LICENSE AGREEMENT

THIS AGREEMENT dated for reference March 10, 2005 (the "Effective Date")

BETWEEN:

BRITISH COLUMBIA CANCER AGENCY BRANCH, a branch society of the Provincial Health
Services Authority amalgamated under the Society Act (British Columbia) and
having an office at Suite 600, West 10th Avenue, Vancouver, British Columbia,
Canada, V5Z 4E6

(the "Agency")

AND:

UPSTREAM BIOSCIENCES INC., a corporation incorporated under the Canada Business
Corporations Act and having a registered office at Suite 305, 1338 West
Broadway, Vancouver, British Columbia, Canada, V6H 1H2

(the "Licensee")

WHEREAS:

A.

The Agency is the owner or licensee of various software and related technologies
that comprise the Licensed Technology (as defined below);

B.

The Licensee is desirous of entering into this Agreement with the objective of
the Agency granting to the Licensee certain rights to develop and commercially
exploit the Licensed Technology;

C.

The Agency is desirous of entering into this agreement (this "Agreement") in
support of the following objectives:

 

(a)

the further development of the Licensed Technology for use by the Agency,

 

(b)

the further development and application of the Licensed Technology for the
benefit of society, and

 

(c)

the generation of additional technology, financial, and other resources for the
benefit and use of the Agency

all in furtherance of and in a manner consistent with the objects of the Agency.

 

 

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NOW THEREFORE THIS AGREEMENT WITNESSETH that, in consideration of the premises
and of the mutual covenants herein set forth, the parties hereto agree as
follows:

ARTICLE 1

DEFINITIONS

1.1

In this Agreement:

 

(a)

"Acceptance of Initial Payment" has the meaning ascribed thereto in Section
2.1(a);

 

(b)

"Agency Improvements" means improvements, variations, updates, modifications,
derivative works, and enhancements relating to the Licensed Technology that are
made by, for, or on behalf of the Agency during the First Annual Period and that
are (i) owned by Licensee or (ii) licensed to the Agency with a right to
sublicense to the Licensee on the same terms as contemplated hereunder in
respect of the Licensed Technology;

 

(c)

"Agency Technology" means all Licensed Technology other than the Background
Technology;

 

(d)

"Annual License Fee" has the meaning ascribed thereto in Section 2.1(b);

 

(e)

"Annual Period" means each year-long period, during the term of this Agreement,
that commences on the Commencement Date or any anniversary thereof,

 

(f)

"Background Licenses" means all contractual and other provisions applicable to
the use of the Background Technology, including the granting of sublicenses
therein, by the Agency;

 

(g)

"Background Licensors" means (i) in respect of Background Technology that is
licensed to the Agency by a party who is not the owner of the Background
Technology, the Agency's licensor of the Background Technology, or (ii) in all
other cases, the owner of the Background Technology;

 

(h)

"Background Technology" means all portions of the Licensed Technology that are
owned by any party other than the Agency;

 

(i)

"Commencement Date" means the later of the Effective Date and the date of
Acceptance of Initial Payment;

 

(j)

"Confidential Information" means any information (i) that is designated by the
disclosing party (the "Disclosing Party") as confidential, whether orally or in
writing, or (ii) the nature of which is such that it would generally be
considered confidential in the industry in which the Disclosing Party operates,
but excluding any information:

 

 

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(i)

possessed by the receiving party (the "Receiving Party") prior to receipt from
the Disclosing Party, other than through prior disclosure by the Disclosing
Party, as evidenced by the Receiving Party's business records,

 

(ii)

published or available to the general public otherwise than through a breach of
this Agreement,

 

(iii)

obtained by the Receiving Party from a third party with a valid right to
disclose it, provided that said third party is not under a confidentiality
obligation to the Disclosing Party, or

 

(iv)

independently developed by employees, agents or consultants of the Receiving
Party who had no knowledge of or access to the Disclosing Party's Confidential
Information as evidenced by the Receiving Party's business records;

 

(k)

"Effective Date of Termination" the date on which this Agreement is terminated
pursuant to Article 17;

 

(l)

"End Users" means individuals, corporations, or other entities who license the
Licensee Products for internal use;

 

(m)

"First Annual Period" means the Annual Period commencing on the Commencement
Date;

 

(n)

"Gross Revenue" means all revenues, receipts, monies, and the fair market value
of all other consideration directly or indirectly collected or received whether
by way of cash or credit or any barter, benefit, advantage, or concession
received by the Licensee in respect of all Licensee Products based on Agency
Technology, less the following deductions to the extent included in the amounts
invoiced and thereafter actually allowed and taken:

 

(i)

credit, allowances or refunds given on account of returned goods,

 

(ii)

transportation charges invoiced separately and actually charged to third
parties,

 

(iii)

taxes, duties, and customs on all sales of Licensee Products,

 

(iv)

agents' commissions paid by the Licensee to non-affiliated third parties for the
sale of Licensee Products, and

 

(v)

bona fide special rebates provided by the Licensee for Licensee Products
purchased by third parties

and, where any Gross Revenue is derived in a currency other than Canadian
dollars it shall be converted to the equivalent in Canadian dollars on the date
the Licensee is deemed to have received such Gross Revenue pursuant to the terms

 

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hereof at the rate of exchange set by the Bank of Montreal for buying such
currency;

 

(o)

"Initial License Fee" has the meaning ascribed thereto in Section 2.l(a);

 

(p)

"Intellectual Property Rights" means any and all worldwide proprietary rights
provided under (a) patent law, (b) copyright law, (c) trade-mark law, (d) design
patent patent or industrial design law, (e) semi-conductor chip or mask work
law, or (f) any other applicable statutory provision or common law principle,
including trade secret law, that may provide a right in ideas, formulae,
algorithms, concepts, inventions, or know-how, or the expression or use thereof,
and including all past, present, and future causes of action, rights of
recovery, and claims for damage, accounting for profits, royalties, or other
relief relating, referring, or pertaining to any of the foregoing and including
the right to file applications for registration of or for obtaining any of the
foregoing anywhere in the world;

