**Exhibit10.3**

 

**DEVELOPMENT AND COMMERCIALIZATION AGREEMENT**

 

THIS DEVELOPMENT AND COMMERCIALIZATION AGREEMENT (the “Agreement”) ismade and entered into the 25th day of July, 2008 to be effective as of theeffective date (the “Effective Date”), between Artann Laboratories, Inc.,(“Artann”) a Delaware corporation, and ProUroCare Medical Inc., (“ProUroCare”)a Nevada corporation.

 

**WITNESSETH:**

** **

WHEREAS, ProUroCare has expertise and intellectual property in thefield of urologic products and applications; and

 

WHEREAS, Artann has developed expertise and intellectual property inthe area of a prostate mechanical imaging system; and

 

WHEREAS,  ProUroCare and Artanndesire to enter into (i) this Agreement and (ii) a License Agreementof even date herewith (the “License Agreement”) whereby Artann grants certainpatent, trade secret and technology license rights to ProUroCare with respectto various prostate mechanical imaging systems (the “PMI System”); and

 

WHEREAS, Artann and ProUroCare desire to work together pursuant to theterms of this Agreement to develop and commercialize PMI Systems.

 

**AGREEMENTS:**

** **

NOW THEREFORE, in consideration of the representations, warranties,covenants and agreements contained herein, and for other valuableconsideration, the receipt and adequacy of which is hereby acknowledged, theparties mutually agree as follows:

 

**ARTICLE 1DEFINITIONS**

** **

## 1.1           SpecificDefinitions.  As used in thisAgreement, the following terms shall have the meanings set forth or asreferenced below:

##  

“2008ProUroCare Offering” means one or more public or private equity offeringsthat raises at least Four Million Dollars ($4,000,000.00) by ProUroCare afterthe date of signing of this Agreement.

 

“2008 OfferingPrice” means the weighted average price that ProUroCare shares have tradedover the forty five (45) day period prior to the date of the closing of the2008 ProUroCare Offering.

 

“510K” means an application filed with FDA pursuant to § 510(k) ofthe Medical Device Amendments of 1976 to the Federal Food, Drug and CosmeticAct to initiate marketing and sales in the U.S.

 

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“Agreement” means this Agreement and all Exhibits hereto.

 

“Artann” means Artann Laboratories, Inc.

 

“Artann Trade Secrets” means the Confidential Information ofArtann (e.g., software source code) that are used or useful in the use,manufacture or sale of a PMI System and which provide a sustainable competitivetechnology and which qualify fully as trade secret information within thenormal and common meaning of that term under the laws of the State of NewJersey.

 

“Confidential Information” means know-how, trade secrets, andunpublished information disclosed (whether before or during the term of thisAgreement) by one of the parties (the “disclosing party”) to the other party(the “receiving party”) or generated under this Agreement, excludinginformation which:

 

### (a)           was already in thepossession of receiving party prior to its receipt from the disclosing party(provided that the receiving party is able to provide the disclosing party withreasonable documentary proof thereof);

###  

### (b)           is or becomes partof the public domain by reason of acts not attributable to the receiving party;

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### (c)           is or becomesavailable to receiving party from a source other than the disclosing partywhich source, to the best of receiving party’s knowledge, has rightfullyobtained such information and has no obligation of non-disclosure orconfidentiality to the disclosing party with respect thereto;

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### (d)           is made available bythe disclosing party to a third party unaffiliated with the disclosing party onan unrestricted basis;

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### (e)           has beenindependently developed by the receiving party without breach of this Agreementor use of any Confidential Information of the other party; or

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### (f)            has been or must bepublicly disclosed by reason of legal, accounting or regulatory requirementsbeyond the reasonable control, and despite the reasonable efforts of thereceiving party.

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All Confidential Information disclosed by one party to the other underthis Agreement with the exception of PMI Documentation and Artann Trade Secretsshall be in writing and bear a legend “Company Proprietary” or words of similarimport or, if disclosed in any manner other than writing, shall be preceded orfollowed by an oral statement indicating that the information is Companyproprietary or confidential, with an identification of the particularinformation that is Company proprietary or confidential.  PMI Documentation and Artann Trade Secretswill be considered Confidential Information by default.

 

“Effective Date” means ten (10) days after close of the2008 ProUroCare Offering or November 30, 2008, whichever is first tooccur.

 

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“FDA” means the United States Food and Drug Administration orany successor entity thereto.

