Nightingale, Inc.

1661 Lakeview Circle

Ogden, UT 84403

Telephone:  801-399-3632

 

 

November 6, 2014

 

Todd N. McAllister, Ph.D.

Chief Executive Officer

Cytograft Tissue Engineering, Inc.

3 Hamilton Landing, Suite 220

Novato, CA  94949

Re:       Proposed Transactions

Dear Dr. McAllister:

Nightingale, Inc., a Delaware corporation (“Nightingale”), and Cytograft Tissue
Engineering, Inc., a Delaware corporation (“CTE”), are contemplating a proposed
transaction as described below (the “Transaction”).  To facilitate due diligence
by Nightingale and CTE and the negotiation of a mutually acceptable definitive
agreement for the Transaction, Nightingale and CTE agree to the terms set forth
in this letter of intent (the “Letter of Intent”). 

1.         Transaction.  If the Transaction is closed, Nightingale will acquire
CTE pursuant to a reverse triangular merger (the “Merger”) in which a newly
formed Delaware subsidiary of Nightingale (“Merger Sub”) will be merged with and
into CTE, with CTE surviving as a wholly-owned subsidiary of Nightingale. 
Accordingly, if the Merger is closed, Nightingale, the parent company, will own
CTE as a wholly-owned subsidiary.  All outstanding shares of CTE will be
converted into shares of Nightingale common stock pursuant to the Definitive
Merger Agreement.  The Merger will be completed pursuant to a customary merger
agreement (the “Definitive Merger Agreement”)drafted by counsel to Nightingale,
which Merger Agreement shall contain, among other things:

            (a)        appropriate representations and warranties of (a)
Nightingale and (b) CTE and the major shareholders of CTE (the “Major
Shareholders”);

            (b)        agreed upon covenants of (a) Nightingale and (b) CTE and
the Major Shareholder reflecting the provisions set forth herein;

            (c)        other customary provisions; and

            (d)        appropriate conditions of closing. 

The negotiation and execution of the Definitive Merger Agreement shall occur as
promptly as practicable following the execution of this Letter of Intent.  The
closing of the Merger shall occur as promptly as is practicable after all of the
conditions to closing are satisfied. 

            2.         Capitalization of Nightingale. 

                        (a)        Current Capitalization.  Nightingale has
175,000,000 shares of $0.001 par value common stock and 25,000,000 shares of
$0.001 par value preferred stock authorized.  Nightingale effected a 1-for- 3
reverse stock split on June 5, 2014 and currently has approximately 1,000,000
shares of common stock issued and outstanding and no shares preferred stock
issued and outstanding. In June 2014, Nightingale changed its domicile from the
State of Utah to the State of Delaware

                        (b)        Outstanding Warrants and Options. 
Nightingale has certain warrants and options outstanding which are as follows:

                        (i)         Nightingale’s Board of Directors, has
granted Mark A. Scharmann warrants to purchase 1,000,000 shares of its common
stock. These Warrants were granted effective May 15, 2014 and September 25, 2014
and were granted as compensation for Mr. Scharmann’s services in connection with
(A) bringing Nightingale current in its Securities and Exchange Commission
filings, (B) finalization of tax returns, and (C) coordination of various other
business matters.  500,000 warrants were granted May 15, 2014, have an exercise
price of $0.50 per share and expire May 15, 2019.  500,000 warrants were granted
September 25, 2014, have an exercise price of $0.75 per share and expire
September 25, 2017.  These warrants are not subject to commissions.

                         (ii)       Nightingale’s Board of Directors granted
David Knudson an option to purchase 33,334 shares of its common stock at a price
of $0.30 per share.  This Option was granted effective May 18, 1995.  These
options expire December 31, 2017 and are not subject to commissions.

                        (iii)       Nightingale has Series A Common Stock
Purchase Warrants issued and outstanding that entitles the holders to purchase
approximately 966,667 shares of Nightingale Common Stock at a price of $0.75 per
share.  These warrants expire 12/31/2015.  Sale of these warrants will be
subject to a 10 percent cash commission and a 10 percent share commission to the
broker-dealer.