 

(q)

"Licensed Technology" means, subject to Section 6.1, the Technology described in
Schedule A, as amended from time to time by the mutual agreement of the parties,
together with:

 

(i)

all Licensee Improvements, and

 

(ii)

all Agency Improvements;

 

 

(r)

"Licensee Customer Agreement" means an agreement between the Licensee and its
customers;

 

(s)

"Licensee Improvements" means improvements, variations, updates, modifications,
derivative works, and enhancements relating to the Licensed Technology that are
made by, for, or on behalf of the Licensee but excluding any such improvements,
variations, updates, modifications, and enhancements (but not derivative works)
if and to the extent that they embody, and cannot be separated from, proprietary
rights of End Users;

 

(t)

"Licensee Products" means products provided by the Licensee based on Agency
Technology, including without limitation the provision of access to products or
services on an application service provider, online, or similar basis;

 

(u)

"Licensee Requested Patent" has the meaning ascribed thereto in Section 7.2;

 

(v)

"Licensee Services" means services provided by the Licensee;

 

(w)

"License Rights" has the meaning ascribed thereto in Section 5.1;

 

(x)

"Objectionable Material" has the meaning ascribed thereto in Section 10.5;

 

 

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(y)

"Source Code" means the human-readable form of a computer instruction, including
related system documentation, applicable comments and procedural codes such as
job control language;

 

(z)

"Source Materials" means, in relation to items of software or other Technology,
supporting materials that would enable a reasonable skilled programmer to
compile, debug and support and/or make improvements to such software in a
commercially reasonable manner including (i) any Source Code related thereto,
reasonably annotated, (ii) technical and system documentation including detailed
design, functional, operational, and technical documentation, flow charts,
diagrams, file layouts, report layouts, screen layouts, business rules, data and
database models and structures, working papers and reasonably related notes and
memoranda in electronic or written format, which were made or obtained in
relation to the design and development of such software and compilation
instructions related to such software, (iii) listing by name, version and vendor
of relevant third party compliers, utilities and other software that are
necessary for normal operation of such software to which the Source Materials
related including sufficient information to procure a license from such vendors,
(iv) a reasonably detailed listing of relevant equipment and information
necessary for normal operation of such software, and (v) all other information
reasonably necessary to rebuild, install, and otherwise implement the software
in the context of the applicable system(s) including, without limitation, all
relevant tools, programs, files, encryptions keys, make files, installation
instructions, systems settings, and database settings; and

 

(aa)

"Technology" means software, knowledge, know-how, techniques, research data,
specifications, instructions, manuals, papers, or other materials.

ARTICLE 2

CONSIDERATION

2.1

In consideration of the rights granted to the Licensee hereunder, the Licensee
shall pay to the Agency the following consideration:

 

(a)

an initial payment of CDN$20,000, payable by the issuance to the Agency of
equity in the Licensee of an amount and kind equal, in the opinion of the
Agency, to CDN$20,000 and the particulars of which are otherwise satisfactory to
the Agency as indicated by written notice from the Agency to the Licensee (the
"Acceptance of Initial Payment"); and

 

(b)

in respect of each Annual Period, annual license fees (the "Annual License
Fees") equal to the greater of:

 

(i)

an amount equal to 10% of the Gross Revenue, and

 

(ii)

CDN$10,000

 

 

 

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which Annual License Fees shall be payable on the last working day of each
Annual Period.

2.2

Notwithstanding the foregoing, in respect of First Annual Period the Licensee
shall be obligated to pay to the Agency Annual License Fees only if and to the
extent that the Annual License Fee otherwise payable pursuant to Section 2.1(b)
exceeds CDN$20,000.

ARTICLE 3

PROPERTY RIGHTS

3.1

The Licensee acknowledges and agrees that the Agency owns any and all right,
title, and interest in and to the Agency Technology and in and to all
Intellectual Property Rights therein.

3.2

The Licensee shall, at the request of the Agency, enter into such further
agreements and execute any and all documents as may be required to ensure that
ownership of the Agency Technology remains with the Agency.

ARTICLE 4

DELIVERY OF SOURCE MATERIALS

4.1

The Agency shall, on the Commencement Date or as soon as reasonably practicable
thereafter, deliver to the Licensee a copy of all Source Materials for the
Licensed Technology that are in the possession of the Agency.

4.2

The Agency shall, on the last working day of each Annual Period during the term
of this Agreement, deliver to the Licensee all Source Materials pertaining to
any and all Agency Improvements that the Agency has developed and/or acquired
during such Annual Period.

4.3

The Licensee shall, on the last working day of each calendar quarter during the
term of this Agreement or more or less frequently as reasonably requested by the
Agency from time to time, deliver to the Agency all Source Materials pertaining
to any and all Licensee Improvements that the Licensee has developed and/or
acquired during such quarter. If requested by the Agency after receipt of such
Source Materials, the Licensee shall provide the Agency in writing with further
details of such Licensee Improvements within 30 days of such request.

ARTICLE 5

GRANT OF LICENSE

5.1

The Agency hereby grants to the Licensee, commencing on the Commencement Date, a
worldwide license to reproduce, modify, publish, and create derivative works of
the Licensed Technology as necessary to:

 

(a)

further develop, modify, and enhance the Licensed Technology in connection with
the development of Licensee Products;

 

 

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(b)

sublicense the Licensed Technology, as part of Licensee Products, to End Users;

 

(c)

sublicense (but not cross-license) the Licensed Technology, as part of Licensee
Products, to value-added resellers for on-licensing to End Users; and

 

(d)

provide Licensee Services to End Users

 

all on the terms and conditions of this Agreement (the "License Rights").

