Exhibit 10.5
CERTAIN CONFIDENTIAL INFORMATION CONTAINED IN THIS DOCUMENT, MARKED BY […***…],
HAS BEEN OMITTED BECAUSE IT IS BOTH (I) NOT MATERIAL AND (II) WOULD LIKELY CAUSE
COMPETITIVE HARM IF PUBLICLY DISCLOSED.
image_01a.jpg [image_01a.jpg]
STATE OF TEXAS
COUNTY OF TRAVIS
This CANCER RESEARCH GRANT CONTRACT (“Contract”) is by and between the Cancer
Prevention and Research Institute of Texas (“CPRIT”), hereinafter referred to as
the “INSTITUTE”, acting through its Executive Director, and Bellicum
Pharmaceuticals, Inc., hereinafter referred to as the “RECIPIENT”, acting
through its authorized signing official.
RECITALS
WHEREAS, pursuant to TEX. HEALTH & SAFETY CODE, Ch. 102, the INSTITUTE may make
grants to public and private persons in this state for research into the causes
and cures for all types of cancer in humans; facilities for use in research into
the causes and cures for cancer; research to develop therapies, protocols,
medical pharmaceuticals, or procedures for the cure or substantial mitigation of
all types of cancer; and cancer prevention and control programs.
WHEREAS, Article III, Section 67 of the Texas Constitution expressly authorizes
the State of Texas to sell general obligation bonds on behalf of the INSTITUTE
and for the INSTITUTE to use the proceeds from the sale of the bonds for the
purposes of cancer research and prevention programs in this state.
WHEREAS, the INSTITUTE issued a request for applications for RFA R-11-COMP-1:
Company Commercialization Awards on or about July 2010.
WHEREAS, pursuant to TEX. HEALTH & SAFETY CODE § 102.251, and after a review by
the INSTITUTE’s scientific research and prevention program committees, the
INSTITUTE’s Executive Director has approved a Grant (defined below) to be
awarded to the RECIPIENT.
WHEREAS, to ensure that the Grant provided to the RECIPIENT pursuant to this
Contract is utilized in a manner consistent with Tex. Const. Article III,
Section 67 and other laws, and in exchange for receiving such Grant, the
RECIPIENT agrees to comply with certain conditions and deliver certain
performance.
WHEREAS, the RECIPIENT and the INSTITUTE desire to set forth herein the
provisions relating to the awarding of such monies and the disbursement thereof
to the RECIPIENT.
IN CONSIDERATION of the Grant and the premises, covenants, agreements, and
provisions contained in this Contract, the parties agree to the following terms
and conditions:
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Article I
DEFINITIONS

The following terms shall have the following meaning throughout this Contract
and any Attachments and amendments. Other terms may be defined elsewhere in this
Contract.
(1) Collaborator – any entity other than the RECIPIENT having one or more
personnel participating in the Project and (a) designated as a collaborator in
the application submitted by the RECIPIENT requesting the Grant funds awarded by
the INSTITUTE, or (b) otherwise approved in writing as a collaborator by the
INSTITUTE.
(2) Contractor – any person or entity, other than a Collaborator or the
RECIPIENT (or their respective personnel), who is contracted by the RECIPIENT to
perform activities for the Project.
(3) Equipment – an article of tangible, nonexpendable personal property having a
useful life of more than one year and an acquisition cost of $5,000 or more per
unit.
(4) Grant – the funding assistance authorized by TEX. HEALTH & SAFETY CODE, Ch.
102 in the amount specified in Section 2.01 and awarded by the INSTITUTE to the
RECIPIENT to carry out the Project pursuant to the terms and conditions of this
Contract.
(5) Indirect Costs – the expenses of doing business that are not readily
identified with a particular grant, contract, project, function or activity, but
are necessary for the general operation of the organization or the performance
of the organization’s activities.
(6) Institute-Funded Activity - all aspects of work conducted on or as part of
the Project.

(7) Non-Profit Organization – a university or other institution of higher
education or an organization of the type described in 501(c)(3) of the Internal
Revenue Code of 1986, as amended (26 U.S.C. 501 (c)(3)) and exempt from taxation
under 501 (a) of the Internal Revenue Code (26 U.S.C. 501 (a)) or any nonprofit
scientific or educational organization qualified under a state nonprofit
organization statute.
(8) Principal Investigator/Program Director – the individual designated by the
RECIPIENT to direct the Project who is principally responsible and accountable
to the RECIPIENT and the INSTITUTE for the proper conduct of the Project.
References herein to “Principal Investigator/Program Director” include
Co-Principal Investigators or Co-Program Directors as well. The Principal
Investigator/Program Director and Co-Principal Investigators or Co-Program
Directors are set forth on Attachment A.
(9) Project – the activities specified or generally described in the Scope of
Work or otherwise in this Contract (including without limitation any of the
Attachments to the Contract) that are approved by the INSTITUTE for funding,
regardless of whether the INSTITUTE funding constitutes all or only a portion of
the financial support necessary to carry them out.
(10) Recipient Personnel – The RECIPIENT’s Principal Investigator/Program
Director and RECIPIENT’s employees and consultants working on the Project.

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Article II
GRANT AWARD

Section 2.01 Award of Monies. In accordance with the provisions of this
Contract, the INSTITUTE shall disburse the proceeds of the Grant to the
RECIPIENT in an amount not to exceed $5,680,310 to be used solely for the
Project. This award is subject to compliance with the Scope of Work and
demonstration of progress towards achievement of the milestones set forth in
Section 2.02. The INSTITUTE, in its sole discretion, may award supplemental
funding not to exceed ten percent (10%) of the total Grant amount based upon
progress made by the RECIPIENT pursuant to the Scope of Work. This Grant is not
intended to be a loan of money.
Section 2.02 Scope of Work and Milestones. The RECIPIENT shall perform the
Project in accordance with this Agreement and as outlined in Application
RP110508 submitted by the RECIPIENT and approved by the INSTITUTE. The RECIPIENT
shall conduct the Project within the State of Texas with Texas-based employees,
Contractors and/or Collaborators unless otherwise specified in the Scope of Work
or the Approved Budget. The INSTITUTE and the RECIPIENT hereby adopt the terms
of Attachment A in their entirety, incorporate them as if fully set forth
herein, and agree that the Project description, goals, timeline and milestones
included as Attachment A accurately reflect the Scope of Work of the Project to
be undertaken by the RECIPIENT (the “Scope of Work”) and the milestones expected
to be achieved. RECIPENT and the INSTITUTE mutually agree that the outcome of
scientific research is unpredictable and cannot be guaranteed. The RECIPIENT
shall use commercially reasonable efforts to complete the goals of the Project
pursuant to the timeline reflected in Attachment A and shall timely notify the
INSTITUTE if circumstances occur that materially and adversely affect completion
thereof. Modifications, if any, to the Scope of Work must be agreed to in
writing by both parties as set forth in Section 2.06 “Amendments and
Modifications” herein. Material changes to the Scope of Work include, but are
not limited to, changes in key personnel involved with the Project, the site of
the Project, and the milestones expected to be achieved.
Section 2.03 Contract Term. The Contract shall be effective as of June 1, 2011
(the “Effective Date”) and terminate on May 31, 2013 or in accordance with the
Contract termination provisions set forth in Article VIII herein, whichever
shall occur first (the “Termination Date”). Unless otherwise approved by the
INSTITUTE as evidenced by written communication from the INSTITUTE to the
RECIPIENT and appended to the Contract, Grant funds distributed pursuant to the
Contract shall be expended no earlier than the Effective Date or subsequent to
the Termination Date. If, as of the Termination Date, the RECIPIENT has not used
Grant money awarded by the INSTITUTE for permissible services, expenses, or
costs related to the Project and has not received approval from the INSTITUTE
for a no cost extension to the contract term pursuant to Section 3.11 “Carry
Forward of Unspent Funds and No Cost Extension” herein, then the RECIPIENT shall
not be entitled to retain such unused Grant funds from the INSTITUTE. Certain
obligations as set forth in Section 9.09 of this Contract shall extend beyond
the Termination Date.
Section 2.04 Contract Documentation. The Contract between the INSTITUTE and the
RECIPIENT shall consist of this final, executed Contract, including the
following Attachments to the Contract, all of which are hereby incorporated by
reference:
(a)    Attachment A – Project Description, Goals and Timeline

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(b)    Attachment B – Approved Budget, including changes approved by the
INSTITUTE subsequent to execution of the Contract.
(c)    Attachment C – Assurances and Certifications
(d)    Attachment D – Intellectual Property and Revenue Sharing
(e)    Attachment E – Reporting Requirements
(f)    Attachment F – Approved Amendments to Contract, excluding budget
amendments reflected in Attachment B.
Section 2.05 Entire Agreement. All agreements, covenants, representations,
certifications and understandings between the parties hereto concerning this
Contract have been merged into this written Contract. No prior or
contemporaneous representation, agreement or understanding, express or implied,
oral or otherwise, of the parties or their agents that may have related to the
subject matter hereof in any way shall be valid or enforceable unless embodied
in this Contract.
Section 2.06 Amendments and Modifications. Requested amendments and
modifications to the Contract must be submitted in writing to the INSTITUTE for
review and approval (such approval shall not be unreasonably withheld.)
Amendments and modifications (including alterations, additions, deletions,
assignments and extensions) to the terms of this Contract shall be made solely
in writing and shall be executed by both parties. The approved amendment shall
be reflected in Attachment A if it is change to the Scope of Work, or as part of
Attachment B if it is a budget amendment, or as part of Attachment F for all
other changes. No handwritten changes to this Contract shall be effective unless
initialed and dated by authorized signatories of both parties.
Section 2.07 Relationship of the Parties. The RECIPIENT shall be responsible for
the conduct of the Project that is the subject of this Contract and shall direct
the activities and at all times be responsible for the performance of Recipient
Personnel, Collaborators, Contractors and other agents. The INSTITUTE does not
assume responsibility for the conduct of the Project or any Institute-Funded
Activity that is the subject of this Contract. The INSTITUTE and the RECIPIENT
shall perform their respective obligations under this Contract as independent
contractors and not as agents, employees, partners, joint venturers, or
representatives of the other party. Neither party is permitted to make
representations or commitments that bind the other party.
Section 2.08 Subcontracting. Any and all subcontracts entered into by the
RECIPIENT in relation to the performance of activities under the Project shall
be in writing and shall be subject to the requirements of this Contract. Without
in any way limiting the foregoing, the RECIPIENT shall enter into and maintain a
written agreement with each such permitted Contractor with terms and conditions
sufficient to ensure the RECIPIENT fully complies with the terms of this
Contract, including without limitation the terms set forth in Attachments C, D,
and E. The RECIPIENT agrees that it shall be responsible to the INSTITUTE for
the performance of and payment to any Contractor. Any reimbursements made by the
RECIPIENT to a Contractor shall be made in accordance with the applicable
provisions of TEX. GOV’T. CODE, Ch. 2251.