                        (iv)       Nightingale has Series B Common Stock
Purchase Warrants issued and outstanding that entitles the holders to purchase
approximately 966,667 shares of Nightingale Common Stock at a price of $1.50 per
share.  These warrants expire 12/31/2015.  Sale of these warrants will be
subject to a 10 percent cash commission and a 10 percent share commission to the
broker-dealer.

 

            3.         Promissory Note Offering.  From June 1, 2014 to October
1, 2014, Nightingale issued convertible promissory notes in the approximate
aggregate amount of $3,000,000.  Such Notes are convertible into shares of
Nightingale common stock at a price of $.69 per share.   Accordingly, if all
$3,000,000 of  the Notes are converted into shares of Nightingale Common Stock,
of which there can be no assurance, approximately 4,350,000 shares of
Nightingale’s common stock may be issued in connection with such conversion. 
Nightingale intends to compensate selected registered broker-dealers in
connection with the conversion of these promissory notes into shares of
Nightingale common stock.  Such compensation is expected to be up to (i) ten
percent (10%) of the Notes converted, payable in cash ($300,000); and (ii) one
share of Nightingale common stock for each ten shares issued to Note holders in
the conversion (435,000 shares).

 

4.         Payment of Liabilities.  From June 1, 2014 to October 24, 2014,
Nightingale paid approximately $217,000 on liabilities that were existing as of
June 1, 2014.  This includes approximately $210,000 paid to affiliates of
Nightingale.

 

5.         Conversion of Existing Debt.  As of October 24, 2014, Nightingale had
approximately $950,000 in outstanding liabilities.  Nightingale anticipates that
prior to the Merger, approximately $300,000 of outstanding liabilities will be
converted into shares of Nightingale common stock at a conversion price of $0.69
per share.  Accordingly, Nightingale anticipates that a total of approximately
435,000 shares of Nightingale common stock will be issued in connection with
such conversion.  The remaining debt shall be paid in cash by Nightingale.

 

6.         SEC Filings, Financial Statements and Tax Returns.  Nightingale is
not current in its filings with the Securities and Exchange Commission (“SEC”)
and its tax filings with IRS. Nightingale is working on its annual and quarterly
financial statements which will enable it to file its SEC filings and tax
returns.

 

7.         Offering.  Prior to the closing of the Merger, Nightingale intends to
offer up to 2,898,551 shares of its common stock to accredited investors at a
price of $0.69 per share, (total maximum gross sales proceeds of $2,000,000). 
These shares will be offered through a Private Placement Memorandum offering by
a registered broker-dealer which will be paid a commission of 10 percent of the
gross offering proceeds and issued one share of common stock for each 10 shares
sold in the offering.   If the total offering is sold, of which there can be no
assurance, Nightingale anticipates the net offering proceeds will be
approximately $1,700,000 and the total number of shares issued to the investors
and the broker dealer will be approximately 3,188,406.  Expenses of the offering
will be capped at $100,000 and accounting will be disclosed to Cytograft. 

 

8.         Pro Forma Capitalization of Nightingale.  Nightingale anticipates
that immediately prior to the Closing, it will have 12,375,074 shares
outstanding on a fully-diluted basis:

                                                                                                                                               
                        Maximum

 

            Current Shares of Common                            1,000,000

            Shares Issued in Debt Conversion                     435,000

            Shares Issuable Upon Note Conversion          4,350,000

            Broker Shares Note Conversion                         435,000

            Warrant and Option Shares                             2,966,668

            Shares issued in Private Equity Offering         3,188,406

 

            Total                                                            
12,375,074

 

9.         Loans to CTE.   As of October 24, 2014 Nightingale has made loans in
the amount of $580,000 to CTE.   If the Merger Closes, such loans shall
extinguished as part of the Nightingale consolidated financial statements. 
Nightingale will loan an additional $140,000 per month until deal close to
offset expenses.