5.2

The License Rights shall, subject to Section 5.4, be exclusive to Licensee.

5.3

The Licensee shall not sublicense, transfer, disclose, cross-license, publish,
or otherwise use the Licensed Technology except as expressly set out in this
Agreement.

5.4

For greater certainty and notwithstanding any other provision of this Agreement,
the Licensee acknowledges that the Agency has the right to continue to
reproduce, modify, publish, create derivative works of, and otherwise use the
Licensed Technology, without accounting to the Licensee of any kind, as follows:

 

(a)

for research, scholarly publication, educational, or other non-commercial uses,
including the licensing of the Licensed Technology to third parties for such
purposes; and

 

(b)

in connection with the Agency's provision of services to or the undertaking of
activities in collaboration with other entities and the Agency's conduct and
provision of clinical services of any kind, whether or not on a non-commercial
basis.

5.5

The Licensee shall ensure the Licensed Technology will not be provided by the
Licensee or its agents or permitted sub-licensees to any individual,
corporation, or other person unless and until such person has entered into a
Licensee Customer Agreement containing at least the terms and conditions set out
in Schedule B.

ARTICLE 6

BACKGROUND TECHNOLOGY

6.1

The Licensee shall comply with, and, notwithstanding any other provision of this
Agreement, shall ensure that the Licensee's activities in respect of the
Licensed Technology do not render the Agency in non-compliance with, the terms
and conditions of the Background Licenses.

6.2

The Licensee agrees that all rights and obligations of the parties hereunder
shall be subject to the terms of the Background Licenses and to the obligations
of the Agency thereunder. If and to the extent that any term of this Agreement
is inconsistent with any Background License or the obligations of the Agency
thereunder, the Agency and the Licensee shall enter good faith negotiations to
amend this Agreement to eliminate such inconsistency and, in the event that the
parties are unable to agree to such amendments, either party may institute
dispute resolution proceedings in accordance with Section 15.2.

 

 

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6.3

If and to the extent that the Agency becomes, from time to time, obligated to
pay any amounts to any Background Licensor as a result of or in respect of this
Agreement or the activities or rights of either party hereunder, the Licensee
shall, within 15 days of receipt of notice from the Agency, reimburse the Agency
for any such amounts.

ARTICLE 7

MANAGEMENT OF INTELLECTUAL PROPERTY RIGHTS

7.1

The Agency will own and manage all Intellectual Property Rights in respect of
the Licensed Technology.

7.2

The Licensee shall have the right to identify any process, use or products
arising out of the Licensed Technology that may be patentable and the Agency
will, on the request of the Licensee or on its own initiative, take all
reasonable steps to apply for a patent therefor, in one or more jurisdictions,
(each, a "Licensee Requested Patent") provided that:

 

(a)

all Licensee Requested Patents shall be in the name of the Agency;

 

(b)

the Licensee shall pay all costs of applying for, registering and maintaining
any Licensee Requested Patents; and

 

(c)

the Agency will keep the Licensee advised as to all material developments with
respect to all Licensee Requested Patents and applications therefor and will
supply the Licensee with copies of all material papers received and filed in
connection with the prosecution thereof.

7.3

On the issuance of a Licensee Requested Patent in accordance with Section 7.2,
the Licensee will have the right to become, and will become, the licensee of
such Licensee Requested Patent pursuant to the terms contained herein.

7.4

The Licensee shall not contest the validity or scope of any Licensed Technology
or any Intellectual Property Rights therein.

7.5

The Licensee will ensure proper and appropriate patent marking for all Licensee
Products, including talking any steps reasonably requested by the Agency.

ARTICLE 8

DISCLAIMER OF WARRANTY AND CONDUCT OF LITIGATION

8.1

The Licensed Technology is provided to the Licensee on an "AS IS" basis. The
Agency makes no, and hereby disclaims all, representations, conditions, or
warranties, either express or implied, with respect to the Licensed Technology.
The Agency shall not be liable for any loss, whether direct, consequential,
incidental or special, that the Licensee suffers arising from any defect, error,
fault, or failure to perform with respect to the Licensed Technology, even if
the Agency has been advised of the possibility of such defect, error, fault, or
failure. The Licensee acknowledges that it has been advised by the Agency to
undertake its own due diligence with respect to the Licensed Technology.

 

 

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8.2

Nothing in this Agreement shall be construed as:

 

(a)

a warranty or representation by the Agency as to title to the Licensed
Technology or that anything made, used, sold or otherwise disposed of under the
license granted in this Agreement is or will be free from infringement of
Intellectual Property Rights or other rights;

 

(b)

an obligation by the Agency to bring or prosecute or defend actions or suits
against third parties for infringement of Intellectual Property Rights or other
rights; or

 

(c)

the conferring by the Agency of the right to use in advertising or publicity the
name or trade-marks of the Agency or of the Background Licensors.

8.3

The parties acknowledge and agree that the International Sale of Goods Contracts
Convention Act and the United Nations Convention on Contracts for the
International Sale of Goods have no application to this Agreement.