 

“FDA Approval” means approval by the FDA of a 510K or PMA tocommercially sell a Product.

 

“Field of Use” means diagnosis or treatment of urologicdisorders of the prostate, kidney or liver.

 

“Generation V PMI System” means the most current PMI Systemexisting as of the Effective Date of the Agreement.

 

“Intellectual Property” means U.S. and foreign patents andpatent applications, know-how, trade secrets, Inventions, discoveries andtechnical information including but not limited to information embodied indrawings, designs, mask works, mask work applications, copyrights, copyrightapplications, trademarks and trademark applications, material specifications,processing instructions, formulas, equipment specifications, productspecifications, confidential data, computer software, electronic files,research notebooks, invention disclosures, research and development reports andthe like related thereto and all amendments, modifications and improvements toany of the foregoing.

 

“Invention” means any invention, whether or not patented orpatentable, and whether or not memorialized in writing.

 

“PMA” means a pre-market approval application filed with the FDAas more fully defined under 21 U.S.C. Section 360(e), to obtain permissionto initiate marketing and sales in the U.S.

 

“PMI System” means the Artann’s prostate mechanical imagingsystem consisting of a 1) transrectal probe with pressure sensor arrays, 2)positioning system, 3) data processing unit, 4) real time imaging display, and5) operating system, as generally outlined in the journal article entitled “ProstateMechanical Imaging:  A New Method forQuantitative Prostate Assessment” by Weiss, et al.

 

“PMI Documentation” means software and software source code (if,and to the extent such code is not maintained as an Artann Trade Secret); anyand all drawings, schematics, assembly information, methods, specifications,know how, procedures, processes, designs, technical data and engineeringreports necessary and/or useful in the development, use and manufacture of aPMI System.

 

“Product” means a PMI System including all improvements andmodifications applicable thereto, except for improvements and modificationsthat are developed for a different medical device which have only tangentialapplication to a PMI System and which were developed independently of anyactivities conducted under this Agreement and/or the Development andCommercialization Agreement.

 

“ProUroCare” means ProUroCare Medical, Inc.

 

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“Territory” means anywhere and everywhere in the world.

 

## 1.2           DefinitionalProvisions.

##  

### (a)           The words “hereof,” “herein,”and “hereunder” and words of similar import, when used in this Agreement, shallrefer to this Agreement as a whole and not to any particular provisions of thisAgreement.

###  

### (b)           Terms defined in thesingular shall have a comparable meaning when used in the plural, andvice-versa.

###  

### (c)           References to an “Exhibit”or to a “Schedule” are, unless otherwise specified, to one of the Exhibits orSchedules attached to or referenced in this Agreement, and references to an “Article”or a “Section” are, unless otherwise specified, to one of the Articles orSections of this Agreement.

###  

### (d)           The term “person”includes any individual, partnership, joint venture, corporation, trust,unincorporated organization or government or any department or agency thereof.

###  

**ARTICLE 2DEVELOPMENT ACTIVITIES**

 

## 2.1           Purpose.   Artann and ProUroCare intend to collaboratetogether to develop, commercialize and market PMI Systems.  Toward that end, clinical testing regulatoryapproval and product refinement of the PMI System is indicated.  Each party shall perform its respectiveobligations pursuant to the process set forth in this Agreement.

##  

2.2           Clinical Testing and IDESubmission.

 

(a)           Unless otherwise specified, Artannshall conduct and complete all pre-clinical activities and testing on theGeneration V PMI System.

 

(b)           Unless otherwise specified, Artannshall be responsible for obtaining all necessary FDA regulatory approval fortests of the Generation V PMI System pursuant to an IDE including specificationof the scope of IDE clinical study, selection of investigational sites,preparation of investigator brochures, instruction and training of clinicalinvestigators, data collection and analysis reporting of adverse IDE events andoverall preparation and prosecution of FDA approved IDE clinical studies.  It is understood that all choseninvestigational sites shall be acceptable to Artann, shall not conflict withthe NIH grant objectives and shall be subject to the inventory andaccountability requirements as specified by the Department of Health and HumanServices.

 

(c)           Artann may solicit, accept andutilize NIH grant monies for the conduct of such pre-clinical and clinicalstudies, as, if, and to the extent permitted in any such grants.