 

10.       Capitalization of CTE.   You have informed us that CTE has 35,000,000
shares of $0.001 par value common stock and 21,631,429 shares of $0.001 par
value preferred stock authorized.   CTE has 7,786,936 shares of common stock
issued and outstanding and the following Series of Preferred Stock issued and
outstanding:

 

            (a)        4,212,963 shares of Series A Preferred Stock are
outstanding which are convertible into 4,212,963 shares of CTE common stock;

 

            (b)        2,673,432 shares of Series B Preferred Stock are
outstanding, which are convertible into 2,673,432 shares of CTE common stock;

 

            (c)        4,432,534 shares of Series C Preferred Stock are
outstanding which are convertible into 4,432,534 shares of CTE common stock; and

 

            (d)        10,312,495 shares of our Series D Preferred Stock are
outstanding which are convertible into 10,312,495 shares of CTE common stock.

 

            11.       Conversion of CTE Preferred Stock into CTE Common Stock. 
As a condition to the Closing of the Merger, all shares of CTE Preferred Stock
will be converted into shares of CTE Common Stock.  As a result of such
conversion, there shall be approximately 29,500,000 shares of CTE common stock
issued and outstanding immediately prior to the closing of the Merger.

 

12.       Outstanding CTE Warrants and Options.  CTE has certain options
outstanding which are as follows:

 

            (a)        There are Stock Plan and Equity Incentive Plan options
issued and outstanding, and pending issue, that entitle the holders to purchase
782,500 shares of CTE Common Stock at prices ranging from $0.06 to $0.69 per
share.

 

            (b)        In October 2013 CTE entered into a convertible bridge
loan in the amount of $500,000, with interest at 3% per annum.  This loan,
including interest, is convertible into common shares of CTE calculated at a
rate equivalent to that of the proposed Offering in Section 7, as adjusted by
the Conversion Ratio, and conditioned on the closing of the Transaction.

            13.       Merger Consideration.  Pursuant to the Merger, all of the
shares of CTE common stock outstanding on the closing date of the Merger (the
“CTE Stock”)  and all CTE Warrants and Options shall be converted into the right
to receive a total of 42,225,000 shares of Nightingale common stock, (the
“Conversion Ratio”). The shares issued to the CTE shareholders in the Merger
will not be registered with the Securities and Exchange Commission or any state
securities agency and will be “restricted” securities as that term is defined in
Rule 144 promulgated under the Securities Act of 1933, as amended.

            14.       Post-Closing Capital on a Fully Diluted Basis. 
Immediately following the Closing of the Merger it is anticipated that there
will be approximately 54,600,074 shares of Nightingale issued and outstanding on
a fully diluted basis allocated as follows:

 

Nightingale Related Parties      12,375,074[1]

Cytograft Related Parties         42,225,000[2]

Total                                        54,600,074

15.       Required Financial Statements of CTE.  CTE shall provide, at its own
cost and expense, audited financial statements for its respective last two
fiscal years, consisting of a balance sheet and a related statement of income
for the periods then ended that fairly present the financial condition of each
as of their respective dates and for the periods involved, along with all
related other schedules as may be required of “reporting issuers” under the
Securities Exchange Act of 1934, as amended (the “Exchange Act”), and such
statements shall be prepared in accordance with generally accepted accounting
principles consistently applied prior to the Merger, no later than 60 days
following the execution of the Definitive Merger Agreement, together with
similar reviewed quarterly financial statements for the quarterly period
preceding the date of the Definitive Merger Agreement.

16.       Indemnification.  Nightingale will be entitled to indemnification with
regard to breaches by CTE and/or the Major Shareholders of representations,
warranties and covenants contained in the Definitive Merger Agreement.  The
Major Shareholders will join CTE in making the representations, warranties and
covenants of CTE. 

            CTE will be entitled to indemnification with regard to breaches by
Nightingale of representations, warranties and covenants contained in the
Definitive Merger Agreement.  The representations, warranties, covenants and
obligations to indemnify shall survive the closing of the Merger until the one
year anniversary of the closing of the Merger.