8.4

If any complaint alleging infringement or violation of any patent or other
proprietary rights is made against the Licensee with respect to the permitted
use of the Licensed Technology, the following procedure shall be adopted:

 

(a)

the Licensee shall promptly notify the Agency upon receipt of any such complaint
and shall keep the Agency fully informed of the actions and positions taken by
the complainant and taken or proposed to be taken by the Licensee;

 

(b)

except as provided in Section 8.4(d), all costs and expenses incurred by the
Licensee in investigating, resisting, litigating and settling such a complaint,
including the payment of any award of damages and/or costs to any third party,
shall be paid by the Licensee;

 

(c)

no decision or action concerning or governing any final disposition of the
complaint shall be taken without full consultation with and approval by the
Agency;

 

(d)

the Agency may elect to participate formally in any litigation involving the
complaint to the extent that the court may permit, but any additional expenses
generated by such formal participation shall be paid by the Agency (subject to
the possibility of recovery of some or all of such additional expenses from the
complainant);

 

(e)

if the complainant is willing to accept an offer of settlement and one of the
parties to this Agreement is willing to make or accept such offer and the other
is not, then the unwilling party shall conduct all further proceedings at its
own expense, and shall be responsible for the full amount of any damages, costs,
accounting of profits, and settlement costs in excess of those provided in such
offer, but shall be entitled to retain unto itself the benefit of any litigated
or settled result entailing a

 

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lower payment of costs, damages, accounting of profits, and settlement costs
than that provided in such offer; and

 

(f)

any license fees payable to the Agency pursuant to this Agreement shall be paid
by the Licensee to the Agency in trust from the date the complaint is made until
such time as a resolution of the complaint has been finalized. If the
complainant prevails in the complaint, then the payments paid to the Agency in
trust pursuant to this Article shall be returned to the Licensee, provided that
the amount returned to the Licensee hereunder shall not exceed the amount paid
by the Licensee to the complainant in the settlement or other disposition of the
complaint. If the complainant does not prevail in the complaint, then the Agency
shall be entitled to retain all payments paid to it pursuant to this Article.

8.5

As between the parties, the Agency shall have sole conduct over any litigation
against any third party relating to such third party's infringement or alleged
infringement of any Licensed Technology or of any Intellectual Property Rights
therein.

ARTICLE 9

INDEMNITY AND LIMITATION OF LIABILITY

9.1

The Licensee hereby indemnifies, holds harmless and defends the Agency, its
officers, employees, invitees and agents against any and all claims (including
all legal fees and disbursements incurred in association therewith) arising out
of (i) the exercise of any rights under this Agreement including, without
limiting the generality of the foregoing, against any damages or losses,
consequential or otherwise, arising from or out of the use of the Licensed
Technology by the Licensee or its sub-licensees or their customers or end-users
howsoever the same may arise of (ii) the Licensee's breach of this Agreement or
any Background License.

9.2

The Agency's total liability, whether under the express or implied terms of this
Agreement, in tort (including negligence), or at common law, for any loss or
damage suffered by the Licensee, whether direct, indirect or special, or any
other similar or like damage that may arise or does arise from any breaches of
this Agreement by the Agency, its officers, employees, or agents shall be
limited to the amount of CDN$100,000.

9.3

In no event shall the Agency be liable for consequential or incidental damages
arising from any breach or breaches of this Agreement.

9.4

No action, whether in contract or tort (including negligence), or otherwise
arising out of or in connection with this Agreement, may be brought by the
Licensee more than 12 months after the cause of action has accrued.

ARTICLE 10

PUBLICATION AND CONFIDENTIALITY

10.1

The Confidential Information disclosed by each party to the other party shall be
received and used by the other party solely in furtherance of the purposes set
forth in this Agreement subject to the terms and conditions set forth in this
Article 10. Nothing herein

 

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shall affect a party's use of its own Confidential Information. For greater
certainty, all Licensed Technology shall constitute Confidential Information of
the Agency.

10.2

The parties shall keep and use all of the Confidential Information in confidence
and will not, without the other party's prior written consent, disclose any
Confidential Information received from the other party, to any person or entity,
except those of the recipient's officers, employees, technical consultants and
professional advisors who require said Confidential Information in performing
their obligations under this Agreement. Each party hereto will and maintain an
appropriate internal program limiting the internal distribution of any
Confidential Information received from the other party, to only those officers,
employees, technical consultants and professional advisors who require said
Confidential Information in performing their obligations under this Agreement
and who are under obligations of confidentiality consistent to those of this
Agreement. Without limiting the generality of the foregoing, all officers,
employees and technical consultants of the Licensee who are given access to the
Agency's Confidential Information will sign confidentiality and non-disclosure
agreements in a form approved by the Licensee's board of directors.

10.3

If either party is required by judicial or administrative process or timely
disclosure policies imposed by law or stock exchange policies to disclose any or
all of the other party's Confidential Information, such disclosing party will
promptly notify the other party and will allow the other party reasonable time
to oppose such process before disclosing any Confidential Information.

10.4

Notwithstanding any termination or expiry of this Agreement, the obligations
created in this Article 10 shall survive and be binding upon the parties for a
period of 5 years after such expiry or termination except with respect to
Confidential Information specifically identified as "trade secrets" for which
such obligations will continue in perpetuity.

 

10.5

The Agency shall not be restricted from presenting at symposia, national or
regional professional meetings, or from publishing in journals or other
publications, accounts of its research relating to the Licensed Technology,
provided that with respect to Confidential Information only, the Licensee shall
have been furnished copies of the disclosure proposed therefor at least 60 days
in advance of the presentation or publication date. The Licensee may within 30
days after delivery of the proposed disclosure object to such presentation or
publication on the grounds that it contains patentable subject matter requiring
protection from disclosure or the Licensee's Confidential Information. Any
objection to a proposed presentation or publication shall specify the portions
of the presentation or publication considered objectionable (the "Objectionable
Material"). Upon receipt of notification from the Licensee that any proposed
publication or disclosure contains Objectionable Material, the Agency and the
Licensee will work together to revise the proposed publication or presentation
to remove or alter the Objectionable Material in a manner acceptable to the
Licensee, in which case the Licensee shall withdraw its objection. If an
objection is made, disclosure of the Objectionable Material shall not be made
for a period of 6 months after the date the Agency has delivered to the Licensee
the proposed publication or presentation relating to the Objectionable Material,
during which period any patent application with respect to

 

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patentable subject matter may be filed. The Agency shall co-operate in all
reasonable respects in making revisions to any proposed disclosures if
considered by the Licensee to contain Objectionable Material. The Agency shall
not be restricted from publishing or presenting the proposed disclosure as long
as the Objectionable Material has been removed. After the 6 month period has
elapsed the Agency shall be free to present and/or publish the proposed
publication or presentation whether or not it contains Objectionable Material,
except that in no circumstances will the Agency publish and/or present any
Confidential Information of the Licensee which has been identified by the
Licensee as its trade secret.