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Section 2.09 Transfer or Assignment by the Recipient. This Contract is not
transferable or otherwise assignable by the RECIPIENT, whether by operation of
law or otherwise, without the prior written consent of the INSTITUTE, except as
provided in this Section 2.09. Any such attempted transfer or assignment without
the prior written consent of the INSTITUTE (except as provided in this Section
2.09) shall be null, void and of no effect. For purposes of this section, an
assignment or transfer of this Contract by the RECIPIENT in connection with a
merger, transfer or sale of all or substantially all of the RECIPIENT’s assets
or business related to this Contract or a consolidation, change of control or
similar transaction involving the RECIPIENT shall not be deemed to constitute a
transfer or assignment, so long as such action does not impair or otherwise
negatively impact the revenue sharing terms in Attachment D. Nothing herein
shall be interpreted as superseding the requirement that the Project be
undertaken in Texas with Texas-based employees.
If the Principal Investigator leaves the employment of the RECIPIENT or is
replaced by the RECIPIENT for any reason during the course of the Grant with
someone who is not already designated a co-Principal Investigator in Attachment
A, the RECIPIENT shall notify the INSTITUTE prior to replacing the Principal
Investigator. Written approval by the INSTITUTE is required for the replacement
of the Principal Investigator with someone who is not already a co-Principal
Investigator in Attachment A, which approval shall not be unreasonably withheld,
conditioned or delayed.
Section 2.10 Representations and Certifications. The RECIPIENT represents and
certifies to the best of its knowledge and belief to the INSTITUTE as follows:
(a)    It has legal authority to enter into, execute, and deliver this Contract,
and all documents referred to herein, and it has taken all corporate actions
necessary to its execution and delivery of such documents;
(b)    It will comply with all of the terms, conditions, provisions, covenants,
requirements, and certifications in this Contract, and all other documents
incorporated herein by reference;
(c)    It has made no material false statement or misstatement of fact in
connection with this Contract and its receipt of the Grant, and all of the
information it previously submitted to the INSTITUTE or that it is required
under this Contract to submit to the INSTITUTE relating to the Grant or the
disbursement of any of the Grant is and will be true and correct at the time
such statement is made;
(d)    It is in compliance in all material respects with provisions of its
charter and of the laws of the State of Texas, and of the laws of the
jurisdiction in which it was formed, and (i) there are no actions, suits, or
proceedings pending, or threatened, before any judicial body or governmental
authority against or affecting its ability to enter into this Contract, or any
document referred to herein, or to perform any of the material acts required of
it in such documents and (ii) it is not in default with respect to any order,
writ, injunction, decree, or demand of any court or any governmental authority
which would impair its ability to enter into this Contract, or any document
referred to herein, or to perform any of the material acts required of it in
such documents;
(e)    Neither the execution and delivery of this Contract or any document
referred to herein, nor compliance with any of the terms, conditions,
requirements, or provisions contained in this Contract or any documents referred
to herein, is prevented by, is a breach of, or will result in a breach of, any
term, condition, or provision of any agreement or document to which it is now a
party or by which it is bound; and

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(f)    It shall furnish such satisfactory evidence regarding the representations
and certifications described herein as may be required and requested by the
INSTITUTE from time to time.
Section 2.11 Reliance upon Representations. By awarding the Grant and executing
this Contract, the INSTITUTE is relying, and will continue to rely throughout
the term of this Contract, upon the truthfulness, accuracy, and completeness of
the RECIPIENT’s written assurances, certifications and representations.
Moreover, the INSTITUTE would not have entered into this Contract with the
RECIPIENT but for such written assurances, certifications and representations.
The RECIPIENT acknowledges that the INSTITUTE is relying upon such assurances,
certifications and representations and acknowledges their materiality and
significance.
Section 2.12 Contingent upon Availability of Grant Funds. This Contract is
contingent upon funding being available for the term of the Contract and the
RECIPIENT shall have no right of action against the INSTITUTE in the event that
the INSTITUTE is unable to perform its obligations under this Contract as a
result of the suspension, termination, withdrawal, or failure of funding to the
INSTITUTE or lack of sufficient funding of the INSTITUTE for this Contract. If
funds become unavailable to the INSTITUTE during the term of the Contract,
Section 8.01(c) shall apply. For the sake of clarity, and except as otherwise
provided by this Contract, if this Contract is not funded, then both parties are
relieved of all of their obligations under this Contract. The INSTITUTE
acknowledges and agrees that the Project is a multiyear project subject to Tex.
Health & Safety Code, Chr. 102, Section 102.257.
Section 2.13 Confidentiality of Documents and Information. In connection with
work contemplated for the Project or pursuant to complying with various
provisions of this Contract, the RECIPIENT may disclose its confidential
business, financial, technical, scientific information and other information to
the INSTITUTE (“Confidential Information”). To assist the INSTITUTE in
identifying such information, the RECIPIENT shall mark or designate the
information as “confidential,” provided however that the failure to so designate
does not operate as a waiver to protections provided by applicable law or this
Contract. The INSTITUTE shall use no less than reasonable care to protect the
confidentiality of the Confidential Information to the fullest extent
permissible under the Texas Public Information Act, Texas Government Code,
Chapter 552 (the “TPIA”), and, except as otherwise provided in the TPIA to
prevent the disclosure of the Confidential Information to third parties for a
period of time equal to three (3) years from the termination of the contract,
unless the INSTITUTE and the RECIPIENT agree in writing to extend such time
period, provided that this obligation shall not apply to information that:
(a)    was in the public domain at the time of disclosure or later became part
of the public domain through no act or omission of the INSTITUTE in breach of
this Contract;
(b)    was lawfully disclosed to the INSTITUTE by a third party having the right
to disclose it without an obligation of confidentiality;
(c)    was already lawfully known to the INSTITUTE without an obligation of
confidentiality at the time of disclosure;
(d)    was independently developed by the INSTITUTE without using or referring
to the RECIPIENT’s Confidential Information; or
(e)    is required by law or regulation to be disclosed.

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The INSTITUTE shall hold the Confidential Information in confidence, shall not
use such Confidential Information except as provided by the terms of this
Contract, and shall not disclose such Confidential Information to third parties
without the prior written approval of the RECIPIENT or as otherwise allowed by
the terms of the Contract. Subject in all respects to the terms of this Contract
and the TPIA, the INSTITUTE has the right to use and disclose the Confidential
Information reasonably in connection with the exercise of its rights under the
Contract.
In the event that the INSTITUTE is requested or required (by oral questions,
interrogatories, requests for information or documents in legal proceedings,
subpoena, civil investigative demand or other similar process by a court of
competent jurisdiction or by any administrative, legislative, regulatory or
self- regulatory authority or entity) to disclose any Confidential Information,
the INSTITUTE shall provide the RECIPIENT with prompt written notice of any such
request or requirement so that the RECIPIENT may seek a protective order or
other appropriate remedy. If, in the absence of a protective order or other
remedy, the INSTITUTE is nonetheless legally compelled to make any such
disclosure of Confidential Information to any person, the INSTITUTE may, without
liability hereunder, disclose only that portion of the Confidential Information
that is legally required to be disclosed, provided that the INSTITUTE will use
reasonable efforts to assist the RECIPIENT, at the RECIPIENT’s expense, in
obtaining an appropriate protective order or other reliable assurance that
confidential treatment will be accorded the Confidential Information. To the
extent that such Confidential Information does not become part of the public
domain by virtue of such disclosure, it shall remain Confidential Information
hereunder.
Article III
DISBURSEMENT OF GRANT AWARD PROCEEDS

Section 3.01 Payment of Grant Award Proceeds. The INSTITUTE will advance Grant
award proceeds upon request by the RECIPIENT, consistent with the amounts and
schedule as provided in Attachment B. If the RECIPIENT does not request
advancement of funds for some or all of the Grant award proceeds, disbursement
of Grant award proceeds for services performed and allowable expenses and costs
incurred pursuant to the Scope of Work will be on a reimbursement basis.
Section 3.02 Requests for Reimbursement and Quarterly Financial Status Reports.
If the RECIPIENT does not elect to receive an advance disbursement of Grant
proceeds, the RECIPIENT’s requests for reimbursement shall be made on INSTITUTE
Form 269a (Financial Status Report). If the RECIPIENT has elected to receive an
advance disbursement of Grant proceeds, RECIPIENT shall submit INSTITUTE Form
269a (Financial Status Report) to document all costs and allowable expenses paid
with Grant proceeds. The RECIPIENT shall submit the INSTITUTE Form 269a
quarterly to the INSTITUTE within 90 days following the end of the quarter
covered by the bill. A final INSTITUTE Form 269a shall be submitted by RECIPIENT
not later than 90 days after the Termination Date. An extension of time for
submission deadlines specified herein must be expressly authorized in writing by
the INSTITUTE.
Section 3.03 Actual Costs and Allowable Expenses. Because the Approved budget
for the Project(s) as set forth in Attachment B is only an estimate, the parties
agree that the RECIPIENT’s billings under this Contract will reflect the actual
costs and expenses incurred in performing the Project(s), regardless of the
Approved Budget, up to the total contracted amount specified in Section 2.01
“Award of Monies.” The RECIPIENT shall use Grant proceeds only for allowable
expenses consistent with state law and agency administrative rules. Allowable
expenses for the Project(s) shall be only as outlined in the Approved Budget and
any modifications to same.

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Section 3.04 Travel Expenses. Reimbursement for travel expenditures shall be in
accordance with the Approved Budget. Prior written approval from the INSTITUTE
must be obtained before travel that exceeds the amount included in the Approved
Budget commences. Failure to obtain such prior written approval shall result in
such excess travel costs constituting expenses that may not be taken into
account for the purposes of calculating expenditure of Grant funds under this
Contract.
Section 3.05 Budget Modifications. The total Approved Budget and the assignment
of costs may be adjusted based on implementation of the Scope of Work, spending
patterns, and unexpended funds, but only by an amendment to the Approved Budget.
In no event shall an amendment to the Approved Budget result in payments in
excess of the aggregate amount specified in Section 2.01 “Award of Monies” or in
approved supplemental funding for the Project, if any. The RECIPIENT may make
transfers between or among lines within budget categories without prior written
approval provided that:
(a)    The total dollar amount of all changes of any single line item within
budget categories (individually and in the aggregate) is less than [...***...]%
of the total Approved Budget;
(b)    The transfer will not increase or decrease the total Approved Budget;
(c)    The transfer will not materially change the nature, performance level, or
Scope of Work of the Project; and
(d)    The RECIPIENT submits a revised copy of the Approved Budget including a
narrative justification of the changes prior to incurring costs in the new
category.
All other budget changes or transfers require the INSTITUTE’s express prior
written approval. Transfer of funds between categories in the Project’s Approved
Budget may be allowed if requests are in writing, fit within the Scope of Work
and the total Approved Budget, are beneficial to the achievement of the
objectives of the Project, and appear to be an efficient, effective use of the
INSTITUTE’s funds.
Section 3.06 Withholding Payment. The INSTITUTE may withhold Grant award
proceeds from the RECIPIENT if required Financial Status Reports (Form 269a) are
not on file for previous quarters or for the final period, if material program
requirements are not met and remain uncured after a reasonable time period to
cure, if the RECIPIENT is in breach of any material term of this Contract, or in
accordance with provisions of this Contract as well as applicable state or
federal laws, regulations or administrative rules, and the breach remains
uncured after a reasonable time period to cure. The INSTITUTE shall have the
right to withhold all or part of any future payments to the RECIPIENT to offset
any prior advance payments made to the RECIPIENT for ineligible expenditures
that have not been refunded to the INSTITUTE by the RECIPIENT
Section 3.07 Grant Funds as Supplement to Budget. The RECIPIENT shall use the
Grant proceeds awarded pursuant to this Contract to supplement its overall
budget. These funds will in no event supplant existing funds currently available
to the RECIPIENT that have been previously budgeted and set aside for the
Project. The RECIPIENT will not bill the INSTITUTE for any costs under this
Contract that also have been billed or should have been billed to any other
funding source.

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Section 3.08 Buy Texas. The RECIPIENT shall apply good faith efforts to purchase
goods and services from suppliers in Texas to the extent reasonably possible, to
achieve a goal of more than 50 percent of such purchases from suppliers in
Texas.
Section 3.09 Historically Underutilized Businesses. The RECIPIENT shall use
reasonable efforts to purchase materials, supplies or services from a
Historically Underutilized Business (HUB). The Texas Procurement and Support
Services website will assist in finding HUB vendors
(http://www.window.state.tx.us/procurement.) The RECIPIENT shall complete a HUB
report with each annual report submitted to the INSTITUTE in accordance with
Attachment E.
Section 3.10 Limitation on Use of Grant Award Proceeds to Pay Indirect Costs.
The RECIPIENT shall not spend more than five percent of the Grant award proceeds
for Indirect Costs.
Section 3.11 Carry Forward of Unspent Funds and No Cost Extension. RECIPIENT may
request to carry forward unspent funds into the budget for the next year.
Carryover of unspent funds must be specifically approved by the INSTITUTE. The
INSTITUTE may approve a no cost extension for the Contract for a period not to
exceed six (6) months after the Termination Date if additional time beyond the
Termination date is required to ensure adequate completion of the approved
project. The Contract must be in good fiscal and programmatic standing. All
terms and conditions of the Contract shall continue during any extension period
and if such extension is approved, notwithstanding Section 2.03, all references
to the “Termination Date” shall be deemed to mean the date of expiration of such
extension period.
Article IV
AUDITS AND INSPECTIONS

Section 4.01 Record Keeping. The RECIPIENT, each Collaborator and each
Contractor whose costs are funded in all or in part by the Grant shall maintain
or cause to be maintained books, records, documents and other evidence
(electronic or otherwise) pertaining in any way to its performance under and
compliance with the terms and conditions of this Contract (“Records”). The
RECIPIENT, each Collaborator and each Contractor shall use, or shall cause the
entity which is maintaining such Records to use generally accepted accounting
principles in the maintenance of such Records, and shall retain or require to be
retained all of such Records for a period of four (4) years from the Termination
Date of the Contract.
Section 4.02 Audits. Upon request and with reasonable notice, the RECIPIENT,
each Collaborator and each Contractor whose costs are charged to the Project
shall allow, or shall cause the entity which is maintaining such items to allow,
the INSTITUTE, or auditors working on behalf of the INSTITUTE, including the
State Auditor and/or the Comptroller of Public Accounts for the State of Texas,
to review, inspect, audit, copy or abstract all of its Records during regular
working hours. Acceptance of funds directly under the Contract or indirectly
through a subcontract under the Contract constitutes acceptance of the authority
of the INSTITUTE, or auditors working on behalf of the INSTITUTE, including the
State Auditor and/or the Comptroller of Public Accounts, to conduct an audit or
investigation in connection with those funds for a period of four (4) years from
the Termination Date of the Contract.