17.       Due Diligence.  In order to complete their respective due diligence
investigations of each other, Nightingale will provide to CTE, and CTE will
provide to Nightingale,  and each to the other’s attorneys, accountants and
other representatives, upon prior coordination with each other, reasonable
access during normal business hours and, as necessary, during evenings and
weekends, to all books, records, contracts, technology, executive and other
mutually agreed personnel and other information of Nightingale and CTE from the
date last set forth below until the first to occur of (i) the termination of
this Letter of Intent, and (ii) the closing of the Merger. 

18.       Public Disclosure.  Neither party will make any public disclosure of,
or otherwise disclose to any person (other than its officers, employees,
accountants, attorneys, advisors and agents whose duties require them to have
access to such information or its current or bona fide prospective shareholders
and investors, employees, investment bankers, lenders, and other advisors), the
existence or terms of the Transactions or of this Letter of Intent, without the
other party’s prior written consent, unless such disclosure is required by law
(including securities laws and regulations) or the rules of any securities
exchange.  The parties will consult with each other prior to making any public
announcement regarding the Transactions.  Notwithstanding the foregoing, both
parties acknowledge the intent to issue a joint public press release
simultaneously with the execution of the Definitive Merger Agreement providing a
summary of the Transactions and the anticipated closing date.

19.       No Shop.  CTE agrees that, from the date last set forth below until
the first to occur of (i) the termination of this Letter of Intent and (ii) the
execution of the Definitive Merger Agreement, CTE will not, and will not
authorize or permit any officer or director of CTE or any other person on its
behalf to, directly or indirectly, solicit, facilitate, encourage, entertain,
discuss, negotiate or accept or enter into any offer, inquiry or proposal from
or any agreement with any party other than Nightingale concerning a possible
investment in, or an acquisition, merger or consolidation of CTE with or into
any other entity, a disposition of all or any substantial portion of the
business, assets or securities of CTE, or provide any confidential information
to any party other than Nightingale concerning any such investment, acquisition,
merger, consolidation or disposition (a “CTE Third Party Transaction”).  CTE
will promptly notify Nightingale in writing of any such offer, the principal
terms of the same and the identity of the party making the same, unless CTE’s
sole response to such offer is to refuse to discuss the offer with such party. 
In the event that CTE breaches any of its undertakings provided for in this
Section 19 and CTE enters into a definitive agreement or agreement in principle
with any third party in respect of which it breached such undertaking within six
months after the termination by CTE of this Letter of Intent, then CTE shall
cause Nightingale to be paid, by CTE or another party or parties to the CTE
Third Party Transaction, the amount of $200,000 in cash upon the closing of such
CTE Third Party Transaction.

20.       Conduct of Business Pending Closing.  After the Letter of Intent
becomes effective and until consummation or termination of the Definitive Merger
Agreement, the Parties will conduct business only in the ordinary course and
none of its assets shall be sold or disposed of except in the ordinary course of
business or with the written consent of the other parties.

21.       Conditions Precedent.  The closing of the Merger will be subject to
the following conditions, which are waivable by CTE and Nightingale in their
sole discretion:

(A)          APPROVAL OF THE TRANSACTION BY THE NIGHTINGALE BOARD OF DIRECTORS;

(B)         APPROVAL OF THE TRANSACTION BY THE CTE BOARD OF DIRECTORS AND
SHAREHOLDERS;

(C)          NIGHTINGALE’S FILING OF ALL REQUIRED SEC FILINGS FOR ITS ANNUAL AND
QUARTERLY REPORTS;

(D)         COMPLIANCE WITH APPLICABLE SECURITIES LAWS IN CONNECTION WITH THE
PROPOSED ISSUANCE OF SHARES OF CAPITAL STOCK OF NIGHTINGALE IN THE MERGER,
INCLUDING THE PREPARATION OF THE REQUIRED AUDITED AND OTHER FINANCIAL STATEMENTS
OF CTE RELATED TO FORM 8-K AND ANY OTHER APPLICABLE SECURITIES FILINGS IN
CONJUNCTION WITH THE MERGER;