ARTICLE 11

MARKETING

11.1

The Licensee shall not use the Agency's name, trade-marks, service marks, logos,
insignia, seal, or designs without the prior written consent of the Agency.

11.2

The Licensee shall not use or make reference to the Agency or its name in any
advertising or publicity whatsoever, without the prior written consent of the
Agency, except as required by law. Without limiting the generality of the
foregoing, the Licensee shall not issue a press release with respect to this
Agreement or any activity contemplated herein without the prior review and
approval of same by the Agency, except as required by law. If the Licensee is
required by law to act in contravention of this Section, the Licensee shall
provide the Agency with sufficient advance notice in writing to permit the
Agency to bring an application or other proceeding to contest such requirement.

11.3

The Licensee represents and warrants to the Agency that it has the
infrastructure, expertise and resources to:

 

(a)

develop and commercialize the Licensed Technology;

 

(b)

track and monitor on an ongoing basis performance under the terms of each
sublicense entered into by the Licensee;

 

(c)

monitor patent infringement regarding any patent relating to the Technology
licensed under this agreement; and

 

(d)

handle the Licensed Technology with care and without danger to the Licensee, its
employees, agents, or the public.

11.4

The Licensee represents and warrants to the Agency that it will, throughout the
term of this agreement:

 

(a)

allocate to the development and commercialization of the Licensed Technology at
least the same degree of diligence, expertise, infrastructure, and resources as
the Licensee is allocating to the most favoured product developed and marketed
by the Licensee, and

 

 

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(b)

use its best efforts to promote, market and sell the Products and exploit the
Licensed Technology and to meet or cause to be met the market demand for the
Products and the potential use of the Licensed Technology.

11.5

The Licensee will:

 

(a)

complete a Series A financing, for a minimum of CDN$2,000,000, within 18 months
of the Commencement Date;

 

(b)

ensure that, during the period commencing on the Commencement Date and ending on
the date that is 36 months thereafter, the Gross Revenue equals not less than
CDN$1,000,000; and

 

(c)

ensure that, during the Annual Period commencing on the date that is 36 months
after the Commencement Date and during each Annual Period thereafter, the Gross
Revenue equals not less than CDN$300,000.

11.6

If the Agency is of the view that the Licensee is in breach of Section 11.3, the
Agency may give notice to the Licensee under Section 17.5. Within 15 days of
receiving the Agency's notice, the Licensee shall provide notice to the Agency
of its election to:

 

(a)

proceed with remedying the breach in accordance with Section 17.5, or

 

(b)

dispute the breach ("Dispute") and refer the Dispute to mediation in accordance
with Section 11.7; or

 

(c)

accept the breach.

If the Licensee elects to proceed with remedying the breach, then the Licensee
will be deemed to have waived any right to refer the matter to mediation in
accordance with Section 11.7. If the Licensee fails to make an election in
accordance with this Article, then the Licensee will be deemed to have accepted
the breach and the Agency may terminate this agreement.

11.7

If the Licensee elects to refer the Dispute to mediation, the Agency will
appoint a mediator (the "Mediator") within 15 days of the Licensee's election.
On appointment of Mediator the following rules and procedures will govern the
conduct of the parties and the Mediator before and during the mediation of a
Dispute:

 

(a)

within 15 days of the appointment of the Mediator, the Licensee will provide to
the Mediator and the Agency a written summary of its position and copies of all
documents on which it intends to rely. On receiving the Licensee's summary and
documents, the Agency has 15 days to submit to the Licensee and the Mediator a
summary of the Agency's position along with the documents on which the Agency
intends to rely;

 

(b)

after each of the Licensee and the Agency has provided its summary and documents
under Section 11.6(a), but not more than 60 days from the appointment of the
Mediator, the parties agree to meet in the presence of the

 

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Mediator with a view to resolving the Dispute. The role of the Mediator will be
to assist in negotiating a resolution of a Dispute and will not make a binding
decision without the parties' prior written agreement;

 

(c)

the mediation of a Dispute may be terminated by either party, by giving notice
to the other party:

 

(i)

if the other party fails to comply with its obligations under Section 11.3; or

 

(ii)

if the parties cannot agree on a resolution of the Dispute within 60 days from
the appointment of the Mediator;

 

(d)

any information or documents disclosed by either party under this Section 11.7
must be kept confidential and must not be used except to attempt to resolve the
Dispute; and

 

(e)

each party must bear its own costs of complying with Section 11.7 and the
parties must bear equally the costs of any Mediator engaged.

11.8

If the parties cannot agree on the resolution of the Dispute within 60 days from
the appointment of the Mediator, or if the mediation of the Dispute has been
terminated under Section 11.7(c) then the Licensee will (counting from the end
of the 60 day period) have a further 30 days to remedy the breach in accordance
with Section 15.2. If the Licensee fails to remedy the breach within such 30 day
period then the Agency may terminate this agreement.

ARTICLE 12

RECORDS

12.1

The Licensee will maintain separate accounts and records of all business done
pursuant to this Agreement, such accounts and records to be in sufficient detail
to enable proper returns to be made under this Agreement.

12.2

The Licensee shall deliver to the Agency with any payment due under this
Agreement an accounting summary setting out how the amount paid to the Agency
was determined.

12.3

The calculation of any amount due to the Agency under this Agreement will be
carried out in accordance with generally accepted Canadian accounting principles
(GAAP).

12.4

The Licensee shall retain the accounts and records referred to in Section 12.1
above for at least 6 years after the date upon which they were made and shall
permit any duly authorized representative of the Agency to, at the Agency's
expense, inspect such accounts and records during normal business hours of the
Licensee.

