue Cell Products    Patent Rights
Group (A)   

•  METHODS OF TREATING BRAIN INJURY USING CORD BLOOD OR A COMPONENT THEREOF, US
Application 16/477,110 (4719)

  

•  COMPOSITIONS AND METHODS OF THE TREATMENT OF DEMYLINATING CONDITIONS, US
Application 16/477,167, EP 18738872.3 (5000/5191)

  

•  METHODS FOR THE TREATMENT OF AUTISM SPECTRUM DISORDERS, PCT/US2018/022174, US
Application 16/493,754 (5204)

   Patent Rights Group (B)   

•  METHODS OF TREATING CEREBRAL PALSY USING HIGH DOSE ALLOGENEIC UMBILICAL CORD
BLOOD, US Application 16/510,387 (6479)

  

•  METHODS OF TREATING CEREBRAL PALSY AND HYPOXIC-ISCHEMIC ENCEPHALOPATHY USING
HUMAN UMBILICAL CORD TISSUE-DERIVED MESENCHYMAL STROMAL CELLS, PCT/US2019/025796
(6381)

  

•  METHODS FOR THE TREATMENT OF AUTISM SPECTRUM DISORDERS USING HUMAN UMBILICAL
CORD TISSUE-DERIVED MESENCHYMAL STROMAL CELLS, PCT/US2019/025716 (6382)

  

•  COMPOSITIONS AND METHODS FOR THE TREATMENT OF DEMYELINATING CONDITIONS US
Application 16/510,395

  

•  COMPOSITIONS COMPRISING MESESCHYMAL STROMAL CELLS FOR THE TREATMENT OF VIRAL
INFECTIONS US application 63/017,290

 

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DUKE will control the prosecution of any patent applications, provided DUKE will
consult LICENSEE on the prosecution of PATENT RIGHTS under this agreement and
keep LICENSEE fully informed with respect thereto. LICENSEE will reimburse DUKE
for its costs not yet reimbursed in seeking, prosecuting and maintaining PATENT
RIGHTS and for its costs incurred during the term of the license agreement.
“REGULATORY DATA”    includes copyrights and other intellectual property rights,
to the extent owned by and/or (if any) licensed to DUKE under United States and
international law, in any protocols, Standard Operating Procedures, case report
forms, and published data collected or created in connection with DUKE’s
pre-clinical studies, regulatory submissions, and clinical trials (specifically
IND numbers 14360, 16615, 15949, 17313, 17921, 16274, and 14753) and further
includes any additional relevant TECHNICAL INFORMATION related to studies with
Protocol Numbers 00017801, 00065043, 00052449, 00070514, 00079241, 00059284,
00077580, 00000412, and 00066647 including related reports, manuscripts and
correspondence and other records of regulatory interactions communicated by DUKE
to LICENSEE under this License Agreement and at DUKE’s sole discretion, with
initial reference in DUKE Office of Licensing and Ventures File Nos: 6480, 6622,
6623, 6624, and 6625. REGULATORY DATA and TECHNICAL INFORMATION shall not
include the private medical records of individuals, and shall not include any
data or information that allows such individuals to be directly identified.
Technical Information:    means any non-patented scientific, technical,
regulatory and other information to the extent owned by and/or (if any) licensed
to DUKE and disclosed by DUKE to LICENSEE under this License Agreement and at
DUKE’s sole discretion. TECHNICAL INFORMATION does not include information that
belongs in the public domain, as LICENSEE can show by documentary evidence.
Licensed Rights:       an exclusive worldwide license under Patent Rights B to
make, have made, use, import, offer for sale, sell and otherwise commercially
exploit LICENSED PRODUCTS and to practice LICENSED PROCESSES, and the exclusive
right to use REGULATORY DATA and TECHNICAL INFORMATION in connection with such
licensed patent rights, in the FIELD OF USE and TERRITORY; and    an exclusive
license under Patent Rights A to make, have made, use, import, offer for sale,
sell and otherwise commercially exploit LICENSED PRODUCTS and to practice
LICENSED PROCESSES, and the exclusive right to use REGULATORY DATA and TECHNICAL
INFORMATION in connection with such licensed patent rights, in the FIELD OF USE
and

 