(E)          RECEIPT OF ALL NECESSARY GOVERNMENTAL AND THIRD PARTY CONSENTS;

(F)          ALL REQUIRED TAX RETURNS OF NIGHTINGALE AND CTE ARE FILED WITH
APPROPRIATE TAX AUTHORITIES;

(G)                 CTE SHALL HAVE DELIVERED TO NIGHTINGALE FINANCIAL AND ALL
OTHER INFORMATION REQUIRED TO BE INCLUDED IN THE POST-MERGER FORM 8-K;

(H)               THE MERGER CAN BE COMPLETED AS A NON-PUBLIC OFFERING WITHOUT
REGISTRATION WITH FEDERAL OR STATE SECURITIES REGULATORS;

(I)                 DISSENTER’S RIGHTS ARE NOT EXERCISED BY THE HOLDERS OF MORE
THAN FIVE PERCENT (5%) OF THE HOLDERS OF CTE’S OUTSTANDING VOTING STOCK;

(J)                 ALL OUTSTANDING RIGHTS TO ACQUIRE THE CAPITAL STOCK OF CTE
SHALL HAVE BEEN EXERCISED IN FULL OR TERMINATED, AND THERE SHALL BE NO
OUTSTANDING RIGHTS TO ACQUIRE ANY SHARES OF THE CAPITAL STOCK OF CTE, INCLUDING,
WITHOUT LIMITATION, THROUGH PAYMENT OF THE EXERCISE PRICE, CONVERSION OF ANY
CONVERTIBLE SECURITIES, OR REPAYMENT OF INDEBTEDNESS;

(K)         NO MATERIAL ADVERSE CHANGE IN THE CONDITION (FINANCIAL OR
OTHERWISE), PROPERTIES, ASSETS (INCLUDING INTANGIBLE ASSETS), LIABILITIES,
BUSINESS, OPERATIONS, RESULTS OF OPERATIONS OR PROSPECTS OF CTE OR NIGHTINGALE;

                        (L)         RESULTS OF A DUE DILIGENCE REVIEW OF CTE
SATISFACTORY TO NIGHTINGALE IN NIGHTINGALE’S SOLE DISCRETION, AND RESULTS OF A
DUE DILIGENCE REVIEW OF NIGHTINGALE SATISFACTORY TO CTE IN CTE’S SOLE
DISCRETION, WHICH DUE DILIGENCE REVIEWS HAVE NOT YET BEEN CONDUCTED;

                        (M)       EACH OF THE PARTIES TO THE DEFINITIVE
AGREEMENT SHALL HAVE RECEIVED ALL PERMITS, AUTHORIZATIONS, REGULATORY APPROVALS
AND THIRD PARTY CONSENTS NECESSARY FOR THE CONSUMMATION OF THE DEFINITIVE
AGREEMENT, AND ALL APPLICABLE LEGAL REQUIREMENTS SHALL HAVE BEEN SATISFIED;

            (n)        The closing shall occur not later than February 28, 2015;

                        (O)        NEITHER PARTY SHALL BE THE SUBJECT OF ANY
PENDING LITIGATION, ASSERTED CLAIMS OR DISPUTES; AND

                        (P)        OTHER CUSTOMARY CONDITIONS TO CLOSING.  

            22.       RULE 144 REPORTING.  WITH A VIEW TO MAKING AVAILABLE TO
THE POST-MERGER STOCKHOLDERS THE BENEFIT OF CERTAIN RULES AND REGULATIONS OF THE
SEC WHICH MAY PERMIT THE SALE OF NIGHTINGALE COMMON STOCK TO THE PUBLIC WITHOUT
REGISTRATION, FROM AND AFTER THE CLOSING DATE, THE PARTIES AGREES TO: (1) MAKE
AND KEEP PUBLIC INFORMATION AVAILABLE, AS THOSE TERMS ARE UNDERSTOOD AND DEFINED
IN RULE 144; AND (2) FILE WITH THE SEC, IN A TIMELY MANNER, ALL REPORTS AND
OTHER DOCUMENTS REQUIRED OF  UNDER THE EXCHANGE ACT.

