EXECUTION VERSION

 

TRANSITION SERVICES AGREEMENT

 

This Transition Services Agreement (this “Agreement”) is made as of the 15th day
of July, 2019 (the “Effective Date”), by and between Cancer Genetics, Inc., a
Delaware corporation (“CGI”) and Interpace BioPharma, Inc., a Delaware
corporation (“Buyer”). Buyer and CGI are sometimes referred to herein
collectively, as the “Parties” and individually, each a “Party”.

 

Recitals

 

Whereas, CGI and Buyer are parties to that certain Secured Creditor Asset
Purchase Agreement, dated as of July 15, 2019 (as may be amended from time to
time, the “Asset Purchase Agreement”), pursuant to which, among other things,
PFG is selling CGI’s right, title and interest in the Purchased Assets (as such
terms are defined in the Asset Purchase Agreement) to Buyer on the terms and
conditions set forth therein;

 

Whereas, in connection with the Asset Purchase Agreement and following the
Closing, Buyer shall provide CGI, or an Affiliate of CGI, certain services
described in Exhibit A attached hereto, for a limited period, subject to the
terms and conditions set forth herein;

 

Whereas, in connection with the Asset Purchase Agreement and following the
Closing, CGI shall provide Buyer, or an Affiliate of Buyer, certain services
described in Exhibit B attached hereto, for a limited period, subject to the
terms and conditions set forth herein;

 

Whereas, in connection with the Asset Purchase Agreement and following the
Closing, CGI shall provide Buyer, or an Affiliate of Buyer, certain payroll and
benefit services described in Exhibit C attached hereto, for a limited period,
subject to the terms and conditions set forth herein; and

 

Whereas, CGI has executed an agreement for the sale of certain assets related to
the Clinical Business to a third party, which are not included in the Purchased
Assets and which the foreclosing lender has not foreclosed on (the “Clinical
Business Transaction”, and the third party buyer, the “Clinical Business
Buyer”), which sale was consummated on July 8, 2019, and in connection with the
Clinical Business Transaction, following the Closing, Buyer shall provide CGI,
or an Affiliate of CGI, certain services described in Exhibit D attached hereto,
as a subcontractor for a limited period, subject to the terms and conditions set
forth herein.

 

Now Therefore, in consideration of the foregoing and the representations,
warranties and mutual covenants contained herein, and for other good and
valuable consideration, the receipt and sufficiency of which are hereby
acknowledged, the Parties intending to be legally bound, agree as follows:

 

1. Definitions. Capitalized terms used and not defined herein shall have the
meanings ascribed to them in the Asset Purchase Agreement.

 

 -1- 

 

 

2. Transition Services; Payment.

 

(a) As of the Effective Date, Buyer shall provide and CGI shall accept those
transition services that are set forth on Exhibit A attached hereto and made a
part hereof (each, a “Buyer Service” and collectively, the “Buyer Services”).

 

(b) As of the Effective Date, CGI shall provide, and Buyer shall accept those
transition services that are set forth on Exhibit B attached hereto and made a
part hereof (each, a “CGI Service”, collectively, the “CGI Services”).

 

(c) As of the Effective Date, CGI shall provide and Buyer shall accept those
payroll and benefit transition services that are set forth on Exhibit C attached
hereto and made a part hereof (each, a “CGI Payroll and Benefit Service” and
collectively, the “CGI Payroll and Benefit Services”).

 

(d) As of the Effective Date, each Party shall provide, and the other Party
shall accept, those transition services that are set forth on Exhibit D attached
hereto and made a part hereof (each, a “Clinical Business Service” and
collectively, the “Clinical Business Services”; the Buyer Services, the CGI
Services, the CGI Payroll and Benefit Services and the Clinical Business
Services are collectively referred to herein as the “Services”). Notwithstanding
the foregoing, the Services shall include all activities, tasks and
responsibilities that are inherent and reasonably necessary as part of, or
necessary for the proper performance of, the Services.

 

(e) For avoidance of doubt:

 

(i) CGI Services shall include (and the Services included on Exhibit B shall in
all events include) the specific activities, tasks, and responsibilities (i) as
are reasonably necessary for assistance with the transition of the operation of
the BioPharma Business after the Closing Date and (ii) that have been provided,
or reasonably should have been provided, by CGI or any of its Affiliates to the
BioPharma Business on a customary and regular basis during the twelve (12)
months preceding the Closing Date. If, after the Closing Date, the Parties
reasonably determine that a service that was reasonably necessary for the
operation of the BioPharma Business after the Closing Date was omitted from
Exhibit B, the Parties shall negotiate in good faith to reach a mutually
acceptable agreement with respect to the provision of such service. If the
Parties reach a mutual agreement regarding the provision of such service, then
the Parties shall amend Exhibit B to reflect the terms of such mutual agreement,
and the applicable Party shall provide such services to the other Party and such
services shall be deemed to be “CGI Services”;

 

(ii) the CGI Payroll and Benefit Services means the Services set forth on
Exhibit C;

 

(iii) the Buyer Services shall mean the Services set forth on Exhibit A; and

 

(iv) the Clinical Business Services shall mean the Services set forth on Exhibit
D.