 

(d)           Artann shall share information withProUroCare necessary to facilitate a mutual understanding of the status of theclinical studies and the decision-making in connection 

 

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therewith.  Without limiting the foregoing, Artann shallprovide ProUroCare with a summary of the clinical activities and developmentsas reasonably requested by ProUroCare. Such report shall encompass data, records and reports generated by orfor hospitals, clinics and health care groups and all reports and informationon the IDE clinical study provided to the FDA and all information and reportsreceived from the FDA.  ProUroCare shallbe provided a copy of the NIH grant.

 

(e)           ProUroCare shall provide clinicalstudy advice and assistance, at no charge to Artann, including but not limitedto suggestions on the selection of investigators, the scope and content ofclinical study protocol and IDE submissions, the preparation of investigatorbrochures, the claims to be addressed and supported in the study, and theoverall conduct of the clinical studies. Although not bound to follow such ProUroCare advice and suggestions,Artann shall give it due consideration and preference whenever feasible.

 

2.3           510K/PMA Regulatory Submission.

 

(a)           Unless otherwise specified, Artannshall be responsible for preparing all necessary regulatory approvals for theGeneration V PMI System via a 510K or PMA application to FDA in accordance withthe NIH grant funding even though the 510K or PMA application may be drafted orprepared in significant part by Hogan & Hartson and/or otherregulatory and consulting groups.

 

(b)           Artann may solicit, accept andutilize NIH grant monies for such 510K or PMA submission, as, if and to theextent permitted in any such grants.

 

( c)          Artann shall share information withProUroCare on the proposed 510K or PMA application strategy, including but notlimited to details on the proposed claims, warnings, contradictions and useinstructions for which approval is to be sought.  Without limiting the foregoing, Artann shallallow ProUroCare to review and comment upon any and all draft 510(K) orPMA submissions and shall modify any such 510(K) or PMA submission asrequested by ProUroCare, unless such ProUroCare requested modification woulddelay the date that the 510(K) or PMA is filed with and/or approved byFDA.

 

(d)           The 510(K) or PMA applicationshall be submitted in the name of Artann, but application shall be made to FDAto have the name on the application changed from Artann to ProUroCare upon thefirst commercial sale of the Generation V PMI System.

 

2.4           Product Refinement.

 

(a)           Artann shall provide Product hardwareand software development, refinement and debugging services to ready theGeneration V PMI System for commercial sale. Such development, refinement and debugging services shall, among otherthings, address issues, concerns and deficiencies identified in IDE clinicaltesting and satisfy FDA concerns.

 

(b)           Artann may solicit, accept andutilize NIH grant monies for such Product refinement, as, if, and to the extentpermitted in any such grants.

 

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**ARTICLE 3**

**PAYMENT FOR DEVELOPMENTACTIVITIES**

 

3.1           In consideration for the developmentactivities undertaken by Artann hereunder, ProUroCare shall provide Artann; 1)the equity set forth in Section 3.2; 2) the milestone payments set forthin Section 3.3, and 3) the retainer fee set forth in Section 3.4.

 

3.2           Equity.

 

ProUroCare shallprovide equity (i.e., shares of stock) in ProUroCare having a value ofapproximately One Million Dollars ($1,000,000.00) upon completion of the FDAapproved IDE clinical studies more fully described in Section 2.2 andsubmission of a 510(K) or PMA as outlined in Section 2.3 on theGeneration V PMI System.  The exactnumber of shares of stock in ProUroCare shall equal $1,000,000.00 divided bythe fair market value price per share of ProUroCare stock, with that pricebeing the weighted average price that ProUroCare shares have traded over theforty five (45) day period prior to the date of the 510(K) or PMAsubmission.  In no event shall the fairmarket price per share used for this computation be less than eighty percent(80%) of the 2008 Offering Price.

 

3.3           Milestone Payments.

 

ProUroCare shallmake the following milestone payments to Artann:

 

(a)           Two Hundred Fifty Thousand Dollars($250,000.00) upon initiation of an FDA approved IDE clinical study (i.e., uponfirst actual use of a Generation V PMI System on a patient enrolled in the IDEclinical study) on the Generation V PMI System as more fully described in Section 2.2;

 

(b)           Two Hundred Fifty Thousand Dollars($250,000.00) upon completion of that FDA approved IDE clinical study andsubmission of a 510(K) or PMA on the Generation V PMI System; as morefully described in Section 2.3; and

 

(c)           Seven Hundred Fifty Thousand Dollars($750,000.00) upon FDA approval of a 510(K) or PMA to allow the GenerationV PMI System to be commercially sold.

