SERVICES AGREEMENT

 

This Services Agreement (this “Agreement”) is entered into this 18th_ day of
November     , 2019 (the “Effective Date”), between and among H-Cyte, Inc., a
Nevada corporation (“H-Cyte”), and Rion, LLC, a Minnesota limited liability
company (“Rion”).

 

BACKGROUND

 

A. Effective June 21, 2019, H-Cyte and Rion entered into that certain Product
Supply Agreement (the “Supply Agreement”), pursuant to which H-Cyte has agreed
to, among other things, purchase and receive Product from Rion (defined in the
Supply Agreement), as more fully described therein.

 

B. The Supply Agreement provides for the delivery of a Services Agreement
setting forth the terms and conditions by which Rion will conduct Process
Development Research and Development for the generation of L-Cyte-01.

 

NOW THEREFORE, for good and valuable consideration, the receipt and sufficiency
of which is hereby acknowledged, the parties agree as follows:

 

AGREEMENT

 

1. Defined Terms. Defined terms that are used but not otherwise defined herein
shall have the meanings ascribed to them in the Supply Agreement.

 

2. Term. This Agreement shall commence on the date hereof and continue until
completion of the services outlined on Exhibit A (prior to commencing the
regulatory approval process), unless terminated earlier by mutual written
consent of the parties or in accordance with Section 6 (the “Term”).

 

3. Services and Compensation. Rion agrees to provide the services (the
“Services”) set forth on Exhibit A attached hereto to H-Cyte during the Term and
on the other terms and conditions set forth in this Agreement and for the
compensation set forth on Exhibit A (the “Service Fees”).

 

4. Payment. Due upon execution of this agreement. Rion shall commence Services
on receipt of payment.

 

5. Level of Services. The intent of this Agreement is to provide H-Cyte the
benefit of Rion’s resources and expertise for the limited purpose of (i)
consulting with and assisting H-Cyte in the (i) further research and development
for the generation of L-Cyte-01 and (ii) subsequently assisting H-Cyte in
seeking and obtaining FDA Phase 1 IND clearance for L-Cyte-01. Rion also agrees
to consult with H-Cyte in its arrangements for services from third parties
unaffiliated with Rion to support research, development, regulatory approval and
commercialization of L-Cyte-01. H-Cyte agrees that the Services provided to
H-Cyte hereunder will solely be used for H-Cyte’s operation of its business and
will not be resold or otherwise made available to other parties. Rion shall use
commercially reasonable efforts to perform the Services exercising the same
degree of care as it exercises in performing the same or similar services for
its own account. Notwithstanding the foregoing, H-Cyte understands and agrees
that Rion does not and cannot guarantee successful development or approval of
L-Cyte-01.

 

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H-Cyte acknowledges that Rion is not in the business of providing services
similar to the Services to entities outside Rion’s group and that the provisions
of this Agreement shall be interpreted in that context. The Services shall be
provided in accordance with Rion’s practices as carried out in the ordinary
course of business and shall be subject to the limitations, restrictions and
other conditions that may from time to time apply to the respective lease,
license, services and other agreements of Rion and/or its Affiliates with third
party providers. Rion makes no representations and warranties of any kind,
implied or expressed, with respect to the Services, including, without
limitation, warranties of merchantability or fitness for a particular purpose,
which are specifically disclaimed. Except for gross negligence or willful
misconduct, Rion shall have no liability to any person based on any claim of
negligence with respect to the Services hereunder.

 

H-Cyte further acknowledges as follows: (a) Rion’s efforts to provide the
Services hereunder will be secondary to Rion’s primary and continuing
operations; (b) the Services will be provided by Rion personnel assigned by
Rion, and Rion will have no obligation to hire new personnel to replace any
terminated employee providing Services from time to time; (c) all Services will
be provided using only Rion’s physical and other resources existing from time to
time; (d) Services will be provided, as reasonably requested by H-Cyte, during
regular business hours and under regular business conditions; and (e) H-Cyte’s
obligations with respect to the Services will be solely as set forth herein and
Rion will have no obligation to adhere to any policies or procedures of H-Cyte.
H-Cyte acknowledges and agrees that it shall have no right, title or interest in
the equipment used by Rion to perform the services, including, but not limited
to, the right to lease such equipment.