 

(f) The Parties agree to be bound by any additional conditions, covenants and
obligations for a specific Service as set forth in Exhibit A, Exhibit B, Exhibit
C or Exhibit D (such exhibits, collectively, the “Exhibits”) describing such
Service. For the purposes of this Agreement, with respect to any Service,
“Receiving Party” shall mean the Party that is receiving such Service and
“Providing Party” shall mean the Party that is providing such Service.

 

 -2- 

 

 

(g) Each category of Service shall be provided for the period specified in the
applicable Exhibit with respect to such category. There shall be no fees for the
Services other than fees for Services, if any, provided by third parties that a
Providing Party arranges or incurs on behalf of a Receiving Party (“Third Party
Services”), which shall be charged at the direct third-party cost (“Pass Through
Costs”); provided, however, the use of any third party for the provision of any
Service hereunder shall be only for Services not provided by the Providing Party
itself in the preceding twelve (12) months and subject to the approval of the
Receiving Party, in its reasonable discretion. The Providing Party will submit
monthly invoices to the Receiving Party which shall set forth the amounts due
under this Agreement. Each invoice will specify Pass Through Costs, if any, for
each of the Services (by category) provided during the relevant time period. The
Providing Party agrees to afford the Receiving Party, upon reasonable notice,
access to such information, records and documentation of Providing Party as the
Receiving Party may reasonably request in order to verify the invoiced amount.
The Receiving Party shall bear its own costs incurred in connection with the
verification of the invoiced amounts.

 

(h) If the Receiving Party in good faith disputes any charges contained in an
invoice, the Receiving Party shall promptly submit to the Providing Party
written notice of such dispute and may withhold from the Receiving Party’s
payment of the relevant invoice any such disputed amounts (and only such
disputed amounts and excluding any applicable Taxes), up to a maximum of the
amount for the Service(s) to which such dispute relates. The Receiving Party
shall remit to the Providing Party the invoiced amount, minus the amount
withheld pursuant to the first sentence of this Section 2(h).

 

(i) From time to time after the Effective Date, the Parties may mutually agree
in writing upon the provision of additional Services in accordance with the
terms of this Agreement (in either case, the “Additional Services”), and shall
negotiate in good faith to reach a mutually acceptable agreement with respect to
the provision of such Additional Services. In the event the Parties agree on
such Additional Services, the Exhibits, as applicable, shall be appropriately
modified and the applicable “Services” stated thereon shall be deemed to include
such Additional Services.

 

(j) Notwithstanding anything contained herein to the contrary, any and all
Services may be earlier terminated by the Receiving Party upon fifteen (15)
days’ prior written notice to the Providing Party unless terminated earlier with
respect to a Third Party Service upon the termination of the agreements with the
third party provider. With respect to a termination of any Service that occurs
other than at an applicable billing cut-off date, the Receiving Party shall pay
the prorated fees of certain third parties as set forth in Section 2(g) above
through the date such Services were ceased. The Providing Party agrees and
acknowledges that after a termination of a particular Service (or category of
Service) under this Agreement by the Receiving Party (subject to the payment of
the applicable prorated fees by the Receiving Party), the Receiving Party shall
no longer have any payment obligations with respect to such Service (or category
of Service, as applicable) unless the Providing Party continues to have an
obligation to pay such fees as approved by the Receiving Party in Section 2(g)
above. For the avoidance of doubt, a termination of a particular Service (or
category of Service, as applicable) under this Agreement by a Receiving Party
will have no effect on the Providing Party’s obligation to perform any other
Services hereunder.

 

 -3- 

 

 

(k) Upon the last day on which any services will be provided by CGI under this
Agreement, including with respect to the NJ Office Space Transition Period and
the NC Office Space Transition Period, including in the event that the Providing
Party becomes insolvent, files bankruptcy or otherwise becomes unable to perform
the Services under this Agreement (the “Transition Services Expiration Date”),
the Providing Party shall deliver to the Receiving Party all records and other
information pertaining to any matters for which the Providing Party was
providing Services hereunder; provided, however, that the Providing Party may
retain copies of such records and information to the extent necessary for
accounting, tax reporting, compliance with the Providing Party’s document
retention policies or other legitimate business purposes, subject to the
requirements of Section 14 and Section 15. The Providing Party acknowledges and
agrees that after termination of a particular Service (or category of Service)
under this Agreement by the Receiving Party, the Receiving Party shall not have
any payment obligations with respect to such Service (or category of Service, as
applicable) performed after the effective date of such termination and that such
termination by the Receiving Party with respect to any particular Service (or
category of Service, as applicable) will not affect the Providing Party’s
obligation to perform any other Service (or category of Service, as applicable)
hereunder.

 

(l) Nothing in this Agreement shall preclude Buyer from obtaining services
comparable to the CGI Services or the CGI Payroll and Benefit Services from its
own employees or from providers other than CGI, in whole or in part. Similarly,
nothing in this Agreement shall preclude CGI from obtaining services comparable
to the Buyer Services or the Clinical Business Services from its own employees
or from providers other than Buyer, in whole or in part.

 

3. Term. The term of this Agreement shall commence on the Effective Date and
shall continue with respect to each Service for the longest time period provided
in the applicable Exhibit, or such later date as mutually agreed upon by Buyer
and CGI (the “Transition Period”), unless earlier terminated in accordance with
this Agreement.