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Notwithstanding the foregoing, any RECIPIENT expending $[...***...] or more in
federal or state awards during its fiscal year shall obtain either an annual
single audit or a program specific audit. A RECIPIENT expending funds from only
one federal program (as listed in the Catalog of Federal Domestic Assistance
(CFDA) or one state program may elect to obtain a program specific audit in
accordance with Office of Management and Budget (OMB) Circular A-133 or with the
State of Texas Uniform Grant Management Standards (UGMS). A single audit is
required if funds from more than one federal or state program are spent by the
RECIPIENT. The audited time period is the RECIPIENT’s fiscal year, not the
INSTITUTE funding period.
Section 4.03 Inspections. In addition to the audit rights specified in Section
4.02 “Audits”, the INSTITUTE shall have the right to conduct periodic onsite
inspections within normal working hours and on a day and a time mutually agreed
to by the parties, to evaluate the Institute-Funded Activity. The RECIPIENT
shall fully participate and cooperate in any such evaluation efforts.
Section 4.04 On-going Obligation to Submit Requested Information. The RECIPIENT
shall, submit other information related to the Grant to the INSTITUTE as may be
reasonably requested from time-to-time by the INSTITUTE, by the Legislature or
by any other funding or regulatory bodies covering the RECIPIENT’s activities
under this Contract.
Section 4.05 Duty to Resolve Deficiencies. If an audit and/or inspection under
this Article IV finds there are deficiencies that should be remedied, then the
RECIPIENT shall resolve and/or cure such deficiencies within a reasonable time
frame specified by the INSTITUTE. Failure to do so shall constitute an Event of
Default pursuant to Section 8.03 “Event of Default.” Upon the RECIPIENT’S
request, the parties agree to negotiate in good faith, specific extensions so
that the RECIPIENT can cure such deficiencies.
Section 4.06 Repayment of Grant Proceeds for Improper Use. In no event shall
RECIPIENT retain Grant funds that have not been used by the RECIPIENT for
purposes for which the Grant was intended or in violation of the terms of this
Contract. The RECIPIENT shall repay any portion of Grant proceeds used by the
RECIPIENT for purposes for which the Grant was not intended, as determined by
the final results of an audit conducted pursuant to the provisions of this
Contract. Unless otherwise expressly provided for in writing and appended to
this Contract, the repayment shall be made to the INSTITUTE no later than
[...***...] upon a written request by the INSTITUTE specifying the amount to be
repaid and detailing the basis upon which such request is being made and the
amount shall include interest calculated at an amount not to exceed five percent
(5%) annually. The RECIPIENT may request that the INSTITUTE waive the interest,
subject in all cases to the INSTITUTE’S sole discretion.
Section 4.07 Repayment of Grant Proceeds for Relocation Outside of Texas. The
RECIPIENT shall repay the INSTITUTE all Grant proceeds disbursed to RECIPIENT in
the event that RECIPIENT relocates its principal place of business outside of
the State during the Contract term or within 3 years after the final payment of
the Grant funds is made by the INSTITUTE.

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Article V
ASSURANCES AND CERTIFICATIONS

Adoption of Attachment C. The INSTITUTE and the RECIPIENT hereby adopt the terms
of Attachment C in their entirety, incorporate them as if fully set forth
herein, and agree to perform and be bound by all such terms.

Article VI
INTELLECTUAL PROPERTY AND REVENUE SHARING

Adoption of Attachment D. The INSTITUTE and the RECIPIENT hereby adopt the terms
of Attachment D in their entirety, incorporate them as if fully set forth
herein, and agree to perform and be bound by all such terms.

Article VII
REPORTING

Adoption of Attachment E. The INSTITUTE and the RECIPIENT hereby adopt the terms
of Attachment E in their entirety, incorporate them as if fully set forth
herein, and agree to perform and be bound by all such terms.

Article VIII
EARLY TERMINATION AND EVENT OF DEFAULT

Section 8.01 Early Termination of Contract. This Contract may be terminated
prior to the Termination Date specified in Section 2.03 “Contract Term” by:
(a)    Mutual written consent of all parties to this Contract; or
(b)    The INSTITUTE for an Event of Default (defined in Section 8.03) by the
RECIPIENT; or
(c)    The INSTITUTE if allocated funds should become legally unavailable during
the Contract period and the INSTITUTE is unable to obtain additional funds for
such purposes; or
(d)    The RECIPIENT for convenience.
Section 8.02 Repayment of Grant Proceeds upon Early Termination. The INSTITUTE
may require the RECIPIENT to repay any unused portion of the disbursed Grant
proceeds in the event of early termination under 8.01 (d) above or under Section
8.01(b) above, to the extent such Event of Default resulted from Grant funds
being expended in violation of this Contract. To the extent that the INSTITUTE
exercises this option, the INSTITUTE shall provide written notice to the
RECIPIENT stating the amount to be repaid, applicable interest calculated not to
exceed five percent (5%) annually, and the schedule for such repayment. The
RECIPIENT may request that the INSTITUTE waive the interest, subject in all
cases to the INSTITUTE’S sole discretion. In no event shall the RECIPIENT retain
Grant funds that have not been used by the RECIPIENT for purposes for which the
Grant was intended.

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Section 8.03 Event of Default. The following events shall, unless expressly
waived in writing by the INSTITUTE or fully cured by the RECIPIENT pursuant to
the provisions herein, constitute an event of default (each, an “Event of
Default”):
(a)    The RECIPIENT’s failure, in any material respect, to conduct the Project
in accordance with the approved Scope of Work and to demonstrate progress
towards achieving the milestones set forth in Section 2.02;
(b)    The RECIPIENT’s failure to conduct the Project within the State of Texas
to the extent required under this Contract unless as otherwise specified in the
application, Scope of Work or Approved Budget;
(c)    The RECIPIENT’s failure to fully comply, in any material respect, with
any provision, term, condition, covenant, representation, certification, or
warranty contained in this Contract or any other document incorporated herein by
reference;
(d)    The RECIPIENT’s failure to comply with any applicable federal or state
law, administrative rule, regulation or policy with regard to the conduct of the
Project;
(e)    The RECIPIENT’s material misrepresentation or false covenant,
representation, certification, or warranty made by the RECIPIENT herein, in the
Grant application, or in any other document furnished by the RECIPIENT pursuant
to this Contract that was false or misleading at the time that it was made; or
(f)    The RECIPIENT ceases its business operations, has a receiver appointed
for all or substantially all of its assets, makes a general assignment for the
benefit of creditors, is declared insolvent by a court of competent jurisdiction
or becomes the subject, as a debtor, of a proceeding under the federal
bankruptcy code, which such proceedings are not dismissed within ninety (90)
days after filing.
Section 8.04 Notice Required. If the RECIPIENT intends to terminate pursuant to
Section 8.01(d) “Early Termination of Contract”, it shall provide written notice
to the INSTITUTE pursuant to the notice provisions of Section 9.21 “Notices” no
later than thirty (30) days prior to the intended date of termination.
If the INSTITUTE intends to terminate for an Event of Default under Section
8.01(b) by the RECIPIENT, as described in Section 8.03 “Event of Default”, the
INSTITUTE shall provide written notice to the RECIPIENT pursuant to Section 9.21
“Notices” and shall include a reasonable description of the Event of Default
and, if applicable, the steps necessary to cure such Event of Default. Upon
receiving notice from the INSTITUTE, the RECIPIENT shall have thirty (30) days
beginning on the day following the receipt of notice to cure the Event of
Default. Upon request, the INSTITUTE may provide an extension of time to cure
the Event of Default(s) beyond the thirty (30) day period specified herein so
long as the RECIPIENT is using reasonable efforts to cure and is making
reasonable progress in curing such Event(s) of Default. The extension shall be
in writing and appended to the Contract. If the RECIPIENT is unable or fails to
timely cure an Event of Default, unless expressly waived in writing by the
INSTITUTE, this Contract shall immediately terminate as of the close of business
on the final day of the allotted cure period without any further notice or
action by the INSTITUTE required. In addition, and notwithstanding the
foregoing, the INSTITUTE and the RECIPIENT agree that certain events that cannot
be cured shall, unless expressly waived in writing by the INSTITUTE, constitute
a final Event of Default under this Contract and this Contract shall terminate
immediately upon the INSTITUTE giving the RECIPIENT written “Notice of Event of
Default and FINAL TERMINATION.”

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In the event that the INSTITUTE terminates the Contract under Section 8.01(c)
above because allocated funds become legally unavailable during the Contract
period, the INSTITUTE shall immediately provide written notification to the
RECIPIENT of such fact pursuant to Section 9.21 “Notices.” The Contract is
terminated upon the RECIPIENT’s receipt of that notification, subject to Section
9.09 “Survival of Terms.”
Section 8.05 Duty to Report Event of Default. The RECIPIENT shall notify the
INSTITUTE in writing pursuant to Section 9.21 “Notices”, promptly and in no
event more than (30) days after it obtains knowledge of the occurrence of any
Event of Default. The RECIPIENT shall include a statement setting forth
reasonable details of each Event of Default and the action which the RECIPIENT
proposes to take with respect thereto.
Section 8.06 Obligations/Liabilities Affected by Early Termination. The
RECIPIENT shall not incur new obligations that otherwise would have been paid
for using Grant funds after the receipt of notice as provided by Section 8.04
“Notice Required”, unless expressly permitted by the INSTITUTE in writing, and
shall cancel as many outstanding obligations as possible. The INSTITUTE shall
not owe any fee, penalty or other amount for exercising its right to terminate
the Contract in accordance with Section 8.01. In no event shall the INSTITUTE be
liable for any services performed, or costs or expenses incurred, after the
Termination Date of the Contract. Early termination by either party shall not
nullify obligations already incurred, including the RECIPIENT’s revenue sharing
obligations as set forth in Attachment D, or the performance or failure to
perform obligations prior to the Termination Date.
Section 8.07 Interim Remedies. Upon receipt by the RECIPIENT of a notice of
Event of Default, and at any time thereafter until such Event of Default is
cured to the satisfaction of the INSTITUTE or this Contract is terminated, the
INSTITUTE may enforce any or all of the following remedies (such rights and
remedies being in addition to and not in lieu of any rights or remedies set
forth herein):
(a)    The INSTITUTE may refrain from disbursing any amount of the Grant funds
not previously disbursed; provided, however, the INSTITUTE may make such a
disbursement after the occurrence of an Event of Default without thereby waiving
its rights and remedies hereunder;
(b)    The INSTITUTE may enforce any additional remedies it has in law or
equity.
The rights and remedies herein specified are cumulative and not exclusive of any
rights or remedies that the INSTITUTE would otherwise possess.

Article IX
MISCELLANEOUS

Section 9.01 Uniform Grant Management Standards. Unless otherwise provided
herein, the RECIPIENT agrees that the Uniform Grant Management Standards (UGMS),
developed by the Governor’s Budget and Planning Office as directed under the
Uniform Grant Management Act of 1981, TEX. GOVT. CODE, Ch. 783, apply as
additional terms and conditions of this Contract and that the standards are
adopted by reference in their entirety. If there is a conflict between the
provisions of this Contract and UGMS, the provisions of this Contract will
prevail unless expressly stated otherwise.