12.5

The Agency may conduct, or engage a qualified independent auditor to conduct, an
independent audit of such records and any related financial/accounting/business
records of the Licensee. Such audit will occur, if at all, during the normal
business hours of the Licensee, with a minimum of disruption to the business of
the Licensee, and only after

 

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- 15 -

 

 

written notice has been delivered to the Licensee at least five (5) days in
advance of the audit. If the audit reveals an underpayment of royalties, then
the Agency will submit an invoice to the Licensee in the amount of the
underpayment together with supporting documentation for its claim, and the
Licensee will pay such invoice within 30 days of receipt of same. If the audit
reveals that less than 95% of the royalties due have been paid, and the
underpayment exceeds CDN$1,000, the Licensee will also pay for the cost of the
audit.

ARTICLE 13

INSURANCE

13.1

The Licensee shall procure and maintain, commencing on the Effective Date and
continuing during the term of this Agreement, appropriate public liability,
product liability and errors and omissions insurance with a reputable and
financially secure insurance carrier which shall provide primary coverage with
respect to the activities contemplated by this Agreement. Such insurance will in
no case be less than the insurance which a reasonable and prudent businessperson
carrying on a similar line of business would acquire and such policies of
insurance shall include the Agency, its Boards of Directors, officers,
employees, and agents as additional insureds, shall contain a waiver of
subrogation against the Agency, and its Board of Directors, officers, employees,
and agents, and shall include severability of interest and cross-liability
clauses. Such policies shall provide that they may not be cancelled or
materially altered except upon the provision of at least 30 days written notice
to the Agency. The Licensee covenants not to enter into any Licensee Customer
Agreements before certificates of insurance evidencing such coverage have been
provided to the Agency.

13.2

If there is a dispute between the parties on the appropriate terms or the amount
of coverage, then the matter shall be determined by arbitration as provided for
herein.

ARTICLE 14

ASSIGNMENT

14.1

The Licensee will not assign any or all of the rights, duties or obligations
granted to it under this Agreement without the prior written consent of the
Agency, which consent may be withheld in the sole election of the Agency.
Further, the Licensee will not transfer, mortgage, charge, or otherwise dispose
of any or all of the lights, duties, or obligations granted to it under this
Agreement.

ARTICLE 15

GOVERNING LAW AND ARBITRATION

15.1

This Agreement shall be governed by and construed in accordance with the laws of
the Province of British Columbia and the laws of Canada in force therein without
regard to its conflict of law rules. All parties agree that by executing this
Agreement they have attorned to the jurisdiction of the Supreme Court of British
Columbia. Subject to Sections 15.2 and 15.3, the British Columbia Supreme Court
and all courts competent to hear appeals therefrom shall have exclusive
jurisdiction over this Agreement.

 

 

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- 16 -

 

 

15.2

In the event of any dispute arising between the parties concerning this
Agreement, its enforceability or the interpretation thereof, the same shall be
settled by a single arbitrator appointed pursuant to the provisions of the
Commercial Arbitration Act of British Columbia, or any successor legislation
then in force. The place of arbitration shall be Vancouver, British Columbia.
The language to be used in the arbitration proceedings shall be English.

15.3

Nothing in Section 15.2 shall prevent a party hereto from applying to a court of
competent jurisdiction for interim or injunctive relief, for recovery of
monetary amounts owed to the party, or for enforcement of any award.

ARTICLE 16

NOTICES

 

16.1

All payments, reports and notices or other documents that any of the parties
hereto are required or may desire to deliver to any other party hereto may be
delivered only by personal delivery or by registered or certified mail, telex or
fax, all postage and other charges prepaid, at the address for such party set
forth below or at such other address as any party may hereinafter designate in
writing to the others. Any notice personally delivered or sent by fax shall be
deemed to have been given or received at the time of delivery or faxing (with
confirmation of completion of fax transmission showing the correct answer back).
Any notice mailed as aforesaid shall be deemed to have been received on the
expiration of 5 days after it is posted, provided that if there shall be at the
time of mailing or between the time of mailing and the actual receipt of the
notice a mail strike, slow down or labour dispute which might affect the
delivery of the notice by the mails, then the notice shall only be effected if
actually received.

If to the Agency:

Technology Development Office

 

675 West 10th Ave

 

Vancouver, BC V5Z 1L3

 

Tel: 604-675-8198

 

Fax: 604-675-8189

 

 

 

Attn: Director

 

If to the Licensee:

X

 

Suite 305, 1338 West Broadway, Vancouver, BC

 

V6H 1H2

 

Tel: 604-730-0086

 

Fax: X

 

 

 

Attn: Chief Executive Officer

 

 

 

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- 17 -

 

 

ARTICLE 17

TERM AND TERMINATION

17.1

This Agreement shall commence on the Effective Date and shall, unless and until
terminated as provided herein, survive for a period of seven (7) years after the
Commencement Date.

17.2

This Agreement shall automatically and immediately terminate without notice to
the Licensee if any proceeding under the Bankruptcy and Insolvency Act of
Canada, or any other statute of similar purport, is commenced by or against the
Licensee.

17.3

All rights of the Licensee in respect of the Licensed Technology shall
terminate, in respect of any Background Technology, upon expiry of the
applicable Background License or otherwise upon the expiry or termination of the
night of the Agency to license such Background Technology.

17.4

The Licensee shall cease to use the Licensed Technology in any manner whatsoever
within 5 days from the Effective Date of Termination of this Agreement.