 

4. Service Availability; Office Space.

 

(a) The Parties shall cooperate and use commercially reasonable efforts to
obtain the consent of any licensors of software, landlords, equipment lessors or
any other third party that may be required in connection with the provision of
any of the Services hereunder (each, a “Required Consent”). If any such third
party requires a payment in order to make any service available to a Receiving
Party, the Providing Party shall notify the Receiving Party of this additional
cost and the Parties shall negotiate in good faith to develop an alternative
service that does not require such third party consent. In any such case,
subject to Section 6.18 of the Asset Purchase Agreement, the Receiving Party
shall have the option to elect: (i) to pay any amounts that are required to be
paid to any third party to obtain the Required Consent or (ii) to terminate any
of the Services associated with the Required Consent.

 

 -4- 

 

 

(b) If a Providing Party is or becomes aware that it will be unable to deliver
any of the Services, in whole or in part, (whether or not such inability was
foreseeable or within the contemplation of any Party to this Agreement) by
reason of fire, flood, storm, riot, civil commotion, war, act of terrorism or
other causes beyond the reasonable control of the Providing Party (each, a
“Force Majeure Event”), the Providing Party shall notify the Receiving Party in
writing as soon as practicable of such inability and cooperate with the
Receiving Party to arrange for replacement services reasonably acceptable to the
Receiving Party during the period in which the Force Majeure Event is ongoing.
The party suffering a Force Majeure Event shall resume the performance of its
obligations under this Agreement as soon as reasonably practicable after the
removal of the cause of the Force Majeure Event.

 

(c) During the NJ Office Space Transition Period (as defined below), CGI shall
provide the office space, including all existing telecom and other office
equipment, for the reasonable use of Buyer employees and its Affiliates and
Representatives on the premises leased under the NJ Lease. The “NJ Office Space
Transition Period” shall mean the period beginning on the Closing Date and
continuing until the date on which the NJ Lease has been validly assigned (with
the landlord’s consent) to, and assumed by Buyer. Buyer shall bear all costs and
expenses associated with and under the NJ Lease, including, but not limited to,
rent, during the NJ Office Space Transition Period.

 

(d) During the NC Office Space Transition Period (as defined below), CGI shall
provide the office space, including all existing telecom and other office
equipment, for the reasonable use of Buyer employees and its Affiliates and
Representatives on the premises leased under the NC Lease. The “NC Office Space
Transition Period” shall mean the period beginning on the Closing Date and
continuing until the date on which the NC Lease has been validly assigned (with
the landlord’s consent) to, and assumed by Buyer. Buyer shall bear all costs and
expenses associated with and under the NC Lease, including, but not limited to,
rent, during the NC Office Space Transition Period.

 

(e) During the Office Space Transition Period (as defined below), Buyer shall
provide office space, including existing telecom and other office equipment, for
the reasonable use of CGI employees, Affiliates and Representatives on the
premises leased under the NC Lease and the NJ Lease, as applicable, as
reasonably required for the performance of the applicable Services and the
Ongoing CGI Tasks. The “Office Space Transition Period” shall mean the period
beginning on the Closing Date and continuing until the later of (a) December 31,
2019 and (b) Transition Services Expiration Date. There shall be no cost to or
expense borne by CGI, or any of its Affiliates or Representatives, for the use
and occupancy of and access to such office space during the Office Space
Transition Period. CGI’s employees and its Affiliates and Representatives shall
not interfere with Buyer’s use of the NJ Lease and NC Lease premises and shall
abide by all terms of the NJ Lease and the NC Lease in connection with its use
of office space during the Office Space Transition Period.

 

(f) It is acknowledged by Buyer that, subject to the terms and provisions of
this Agreement and the Asset Purchase Agreement, during the Services Period, CGI
employees, including the BP Employees, may continue to perform for CGI, from
time to time, tasks (the “Ongoing CGI Tasks”) previously performed in the
ordinary course of business in the last twelve (12) months for CGI related to
(i) legal, accounting, accounts receivable and accounts payable matters and (ii)
the FHACT and TOO tests (“Retained Clinical Tests”); provided, however, that the
performance of such tasks shall not unreasonably interfere with Buyer’s
operations and the provision of services to Buyer under this Agreement, and CGI
shall reimburse and indemnify Buyer for all costs and expenses associated with
the Ongoing CGI Tasks.

 

 -5- 

 

 

5. Representations and Warranties regarding Services.

 

(a) Each of Buyer and CGI represents, warrants and agrees that the Services to
be provided by each such Party shall be provided in compliance with CLIA, CAP,
applicable state clinical laboratory and cGMP regulations in a professional and
workmanlike manner, in accordance with applicable Law and in the same manner in
all material respects that such services were provided with regard to the
BioPharma Business, the Clinical Business, the Discovery Business and general
corporate matters, as applicable, in the twelve (12) months prior to the Closing
Date, including with respect to the dedication of resources and the quality and
timeliness of such services, but in no event with less than reasonable skill and
care.