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Section 9.02 Management and Disposition of Equipment. During the term of this
Contract, the RECIPIENT may use Grant funds to purchase Equipment to be used for
the authorized purpose of the Project, subject to the conditions set forth
below. Unless otherwise provided herein, title to Equipment shall vest in the
RECIPIENT upon termination of the Contract.
(a)    The INSTITUTE must authorize the acquisition in advance and in writing
but an acquisition is deemed authorized if included in the Approved Budget for
the Project;
(b)    Equipment purchased with Grant funds must stay within the State of Texas;
(c)    Equipment purchased with Grant funds must be materially deployed to the
uses and purposes related to the Project;
(d)    In the event the RECIPIENT is indemnified, reimbursed or otherwise
compensated for any loss of, destruction of, or damage to the Equipment
purchased using Grant funds, it shall use the proceeds to repair or replace said
Equipment;
(e)    Equipment may be exchanged (trade-in) or sold without the prior written
approval of the INSTITUTE if the proceeds thereof shall be applied to the
acquisition cost of replacement Equipment;
(d)    The RECIPIENT may use its own property management standards and
procedures provided that it observes the terms of UGMS, A-102, in all material
respects;
(e)    The title or ownership of the Equipment shall not be encumbered for
purposes other than the Project nor or transferred other than to a permitted
assignee of this Contract without the prior written approval of the INSTITUTE;
(f)    If the original or replacement Equipment is no longer needed for the
originally authorized purpose or for other activities supported by the
INSTITUTE, the RECIPIENT shall request disposition instructions from the
INSTITUTE and, upon receipt, shall fully comply therewith; and
(g)    If this Contract is terminated early pursuant to Section 8.01(b),(d), (e)
or (f) above, the INSTITUTE shall determine the final disposition of Equipment
purchased with Grant award money.
Section 9.03 Supplies and Other Expendable Property. The RECIPIENT shall
classify as materials, supplies and other expendable property the allowable unit
acquisition cost of such property under $5,000 necessary to carry out the
Project. Title to supplies and other expendable property shall vest in the
RECIPIENT upon acquisition.
Section 9.04 Acknowledgement of Grant Funding and Publicity. The parties agree
to the following terms and conditions regarding acknowledging Grant funding and
publicity:
(a)    The parties agree to fully cooperate and coordinate with each other in
connection with all press releases and publications regarding the award of the
Grant, the execution of the Contract and the Institute-Funded Activities.

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(b)    The RECIPIENT shall notify the INSTITUTE’s Information Specialist or
similar personnel at least three business days prior to any press releases,
advertising, publicity, use of CPRIT logo, or other promotional activities that
pertain to the Project or any Institute-Funded Activity. In the event that the
INSTITUTE wishes to participate in a joint press release, the RECIPIENT shall
coordinate and cooperate with the INSTITUTE’s Information Specialist or similar
personnel to develop a mutually agreeable joint press release.
(c)    Consistent with the goal of encouraging development of scientific
breakthroughs and dissemination of knowledge, publication or presentation of
scholarly materials is expected and encouraged. The RECIPIENT may publish in
scholarly journals or other peer-reviewed journals (including graduate theses
and dissertations) and may make presentations at scientific meetings without
prior notice to or consent of the INSTITUTE, except as may otherwise be set
forth in this Contract. The RECIPIENT shall promptly notify the INSTITUTE when
any scholarly presentations or publications have been accepted for public
disclosure and shall provide the INSTITUTE with final copies of all such
accepted presentations and publications. The RECIPIENT shall acknowledge receipt
of the INSTITUTE funding in all publications, presentations, press releases and
other materials regarding the work associated with the Institute-Funded
Activities. The RECIPIENT shall promptly submit an electronic version of all
published manuscripts to PubMed Central in accordance with Section 9.05 “Public
Access to Research Results.”
(d)    When grant funds are used to prepare print or visual materials for
educational or promotional purposes for the general public (e.g., patients), and
excluding presentations and publications discussed above in subsection (c), the
RECIPIENT shall provide a copy of such materials to the INSTITUTE at least ten
(10) days prior to printing. The RECIPIENT shall also acknowledge receipt of the
INSTITUTE funding on all such materials including, but not limited to,
brochures, pamphlets, booklets, training fliers, project websites, videos and
DVDs, manuals and reports, as well as on the labels and cases for audiovisual or
videotape/DVD presentations.
Section 9.05 Public Access to Results of Institute-Funded Activities. The
RECIPIENT shall submit an electronic version of its final peer-reviewed journal
manuscripts that arise from Grant funds to the digital archive National Library
of Medicine’s PubMed Central upon acceptance for publication. These papers must
be accessible to the public on PubMed no later than 12 months after publication.
This policy is subject to the terms of Attachment D and does not supplant
applicable copyright law. For clarity, this policy is not intended to require
the RECIPIENT to make a disclosure at a time or in any manner that would cause
the RECIPIENT to abandon, waive or disclaim any intellectual property rights
that it is obligated to protect pursuant to the terms of Attachment D.
Section 9.06 Work to be Conducted in State. The RECIPIENT agrees that it will
use reasonable efforts to direct that any new or expanded preclinical testing,
clinical trials, commercialization or manufacturing that is part of or relating
to any Institute-Funded Activities take place in the State of Texas, including
the establishment of facilities to meet this purpose. If the RECIPIENT decides
not to conduct such work in the State of Texas, the RECIPIENT shall provide a
prior written explanation to the INSTITUTE detailing the RECIPIENT’s reasons for
conducting the work outside of the State of Texas and the RECIPIENT’s efforts
made to conduct the work in the State of Texas
Section 9.07 Duty to Notify. During the term of this Contract and for a period
of [...***...] thereafter, the RECIPIENT is under a continuing obligation to
notify the INSTITUTE’s executive director at the same time it is required to
notify any Federal or State entity of any unexpected adverse event

15

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or condition that materially impacts the performance or general public
perception of the conduct or results of the Project and the Institute-Funded
Activities, including any impact to the Scope of Work included in the Contract
and events or results that have a serious adverse impact on human health, safety
or welfare. By way of example only, if clinical testing of the results of the
Institute-Funded Activities reveal an unexpected risk of developing serious
health conditions or death, then the RECIPIENT shall, at the same time it
notifies any Federal or State entity, promptly so notify the INSTITUTE’s
executive director even if such results are not available until after the term
of this Contract. Notice required under this section shall be made as promptly
as reasonably possible and shall follow the procedures set forth in Section 9.21
“Notices.”
Section 9.08 Severability. If any provision of this Contract is construed to be
invalid, illegal or unenforceable in any respect, such invalidity, illegality or
enforceability shall not affect any other provisions hereof. The invalid,
illegal or unenforceable provision shall be deemed stricken and deleted to the
same extent and effect as if never incorporated herein. All other provisions
shall continue as provided in this Contract.
Section 9.09 Survival of Terms. Termination or expiration of this Contract for
any reason will not release either party from any liabilities or obligations set
forth in this Contract that: (1) the Parties have expressly agreed shall survive
any such termination or expiration; or (2) remain to be performed or by their
nature would be intended to be applicable following any such termination or
expiration. Such surviving terms include, but are not limited to, Sections 2.13,
4.01, 4.02, 4.05, 4.06, 8.02, 8.06, 9.04, 9.05, 9.06, 9.07, 9.09, 9.14, 9.15,
9.16, 9.17, 9.18, and Attachment D.
Section 9.10 Binding Effect and Assignment or Modification. This Contract and
all terms, provisions and obligations set forth herein shall be binding upon and
shall inure to the benefit of the parties and their successors and permitted
assigns, including all other state agencies and any other agencies, departments,
divisions, governmental entities, public corporations or other entities which
shall be successors to either of the parties or which shall succeed to or become
obligated to perform or become bound by any of the covenants, agreements or
obligations hereunder of either of the parties hereto. Upon a permitted
assignment of this Contract by RECIPIENT, all references to “the RECIPIENT”
herein shall be deemed to refer to such permitted assignee.
Section 9.11 No Waiver of Contract Terms. Neither the failure by the RECIPIENT
or the INSTITUTE, in any one or more instances, to insist upon the complete and
total observance or performance of any term or provision hereof, nor the failure
of the RECIPIENT or the INSTITUTE to exercise any right, privilege or remedy
conferred hereunder or afforded by law, shall be construed as waiving any breach
of such term or provision or the right to exercise such right, privilege or
remedy thereafter. In addition, no delay on the part of either the RECIPIENT or
the INSTITUTE, in exercising any right or remedy hereunder shall operate as a
waiver thereof, nor shall any single or partial exercise of any right or remedy
preclude other or further exercise thereof or the exercise of any other right or
remedy.
Section 9.12 No Waiver of Sovereign Immunity. No provision of this Contract is
in any way intended to constitute a waiver by the INSTITUTE, the RECIPIENT (if
applicable), or the State of Texas of any immunities from suit or from liability
that the INSTITUTE, the RECIPIENT, or the State of Texas may have by operation
of law.

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Section 9.13 Force Majeure. Neither the INSTITUTE nor the RECIPIENT will be
liable for any failure or delay in performing its obligations under the Contract
if such failure or delay is due to any cause beyond the reasonable control of
such party, including, but not limited to, unusually severe weather, strikes,
natural disasters, fire, civil disturbance, epidemic, war, court order or acts
of God. The existence of such causes of delay or failure will extend the period
of performance in the exercise of reasonable diligence until after the causes of
delay or failure have been removed. Each party must inform the other in
accordance with Section 9.21 “Notices” within five (5) business days, or as soon
as it is practical, of the existence of a force majeure event or otherwise waive
this right as a defense.
Section 9.14 Disclaimer of Damages. IN NO EVENT WILL EITHER PARTY BE LIABLE TO
THE OTHER PARTY FOR ANY INDIRECT, SPECIAL, PUNITIVE, EXEMPLARY, INCIDENTAL OR
CONSEQUENTIAL DAMAGES. THIS LIMITATION WILL APPLY REGARDLESS OF WHETHER OR NOT
THE OTHER PARTY HAS BEEN ADVISED OF THE POSSIBILITY OF SUCH DAMAGES.
Section 9.15 Indemnification and Hold Harmless. Except as provided herein, the
RECIPIENT agrees to fully indemnify and hold the INSTITUTE and the State of
Texas harmless from and against any and all claims, demands, costs, expenses,
liabilities, causes of action and damages of every kind and character (including
reasonable attorneys fees) which may be asserted by any third party in any way
related or incident to, arising out of, or in connection with (1) the
RECIPIENT’s negligent, intentional or wrongful performance or failure to perform
under this Contract, (2) the RECIPIENT’s receipt or use of Grant funds, or (3)
any negligent, intentional or wrongful act or omission committed by the
RECIPIENT as part of an Institute-Funded Activity or during the Project. In
addition, the RECIPIENT agrees to fully indemnify and hold the INSTITUTE and the
State of Texas harmless from and against any and all costs and expenses of every
kind and character (including reasonable attorneys fees, costs of court and
expert fees) that are incurred by the INSTITUTE or the State of Texas arising
out of or related to a third party claim of the type specified in the preceding
sentence. Notwithstanding the preceding, such indemnification shall not apply in
the event of the sole or gross negligence of the INSTITUTE. If the RECIPIENT is
a State of Texas agency or institution of higher education, then this Section
9.15 is subject to the extent authorized by the Texas Constitution and the laws
of the State of Texas.
The RECIPIENT acknowledges and agrees that this indemnification shall apply to,
but is not limited to, employment matters, taxes, personal injury, and
negligence.
It is understood and agreed that it is not the intent of the parties to expand
or increase the liability of the State of Texas under this Article. This
provision is intended to prevent the RECIPIENT, the INSTITUTE and the State of
Texas from attempting or appearing to assume liability it does not have the
statutory or legal power to assume.
Section 9.16 Alternative Dispute Resolution. If applicable, the dispute
resolution process provided for in TEX. GOVT. CODE, Ch. 2260 shall be used, as
further described herein, to resolve any claim for breach of contract made
against the INSTITUTE (excluding any uncured Event of Default). The submission,
processing and resolution of a party’s claim are governed by the published rules
adopted by the Attorney General pursuant to TEX. GOVT. CODE, Ch. 2260, as
currently effective, hereafter enacted or subsequently amended.
Section 9.17 Applicable Law and Venue. This Contract shall be construed and all
disputes shall be considered in accordance with the laws of the State of Texas,
without regard to its principles governing the conflict of laws. Provided that
the RECIPIENT first complies with procedures set forth in Section 9.16
“Alternative Dispute Resolution,” exclusive venue and jurisdiction for the
resolution of claims arising from or related to this Contract shall be in the
federal and state courts in Travis County, Texas.