 

3.4           ProUroCare shall pay Artann a monthlyretainer fee for technical advice and training of ProUroCare representatives byqualified Artann personnel, as may be most appropriate, to facilitate athorough understanding of the Generation V PMI System and the PMIDocumentation.  Although the exact numberof days that it will take Artann personnel to conduct such advice and trainingis not now known, it is anticipated that it may take up to twenty-five (25)days per month for the first six (6) months and twelve (12) days per monthfor the following twelve (12) months. The monthly fee retainer shall be paid within ten (10) days fromthe end of the month starting from the Effective Date of the Agreement andshall be Thirty Thousand Dollars ($30,000.00) per month for each of the firstsix (6) months from the Effective Date of the Agreement and FifteenThousand Dollars ($15,000.00) per month for the next twelve (12) 

 

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months.  It is understood and agreed that anyintellectual property (e.g., any patentable invention) provided through or as apart of this technical advice and training shall not be deemed to be work madefor hire and ProUroCare shall not obtain any property rights thereto.

 

3.5           Product Development Success Bonus.

 

ProUroCare shallprovide equity (i.e., shares of stock) in ProUroCare having a value ofapproximately One Million Dollars ($1,000,000.00) as a bonus if FDA approvalfor commercial sale of the Generation V PMI System is obtained within fifteen(15) months of the Effective Date of the Agreement.  The exact number of shares of stock inProUroCare shall equal $1,000,000.00 divided by the fair market value price pershare of ProUroCare stock, with that price being the weighted average pricethat ProUroCare shares have traded over the forty five (45) day period prior tothe date of the 510(K) or PMA approval for commercial sale.  Such equity shall be reduced by ten (10) percentper month for each full month that such FDA approval is delayed beyond suchfifteen (15) month period.

 

**ARTICLE 4**

**SCALE UP COMMERCIAL ACTIVITIES**

 

4.1           Pre-Commercial Product.

 

Artann shallsupply to ProUroCare such quantities of Generation V PMI Systems as isreasonably required by ProUroCare for pre-commercial test, evaluation,marketing and clinical study and to facilitate having a third partymanufacturer produce the Generation V PMI Systems for commercial sale.  The number of such pre-commercial GenerationV PMI Systems to be supplied by Artann is anticipated to number approximatelytwenty (20).

 

4.2           Commercial Product.

 

Artann may berequested to provide Generation V PMI Systems for ProUroCare’s initialcommercial marketing.  Artann agrees touse best reasonable efforts to provide such needed commercial Product toProUroCare and ProUroCare shall use best reasonable efforts to limit the numberof such Product to a number less than one hundred (100).

 

4.3           Pre-Commercial and CommercialProduct.

 

ProUroCare shallpay Artann TBD Dollars for each requested pre-commercial Generation V PMISystem and TBD Dollars for each commercial system.  Payment for each such system shall be made asfollows:  fifty percent (50%) at the dateProUroCare orders the Generation V PMI System and the remaining fifty percent(50%) upon delivery to ProUroCare.

 

4.4           Scale-Up Service.

 

Artann shallprovide all reasonably requested Generation V PMI System manufacture andscale-up services to ProUroCare or a third party manufacturer designated byProUroCare to facilitate the commercial manufacture of such Product.  Such services shall be provided by qualifiedArtann personnel and ProUroCare shall pay Artann Twelve Hundred Dollars 

 

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($1,200.00) perday per individual (based upon an eight (8) hour work day with partialdays being payable on a pro-rata basis) for such services.

 

**ARTICLE 5**

**FUTUREGENERATION PMI SYSTEMS**

 

5.1           Future Agreements.

 

The partiescontemplate the development and marketing of further and additional versionsand generations of PMI Systems. ProUroCare shall solicit ideas and recommendations from Artann, butProUroCare shall be solely responsible for setting specifications andoutsourcing the manufacture of such further and additional versions andgenerations of PMI Systems.  The specificterms for development and marketing of such further and additional versions andgenerations of PMI Systems shall be as specified in a separate agreemententered into between the parties hereto.

 

5.2           Future NIH Grants.

 

ProUroCare shallhave a “right of first negotiation” with Artann regarding any future NIH grantsthat Artann receives for the development of Products in the Field of Use.  The “right of first negotiation” means theright of ProUroCare to negotiate exclusivity with Artann for a period of ninety(90) days (the “period of exclusivity”) from the date of such NIH grant toenter into a development and commercialization arrangement for suchProducts.  If an agreement is not reachedduring this “period of exclusivity”, Artann may enter into a development andcommercialization agreement with a third party, but only upon terms which areno less favorable than those offered by ProUroCare during the “period ofexclusivity”.