 

(b) EXCEPT AS EXPRESSLY PROVIDED IN SECTION 5(a) AND SECTION 6, THE SERVICES TO
BE PROVIDED UNDER THIS AGREEMENT ARE FURNISHED WITHOUT ANY REPRESENTATIONS AND
WARRANTIES OF ANY KIND, EXPRESS OR IMPLIED, WITH RESPECT TO THE SERVICES,
INCLUDING, WITHOUT LIMITATION, ANY WARRANTY OF MERCHANTABILITY OR FITNESS FOR A
PARTICULAR PURPOSE, WHICH ARE SPECIFICALLY DISCLAIMED. EXCEPT AS EXPRESSLY
PROVIDED IN SECTION 5(a) AND SECTION 6, THE PARTIES MAKE NO REPRESENTATIONS OR
WARRANTIES AS TO THE QUALITY, SUITABILITY OR ADEQUACY OF THE SERVICES FOR ANY
PURPOSE OR USE.

 

6. Representations, Warranties and Covenants of CGI

 

(a) Representations and Warranties. CGI hereby represents and warrants to Buyer
that (i) the execution and delivery by CGI of, and the consummation by CGI of
the transactions contemplated by, this Agreement, and compliance with the terms
hereof by CGI, do not and shall not: (A) (w) conflict with or result in a breach
of the terms, conditions or provisions of, (x) constitute a default under, (y)
give any third party the right to modify, terminate or accelerate any obligation
under or (z) result in a violation of the charter or organizational documents of
CGI, any Law or order to which CGI is subject or any contract (whether written
or oral) to which CGI is party or subject; or (B) require any authorization,
consent, approval, license, permit, exemption or other action by or notice or
declaration to, or filing with, any Governmental Authority pursuant to the
charter or organizational documents of CGI, any Law or order to which CGI is
subject or any contract (whether written or oral) to which CGI is subject, (ii)
it has all requisite corporate power and authority, and has taken all corporate
action necessary, to execute and deliver this Agreement, to consummate the
transactions contemplated hereby and to perform its obligations hereunder, (iii)
this Agreement has been duly executed and delivered by CGI and, assuming that
this Agreement is valid and binding on Buyer, constitutes a legal, valid and
binding obligation of CGI, enforceable against CGI in accordance with its terms
and (iv) it has provided to Buyer a true and complete copy of the sale agreement
(including schedules and exhibits thereto) relating to the Clinical Business
Transaction, which is in full force and effect.

 

 -6- 

 

 

(b) Compliance with Laws. CGI shall perform the CGI Services and the CGI Payroll
and Benefit Services pursuant to this Agreement in a manner that complies with
all applicable Laws and orders or other actions or requirements of any
Governmental Authority that are applicable to CGI’s performance pursuant to this
Agreement or to the CGI Services or the CGI Payroll and Benefit Services.

 

(c) Resources and Ability. CGI is and shall remain able to provide the CGI
Services and the CGI Payroll and Benefit Services during the Transition Period
for such Service. CGI has and shall have and maintain for the duration of the
Transition Period for such Service sufficient resources and personnel to perform
its obligations pursuant to this Agreement.

 

(d) Additional Representation and Covenant of CGI Related to the Clinical
Business Services. CGI hereby represents and warrants that it has transferred to
Buyer pursuant to the Asset Purchase Agreement all of the Intellectual Property
and/or related rights that are necessary or useful for Buyer to perform the
Clinical Business Services for and during the applicable periods set forth in
Exhibit D. If, following the Closing, Buyer reasonably determines that any
Intellectual Property and/or related rights that are necessary or useful for
Buyer to perform the Clinical Business Services for and during the applicable
periods set forth in Exhibit D have not been so transferred to Buyer pursuant to
the Asset Purchase Agreement, then CGI shall immediately transfer or license (on
a non-exclusive, royalty-free basis) to Buyer such Intellectual Property and/or
related rights solely so that Buyer may perform the Clinical Business Services
for and during the applicable periods set forth in Exhibit D.

 

7. Representations and Warranties of Buyer.

 

(a) Representations and Warranties. Buyer hereby represents and warrants to CGI
that (i) the execution and delivery by Buyer of, and the consummation by Buyer
of the transactions contemplated by, this Agreement, and compliance with the
terms hereof by Buyer, do not and shall not: (A) (w) conflict with or result in
a breach of the terms, conditions or provisions of, (x) constitute a default
under, (y) give any third party the right to modify, terminate or accelerate any
obligation under or (z) result in a violation of the charter or organizational
documents of Buyer, any Law or order to which Buyer is subject or any contract
(whether written or oral) to which Buyer is party or subject; or (B) require any
authorization, consent, approval, exemption or other action by or notice or
declaration to, or filing with, any Governmental Authority pursuant to the
charter or organizational documents of Buyer, any Law or order to which Buyer is
subject or any contract (whether written or oral) to which Buyer is subject,
(ii) it has all requisite corporate power and authority, and has taken all
corporate action necessary, to execute and deliver this Agreement, to consummate
the transactions contemplated hereby and to perform its obligations hereunder,
and (iii) this Agreement has been duly executed and delivered by Buyer and,
assuming that this Agreement is valid and binding on CGI, constitutes a legal,
valid and binding obligation of Buyer, enforceable against Buyer in accordance
with its terms.