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Section 9.18 Attorneys’ Fees. In the event of any litigation, appeal or other
legal action to enforce any provision of the Contract, the RECIPIENT shall pay
all expenses of such action, including attorneys’ fees and costs, if the
INSTITUTE is the prevailing party. If the RECIPIENT is a State of Texas agency
or institution of higher education, then this Section 9.18 is subject to the
extent authorized by the Texas Constitution and the laws of the State of Texas.
Section 9.19 Counterparts. This Contract may be executed in any number of
counterparts, each of which when so executed and delivered shall be an original,
but such counterparts shall together constitute one and the same instrument.
Section 9.20 Construction of Terms. The headings used in this Contract are
inserted only as a matter of convenience and for reference and shall not affect
the construction or interpretation of this Contract. Where context so indicates,
a word in the singular form shall include the plural, a word in the masculine
form the feminine, and vice-versa. The word “including” and similar
constructions (such as “includes”, “included”, “for example”, “such as”, and
“e.g.”) shall mean “including, without limitation” throughout this Contract. The
words “and” and “or” are not intended to convey exclusivity or nonexclusivity
except where expressly indicated or where the context so indicates in order to
give effect to the intent of the parties.
Section 9.21 Notices. All notices, requests, demands and other communications
will be in writing and will be deemed given on the date received as demonstrated
by (i) a courier’s receipt or registered or certified mail return receipt signed
by the party to whom such notice was sent, provided that such notice was sent to
the address provided in the signature block of this Contract, or (ii) a fax
confirmation page showing that such fax was successfully transmitted to the fax
number provided in the signature block of this Contract. Notices shall be sent
to the parties at the addresses or fax numbers specified herein or as may be
updated from time to time by the applicable party in a writing delivered to the
other party pursuant to the terms of this Section.

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IN WITNESS THEREOF, THE PARTIES HAVE SIGNED AND EXECUTED IN DUPLICATE
COUNTERPARTS ON THE DATES INDICATED.
RECIPIENT

By /s/ Thomas J. Farrell, CEO    
(Signature of Person Authorized to Sign Contracts)
Name:    Thomas J. Farrell, CEO
Date:    7/27/11

RECIPIENT Mailing Address:
BELLICUM PHARMACEUTICALS, INC.

6400 Fannin st., Suite 2300, Houston, TX 77030

Physical Address: (If idfferent from above)

Phone: (713) 341-6472
Fax: (13) 335-1446
INSTITUTE

By /s/ William Gimson    

Name:    William Gimson
Date:    July 27, 2011

INSTITUTE Mailing Address:
Cancer Prevention and Research Institute of TX
Grant Compliance
P.O. Box 12097
Austin, TX 78711

INSTITUTE Physical Address:
211 E. 7th Street, Suite 300
Austin, TX 78701

Phone: (512) 463-3190

Fax: (512) 475-2563

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image_41.jpg [image_41.jpg]
ATTACHMENT A
Project Description Summary
The project encompasses preparation for and execution of a Phase 2 clinical
trial, protocol number BP- HM-001, currently entitled “[...***...]”. The
Principal Investigator will be Dr. Richard Champlin, Chairman, Department of
Stem Cell Transplantation and Cellular Therapy, The University of Texas M.D.
Anderson Cancer Center, which will also be the primary clinical trial site. Up
to [...***...] additional sites will be recruited to participate in the trial,
including other sites in Texas.
Preparation activities include the following:
        [...***...]
Activities during the clinical trial include the following:
        [...***...]
Project Goals and Timelines

Page A1

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The primary project goals are to [...***...]. The timeline is summarized by
quarter as follows:

[...***...][...***...][...***...][...***...][...***...][...***...][...***...][...***...][...***...][...***...][...***...][...***...]
[...***...]
[...***...]
[...***...]
[...***...]
[...***...]
[...***...]
[...***...]
[...***...]
[...***...]
[...***...]
[...***...]
[...***...]
[...***...]
[...***...]
[...***...]
[...***...]
[...***...]

The primary milestone to be achieved in Year 1, which will be the milestone for
Year 2 funding, is [...***...] in the clinical trial. This milestone depends on
the achievement of earlier milestones, including [...***...]. This primary
milestone is expected to occur approximately [...***...].
The primary milestone to be achieved in Year 2, which will be the milestone for
Year 3 funding, is [...***...]. Because [...***...].
The primary milestone to be achieved in Year 3, and for the project as a whole,
is [...***...]

Page A2

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image_41.jpg [image_41.jpg]
Application ID: RP110508
Principal Investigator/Program Director: K. Slavin

ATTACHMENT B

DETAILED BUDGET FORM

BUDGET CATEGORYYear 1Year 2Year 3Year 4Year 5TOTALa.
PERSONNEL[...***...][...***...][...***...][...***...]b. FRINGE
BENEFITS[...***...][...***...][...***...][...***...]c.
TRAVEL[...***...][...***...][...***...][...***...]d.
EQUIPMENT[...***...][...***...][...***...][...***...]e.
SUPPLIES[...***...][...***...][...***...][...***...]f. CONTRACTUALProcess
Development[...***...][...***...][...***...][...***...]Clinical Lot
Manufacturing[...***...][...***...][...***...][...***...]Data
Management[...***...][...***...][...***...][...***...]Research-Related Subject
C[...***...][...***...][...***...][...***...]g.
OTHER[...***...][...***...][...***...][...***...]h. Total Direct
Charges[...***...][...***...][...***...][...***...][...***...][...***...]i.
Indirect Charges[...***...][...***...][...***...][...***...]Grand
TOTAL[...***...][...***...][...***...][...***...][...***...][...***...]

Texas/Federal Vendor ID#:12014502004000Fiscal contact:Thomas FarrellAddress:6400
Fannin St., Suite 2300Address 2:Houston, TX 77030Phone:(713) 341-6472Fax:(713)
335-1446Email:tfarrell@bellicum.com

For questions regarding this form, please contact Alfonso Royal at (512)
305-8488 or oroyal@cprit.state.tx.us.

Page B1

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image_41.jpg [image_41.jpg]
ATTACHMENT C

ASSURANCES AND CERTIFICATIONS

This Attachment C is hereby incorporated into and made a part of that certain
CANCER RESEARCH GRANT CONTRACT (“Contract”) by and between the Cancer Prevention
and Research Institute of Texas (“CPRIT” or the “INSTITUTE”) and the RECIPIENT.
A capitalized term used in this Attachment shall have the meaning given to term
in the Contract or in the Attachments to the Contract, unless otherwise defined
herein. In the event of a conflict between the provisions of this Attachment and
the provisions of the Contract, this Attachment shall control. Notwithstanding
any other provision of this Attachment C, each reference to “compliance” in the
foregoing certifications and assurances shall mean “compliance in all material
respects” and the RECIPENT shall be deemed to be in compliance with a law,
regulation or policy identified in a particular certification or assurance
specified in this Attachment C if the RECIPIENT is in compliance in all
materials respects with such law, regulation or policy, as applicable.
By signing this Contract, RECIPIENT certifies compliance with the following
assurances and certifications required by the INSTITUTE (listed below).
RECIPIENT further acknowledges that its obligations pursuant to the following
assurances and certifications are ongoing.
Section C1.01 Demonstration of Matching Funds. Pursuant to TEX. HEALTH & SAFETY
CODE § 102.255(d) and T.A.C. § 703.11, RECIPIENT has an amount of funds equal to
one-half of the amount of the Grant to be disbursed each fiscal year of the
Contract term dedicated to the same area of cancer research that is the subject
of the Grant as demonstrated by the form incorporated herein to Attachment C.
The RECIPIENT shall update the matching funds certification annually for each
fiscal year that Grant funds are disbursed. The update must be on or before the
anniversary of the Effective Date.
Section C1.02 Payment of Taxes. RECIPIENT’s payment of franchise taxes is
current or, if the RECIPIENT is exempt from payment of franchise taxes, that it
is not subject to the State of Texas franchise tax. If franchise tax payments
become delinquent during the Contract term, payments under this Contract may,
upon delivery of written notice by the INSTITUTE to the RECIPIENT be withheld
until the RECIPIENT’s delinquent franchise tax is paid in full. The RECIPIENT
also acknowledges that it is not otherwise exempt from state sales or occupancy
tax as a result of this Contract.
Section C1.03 Compliance with Confidentiality Guidelines Relating to Personal
and Medical Information. RECIPIENT complies with all applicable laws, rules and
regulations relating to personal and medical information. Without in any way
limiting the foregoing, RECIPIENT maintains and enforces, to the extent
applicable to RECIPIENT, appropriate facility and information technology access
rules and procedures to protect against inappropriate disclosure of patient
records and all other documents containing patient personal and medical
information deemed confidential by law, which are maintained in connection with
the Project and Institute-Funded Activities, including provisions that comply
with the requirements of the INSTITUTE’s rules, 25 T.A.C. Section 703.14. Upon
request from the INSTITUTE, RECIPIENT will timely furnish a copy of the
RECIPIENT’s facility and information technology access rules and procedures, as
well as any other applicable confidentiality guidelines.
If RECIPIENT, including any Collaborators or Contractors, works directly with
patients or otherwise has access to or maintains patient personal and medical
information, RECIPIENT specifically addresses Health Insurance Portability and
Accountability Act of 1996 regulations concerning confidentiality of personal
and medical information. Any disclosure of patient confidential information in
any way related to the Project (including information that may be required by
reports and inspections) must be in accordance with all applicable laws.

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Section C1.04 Conduct of Research or Service Provided. RECIPIENT understands
that the Project must be conducted with full consideration for the ethical and
medical implications of the research performed or services delivered and comply
with all applicable federal and state laws regarding the conduct of the research
or service.
Section C1.05 Regulatory Certificates, Licenses and Permits. All of the
RECIPIENT’s personnel, facilities and equipment involved or to be involved in
the Project are certified, licensed, permitted, registered or approved by the
appropriate regulating agency, where applicable. Any revocation, surrender,
expiration, non-renewal, inactivation or suspension of any such certification,
license, permit, registration or approval shall constitute grounds for Contract
termination if the same is not remedied (or alternative personnel, facilities
and/or equipment identified, as applicable, for use in the Project) within the
applicable cure period specified in Section 8.04.
Section C1.06 Assurances and Certifications in Accordance with the NIH Grants
Policy Statement:
(a)    Civil Rights. Compliance with Title VI of the Civil Rights Act of 1964.
(b)    Handicapped Individuals. Compliance with Section 504 of the
Rehabilitation Act of 1973 as amended.
(c)    Sex Discrimination. Compliance with Section 901 of Title IX of the
Education Amendments of 1972 as amended.
(d)    Age Discrimination. Compliance with the Age Discrimination Act of 1975,
as amended.
(e)    Patents, Licenses and Inventions. Compliance with the Standard Patent
Rights clauses as specified in 37 CFR, Part 401 or 35 U.S.C. 203, if appropriate
and applicable, in a manner that adequately protects the INSTITUTE’S rights in
the Project Results.
(f)    Human Subjects. Compliance with the requirements of federal policy
concerning the safeguarding of the rights and welfare of human subjects who are
involved in activities supported by federal funds. Before any funding may be
utilized for any portion of the Project involving human subjects, RECIPIENT must
receive approval from RECIPIENT’s Institutional Review Board (IRB). Upon
request, a copy of RECIPIENT’s IRB approval must be provided to the INSTITUTE.
(g)    Human Biological/Anatomical Material. Compliance with the recommendations
of the NIH Office of Human Subject Research Medical Administrative Series (MAS)
#MO1-2 entitled “Procurement and Use of Human Biological Materials for
Research,” and any other applicable federal or state requirements pertaining to
the procurement and use of human biological material for research.
(h)    Use of Animals. Compliance with applicable portions of the Animal Welfare
Act (PL 89-544 as amended) and appropriate Public Health Service Policy on
Humane Care and Use of Laboratory Animals regulations. Before any funding may be
utilized for any portion of the Project involving animal subjects, RECIPIENT
must receive approval from RECIPIENT’s Institutional Animal Care and Use
Committee (IACUC). Upon request, a copy of RECIPIENT’s IACUC approval must be
provided to the INSTITUTE.