 

H-Cyte acknowledges and agrees that this Agreement does not create a fiduciary
relationship, partnership, joint venture or relationships of trust or agency
between the parties and that all Services are provided by Rion as an independent
contractor. For the avoidance of doubt, the provision of Services hereunder
shall not entail any transfer of ownership of any assets from Rion to H-Cyte.
H-Cyte and Rion will each maintain their appropriate permits, licenses,
exemptions and authorizations from governmental authorities to conduct the
activities required hereunder.

 

6. Termination. Either party may (without prejudice to its other rights or
remedies), by notice to the other, bring the Term to an immediate end if the
other party:

 

(a) is in material or persistent breach of any of its obligations under this
Agreement or the Supply Agreement and either that breach is incapable of remedy
or the other party has failed to remedy that breach within thirty (30) days
after receiving written notice requiring it to remedy that breach;

 

(b) is unable to pay its debts or becomes insolvent or an order is made or a
resolution passed for the administration, winding-up or dissolution of the other
party (otherwise than for the purposes of a solvent merger or reconstruction) or
an administrative or other receiver, manager, liquidator, administrator, trustee
or similar officer is appointed over all or any substantial part of the assets
of the other party; or

 

(c) fails to pay any sum payable under this Agreement when due and that default
is not remedied on or before the date falling thirty (30) days after the date
when the party in delay received a written notice from the other party advising
the delaying party that failure to pay may result in termination of the
Agreement.

 

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Upon expiration or termination of the supply of a Service under this Agreement
in accordance with the terms of this Agreement all rights and obligations of the
parties in respect of that Service only shall cease to have effect, except that
such expiration or termination shall not affect any accrued rights and
obligations of the parties in respect of that Service at the date of
termination. The expiration or termination of the supply of a Service under this
Agreement shall not affect the parties’ rights and obligations in respect of
other Services supplied under this Agreement.

 

7, Information. H-Cyte and Rion shall provide each other with all information
and materials reasonably necessary to perform the Services, in all cases to the
extent necessary for each of H-Cyte and Rion to fulfill their obligations under
this Agreement.

 

8. No Obligation to Continue to Use Services. H-Cyte shall have no obligation to
continue to use any of the Services and H-Cyte may terminate any Service from
the Services (or any portion thereof) that H-Cyte is receiving from the Rion by
giving Rion not less than thirty (30) days prior written notice (unless the
parties otherwise agreement) of its desire to terminate any or all such Services
or any portion thereof; provided that H-Cyte shall be responsible for any
termination or other expenses incurred in connection with the cessation of such
services, including but not limited to, purchasing (at Rion’s cost) any
inventory or stock on hand held by Rion for the provision of Services hereunder
for the sixty (60) days following notice.

 

9, Indemnification and Limitation of Liability. Rion shall indemnify, defend and
hold harmless H-Cyte and its affiliates and each of their respective
representatives (collectively, the “H-Cyte Indemnified Parties”) from and
against any losses or damages of the H-Cyte Indemnified Parties relating to,
arising out of or resulting from the intentional breach, gross negligence or
willful misconduct of Rion in connection with the provision of, or failure to
provide, any Services to H-Cyte. H-Cyte shall indemnify, defend and hold
harmless Rion and its affiliates and each of their respective representatives
(collectively, the “Rion Indemnified Parties”) from and against any and all
losses or damages of the Rion Indemnified Parties relating to, arising out of or
resulting from the intentional breach, gross negligence or willful misconduct of
H-Cyte in connection with the Services provided by Rion pursuant to this
Agreement. The aggregate liability of either party in respect of any losses or
damages suffered by the other party arising out of or in connection with this
Agreement, whether in contract, tort, for breach of statutory duty or in any
other way, hall be limited to the amount of fees paid or payable hereunder.
Without limiting the generality of the foregoing, where a Service has been
provided by Rion through a third party provider, Rion shall, in the event of any
losses or damages suffered by the H-Cyte Indemnified Parties, not be liable to
the H-Cyte Indemnified Parties in excess of what Rion, acting in a prudent
manner, has collected from such third party provider pursuant to the prevailing
contract between H-Cyte and the third party provider.