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   TERRITORY except for the EXCLUDED FIELDS OF USE in the EXCLUDED TERRITORY.
For clarity, COMPANY shall have no LICENSED RIGHTS under Patent Rights A for the
EXCLUDED FIELDS OF USE in the EXCLUDED TERRITORY; and    in each case above with
the right to sublicense; and    subject to DUKE’s reserved rights to practice
the LICENSED RIGHTS for all research, public service, internal (including
clinical) and/or educational purposes; provided that DUKE shall keep COMPANY
reasonably informed with respect to any such practice and the results thereof
and the COMPANY agrees to such activities, not to be unreasonably withheld.   
License is subject to any rights required to be granted under prior research or
sponsorship agreements, or retained by the U.S. government, for example in
accordance with Chapter 18 or Title 35 of USC 200-212 and the regulations
thereunder (37 CFR Part 401), when applicable. Excluded Field of Use:   
Autologous specific therapeutics for autism, Cerebral Palsy and stroke. Excluded
Territory:    Japan, South Korea, and Taiwan Term of the License and Agreement:
   Unless earlier terminated, will continue through the expiration of the
royalty term upon which all licenses granted to COMPANY will become fully-paid
up and irrevocable. Field of Use:    Human Therapeutics Net Sales:    will be
defined in more detail in the License Agreement to include the amounts received,
on sales, however characterized, by LICENSEE and/or SUBLICENSEES of LICENSED
PRODUCTS and uses of LICENSED PROCESSES, less customary discounts including the
following deductions (but only to the extent such deductions are otherwise
included in NET SALES and are not obtained in view of other consideration
received by LICENSEE):   

(a)   cash discounts, rebates and chargebacks actually granted to customers in
such invoices for SALE of LICENSED PRODUCTS, but only in amounts customary in
the trade;

  

(b)   sales taxes, tariff duties and/or use taxes separately stated in such
bills or invoices with reference to particular SALES and actually paid by
LICENSEE to a governmental unit;

 

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   (c) actual freight expenses between LICENSEE and customers, to the extent
such expenses are not charged to or reimbursed by customers; or    (d) amounts
actually refunded or credited on returns. Licensed Products:    means any
product sold by LICENSEE or SUBLICENSEE that: (a) but for this Agreement
comprises an infringement of (including contributory or inducement), or is
covered by, a VALID CLAIM contained in the PATENT RIGHTS in the country in which
any such product or product part is made, used, imported, offered for SALE or
sold; or (b) is manufactured or is administered to a patients by using a
LICENSED PROCESS or is employed to practice a LICENSED PROCESS; or (c) uses any
of the REGULATORY DATA or TECHNICAL INFORMATION. Licensed Process:    means any
process or method or service employed by LICENSEE or SUBLICENSEE that: (a) but
for this Agreement, comprises an infringement of (including contributory or
inducement or is covered by a VALID CLAIM contained in the PATENT RIGHTS in the
country in which such process or method or service is performed; or (b) employs
a LICENSED PRODUCT; (c) uses any of the REGULATORY DATA or TECHNICAL
INFORMATION. Valid Claim    means (a) a claim in an issued patent which has not
(i) expired, (ii) been finally adjudicated or admitted by DUKE as invalid or
unenforceable, or (iii) been abandoned, or (b) a claim in a pending application
which is still under prosecution. It is understood and agreed that a claim in a
pending application that is subject to a restriction requirement during
prosecution and is not yet being prosecuted as part of a divisional patent
application will still be considered a Valid Claim until it is finally rejected
or abandoned. First Commercial Sale:    means the first SALE through a bona fide
arm’s length transaction of any LICENSED PRODUCT or first commercial use of any
LICENSED PROCESS by LICENSEE or a SUBLICENSEE, excluding the SALE of a LICENSED
PRODUCT or use of a LICENSED PROCESS for use in trials, as a sample, or that is
of temporary availability. Market Cap:    means, with respect to a particular
trading day, the closing price per share of common stock on such trading day
multiplied by the number of outstanding shares. Royalty Term    Means 15 years
post first commercial sale or expiration of the last VALID CLAIM, whichever
comes later.

 

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Consideration

License Fee: $12,000,000 (12 million dollars) of which $5 million will be due
upon signing, $5 million will be due on the first anniversary of the LICENSE
EFFECTIVE DATE and $2 million will be on the second anniversary date of the
License EFFECTIVE DATE. License Fee shall be non-refundable, non-creditable. If
LICENSEE terminates the License Agreement prior to three (3) years from the
EFFECTIVE DATE, LICENSEE will pay DUKE the balance of License Fee owed above
within thirty (30) days of said termination and receipt of invoice therefor.

 

Board Observation Rights.    DUKE shall have observation rights at any of
LICENSEE’s Board of Directors meetings. At such meetings, DUKE, at its option,
shall be permitted to have a non-voting designee (the “Observer”) attend
in-person or via telephone for sessions covering matters relating to LICENSEE’s
business, provided that: (i) the Observer will be excused from any Board
activities involving attorney-client privilege or otherwise determined by the
Board consistent with good corporate governance (including any executive or
closed sessions) and (ii) such rights shall terminate on the earliest of a
Change of Control of LICENSEE, or such time as DUKE’s equity interest in
LICENSEE is less than two percent (2%) (on a fully-diluted basis). Any such
Observer will enter into an agreement with LICENSEE on customary terms for
observers to protect confidential information of LICENSEE. Royalties:    For NET
SALES of LICENSED PROCESS:    7% of annual NET SALES up to $75M    10% on annual
NET SALES at or above $75M and up to $200M    12.5% on annual NET SALES at or
above $200M    *Royalties shall be reduced to 75% of the above rates after
expiration of all PATENT RIGHTS but prior to 15 years post FIRST COMMERCIAL
SALE.    For NET SALES of LICENSED PRODUCT:    7.5%    *Royalty reduced to 2.5%
after expiration of all PATENT RIGHTS but prior to 15 years post FIRST
COMMERCIAL SALE.