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(i)    Debarment and Suspension. RECIPIENT certifies that neither it nor the
Principal Investigator/Project Director or any other Recipient Personnel or
personnel of any Collaborator or Contractor assigned to work on the Project are
debarred, suspended, proposed for debarment, declared ineligible or otherwise
excluded from participation in the Project by any federal or state department or
agency.
(j)    Non-Delinquency on Federal or State Debt. RECIPIENT certifies that
neither it, nor, to its knowledge, any person to be paid from funds under this
Contract, is delinquent in repaying any Federal debt as defined by OMB Circular
A-129 or any debt to the State of Texas.
(k)    Eligibility to Receive Payments on State Contracts. RECIPIENT certifies
that it and, to its knowledge, the Principal Investigator/Project Director are
not ineligible to receive the Grant award under this Contract pursuant to Tex.
Fam. Code Ann. Section 231.006 and acknowledges that this Contract may be
terminated and payment may be withheld if this certification is inaccurate.
(l)    Drug-Free Workplace. Compliance with the Drug-Free Workplace Act of 1988
(45 CFR 82).
(m)    Misconduct in Science. Compliance with 42 CFR Part 50, Subpart A, and
Final Rule as published at 54 CFR 32446, August 8, 1989.
(n)    Objectivity of Research/Conflict of Interest. Compliance with the NIH
requirement to maintain a written standard of conduct and comply with 42 CFR
Part 50, Subpart F, Responsibility of Applicants for Promoting Objectivity in
Research. RECIPIENT must notify the INSTITUTE of any conflicting financial
interests pertaining to the performance of the Project and assure that such
conflict of interest has been appropriately managed, reduced or eliminated.
(o)    Trafficking in Persons. Compliance with the NIH regulations on
trafficking in persons as published at
http://grants.nih.gov/grants/guide/notice-files/NOT-OD-08-055.html.
(p)    Criminal Misconduct. RECIPIENT shall promptly report to the INSTITUTE
issues involving potential civil or criminal fraud related in any way to the
Project, the Institute-Funded Activity or this Contract, such as false claims or
misappropriation of federal or state funds.

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ATTACHMENT C
CPRIT Matching Requirement Certification Form

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ATTACHMENT D
INTELLECTUAL PROPERTY AND REVENUE SHARING
This Attachment D is hereby incorporated into and made a part of that certain
CANCER RESEARCH GRANT CONTRACT (“Contract”) by and between the Cancer Prevention
and Research Institute of Texas (“CPRIT” or the “INSTITUTE”) and the RECIPIENT.
A capitalized term used in this Attachment shall have the meaning given the term
in the Contract or in the Attachments to the Contract, unless otherwise defined
herein. In the event of a conflict between the provisions of this Attachment and
the provisions of the Contract, this Attachment shall control.
PART 1
OWNERSHIP AND INTELLECTUAL PROPERTY PROTECTION

Section D1.01 Ownership of Project Results. RECIPIENT and its Collaborators
shall retain ownership of the Institute-Funded Technology and the
Institute-Funded IPR, subject to the terms of the Contract.
Section D1.02 Transfer or Assignment of Rights to a Third Party. RECIPIENT shall
notify the INSTITUTE of any proposed transfer or assignment of rights in any
Institute-Funded IPR to a third party. RECIPIENT shall ensure that, in any
assignment or transfer of Institute-Funded IPR, the transferee or assignee
agrees in writing to (i) recognize that the Institute-Funded IPR is transferred
or assigned subject to the licenses, interests and other rights in such
Institute-Funded IPR provided to the INSTITUTE in the Contract and any
applicable law or regulation, and (ii) take all actions necessary to protect all
such licenses, interests and other rights.
Section D1.03 Protection of Institute-Funded IPR. Subject to Section
D5.01RECIPIENT shall use commercially reasonable efforts to appropriately
protect the Institute-Funded IPR, including without limitation, diligently
seeking registration of patents and copyrights covering the Institute-Funded
Technology, as appropriate. If RECIPIENT elects to abandon Institute-Funded IPR
(including any partial abandonment of Institute-Funded IPR in specific
territories), RECIPIENT shall provide the INSTITUTE with prior written notice of
such election, with sufficient time (but no less than 30 days) for the INSTITUTE
to exercise its rights in Section D5.01 in relation to the subject
Institute-Funded IPR.
Section D1.04 Cost of Protection. The INSTITUTE shall not be responsible for,
and no Grant funds may be used to pay for, any costs or expenses associated with
RECIPIENT’s efforts to protect the Institute-Funded IPR.
Section D1.05 Inventions.
(a) Disclosures. RECIPIENT shall notify INSTITUTE of each Institute-Funded
Invention by delivering a copy of the invention disclosure form (or similar
document) within [...***...] after RECIPIENT receives the form from its
Inventor. In the event that the invention disclosure form is revised or updated,
RECIPIENT shall provide the INSTITUTE with the revised/updated invention
disclosure form as part of the RECIPIENT’s annual written report.
(b) Patent Prosecution and Maintenance. For all Institute-Funded Inventions for
which patent protection is pursued, RECIPIENT shall provide an annual written
report to the INSTITUTE regarding the status of pending applications and issued
patents .
Section D1.06 Required Agreements with Recipient Personnel and Contractors. The
RECIPIENT shall have, maintain and enforce written policies or agreements
applicable to Recipient Personnel and

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Contractors with terms sufficient to enable RECIPIENT to fully comply with all
terms and conditions of this Contract. RECIPIENT shall promptly report to
INSTITUTE any material breach of such policies or agreements relating to or
affecting any of the material provisions of this Contract.
Section D1.07 Agreements with Collaborators. All agreements between RECIPIENT
and a Collaborator relating to or affecting joint ownership of any Project
Result shall recognize the licenses, interests and other rights provided to the
INSTITUTE in the Contract. RECIPIENT shall provide to the INSTITUTE a copy of
each such agreement affecting joint ownership of any Project Result.
PART 2
NON-COMMERCIAL LICENSES

Section D2.01 RECIPIENT License. In granting an Exclusive License to any Project
Result, RECIPIENT shall retain the right to Exploit all Project Results
(including material embodiments thereof) for education, research and other
non-commercial purposes, and the right to grant the licenses pursuant to Section
D2.02 below.
Section D2.02 INSTITUTE License. RECIPIENT agrees to grant, and does hereby
grant, to the INSTITUTE a non-exclusive, irrevocable, royalty-free, perpetual,
worldwide license under the Institute-Funded IPR to Exploit all Project Results
(including material embodiments thereof) for or on behalf of the INSTITUTE and
other governmental entities and agencies of the State of Texas for education,
research and other non-commercial purposes only. RECIPIENT shall make the
Institute-Funded Technology available by reasonable means to the INSTITUTE in
order for the INSTITUTE to exercise its rights under this Section. The INSTITUTE
may not transfer or sublicense the licenses granted under this Section, except
to the State of Texas or other Texas agency.
Section D2.03 No Implied Licenses. No implied licenses are granted under this
Agreement including any license to any Intellectual Property Rights owned or
controlled by RECIPIENT outside of the Institute-Funded IPR. Nothing in this
Agreement shall be construed to impose an obligation on RECIPIENT to license or
otherwise make available any of its Intellectual Property Rights or other
resources owned or controlled by it except as expressly provided in this
Agreement with respect any Institute Funded IPR.
PART 3
COMMERCIALIZATION OF PROJECT RESULTS

Section D3.01 Commercialization Strategy. RECIPIENT shall be under a continuing
obligation throughout the term of this Contract to enhance and improve the
commercial development plan submitted with the Application and to provide an
annual written report to the INSTITUTE regarding the RECIPIENT’s efforts to
commercialize or otherwise bring to practical application Project Results. The
INSTITUTE may, at its option and at any time, provide RECIPIENT with comments
regarding the RECIPIENT’s commercial development plan and strategy, in which
case RECIPIENT shall consider in good faith and use reasonable efforts to
account for and incorporate the INSTITUTE’s input into such commercial
development plan and strategy.
Section D3.02 Commercialization Efforts. The RECIPIENT shall, whether through
its own efforts or the efforts of a licensee under a License Agreement allowed
by the terms of this Attachment, use diligent and commercially reasonable
efforts to commercialize or otherwise bring to practical application the Project
Results in accordance with the commercial development plan described in Section
D3.01.
Section D3.03 Licensing of Project Results. Each License Agreement entered into
by the RECIPIENT shall include an acknowledgement by the licensee that (i) such
License Agreement is subject to the INSTITUTE’s licenses, interests and other
rights under this Contract, and (ii) to the extent that there is a conflict
between the terms of the License Agreement and the terms of this Contract, the
terms of this

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Contract shall prevail. In addition, all License Agreements shall include terms
obligating the licensee to report to the RECIPIENT such information as is
required for the RECIPIENT to fully comply with the terms of the Contract,
including without limitation the reporting obligations set forth in Attachment
E, and to allow RECIPIENT to make the grants specified in Sections D2.02. The
RECIPIENT shall monitor the performance of its licensees and such licensees’
compliance with the terms of the License Agreements and shall take commercially
reasonable actions to enforce the terms of all License Agreements. The RECIPIENT
shall promptly report to the INSTITUTE any material breach of a License
Agreement relating to or affecting any of the material provisions of this
Contract.
Section D3.04 Cost of Licensing Activities. The INSTITUTE shall not be
responsible for, and no Grant funds may be used to pay for, any costs or
expenses associated with the RECIPIENT’s Licensing Activities.
Section D3.05 Survival. The licenses, rights and obligations set forth in this
Attachment D shall survive any termination of this Contract, including any
termination for convenience by RECIPIENT, except in the event that RECIPIENT
pays the Buyout Amount as set forth in Part 4, in which case the licenses,
rights and obligations set forth in this Attachment D shall automatically
terminate.
Section D3.06 Recipient Opt-Out. RECIPIENT may, after diligently attempting to
comply with the terms of Section D3.02, notify the INSTITUTE in writing that it
is electing to cease its efforts, either directly or through a licensee, to
commercialize or otherwise bring to practical application any particular Project
Results. Such written notice must identify the applicable Project Results,
provide a reasonable explanation of the reasons for RECIPIENT’s election,
including any feasibility studies, trial results, regulatory impediments,
financial analyses or similar assessments, and must identify any deadlines in
relation to the applicable Project Results that then exist. Upon receipt of such
notice, the INSTITUTE shall have the option, but not the obligation, to exercise
its rights in Section 5.01 in relation to the subject Project Results at the
INSTITUTE’s expense. The INSTITUTE shall notify the RECIPIENT in writing within
thirty (30) days of its receipt of the RECIPIENT’s notice if the INSTITUTE
elects to exercise its rights in relation to the subject Project Results. In the
event that the INSTITUTE exercises its option under this section, the RECIPIENT
shall fully cooperate with the INSTITUTE’s efforts, in commercializing or
otherwise bringing to practical application the applicable Project Results.
PART 4
REVENUE SHARING

Section D4.01 Revenue Sharing; Buyout.
(a) RECIPIENT shall pay to INSTITUTE royalties as follows:
(i) [...***...]% of all Revenues until the aggregate amount of royalties paid to
INSTITUTE pursuant to this Section D4.01(a)(i) equals [...***...]% of Net Grant
Award Proceeds; and
(ii) [...***...] % of all Revenues thereafter.
(b) Notwithstanding anything to the contrary in this Section D4.01, upon
RECIPIENT’s written notice of the Buyout Notice Trigger Event to INSTITUTE at
any time after the Termination Date (the “Buyout Notice”), RECIPIENT may, in
lieu of paying any additional royalties to INSTITUTE pursuant to Section
D4.01(a), pay to INSTITUTE the dollar amount set forth in the following table
opposite the applicable period in which such Buyout Notice is delivered (the
applicable dollar amount being referred to as the “Buyout Amount”):

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Period in Which Buyout Notice is DeliveredBuyout AmountOn or prior to the fifth
anniversary of the Termination Date
[...***...]% of Net Grant Award Proceeds less the aggregate amount of all
royalties paid to INSTITUTE pursuant to Section D4.01(a) as of the date of the
Buyout Notice.
After the fifth anniversary of the Termination Date but on or prior to the tenth
anniversary of the Termination Date
[...***...]% of Net Grant Award Proceeds less the aggregate amount of all
royalties paid to INSTITUTE pursuant to Section D4.01(a) as of the date of the
Buyout Notice.
After the tenth anniversary of the Termination Date
[...***...]% of Net Grant Award Proceeds less the aggregate amount of all
royalties paid to INSTITUTE pursuant to Section D4.01(a) as of the date of the
Buyout Notice.