 

(b) Compliance with Laws. Buyer shall perform the Buyer Services and the
Clinical Business Services pursuant to this Agreement in a manner that complies
with all applicable Laws and orders or other actions or requirements of any
Governmental Authority that are applicable to Buyer’s performance pursuant to
this Agreement or to the Buyer Services or the Clinical Business Services.

 

 -7- 

 

 

(c) Resources and Ability. Assuming CGI’s continued compliance with Section 6(c)
and the other post-closing covenants under the Asset Purchase Agreement, Buyer
is and shall remain able to provide the Buyer Services during the Transition
Period for such Service. Assuming CGI’s continued compliance with Section 6(c)
and the other post-closing covenants under the Asset Purchase Agreement, Buyer
has and shall have and maintain for the duration of the Transition Period for
such Service sufficient resources and personnel to perform its obligations with
respect to such Service pursuant to this Agreement.

 

8. Representatives. CGI and Buyer shall each designate, from time to time, a
representative to act as CGI’s and Buyer’s respective primary contact persons to
coordinate the provision of all of the Services (collectively, the “Primary
Coordinators”). Each Primary Coordinator may designate one or more service
coordinators for each specific Service (collectively, the “Service
Coordinators”). The names and contact information of the Primary Coordinators
and Services Coordinators shall be listed on Exhibit E hereto. Each Party may
treat an act of a Primary Coordinator of another Party as being authorized by
such other Party without inquiring behind such act or ascertaining whether such
Primary Coordinator had authority to so act, and each Party may treat an act of
a Service Coordinator as being authorized by such other Party only to the extent
such act is directly related to the Service for which such Service Coordinator
has been designated; provided, however, that no such Primary Coordinator or
Service Coordinator has authority to amend this Agreement, except as set forth
in a duly authorized written amendment in accordance with Section 18. CGI and
Buyer shall advise each other promptly (and in any event within seven days) in
writing of any change in the Primary Coordinators and any Service Coordinator
for a particular Service. CGI and Buyer agree that all communications relating
to the provision of the Services shall be directed to the Service Coordinators
for such Service, with concurrently sent copies to the Primary Coordinators.

 

9. Cooperation. During the term of the longest Transition Period, the Parties
shall use commercially reasonable efforts to cooperate with each other in all
matters relating to the provision and receipt of the Services. Such reasonable
cooperation shall include exchanging information, providing electronic access to
systems used in connection with the Services, performing true-ups and
adjustments and using commercially reasonable efforts (including payment of any
commercially reasonable fees or expenses) to obtain all consents, licenses,
sublicenses or approvals necessary to permit each Party to perform its
obligations hereunder, in each case subject to the restrictions of Section 14.
The Parties shall use commercially reasonable efforts to cooperate with each
other in determining the extent to which any Tax is due and owing with respect
to the Services and in providing and making available any resale certificate,
information regarding out-of-state use of materials, services or sale and other
exemption certificates or information reasonably requested by either Party. In
addition, during such Transition Period, each Providing Party shall offer such
reasonable assistance to the Receiving Party to transfer responsibility for the
provision of each applicable Services to the Receiving Party or a new provider.

 

 -8- 

 

 

10. Audit Rights. During the term of the longest Transition Period and for a
one-year period thereafter, the Receiving Party shall have the right, on
reasonable notice and during business hours, to inspect and audit the books,
accounts and records of the Providing Party pertaining to the applicable Service
for the purpose of verifying the amounts invoiced to the Receiving Party
hereunder. If the Receiving Party wishes to perform an audit with respect to any
fees or Service, then the Receiving Party will cooperate in such audit,
including by making available documents, information and personnel to the
employees and/or accounting firm appointed by the Receiving Party for the
purposes of such audit. The Receiving Party shall bear the costs and expenses of
any inspection and audit unless the inspection reveals that the Providing Party
overbilled Buyer by 5% or more with respect to any period being audited, in
which case the Providing Party shall bear 100% of the costs and expenses of such
inspection and audit.

 

11. Indemnification.

 

(a) Indemnification by CGI.

 

(i) CGI shall indemnify and hold Buyer and its Affiliates harmless against any
damages, costs and expenses (including reasonable attorneys’ fees and expenses)
arising from (A) any gross negligence, fraud or intentional misconduct by or on
behalf of CGI or its Affiliates in connection with the provision of any CGI
Service or CGI Payroll and Benefit Service or the receipt or use of any Buyer
Service or Clinical Business Service or any other actions or inactions by or on
behalf of CGI or its Affiliates in connection therewith, (B) any alleged joint
employer status with respect to Buyer and its Affiliates, on the one hand, and
CGI and its Affiliates, on the other hand, or (C) any breach by or on behalf of
CGI or its Affiliates of any of its obligations hereunder.

 

(ii) If notified promptly in writing of any action brought against Buyer or its
Affiliates based on a claim described in Section 11(a)(i) above, CGI and its
Affiliates shall defend such action at their expense and pay all costs, damages
and settlements finally awarded in such action or settlement which are
attributable to such claim. CGI shall have sole control of the defense of any
such action and all negotiations for its settlement or compromise, provided,
that, such settlement or compromise (A) includes an unconditional release of
Buyer and its Affiliates from all liability with respect to such claim, (B) does
not include any award for specific performance, injunctive relief or other
equitable remedy and (C) is in form and substance reasonably satisfactory to
Buyer. Buyer shall reasonably cooperate with CGI, at CGI’s expense, in the
defense of such claim, and may be represented, at Buyer’s expense, by counsel of
Buyer’s selection.