            23.       REGISTRATION.

                        (a)        “Registrable Securities”   means the
Post-Closing Common Shares, the shares of Common Stock issuable upon exercise of
the outstanding Options and Warrants. 

                        (b)        “Registration Statement”  means a
registration statement of the Company filed under the 1933 Act.

                        (c)        Mandatory Registration.  As soon as
practicable following the Closing of the Merger, the management of Nightingale
shall prepare and file with the SEC a Registration Statement or Registration
Statements (as is necessary) on Form S-1 covering the resale of all of the
Registrable Securities. The initial Registration Statement prepared pursuant
hereto shall register for resale at least 20% of the Post-Closing Common Shares,
subject to adjustment as the management of Nightingale deems appropriate.

                        (D)        ALLOCATION OF REGISTRABLE SECURITIES. THE
INITIAL NUMBER OF REGISTRABLE SECURITIES INCLUDED IN ANY REGISTRATION STATEMENT
AND ANY INCREASE OR DECREASE IN THE NUMBER OF REGISTRABLE SECURITIES INCLUDED
THEREIN SHALL BE ALLOCATED PRO RATA AMONG THE HOLDERS OF THE POST-CLOSING COMMON
SHARES BASED ON THE NUMBER OF REGISTRABLE SECURITIES HELD BY EACH AT THE TIME
THE REGISTRATION STATEMENT COVERING SUCH REGISTRABLE SECURITIES IS DECLARED
EFFECTIVE BY THE SEC. IN THE EVENT THAT POST-CLOSING COMMON SHARES SHAREHOLDER
SELLS OR OTHERWISE TRANSFERS ANY OF SUCH PERSON’S REGISTRABLE SECURITIES, EACH
TRANSFEREE SHALL BE ALLOCATED A PRO RATA PORTION OF THE THEN REMAINING NUMBER OF
REGISTRABLE SECURITIES INCLUDED IN SUCH REGISTRATION STATEMENT FOR SUCH
TRANSFEROR.

            24.       EXPENSES.  CTE SHALL BEAR ITS AUDIT, LEGAL AND OTHER
EXPENSES RELATED TO THE TRANSACTIONS.  NIGHTINGALE SHALL BEAR NIGHTINGALE’S
AUDIT, LEGAL AND OTHER EXPENSES RELATED TO THE TRANSACTIONS.

            25.       AUTHORITY; GOVERNING LAW; COUNTERPARTS.  EACH OF CTE AND
NIGHTINGALE REPRESENTS AND ACKNOWLEDGES THAT IT HAS THE POWER AND AUTHORITY TO
ENTER INTO THIS LETTER OF INTENT.  THIS LETTER OF INTENT SHALL BE GOVERNED BY
AND CONSTRUED EXCLUSIVELY UNDER THE LAWS OF THE STATE OF UTAH.  THIS LETTER OF
INTENT MAY BE EXECUTED IN COUNTERPARTS.

            26.       TERMINATION AND NON-BINDING NATURE.

                        (A)        TERMINATION.   THE PARTIES MAY TERMINATE THIS
LETTER OF INTENT AT ANY TIME UPON MUTUAL WRITTEN AGREEMENT.  EITHER NIGHTINGALE
OR CTE MAY TERMINATE THIS LETTER OF INTENT BY WRITTEN NOTICE TO THE OTHER PARTY
IF THE PARTIES HAVE NOT ENTERED INTO THE DEFINITIVE MERGER AGREEMENT WITHIN
SIXTY (60) DAYS AFTER THE DATE LAST SET FORTH BELOW. 

                        (B)        SURVIVAL.  EXCEPT FOR EXPENSES (SECTION 24),
AUTHORITY; GOVERNING LAW; COUNTERPARTS (SECTION 25) AND TERMINATION AND
NON-BINDING NATURE (THIS SECTION 26), WHICH SHALL SURVIVE THE TERMINATION OF
THIS LETTER OF INTENT, ALL OTHER PROVISIONS OF THIS LETTER OF INTENT SHALL
TERMINATE UPON THE TERMINATION OF THIS LETTER OF INTENT.