 

In no event shall Rion have any liability under any provision of this Agreement
for any punitive, incidental, consequential, special or indirect damages,
including loss of future revenue or income, loss of business reputation or
opportunity relating to the breach or alleged breach of this Agreement, or
diminution of value or any damages based on any type of multiple, whether based
on statute, contract, tort or otherwise, and whether or not arising from the
other party’s sole, joint, or concurrent negligence, strict liability, criminal
liability or other fault.

 

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10. Cooperation. H-Cyte and Rion agree to cooperate with each other in respect
of the provision of the Services and provide the other with information, in each
case as reasonably requested from time to time, in order for such party to
comply with its obligations under this Agreement.

 

Rion agrees that it will notify Mayo of this Agreement and endeavor to obtain
its written consent thereto. Rion agrees that it will make all payments owed to
Mayo, if any, on account of this Agreement.

 

11. Confidentiality. Except as required by applicable federal, state or local
law or regulation, or pursuant to the valid order of a court of competent
jurisdiction or an authorized goverrunent agency, each party will treat and hold
as confidential and proprietary all of the other parties’ Confidential
Information and shall not, at any time during or after the Term, disclose to any
unauthorized person or use for such party’s own account any of such Confidential
Information without the prior written consent of the disclosing party.
“Confidential Information” will be interpreted as broadly as possible to include
all information of any sort (whether merely remembered or embodied in a tangible
or intangible form) that is (i) related to the disclosing party’s current or
potential business and (ii) is not generally or publicly known.

 

12. Intellectual Property. Except as provided in the Supply Agreement, H-Cyte
shall not be entitled to use or have any other right whatsoever in any
intellectual property rights belonging to Rion or its Affiliates or any other
third party through which Rion makes available the Services. Any intellectual
property rights developed by Rion in connection with the Services shall
exclusively belong to Rion.

 

13. Specific Performance. The parties acknowledge and agree that remedies at law
would be an inadequate remedy for the breach of any agreement contained herein
and that in addition to any remedies that may be available at law, the parties
hereto shall be entitled to seek specific performance of the terms hereof or
other equitable remedies in the event of any such breach.

 

14. Assignment. H-Cyte may not assign any of its rights or obligations hereunder
without the express prior written consent of Rion. Rion may assign this
Agreement and its rights and obligations under this Agreement.

 

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15. Force Majeure. The obligations of Rion under this Agreement with respect to
any Service shall be suspended during the period and to the extent that Rion is
prevented or hindered from providing such Service, or H-Cyte is prevented or
hindered from receiving such Service, due to any of the following causes beyond
such party’s reasonable control (such causes, “Force Majeure Events”): (i) acts
of God, (ii) flood, fire or explosion, (iii) war, invasion, riot or other civil
unrest, (iv) Goverrunental Order or Law, (v) actions, embargoes or blockades in
effect on or after the date of this Agreement, (vi) action by any Goverrunental
Authority, (vii) national or regional emergency, (viii) strikes, labor stoppages
or slowdowns or other industrial disturbances, (ix) shortage of adequate power
or transportation facilities, or (x) any other event which is beyond the
reasonable control of such party. The party suffering a Force Majeure Event
shall give notice of suspension as soon as reasonably practicable to the other
party stating the date and extent of such suspension and the cause thereof, and
Rion shall resume the performance of its obligations as soon as reasonably
practicable after the removal of the cause. Neither H-Cyte nor Rion shall be
liable for the nonperformance or delay in performance of their respective
obligations under this Agreement when such failure is due to a Force Majeure
Event.

 

16. Interpretation. In the event of any conflict between the provisions of a
Service, as described in Exhibit A, and the main body of this Agreement (the
“Agreement Body”), the Agreement Body shall override any conflicting provision
in Exhibit A.

 

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IN WITNESS WHEREOF, the parties have executed or have caused this Agreement to
be executed by their respective officers thereunto duly authorized, as of the
date first written above.

 

RION:   H-CYTE:       RION,LLC   H-CYTE, INC.

 

By: /s/ AttaBehfar, M.D.   By: /s/ William E. Horne Name: AttaBehfar, M.D.  
Name: William E. Horne Title: Chief Executive Officer   Title: Chief Executive
Office

 

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