 

(iii) Subject to the other provisions of this Agreement, indemnification claims
arising under this Agreement, including control of proceedings and limitations,
shall be governed by the applicable provisions of Article 7 of the Asset
Purchase Agreement; it being acknowledged and agreed by the Parties that any
indemnification of the Buyer Indemnified Parties under this Agreement shall be
effected as set forth in Section 7.5(d) of the Asset Purchase Agreement.

 

(iv) Notwithstanding anything to the contrary in this Agreement, if CGI is in
breach of this Agreement, Buyer may continue to enjoy the benefits of this
Agreement, including remaining in possession of the premises under the NJ Lease,
without prejudice to any rights, remedies and claims of Buyer arising from CGI’s
breach.

 

 -9- 

 

 

(b) Indemnification by Buyer.

 

(i) Buyer shall indemnify and hold CGI and its Affiliates harmless against any
damages, costs and expenses (including reasonable attorneys’ fees and expenses)
arising from (A) any gross negligence, fraud or intentional misconduct by or on
behalf of Buyer or its Affiliates in connection with the provision of any Buyer
Service or Clinical Business Service or the receipt or use of any CGI Service or
CGI Payroll and Benefit Service or any other actions or inactions by or on
behalf of Buyer in connection therewith or (B) any breach by or on behalf of
Buyer or its Affiliates of any of its obligations hereunder.

 

(ii) If notified promptly in writing of any action brought against CGI or its
Affiliates based on a claim described in Section 11(b)(i) above, Buyer shall
defend such action at its expense and pay all costs, damages and settlements
finally awarded in such action or settlement which are attributable to such
claim. Buyer shall have sole control of the defense of any such action and all
negotiations for its settlement or compromise, provided, that, such settlement
or compromise (A) includes an unconditional release of CGI and its Affiliates
from all liability with respect to such claim, (B) does not include any award
for specific performance, injunctive relief or other equitable remedy and (C) is
in form and substance reasonably satisfactory to CGI. CGI shall reasonably
cooperate with Buyer, at Buyer’s expense, in the defense of such claim, and may
be represented, at CGI’s expense, by counsel of CGI’s selection.

 

12. Remedies. Because of the special nature of the Services and the disruption
to the Receiving Party that could ensue from the Providing Party’s failure in
breach of this Agreement to provide any of the Services, the Parties agree that
the Receiving Party would be irreparably harmed by any such failure. For these
reasons, the Providing Party agrees that the Receiving Party shall be entitled
to injunctive relief, including the Providing Party’s specific performance of
its obligations under this Agreement without requirement of posting a bond, in
addition to all other remedies available to the Receiving Party in law or at
equity or otherwise for any such breach. Except as set forth herein, all rights,
powers and remedies herein given to each Party are cumulative and not
alternative and are in addition to all statutes or rules of Law. Any forbearance
or delay by such Party in exercising the same shall not be deemed to be a waiver
thereof, the exercise of any right or partial exercise thereof shall not
preclude the further exercise thereof and the same shall continue in full force
and effect until specifically waived by an instrument in writing executed by
such Party.

 

13. Limitation of Liability. EXCEPT IN THE CASE OF FRAUD, IN NO EVENT SHALL
EITHER PARTY BE LIABLE FOR ANY EXEMPLARY OR PUNITIVE DAMAGES RELATING TO THE
SALE, DELIVERY, PROVISION OR USE OF THE SERVICES OR ANY BREACH OF THIS
AGREEMENT.

 

 -10- 

 

 

14. Confidentiality.

 

(a) In the process of providing and receiving the Services or otherwise in
connection with this Agreement, a Party may have access to Confidential
Information (as hereinafter defined) of another Party. Without limiting the
applicability of any other obligation of confidentiality to which the Parties or
their Affiliates may be bound, each Party agrees to keep (and to cause its
Affiliates and its and their respective employees, agents and independent
contractors to keep) any Confidential Information of the other Party strictly in
confidence, not to disclose it to any third party without prior written approval
of the other Party and to use it only for the purposes set forth in this
Agreement, except (i) as required by applicable Law, in which case the relevant
Party shall notify the other Party prior to disclosing such Confidential
Information and shall use its commercially reasonable efforts to obtain a
protective order or otherwise prevent or minimize disclosure of such
Confidential Information, or (ii) with the express prior written approval of the
other Party.

 

(b) In the event that either Party or anyone to whom either Party disclosed any
Confidential Information shall be legally compelled or required by any
Government Authority to disclose any Confidential Information of the other
Party, such compelled Party agrees to promptly provide written notice to such
other Party to enable such other Party, at such other Party’s cost and expense,
to seek a protective order or other appropriate remedy to avoid public or
third-party disclosure of such Confidential Information. In the event that such
protective order or other remedy is not obtained, such compelled Party shall
furnish only so much of such Confidential Information as it is legally compelled
to disclose (upon advice of such compelled Party’s legal counsel) and shall
exercise such compelled Party’s commercially reasonable efforts to obtain
reliable assurance that confidential treatment will be accorded such
Confidential Information.