                        (C)        NON-BINDING NATURE.  EXCEPT FOR PUBLIC
DISCLOSURE (SECTION 18), NO SHOP (SECTION 19), EXPENSES (SECTION 24), AUTHORITY,
GOVERNING LAW, COUNTERPARTS (SECTION 25) AND TERMINATION AND NON-BINDING NATURE
(THIS SECTION 26), THE PARTIES HERETO UNDERSTAND AND AGREE THAT THIS LETTER OF
INTENT SETS FORTH ONLY THE PARTIES’ CURRENT UNDERSTANDING OF PROPOSALS WHICH MAY
BE SET OUT IN A BINDING FASHION IN THE DEFINITIVE MERGER AGREEMENT TO BE
EXECUTED AT A LATER DATE.  EXCEPT AS PROVIDED IN THE PREVIOUS SENTENCE, THIS
LETTER OF INTENT DOES NOT CREATE AND IS NOT INTENDED TO CREATE A BINDING AND
ENFORCEABLE CONTRACT BETWEEN THE PARTIES OR A DUTY ON THE PART OF EITHER PARTY
TO NEGOTIATE IN GOOD FAITH TOWARD ANY BINDING AGREEMENT, AND MAY NOT BE RELIED
UPON BY EITHER PARTY AS THE BASIS FOR A CONTRACT BY ESTOPPEL OR OTHERWISE, BUT
RATHER EVIDENCES A NON-BINDING EXPRESSION OF GOOD FAITH UNDERSTANDING TO
ENDEAVOR, WITHOUT OBLIGATION, TO NEGOTIATE MUTUALLY AGREEABLE DEFINITIVE
AGREEMENTS. 

            (d)        Forum. Unless otherwise explicitly provided in this
Agreement, any action, claim, suit or proceeding relating to this Agreement or
the enforcement of any provision of this Agreement shall be brought or otherwise
commenced in any Utah state or federal court locating in the Salt Lake City,
Utah.  Each party hereto (i) expressly and irrevocably consents and submits to
the jurisdiction of each such court, and each appellate court located in the
State of Utah, in connection with any such proceeding; (ii) agrees that each
such court shall be deemed to be a convenient forum; (iii) agrees that service
of process in any such proceeding may be made by giving notice pursuant to
Section by US mail; and (iv) agrees not to assert, by way of motion, as a
defense or otherwise, in any such proceeding commenced in any such court, any
claim that such party is not subject personally to the jurisdiction of such
court, that such proceeding has been brought in an inconvenient forum, that the
venue of such proceeding is improper or that this Agreement or the subject
matter of this Agreement may not be enforced in or by such court.

Acceptance

PLEASE INDICATE YOUR ACCEPTANCE OF THE TERMS OF THIS LETTER OF INTENT BY SIGNING
BELOW AND RETURNING BY EMAIL AN EXECUTED COPY OF THIS LETTER OF INTENT NO LATER
THAN 5:00 P.M. (PACIFIC TIME) ON NOVEMBER 7, 2014 TO MARKSCHARM@COMCAST.NET. 
UNLESS SO EXECUTED AND RETURNED BY SUCH DATE, THIS LETTER OF INTENT SHALL BE
NULL AND VOID.

 

 

SIGNATURE PAGE

 

 

NIGHTINGALE, INC.

a Delaware corporation

By: /s/ Mark A. Scharmann                                 

       Mark A. Scharmann, Vice President

 

Dated: November 6, 2014

 

 

 

 

The foregoing letter is agreed to and accepted effective as of the date set
forth below.

 

 CYTOGRAFT TISSUE ENGINEERING, INC.

By: /s/ Todd N. McAllister                               

Name:  Todd N. McAllister, Ph.D.

             Chief Executive Officer

 

 

Dated: November 6th, 2014

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

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[1]  See Section 8 above.

[2]  See Sections 10, 11 and 12 above.  This includes all shares issuable upon
the exercise of all outstanding and pending warrants, options, and other
convertibles of CTE.