After satisfaction of its obligations under this Section D4.01(b), RECIPIENT
shall have no further obligation under this Section D4.01.
(d) “Net Grant Award Proceeds” means the aggregate amount of Grant award
proceeds advanced to RECIPIENT, net of any Grant award proceeds repaid by
RECIPIENT to INSTITUTE, including, without limitation, pursuant to Section 4.07
of the Contract.
Section D4.02 Adjustments. If any funding sources other than the INSTITUTE (but
excluding RECIPIENT) contribute funds, directly or indirectly, to the research
yielding any particular Project Result(s) and such funding sources are legally
or contractually entitled to receive royalty based compensation with respect to
such Project Result(s) (hereinafter a “Participating Funding Source”), then the
royalty percentages in Section D4.01(a) in effect at any time shall be reduced
in proportion to the aggregate amount of funds provided by the INSTITUTE under
this Contract in comparison to the aggregate amount of funds provided by all
Participating Funding Sources that contributed to the Project Result and by the
INSTITUTE. For the sake of clarity, Participating Funding Sources do not include
equity or quasi-equity financing funding sources or debt arrangements. In
calculating such reduced rate, funds from Participating Funding Sources used for
Indirect Costs or for any costs of product development, manufacturing,
marketing, sales, regulatory approval or similar commercialization activities
shall not be included. In addition, for clarity, the rate shall not be reduced
as a result of any funds received from funding sources where such funding
sources are not legally or contractually entitled to receive a share of the
Revenue with respect to such Project Result(s).
Section D4.03 Statements and Timing of Payments. All payments owed pursuant to
this Part 4 shall be made to the Cancer Prevention and Research Institute of
Texas, and are payable on or before the thirtieth day following the end of the
calendar quarter in which RECIPIENT receives the Revenue or, in the case of
Section D4.04, receives the monetary recovery. For each payment specified in
Section D4.01, the payment shall be accompanied by a statement specifying: (i)
the Grant to which the payment relates, (ii) the identities of and amounts
funded by all Participating Funding Sources, (iii) the License

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Agreements to which the payment relates, (iv) the quantity of all Sales of each
Commercial Product and Commercial Service since the last payment, if Sales are
applicable to the current payment, (v) the gross consideration from all such
License Agreements and Sales, if Sales are applicable to the current payment,
and (vi) the amount of the payment to the Cancer Prevention and Research
Institute of Texas.
Section D4.04 Recoveries in Enforcement Actions. In the event that RECIPIENT
receives any monetary recovery from its enforcement of Institute-Funded IPR
against infringement by a third party, then it shall pay to the State of Texas a
share of such monetary recovery, including any punitive damages, less the
documented fees and expenses that are directly associated with such enforcement
and are paid by RECIPIENT to third parties, at the same rate and in the same
manner as it shares Revenue pursuant to Section D4.01 (including any adjustments
allowed by Section D4.02). For clarity, if the enforcement action is resolved by
way of the execution of a License Agreement with the infringing third party,
such License Agreement is consistent with the Section D4.01, then this Section
D4.04 is not intended to apply to such License Agreement or the consideration
specified therein.
Section D4.05 Revenue-Related Records. In addition to satisfying the
requirements of Article IV of the Contract and Section E1.03 of Attachment E,
the RECIPIENT shall keep complete and accurate Revenue-related Records until the
fourth anniversary of the date of the payment of the last royalty payment owed
hereunder, in sufficient detail to permit the INSTITUTE to confirm the accuracy
of the statements delivered to the INSTITUTE under Section D4.03 and the
calculation of the royalties owed hereunder.
Section D4.06 Audit of Revenue-Related Records. Upon at least [...***...]
advance written notice, the RECIPIENT shall permit the INSTITUTE or its
representatives or agents, at the INSTITUTE’s expense, to examine the
Revenue-related Records of the RECIPIENT pursuant to Section D4.05 at least once
per calendar year during regular business hours for the purpose of and to the
extent necessary to verify the RECIPIENT’s compliance with this Part 4. The
rights of the INSTITUTE under this Section D4.06 shall terminate on the fourth
anniversary of the date of the payment of the last royalty payment owed
hereunder. In the event that any such examination reveals an underpayment to the
INSTITUTE of greater than [...***...] percent ([...***...]%) of the amounts
previously paid by the RECIPIENT to the INSTITUTE, then the RECIPIENT shall
reimburse the INSTITUTE for the cost of such examination.
PART 5
OPT-OUT AND DEFAULT

Section D5.01 RECIPIENT Opt-Out. Upon receipt of RECIPIENT’s notice of its
election (i) under Section D1.03 to abandon any Institute-Funded IPR or (ii)
under Section 3.06 to cease its efforts to commercialize or otherwise bring to
practical application any particular Project Results, the INSTITUTE shall have
the option, but not the obligation, to pursue protection of the applicable
Institute-Funded IPR, including directing the filing, prosecution and
maintenance of patents covering the applicable Institute-Funded Inventions
and/or to commercialize or otherwise bring to practical application the
applicable Project Results, at its own cost, either directly or through one or
more licensees. If the INSTITUTE elects to exercise such option, it shall notify
RECIPIENT in writing within thirty (30) days of its receipt of RECIPIENT’s
notice and RECIPIENT shall thereafter comply with the terms of Section D5.03.
Section D5.02 RECIPIENT Default. In the event that the INSTITUTE notifies
RECIPIENT in writing of RECIPIENT’s failure to materially comply with its
obligations under Sections D1.03 or D3.02 with respect to any particular Project
Results, and RECIPIENT fails to cure such failure within thirty (30) days of
such notice, then the INSTITUTE shall have the option, but not the obligation,
to direct the filing, prosecution and maintenance of patents covering the
applicable Institute-Funded Inventions and/or to commercialize or otherwise
bring to practical application the applicable Project Results, at its own cost,
either directly or through one or more licensees. If the INSTITUTE elects to
exercise such option, it shall notify the RECIPIENT in writing of such election
and RECIPIENT shall thereafter comply with the terms of Section D5.03.

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Section D5.03 RECIPIENT Cooperation upon Opt-Out or Default. In the event that
the INSTITUTE exercises its option under Section D5.01 or D5.02, the RECIPIENT
shall:
(1)    transfer all of its right, title and interest in and to the applicable
Project Results to the INSTITUTE or the INSTITUTE’s designee, to the maximum
extent allowed by law, including where relevant and necessary to facilitate the
foregoing transfer, requesting and diligently attempting to obtain any approvals
required by law or otherwise in relation to such transfer;
(2)    to the extent that RECIPIENT is unable to transfer all of its right,
title and interest in and to the applicable Project Results to the INSTITUTE as
specified in item (1), and subject to any existing third party rights, RECIPIENT
hereby grants to the INSTITUTE an exclusive, royalty-free, perpetual, fully
transferable license under the applicable Institute-Funded IPR to Exploit the
Project Results for the development, manufacture and sale of Commercial Products
and Commercial Services and for all other purposes reasonably related thereto,
provided that the INSTITUTE may exercise the foregoing license rights only after
exercising its option under Section D5.01 or D5.02;
(3)    fully cooperate with the INSTITUTE’s efforts, and at the INSTITUTE’s
cost, in protecting applicable Institute-Funded Inventions and in
commercializing or otherwise bringing to practical application the applicable
Project Results, including making relevant Recipient Personnel (to the extent
still then-employed by RECIPIENT), Contractors, Collaborators, records, papers,
information, samples, specimens and other materials related to the applicable
Institute-Funded Technology reasonably available for such purposes and executing
any documents and taking any further action necessary to fully effectuate the
intent of this Section; and
(4)    not take any action that would materially impede the INSTITUTE’s ability
to protect the applicable Institute-Funded Inventions.
If the INSTITUTE exercises its option under Sections D5.01 or D5.02, RECIPIENT
shall have no further claim or interest in or to the applicable Project Results
(except as set forth in Part 2 of this Attachment, if applicable) and shall not
be entitled to any share of Revenue or any other compensation with respect to
such Project Results, except to the minimum extent required by law, if any. To
the extent that the INSTITUTE has exercised its option under Section D5.01 or
D5.02 and RECIPIENT is unable to transfer all of its right, title and interest
in and to the applicable Project Results to the INSTITUTE as specified in item
(1), then the INSTITUTE’s license set forth in item (2) includes the right, but
not the obligation, for the INSTITUTE at its cost to: (i) direct the filing,
prosecution and maintenance of patents covering the applicable Project Results,
and (ii) enforce all applicable Institute-Funded IPR relevant to the Project
Results against any infringement by a third party. Subject to the statutory
duties of the Texas Attorney General, if any, RECIPIENT shall cooperate fully
with the INSTITUTE in any action brought by the INSTITUTE to enforce the
Intellectual Property Rights in the applicable Project Results, at the
INSTITUTE’s cost, including without limitation, joining the enforcement action
in name as a party plaintiff after all required approvals are obtained; provided
that the INSTITUTE or its designee shall have full control over such enforcement
action and shall receive and retain all monetary recoveries resulting from such
enforcement actions, including any punitive damages.