 

(c) For purposes of this Agreement, “Confidential Information” means any
confidential information of Buyer or CGI, including, without limitation, with
respect to methods of operation, customers, customer lists, products, prices,
fees, costs, technology, inventions, trade secrets, know-how, software,
marketing methods, plans, personnel, suppliers, competitors, markets or other
specialized information or proprietary matters, and any Data provided by one
Party to the other in accordance with Section 15. The obligation of
confidentiality set forth in Section 14(a) above shall not extend to: (i)
information that at the time of disclosure was in the public domain or
thereafter comes into the public domain without breach of this Agreement by the
receiving Party and (ii) information that becomes known to the receiving Party
from a source, other than the disclosing Party, that had a valid right to
possess such information and without breach of this Agreement by the receiving
Party.

 

(d) In connection with the provision and performance of the Services, the
Providing Party shall at all times: (A) comply in all material respects with its
own then in-force security guidelines and policies applicable thereto; (B) treat
any Confidential Information generated, collected or stored for the Receiving
Party or its Affiliates with a standard of care at least equal to the standard
of care afforded the Providing Party’s own Confidential Information, and in no
event at a standard less than reasonable care; and (C) comply with all
applicable Laws related to the protection and storage of and access to any such
Confidential Information.

 

(e) Where the Providing Party receives access to the computer systems of the
Receiving Party or its Affiliates, it shall comply in all material respects with
such Party’s security guidelines and policies.

 

 -11- 

 

 

(f) In the event that the Providing Party becomes aware that unauthorized access
or use of Receiving Party’s or its Affiliates’ Confidential Information has
occurred, it shall: (A) promptly (and in any event within two Business Days)
notify the Receiving Party (and/or its respective Affiliates) of such
unauthorized access or use; (B) inform Receiving Party (and/or its Affiliates),
and promptly keep Receiving Party (and/or its Affiliates) fully informed of all
details related to such unauthorized access or use; and (C) cooperate with the
Receiving Party (and/or its Affiliates) in good faith to remedy any ongoing
unauthorized access or use.

 

(g) Upon the expiration or earlier termination of any Service, but except to the
extent otherwise required by applicable Law, each Party shall, and shall cause
its respective Affiliates to, return all Confidential Information of the other
Party received under or pursuant to the provision or receipt of such Service.

 

15. Ownership and Maintenance of Data. All records, data files (and the data
contained therein), input materials, reports and other materials provided by a
Providing Party by or at the direction of the Providing Party pursuant to this
Agreement (collectively, “Data”) will be and remain the exclusive property of
the Providing Party. Neither the Receiving Party nor any of its Affiliates will
possess any interest, title, lien or right with respect thereto or in connection
therewith. The Receiving Party will not, and will cause its Affiliates not to,
use the Data for any purpose other than in support of its obligations hereunder.
Neither the Data nor any part thereof will be disclosed, sold, assigned, leased
or otherwise disposed of to third parties by the Receiving Party or any of its
Affiliates, or commercially exploited by or on behalf of the Receiving Party or
any of its Affiliates or their respective employees or agents, other than in
accordance with the terms of this Agreement or the Asset Purchase Agreement. If
the Receiving Party (a) determines on the advice of its counsel that it is
required to disclose any of the Data pursuant to applicable Law or (b) receives
any demand under lawful process to disclose or provide any of the Data to any
other person or party, including a Governmental Authority, then the terms of
Section 14(b) shall apply to and control the disclosure of any such Data by the
Receiving Party. Upon termination of any Service provided hereunder, each Party
will provide the other Party reasonable access to any Data associated with the
provision of such Service for a period not to exceed one (1) year following the
termination of such Service, whereupon any such Data remaining with the
Receiving Party will be transferred to Providing Party or otherwise made
available to the Providing Party as the Providing Party may reasonably request.

 

16. Expiration. Upon the earlier of the expiration or termination of all CGI
Services and CGI Payroll and Benefit Services under this Agreement, except as
otherwise provided in the Asset Purchase Agreement or any other Ancillary
Agreement:

 

(a) CGI and its Affiliates will no longer make any use of any of the Purchased
Assets or rights in respect of the BioPharma Business.

 

(b) Notwithstanding anything to the contrary contained herein, any account
receivable relating to the BioPharma Business collected by CGI or its Affiliates
under this Agreement shall be for the account of Buyer.

 

17. Independent Contractor. With respect to each Service, the Providing Party
shall be deemed to be an independent contractor of the Receiving Party, and not
an employee, agent, partner, joint employer or joint venture partner of the
Receiving Party in the performance of its obligations hereunder. The Providing
Party shall be solely responsible for compensation and benefits to its personnel
assigned to perform the Services hereunder, including, but not limited to,
worker’s compensation, disability benefits, unemployment insurance and
withholding, employment or any other taxes imposed or assessed on such
employees.

 

 -12- 

 

 

18. Entire Agreement; Amendment. This Agreement, the Asset Purchase Agreement,
and the schedules and exhibits hereto and thereto, collectively, contain the
entire agreement and understanding between the Parties with respect to the
subject matter hereof and supersede all prior and contemporaneous agreements,
negotiations, correspondence, undertakings and understandings, oral or written,
relating to such subject matter. No amendment to or modification of this
Agreement shall be effective unless it shall be in writing and signed by each of
Buyer and CGI.