17.5

The Agency may, at its option, terminate this Agreement immediately on the
happening of any one or more of the following events by delivering notice in
writing to that effect to the Licensee:

 

(a)

if the Licensee shall be in material default under or shall fail to comply with
any other term of this Agreement and:

 

(i)

if such default is reasonably curable within 30 days after receipt of notice of
such default and such default or failure to comply is not cured within 30 days
after receipt of written notice thereof, or

 

(ii)

if such default is not reasonably curable within 30 days after receipt of
written notice thereof, and such default or failure to comply is not cured
within such further reasonable period of time as may be necessary for the curing
of such default or failure to comply;

 

(b)

if the Licensee fails to procure or maintain insurance as required under this
Agreement;

 

(c)

if the Licensee ceases to carry on business;

 

(d)

if the Licensee becomes insolvent;

 

(e)

if any execution, sequestration, or any other process of any court becomes
enforceable against the rights licensed to the Licensee under this Agreement or
upon any of the monies due to the Agency and is not released or satisfied by the
Licensee within the later of (x) 90 days thereafter or, (y) if the Licensee
obtains a valid stay against any such execution, sequestration or other process,
90 days after the expiry or lifting of such stay;

 

 

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

 

- 18 -

 

 

 

(f)

if any resolution is passed or order made or other steps taken for the winding
up, liquidation or other termination of the existence of the Licensee;

 

(g)

if the Licensee is in arrears of any payments that are due to the Agency under
the terms of this Agreement such arrears continue for more than 30 days after
the Licensee's receipt of a written notice from the Agency of such arrears;

 

(h)

if the Licensed Technology becomes subject to any security interest, lien,
charge or encumbrance in favour of any third party claiming through the
Licensee;

 

(i)

if the Licensee grants a sub-sublicense of the Licensed Technology or of this
Agreement other than as expressly permitted hereunder;

 

(j)

if any part of the Licensee's business relating to this Agreement is transferred
to a subsidiary or associated company without the prior written consent of the
Agency;

 

(k)

if both the Agency and the Licensee agree to termination this Agreement in
writing;

 

(1)

if the Licensee fails to satisfy any of the milestones set out in 11.5; or

 

(m)

if the Licensee commits any breach of Section 5.3, Article 10, or Article 14.

17.6

If this Agreement expires or terminated for any reason, the Licensee shall cease
to use the Licensed Technology in any manner whatsoever within 5 days from the
Effective Date of Termination and, further, the Licensee will make all payments
due to the Agency and the Agency may proceed to enforce payment of all
outstanding payments owed to the Agency and to exercise any or all of the rights
and remedies contained herein or otherwise available to the Agency by law or in
equity, successively or concurrently, at the option of the Agency.

17.7

Upon termination of this Agreement each party shall return to the other party
any and all Confidential Information of the other party provided hereunder in
its possession or control (except for one archival copy to be retained by a
person designated by such party (who shall not make such Confidential
Information generally available to employees or other representatives of such
party) for the purpose of confirming which information to hold in confidence
hereunder) and each party shall deliver a certificate of a responsible official
of the party certifying the completeness of same.

ARTICLE 18

MISCELLANEOUS COVENANTS OF LICENSEE

18.1

The Licensee hereby represents and warrants to the Agency that the Licensee is a
corporation duly continued, existing and in good standing under the laws of
Canada and has the power, authority and capacity to enter into this Agreement
and to carry out the transactions contemplated by this Agreement, all of which
have been duly and validly authorized by all requisite corporate proceedings.

 

 

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

 

- 19 -

 

 

18.2

The Licensee shall comply with all laws, regulations and ordinances, whether
Federal, State, Provincial, County, Municipal or otherwise, with respect to the
Licensed Technology and/or this Agreement.

18.3

The Licensee shall pay all taxes and any related interest or penalty howsoever
designated and imposed as a result of the existence or operation of this
Agreement, including, but not limited to, tax which the Licensee is required to
withhold or deduct from payments to the Agency. The Licensee will furnish to the
Agency such evidence as may be required by Canadian authorities to establish
that any such tax has been paid. Any payments specified in this Agreement are
exclusive of taxes. If the Agency is required to collect a tax to be paid by the
Licensee, the Licensee shall pay such tax to the Agency on demand.

18.4

The obligation of the Licensee to make all payments hereunder will be absolute
and unconditional and will not, except as expressly set out in this Agreement,
be affected by any circumstance, including without limitation any set-off,
compensation, counterclaim, recoupment, defence or other right which the
Licensee may have against the Agency, or anyone else for any reason whatsoever.

18.5

All amounts due and owing to the Agency hereunder but not paid by the Licensee
on the due date thereof shall bear interest at the rate of 1% per month. Such
interest shall accrue on the balance of unpaid amounts from time to time
outstanding from the date on which portions of such amounts become due and owing
until payment thereof in full.

18.6

The Licensee will not enter into any agreements with the United States
Government or any other government in connection with the Licensed Technology
without the prior written consent of the Agency, which consent shall not be
unreasonably withheld or delayed.

ARTICLE 19

GENERAL

19.1

Upon reasonable prior written notice by the Agency to the Licensee, the Licensee
shall permit any duly authorized representative of the Agency, during normal
business hours and at the Agency's sole risk and expense, to enter upon and into
any premises of the Licensee for the purpose of ascertaining whether or not the
provisions of this Agreement have been, are being, or will be complied with by
the Licensee.

19.2

Nothing contained herein shall be deemed or construed to create between the
parties hereto a partnership or joint venture. No party shall have the authority
to act on behalf of any other party, or to commit any other party in any manner
or cause whatsoever or to use any other party's name in any way not specifically
authorized by this Agreement. No party shall be liable for any act, omission,
representation, obligation or debt of any other party, even if informed of such
act, omission, representation, obligation or debt.

19.3

Subject to the limitations hereinbefore expressed, this Agreement shall enure to
the benefit of and be binding upon the parties and their respective successors
and permitted assigns.

19.4

No condoning, excusing or overlooking by any party of any default, breach or
non-observance by any other party at any time or times in respect of any
covenants, provisos or

 

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- 20 -

 

 

conditions of this Agreement shall operate as a waiver of such party's rights
under this Agreement in respect of any continuing or subsequent default, breach
or non-observance, so as to defeat in any way the rights of such party in
respect of any such continuing or subsequent default or breach, and no waiver
shall be inferred from or implied by anything done or omitted by such party,
save only an express waiver in writing.