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PART 6
DEFINITIONS

The following terms shall have the following meaning throughout this Attachment.
Other terms may be defined elsewhere in this Attachment.
(1) Authorized Seller – RECIPIENT, its Collaborators, or their licensees or any
other party authorized by RECIPIENT, its Collaborators or their licensees to
make a Sale on their behalf.
(2) Buyout Trigger Event – the acquisition, by an independent third party (“the
Party”), of substantially all of the assets of RECIPIENT and the Party notifies
the RECIPIENT it desires to buy out the Royalty defined by this Contract.
(3) Commercial Product – anything that incorporates, is based on, utilizes or is
developed from Project Results and is created by human or mechanical effort or
by a natural process and that is capable of being sold, licensed, transferred or
conveyed to another party or is capable of otherwise being Exploited or disposed
of, whether in exchange for consideration or not, including without limitation
any drug, chemical or biological compound, gene, nucleic acid or nucleic acid
sequence, gene therapy, plant, machine, mechanical device, hardware, tool or
computer program.
(4) Commercial Service – any service performed that incorporates, is based on,
utilizes or is developed from Project Results. For clarity, Commercial Service
does not include research and development performed by RECIPIENT or its
Collaborators.
(5) Exclusive License – a License Agreement under which the specific rights
granted to the licensee with respect to the Project Results, including without
limitation scope of use and territorial rights, are granted on an exclusive
basis.
(6) Exploit – make, have made, use, sell, offer to sell, import, export or
otherwise dispose of, practice, copy, distribute, create derivative works of,
publicly perform or publicly display.
(7) Institute-Funded IPR – any and all Intellectual Property Rights in and to
Institute-Funded Technology. In no event shall Institute-Funded IPR include any
intellectual property rights and/or technology in existence and owned/controlled
by the RECIPIENT prior to the receipt of funds from the INSTITUTE, the listing
of such IPR and/or technology in existence and owned/controlled by the RECIPIENT
prior to the receipt of funds from the INSTITUTE is attached herein.
(8) Institute-Funded Invention – an Invention conceived or first reduced to
practice by RECIPIENT, Recipient Personnel and/or Collaborator(s) in the
performance of Institute-Funded Activity.
(9) Institute-Funded Technology – any and all of the following resulting or
arising from Institute-Funded Activity during the Contract term: (a) proprietary
and confidential information, including but not limited to data, trade secrets
and know-how; (b) databases, compilations and collections of data; (c) tools,
methods and processes; and (d) works of authorship, excluding all scholarly
works, but including, without limitation, computer programs, source code and
executable code, whether embodied in software, firmware or otherwise,
documentation, files, records, data and mask works; and all instantiations of
the foregoing in any form and embodied in any form, including but not limited to
therapeutics, drugs, drug delivery systems, drug formulations, devices,
diagnostics, biomarkers, reagents and research tools. Institute-Funded
Technology includes Institute-Funded Inventions. In no event shall
Institute-Funded Technology include items that were conceived of, in existence,
or owned/controlled by RECIPIENT prior to receipt of funds from the INSTITUTE
(a) proprietary and confidential information, including but not limited to data,
trade secrets and know-how; (b) databases, compilations and collections of data;
(c) tools, methods and processes; and (d) works of authorship, excluding all
scholarly works, but including, without limitation, computer programs, source
code and executable code, whether embodied in software, firmware or otherwise,
documentation, files, records, data and mask works; and all instantiations of
the foregoing in any form and embodied in any form, including but not limited to
therapeutics, drugs, drug delivery systems, drug formulations, devices,
diagnostics, biomarkers, reagents and research tools,.
(10) Intellectual Property Rights – any and all of the following and all rights
in, arising out of, or associated therewith: (a) all United States and foreign
patents and utility models and applications therefor, and all reissues,
divisions, renewals, extensions, provisionals, and continuations and
continuations-in part thereof, and equivalent or similar rights anywhere in the
world in inventions and discoveries; (b) all trade secrets and rights in
know-how and proprietary information; (c) all copyrights, copyright
registrations and applications therefor, and all other rights
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corresponding thereto throughout the world; (d) all mask works, mask work
registrations and applications therefor, and any equivalent or similar rights in
semiconductor masks, layouts, architectures or topology; and (e) any similar,
corresponding or equivalent rights to any of the foregoing anywhere in the
world.
(11) Invention – a method, device, process or discovery that is conceived and/or
reduced to practice, whether patentable or not.
(12) License Agreement – an agreement by which an owner of a Project Result
grants any right to Exploit such Project Result to another party in exchange for
consideration.
(13) Licensing Activities – the efforts of RECIPIENT or its Collaborator to
negotiate, execute or enforce a License Agreement.
(14) Necessary Additional IPR – any unencumbered Intellectual Property Rights
(a) owned by RECIPIENT, and (b) identified by the Institute and agreed to in
writing by Recipient, that are not Project Results but are necessary to Exploit
the Project Results for the specific purposes set forth in the applicable
Section of this Attachment D.
(15) Non-Exclusive License – a License Agreement under which the rights granted
to the licensee with respect to the Project Results are granted on a
non-exclusive basis.
(16) Project Results – any and all Institute-Funded Technology and
Institute-Funded IPR.
(17) Revenue – the gross consideration, whether cash or non-cash (e.g.,
securities, direct equity interest, indirect equity interest, etc.), received
from Sales and License Agreements related to Project Results (including without
limitation, any milestone fees, license fees, sublicense fees, assignment fees,
product royalties and similar fees and royalties), net of (a) trade or quantity
discounts or rebates, credits, allowances or refunds given for rejected or
returned Commercial Products or Commercial Services, (b) any sales, value-added
or other tax or governmental charge levied on the sale, transportation or
delivery of a Commercial Product or Commercial Service (but excluding any income
tax owed by the RECIPIENT), and (c) any separately stated charges for freight,
postage, shipping and insurance.
(18) Sale – means any sale, lease, transfer, conveyance or other exploitation or
disposition of a Commercial Product or Commercial Service for which
consideration is received by an Authorized Seller.

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ATTACHMENT E
REPORTING REQUIREMENTS

This Attachment E is hereby incorporated into and made a part of that certain
CANCER RESEARCH GRANT CONTRACT (“Contract”) by and between the Cancer Prevention
and Research Institute of Texas (“CPRIT” or the “INSTITUTE”) and the RECIPIENT.
A capitalized term used in this Attachment shall have the meaning given to term
in the Contract or in the Attachments to the Contract, unless otherwise defined
herein. In the event of a conflict between the provisions of this Attachment and
the provisions of the Contract, this Attachment shall control.
INSTITUTE and RECIPIENT agree as follows:
ANNUAL REPORTING
Section E1.01 Annual Reports. The RECIPIENT shall submit reports annually to the
INSTITUTE within 60 days of the anniversary of the Effective Date of this
Contract or at such other time as may be specified herein. The reports shall be
submitted by the means and in the form(s) required by the INSTITUTE and shall be
signed by the Principal Investigator/Program Director and the RECIPIENT’s
Authorized Signing Official. To the extent possible, the reports shall only
include information that may be shared publicly. However, if it is necessary to
submit information in the reports that the RECIPIENT considers confidential in
order to fully comply with the terms of this Contract, then the RECIPIENT shall
use reasonable efforts to mark such information as “confidential” and shall, to
the extent practicable, to segregate such information within the reports to
facilitate its redaction should redaction ever be necessary or appropriate.
Section E1.02 Contents of Reports. Each report shall contain a signed
verification (electronic signature is acceptable) of RECIPIENT’s compliance with
each of its obligations as set forth in the Contract and shall include the
following for the period covered by such report, as may then be applicable:
(a) Project Data. During the term of the Contract, RECIPIENT shall include in
its annual report each of the following (except that the final annual report due
under this part (a) shall be due within ninety (90) days after the end of the
term of the Contract):

(1)    A brief statement of the progress made to under the Scope of Work,
including the progress to achieve the Project Goals and Timelines set forth in
Attachment A.
(2)    A brief statement of the Project Goals for the twelve months following
submission of the report.
(3)    New jobs created in the preceding twelve month period as a result of the
Grant funds awarded to RECIPIENT.
(4)    An inventory of the Equipment purchased for the Project using Grant
funds.
(5)    A HUB report in accordance with Section 3.08 “Historically Underutilized
Businesses” of the Contract.
(b) Commercialization Data. During the term of the Contract and continuing
thereafter for so long as RECIPIENT has ongoing obligations to the INSTITUTE
with respect to protection, development, commercialization and licensing of
Project Results pursuant to Attachment D, RECIPIENT shall provide information
about commercialization activities in a format specified by the INSTITUTE.

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(c) Revenue Sharing Data. During the term of the Contract and continuing
thereafter for so long as RECIPIENT has ongoing obligations to the INSTITUTE
with respect to revenue sharing pursuant to Attachment D:
(1)    A statement of the identities of the funding sources, amounts and dates
of funding for all funding sources for the Project.
(3)    A brief statement of the RECIPIENT’s efforts to secure additional funds
to support the Project.
(4)    All financial information necessary to verify the calculation of the
revenue sharing amounts specified in Attachment D.
(d) Additional Data. In addition to the foregoing, RECIPIENT shall use
commercially reasonable efforts to also promptly report any other information
required by this Contract or otherwise reasonably requested by the INSTITUTE,
the Legislature, or any other funding or regulatory bodies covering the
RECIPIENT’s activities under this Contract.
Section E1.03 Record Keeping and Audits. The provisions of Article IV of the
Contract shall apply fully to all information reported to the INSTITUTE pursuant
to this Attachment, except that the right of the State of Texas to audit and the
RECIPIENT’s obligation to maintain Records shall continue until four years after
the date of each such report made by RECIPIENT hereunder.
Section E1.04 Confidentiality of Documents and Information. The provisions of
Section 2.13 “Confidentiality of Documents and Information” of the Contract
shall apply fully to all Confidential Information reported, delivered or
submitted to the INSTITUTE pursuant to this Attachment E.

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ATTACHMENT F-1

RP110508

By their signatures below, parties hereby agree that the effective date of this
contract as reflected in Section 2.03 is changed to July 1, 2011and the end date
is June 30, 2013.
Further, in accordance with Section 2.03, this amendment serves as specific
authorization for RECIPIENT to expend grant funds prior to the effective date of
the contract, so long as the expenses are not incurred prior to June 1, 2011.
EXECUTED IN DUPLICATE ORIGINALS ON THE DATES INDICATED.
RECIPIENT

By /s/ Thomas J. Farrell, CEO    
(Signature of Person Authorized to Sign
Contracts)
Name:    Thomas J. Farrell, CEO
Date:    August 25, 2011
INSTITUTE

By /s/ William Gimson    
(Signature of Person Authorized to Sign Contracts)

Name:    William “Bill” Gimson, Executive Director
Date:    July 22, 2011

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ATTACHMENT F-2

As indicated by the signatures below, the INSTITUTE and the RECIPIENT agree to
the following amendments to the CPRIT Contract:
Section 4.03 Inspections.
The first sentence of Section 4.03 is hereby amended to read in its entirety as
follows:
“In addition to the audit rights specified in Section 4.02 ‘Audits’, during the
term of this Contract, the INSTITUTE shall have the right to conduct periodic
onsite inspections within normal working hours and on a day and a time mutually
agreed to by the parties, to evaluate the Institute-Funded Activity.”
Section 4.07 Repayment of Grant Proceeds for Relocation Outside of Texas.
Section 4.07 is amended by adding the following sentence to the end of the
Section:
“The RECIPIENT shall repay the INSTITUTE all Grant proceeds disbursed to
RECIPIENT and a preferred return of [...***...]% of the amount disbursed in the
event that RECIPIENT relocates its principal place of business outside of the
State during the Contract term or within 3 years after the final payment of the
Grant funds is made by the INSTITUTE. Upon repayment to the INSTITUTE of all
Grant funds disbursed to RECIPIENT and the preferred return of [...***...]% of
the amount disbursed, the Contract shall terminate and RECIPIENT shall have no
further obligations to the INSTITUTE hereunder.”

AMENDMENTS TO ATTACHMENT D
Section D2.02 INSTITUTE License.
Section D2.02 of Attachment D is here by amended by adding the following
sentence to the end of the section:
“All other rights are reserved by RECIPIENT.”
Section D3.01 Commercialization Strategy.
Section D3.01 of Attachment D is hereby amended by deleting the period in the
last sentence and inserting the following language after the word “strategy”:
“, that RECIPIENT, in its sole business judgment, decides to incorporate.”
EXECUTED IN DUPLICATE ORIGINALS ON THE DATES INDICATED.
RECIPIENT

By /s/ Thomas J. Farrell, CEO    
(Signature of Person Authorized to Sign Contracts)
Name:    Thomas J. Farrell, CEO
Date:    August 31, 2011
INSTITUTE

By /s/ William Gimson    
(Signature of Person Authorized to Sign Contracts)
Name:    William “Bill” Gimson, Executive Director
Date:    August 31, 2011

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ATTACHMENT F-3

RP110508

As indicated by the signatures below, the INSTITUTE and the RECIPIENT agree to
the following amendments to the CPRIT Contract:

AMENDMENT TO SECTION 2.03
The end date indicated in Section 2.03 of the CPRIT Contract is hereby changed
to June 30, 2014.
EXECUTED IN DUPLICATE ORIGINALS ON THE DATES INDICATED.
RECIPIENT

By /s/ Thomas J. Farrell, CEO    
(Signature of Person Authorized to Sign Contracts)
Name:    Thomas J. Farrell
Date:    October 28, 2011
INSTITUTE

By /s/ William Gimson    
(Signature of Person Authorized to Sign Contracts)
Name:    William “Bill” Gimson, Executive Director
Date:    October 24, 2011

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CANCER PREVENTION AND RESEARCH INSTITUTE OF TEXAS
REQUEST FOR ADVANCEMENT OF GRANT AWARD

ENTITY:Bellicum Pharmaceuticals, Inc.ADDRESS:6400 Fannin St, Suite 2300,
Houston, TX 77030PI:Kevin M. Slawin, M.D.CPRIT GRANT NUMBER:RP110508BUDGET
CATEGORIES
CURRENT YEAR APPROVED
BUDGET
ADVANCE AMOUNT
REQUESTEDPercentage of
Funds
AdvancedPERSONNEL[...***...][...***...]FRINGE
BENEFITS[...***...][...***...]TRAVEL[...***...][...***...]EQUIPMENT[...***...][...***...]SUPPLIES[...***...][...***...]CONTRACTUAL[...***...][...***...]OTHER[...***...][...***...]TOTAL[...***...][...***...]100.00%
Justification for Advancement of Grant Award Funds
funds required to achieve first major project milestone

Acknowledgement, I understand that the advancement of grant funds does not
preclude the fiscal requirements (timely submission of financial reports,
allowable expenditures, indirect cost less then five percent, etc.) of the grant
award.

Signature of Authorized Certifying Official:

/s/ Thomas J. Farrell

Telephone Number
713-341-6472
Date
8/29/2011
Typed or Printed Name and Title of Certifying Official:
Thomas J. Farrell, CEO