 

19. Severability. If any provision of this Agreement is held by final judgment
of a court of competent jurisdiction to be invalid, illegal or unenforceable,
such invalid, illegal or unenforceable provision shall be severed from the
remainder of this Agreement and the remainder of this Agreement shall be
enforced. In addition, the invalid, illegal or unenforceable provision shall be
deemed to be automatically modified, and, as so modified, to be included in this
Agreement, such modification being made to the minimum extent necessary to
render the provision valid, legal and enforceable. Notwithstanding the
foregoing, if the severed or modified provision concerns all or a portion of the
essential consideration to be delivered under this Agreement by one Party to the
other, the remaining provisions of this Agreement shall also be modified to the
extent necessary to adjust equitably the Parties’ respective rights and
obligations hereunder.

 

20. Construction. The headings of the sections and paragraphs of this Agreement
have been inserted for convenience of reference only and shall in no way
restrict or otherwise modify any of the terms or provisions hereof. In the
negotiation of this Agreement, each Party has received advice from its own
attorney. The language used in this Agreement is the language chosen by the
Parties to express their mutual intent, and no provision of this Agreement will
be interpreted for or against any Party because that Party or its attorney
drafted the provision.

 

21. Resolution of Disputes; Continuation of Services Pending Outcome of Dispute.
In the event of any dispute between the Parties, the Parties agree to resolve
such dispute in accordance with Sections 8.9, 8.11 and 8.12 of the Asset
Purchase Agreement. Notwithstanding any dispute between the Parties, neither
CGI, on the one hand, or Buyer, on the other hand, shall discontinue the supply
of any Service pending the resolution of such dispute.

 

22. No Modification of Asset Purchase Agreement. The Parties hereby expressly
agree that this Agreement does not, and shall not be construed to, alter or
amend in any way the rights and obligations of the Parties pursuant to the Asset
Purchase Agreement, and any rights and obligations thereunder shall have
priority over the rights and obligations of the Parties hereunder.

 

23. Waiver. Waiver of any term or condition of this Agreement by any Party shall
be effective if in writing and shall not be construed as a waiver of any
subsequent breach or failure of the same term or condition, or a waiver of any
other term of this Agreement. No failure or delay by any Party in exercising any
right, power or privilege hereunder shall operate as a waiver thereof nor shall
any single or partial exercise thereof preclude any other or further exercise
thereof or the exercise of any other right, power or privilege.

 

 -13- 

 

 

24. Governing Law. This Agreement, including any disputes hereunder (whether
arising in contract, tort or at law) or the interpretation hereof, shall be
governed by and construed in accordance with the internal laws of the State of
Delaware applicable to agreements made and to be performed entirely within the
State of Delaware, without regard to the conflicts of law principles thereof or
any other jurisdiction.

 

25. Notices. All notices, requests, demands, claims and other communications
that are required to be or may be given under this Agreement shall be delivered
in accordance with, and effective as set forth in, Section 8.1 of the Asset
Purchase Agreement.

 

26. Assignment. Any of the Parties may (a) assign this Agreement to any
Affiliate of such Party or direct or indirect subsidiary of a parent of such
Party so long as any such assignee agrees in writing to be bound by all of the
provisions of this Agreement and such Party continues to remain secondarily
liable for all obligations hereunder, and (b) assign its rights under this
Agreement to any Person that acquires a majority of the equity interests of such
Party or substantially all of the assets of such Party. Each Party may assign to
its Affiliates its right to receive a payment entitled to be received by it
pursuant to this Agreement without any prior written consent. No Party shall
otherwise assign this Agreement or any part hereof without the prior written
consent of the other Party. Subject to the foregoing, this Agreement shall be
binding upon and inure to the benefit of the Parties and their respective
permitted successors and assigns.

 

27. Parties in Interest. Nothing in this Agreement is intended to provide any
rights or remedies to any Person other than the Parties.

 

28. Survival. Sections 1, 5 through 28 and any other sections of this Agreement
that expressly so provide, shall survive and continue in full force and effect
following any termination or expiration of this Agreement.

 

29. Counterparts. This Agreement may be executed in counterparts, each of which
shall be deemed an original and both of which, when taken together, shall
constitute one agreement. Any signature page delivered by a facsimile machine or
electronic mail shall be binding to the same extent as an original signature
page with regard to any agreement subject to the terms hereof or any amendment
thereto.

 

[Signature Page Follows.]

 

 -14- 

 

 

In Witness Whereof, each party hereto has executed or caused this Agreement to
be executed in its name by a duly authorized officer as of the day and year
first above written.

 

[Signature Page to Transition Services Agreement]

 

   

 

 

  CANCER GENETICS, INC.         By: /s/ John A. Roberts   Name: John A. Roberts
  Title: President & CEO

 

[Remainder of page intentionally left blank]

 

[Signature Page to Transition Services Agreement]

 

   

 

 

  INTERPACE BIOPHARMA, INC.         By: /s/ Jack Stover   Name: Jack Stover  
Title: President & Chief Executive Officer

 

[Signature Page to Transition Services Agreement]