19.5

No exercise of a specific right or remedy by any party precludes it from or
prejudices it in exercising another right or pursuing another remedy or
maintaining an action to which it may otherwise be entitled either at law or in
equity.

19.6

Marginal headings as used in this Agreement are for the convenience of reference
only and do not form a part of this Agreement and are not be used in the
interpretation hereof.

19.7

The terms and provisions, covenants and conditions contained in this Agreement
which by the terms hereof require their performance by the parties hereto after
the expiration or termination of this Agreement shall be and remain in force
notwithstanding such expiration or other termination of this Agreement for any
reason whatsoever. Without limiting the generality of the foregoing, Sections
5.4, 6.3, 7.1, 8.1, 8.2, 12.4, 12.5, 14.1, 18.3, 18.4, 18.5, 18.6, and 19.1 and
Article 3, Article 8, Article 9, Article 10, Article 11, and Article 15 shall
survive expiration or termination of this Agreement for any reason whatsoever.

19.8

If any Article, Section, clause, paragraph or subparagraph of this Agreement
shall be held to be indefinite, invalid, illegal or otherwise voidable or
unenforceable, the entire Agreement shall not fail on account thereof, and the
balance of this Agreement shall continue in full force and effect.

19.9

This Agreement sets forth the entire understanding between the parties with
respect to the subject matter hereof and no modifications hereof shall be
binding unless executed in writing by the parties hereto.

19.10

Time shall be of the essence of this Agreement.

19.11

Whenever the singular or masculine or neuter is used throughout this Agreement
the same shall be construed as meaning the plural or feminine or body corporate
when the context or the parties hereto may require.

19.12

Each of the parties will promptly execute and deliver to the other at the cost
of the other such further documents and assurances and take such further actions
as the other may from time to time request in order to more effectively carry
out the intent and purpose of this Agreement and to establish and protect the
rights, interests and remedies intended to be created in favour of the other
and, for greater certainty and without limiting the generality of the foregoing,
the Licensee shall assist the Agency, as directed by the Agency from time to
time, in obtaining, maintaining, defending, and enforcing (i) any Intellectual
Property Rights of the Agency, and (ii) any rights in the Licensed Technology.

 

 

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- 21 -

 

 

19.13

Neither party will be responsible for delays or failures in performance
resulting from causes beyond the reasonable control of such party and without
the fault or negligence of the party claiming excusable delay or failure,
provided that such party uses commercially reasonable efforts to correct such
delay or failure. This Section will not apply to excuse a delay or failure to
make any payment when due.

IN WITNESS WHEREOF the parties hereto have hereunto executed this Agreement as
of the Effective Date.

 

BRITISH COLUMBIA CANCER

AGENCY BRANCH

UPSTREAM BIOSCIENCES INC.

Signature: /s/ Victor Ling

Signature: /s/ Joel L. Bellerson

Name: Victor Ling

Name: Joel L. Bellerson

Title: VP Research

Title: CEO

 

 

BRITISH COLUMBIA CANCER

AGENCY BRANCH

 

Signature: /s/ Samuel Abraham

Signature: /s/ Dexster Smith

Name: Samuel Abraham

Dexster Smith

Title: Director, Technology Development

President

 

 

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- 22 -

 

 

SCHEDULE A

Licensed Technology

1. TITLE OF
SOFTWARE AND VERSION

SOCKEYE
Version 1.2

2. BRIEF DESCRIPTION OF WHAT IT DOES OR WHAT IT IS USED FOR:

GENOMIC VISUALIZATION, SEQUENCE ALIGNEMENT, REGULATORY ELEMENT DETECTION

3. AUTHORSHIP/ INVENTORSHIP

Name

 

 

 

Stephen B. Montgomery

 

 

 

Tamara Astakhova

 

 

 

Mikhail Bilenky

 

 

 

Tony Fu

 

 

 

Maik Hassel

 

 

 

Marcin Rak

 

 

 

Gordon Robertson

 

 

 

Monica Sleumer

 

 

 

Asim S. Siddiqui

 

 

 

Steven J.M. Jones

 

 

 

 

Kevin Lin

 

 

 

 

1. TITLE OF
SOFTWARE AND VERSION

DISCOVERY SPACE
Version 4.0

2. BRIEF DESCRIPTION OF WHAT IT DOES OR WHAT IT IS USED FOR:

An Application used to browse relationships between biological databases and
provide an interface for overlaying annotation and relationships on gene
expression (SAGE) data.

3. AUTHORSHIP/ INVENTORSHIP

Name

 

 

 

Varhol RJ

 

 

 

Leung D

 

 

 

Robertson N

 

 

 

Oveisi-
Fordoei M

 

 

 

Fjell Chris

 

 

 

Zuyderduyn
S

 

 

 

Siddiqui A

 

 

 

Marra M

 

 

 

Jones S

 

 

 

 

 

 

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- 23 -

 

 

 

1. TITLE OF
SOFTWARE AND VERSION

DISCOVERY DB
Version 4.0

2. BRIEF DESCRIPTION OF WHAT IT DOES OR WHAT IT IS USED FOR:

A database specifying relationships between biological databases. It include
software to update the database utilizing data from the external databases.

3. AUTHORSHIP/ INVENTORSHIP

Name

 

 

 

Varhol RJ

 

 

 

Leung D

 

 

 

Robertson N

 

 

 

Oveisi-Fordoei M

 

 

 

Fjell Chris

 

 

 

Zuyderduyn S

 

 

 

Siddiqui A

 

 

 

Marra M

 

 

 

Jones S

 

 

 

x

 

 

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SCHEDULE B

Licensee Customer Agreement Requirements

x