 

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If, in the performance of a LICENSED PROCESS, a LICENSED PRODUCT is
administered, the NET SALES of such LICENSED PROCESS shall be in addition to the
use or administration of such LICENSED PRODUCT. For purposes of calculating

royalties for the use or administration of a LICENSED PRODUCT by LICENSEE or its
Affiliates in the performance of said LICENSED PROCESS shall constitute a third
party sale of said LICENSED PRODUCT. NET SALES in such an instance shall be the
average selling price of like quantities of LICENSED PRODUCTS sold in the United
States during the reporting period in which such LICENSED PRODUCT was used or
administered in the performance of such LICENSED PROCESS. The License Agreement
will include customary combination sales terms for standard allocation of Net
Sales.

If LICENSEE is obligated or reasonably deems it necessary to pay consideration
to any Third Party that holds a patent(s) that would, in the reasonable judgment
of LICENSEE be infringed by the manufacture, importation, use, offer for sale or
sale of a LICENSED PRODUCT or LICENSED PROCESS, then LICENSEE shall be entitled
to deduct fifty percent (50%) of such consideration paid to such Third Party
from the royalties payable to DUKE. However, in no event shall the royalty
payable to DUKE for any ROYALTY PERIOD be reduced to less than fifty percent
(50%) of the agreed upon royalty rates of NET SALES. LICENSEE shall provide DUKE
with a copy of any agreement with a Third Party that triggers the royalty
reduction, provided that LICENSEE may redact from such copy any provisions
LICENSEE considers confidential or proprietary that are not necessary to verify
the accuracy of such deductions When LICENSEE finalizes the formulation of any
LICENSED PRODUCT during the product development cycle, LICENSEE shall promptly
inform DUKE of any Third Party patent rights required for the LICENSED PRODUCT
and the applicable royalty rates therefore. In addition, should LICENSEE
subsequently determine that any additional Third Party patent rights are
required, LICENSEE shall promptly inform DUKE.

 

Sublicensing Income    35% of any consideration not based on NET SALES (e.g.,
license issue fees, milestone payments, maintenance or annual minimum fees,
other royalties) received from Sublicensees in consideration for the LICENSED
RIGHTS, other than R&D funds and other customary carveouts to be specified in
the License Agreement. Minimum Annual Royalties:    Such minimum annual
royalties to be paid provided the FDA allows the IND transfer and does not
revoke the expanded access for reasons unrelated to LICENSEE

(1) In year 2: $500,000

(2) In Year 3: $1.0M

(3) In Year 4: $2.5 M

(4) In Year 5 and Beyond: $5.0 M

Minimum Annual Royalties shall be credited against Running Royalties due on NET
SALES made during the calendar year for which the Minimum Annual Royalties
apply. Minimum Annual Royalties paid in excess of running royalties shall be
creditable to amounts due for future years.

 

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Milestone Payments:    Cash   

•  $2.0M upon initiation of a Phase III clinical trial for an indication other
than Autism Spectrum Disorder for a Licensed Product comprising cord tissue
derived MSC

   CryoCell Stock   

•  5.0% of common stock upon execution of License Agreement

  

•  2.5% of common stock upon cumulative NET SALES of LICENSED PRODUCT and
LICENSED PROCESS of $10M

  

•  2.5% of common stock upon cumulative NET SALES LICENSED PRODUCT and LICENSED
PROCESS of $75M

  

•  2.5% of common stock at each of the following market cap of LICENSEE
triggers:

  

(1) at $300M as long as this milestone is reached within 18 months of the
execution of the agreement

  

(2) at 500M as long as this milestone is reached within 24 months of the
execution of the agreement

In the event a Sublicensee pays LICENSEE a fee for achieving one of the
milestone events listed above or under earned royalties, or a substantially
similar milestone, LICENSEE shall pay 35% of the higher of: (i) the milestone
payment or (ii) the Non-Sales Based Sublicense Income fee due on such Milestone
Payment.

Milestone payments are non-refundable and non-creditable.

Diligence

LICENSEE shall use commercially reasonable efforts to bring LICENSED PRODUCTS to
market or one or more LICENSED PROCESSES to commercial use through use of
commercially reasonable efforts to (i) implement a thorough, vigorous and
diligent program for exploiting the PATENT RIGHTS and (ii) to continue active,
diligent marketing efforts throughout the life of this Agreement.

 

Milestones:    Performance milestones are established to ensure that the
technology is assiduously developed and to ensure broad public utilization of
the technology.

 

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   In fulfillment of such milestones, LICENSEE agrees to reach the following
commercialization and research and development milestones by the following
dates:   

1) Auto- Milestones to be agreed upon between DUKE and LICENSEE
(development/sales/clinic driven)

  

2) Allo- Milestones to be agreed upon between DUKE and LICENSEE
(development/sales/clinic driven)

  

3) MSC- Milestones to be agreed upon between DUKE and LICENSEE
(development/manufacturing/sales driven)

Other Terms

 

Insurance:    Prior to any distribution or commercial use of LICENSED PRODUCTS
or LICENSED PROCESSES resulting from PATENT RIGHTS by LICENSEE, LICENSEE shall
purchase and maintain in effect policies of product liability, completed
operations, and errors and omissions insurance. Indemnification:    LICENSEE
shall defend, indemnify and hold harmless and shall require SUBLICENSEES to
defend, indemnify and hold harmless DUKE for and against any and all claims,
demands, damages, losses, and expenses of any nature (including attorneys’ fees
and other litigation expenses) (hereinafter “Claim”), resulting from, but not
limited to, death, personal injury, illness, property damage, economic loss or
products liability, including errors and omissions, arising from or in
connection with, any of the following: (1) Any manufacture, use, SALE or other
disposition by LICENSEE, SUBLICENSEES or transferees of LICENSED PRODUCTS or
LICENSED PROCESSES; (2) The use by any person of LICENSED PRODUCTS made, used,
sold or otherwise distributed by LICENSEE or SUBLICENSEES; (3) The use or
practice by LICENSEE or SUBLICENSEES of any invention or computer software
related to the PATENT RIGHTS; and (4) any Claim of infringement and/or
invalidity of any claim(s) of the PATENT RIGHTS. The process for such
indemnification to be set forth in the License Agreement. Assignment    LICENSEE
agrees that these license rights are not assignable without written consent from
DUKE except in connection with a change of control (to be defined in the License
Agreement). Spin-out    If LICENSEE takes part in the formation of a Spinout for
purposes of exploiting the license granted to LICENSEE, LICENSEE shall cause the
Spinout to transfer to DUKE by the later of (a) sixty (60) days after a
sublicense to the PATENT RIGHTS or assignment of this LICENSE AGREEMENT becomes
effective between LICENSEE and the Spinout,

 

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   or (b) the Spinout is first capitalized with at least $X million by a Third
Party investor(s), a total of X percent (%) share of the equity interest in the
Spinout. The equity received by DUKE in the Spinout shall be of the same type
(e.g., class of stock) received by LICENSEE under the relevant sublicense
transaction. If the Spinout is a corporation, then the parties agree that
LICENSEE, or the Spinout, shall make such transfer of equity pursuant to, and
subject to the terms of, an agreement substantially in the form of a Stock
Transfer Agreement as attached in Appendix X. If the Spinout is of another legal
form, then the parties shall negotiate in good faith as to the terms of the
transfer of equity. Warranty:    EXCEPT FOR THOSE REPRESENTATIONS AND WARRANTIES
THAT ARE CUSTOMARY FOR SIMILAR TRANSACTIONS, DUKE, INCLUDING ITS TRUSTEES,
OFFICERS, EMPLOYEES STUDENTS AND AGENTS, MAKES NO REPRESENTATIONS, EXTENDS NO
WARRANTIES OF ANY KIND, EITHER EXPRESS OR IMPLIED, INCLUDING BUT NOT LIMITED TO
THE IMPLIED WARRANTIES OF MERCHANTABILITY OR FITNESS FOR A PARTICULAR PURPOSE,
AND ASSUMES NO RESPONSIBILITIES WHATEVER WITH RESPECT TO DESIGN, DEVELOPMENT,
MANUFACTURE, USE, SALE OR OTHER DISPOSITION BY LICENSEE OR SUBLICENSEES OF
LICENSED PRODUCTS OR LICENSED PROCESSES.    LICENSEE, AND SUBLICENSEES ASSUME
THE ENTIRE RISK AS TO PERFORMANCE OF LICENSED PRODUCTS AND LICENSED PROCESSES.
In no event shall DUKE, including its trustees, fellows, officers, employees and
agents, be responsible or liable for any indirect, special, incidental, or
consequential damages or lost profits or other economic loss or damage with
respect to LICENSED PRODUCTS or LICENSED PROCESSES, to LICENSEE, Sublicensees or
any other individual or entity regardless of legal or equitable theory. Other
Terms:    Other typical terms to be negotiated.

 

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