 

**ARTICLE 6**

**CERTAINREPRESENTATIONS, WARRANTIES AND INDEMNITIES**

 

6.1           Representations and Warranties.

 

### (a)           Artann representsand warrants to ProUroCare that the execution and delivery by Artann of thisAgreement and the performance by Artann of its obligations hereunder have beenduly authorized by all requisite corporate action and will not violate anyprovision of law, any order of any court or other agency of government, theArticles of Incorporation or Bylaws of Artann, as amended, or any provision ofany indenture, agreement or other instrument to which Artann or any of itsproperties or assets is bound, or conflict with, result in a breach of orconstitute (with due notice or lapse of time or both) a default under any suchindenture, agreement or other instrument, or result in the creation orimposition of any lien, charge, restriction, claim or encumbrance of any naturewhatsoever upon any of the properties or assets of Artann and that thisAgreement has been duly executed and delivered by Artann and constitutes thelegal, valid and binding obligation of Artann, enforceable in accordance withits terms, subject, as to the enforcement of remedies, to the discretion of thecourts in awarding 

 

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### equitablerelief and to applicable bankruptcy, reorganization, insolvency, moratorium andsimilar laws affecting the rights of creditors generally.

###  

### (b)           ProUroCarerepresents and warrants to Artann that the execution and delivery by ProUroCareof this Agreement and the performance by ProUroCare of its obligationshereunder have been duly authorized by all requisite corporate action and willnot violate any provision of law, any order of any court or other agency ofgovernment, the Articles of Incorporation or Bylaws of ProUroCare, as amended,or any provision of any indenture, agreement or other instrument to whichProUroCare or any of its properties or assets is bound, or conflict with,result in a breach of or constitute (with due notice or lapse of time or both)a default under any such indenture, agreement or other instrument, or result inthe creation or imposition of any lien, charge, restriction, claim orencumbrance of any nature whatsoever upon any of the properties or assets ofProUroCare and that this Agreement has been duly executed and delivered byProUroCare and constitutes the legal, valid and binding obligation ofProUroCare, enforceable in accordance with its terms, subject, as to theenforcement of remedies, to the discretion of the courts in awarding equitablerelief and to applicable bankruptcy, reorganization, insolvency, moratorium andsimilar laws affecting the rights of creditors generally.

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### Limitation ofLiability.  ARTANNWILL NOT BE LIABLE FOR ANY INDIRECT, SPECIAL INCIDENTAL, CONSEQUENTIAL,EXEMPLARY OR PUNITIVE DAMAGES, INCLUDING BUT NOT LIMITED TO LOST PROFITS,BUSINESS INTERRUPTION, LOSS OF GOODWILL, OR COSTS OF PROCUREMENT OF SUBSTITUTEPRODUCT OR SERVICES, OR OTHERWISE, HOWEVER CAUSED AND UNDER ANY THEORY OFLIABILITY AND WHETHER OR NOT A PARTY WAS ADVISED OF THE POSSIBILITY OF SUCHDAMAGES.

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### 6.2           Indemnity.

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## (a)           Purposely left blank.

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### (b)           Subject to the terms and conditions of this Agreement,ProUroCare shall indemnify and hold Artann, and each of its officers,directors, employees, agents or consultants harmless from and against anythird-party liability, losses, damages, claims, costs and expenses (includingreasonable fees of attorneys and other professionals and court costs)(collectively “Liabilities”) arising out of or connected with (a) anybreach of this Agreement by ProUroCare or (b) the use by or administration of the ProUroCare Product to anyperson that arises out of the use, manufacture, sale, import or otherexploitation of a ProUroCare Product by ProUroCare or a ProUroCare sublicensee(except to the extent such liability resulted from any gross negligence orwillful misconduct of Artann in the design, specification or manufacture of theProduct).  Additionally, ProUroCare shallmaintain commercially reasonable product liability insurance with such insurancebeing effective as of a date no later than the date of first clinical useindependently directed by ProUroCare or commercial sale of Product and shallhave Artann listed as an additional insured party on such insurance.

 

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### **ARTICLE 7INTELLECTUAL PROPERTY**

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7.1           Ownership of Intellectual Property.  All Intellectual Property of ProUroCareexisting on the Effective Date, and any Intellectual Property developed solelyby employees of, or consultants working for, ProUroCare in the course of theAgreement, shall be and remain the property of ProUroCare.  All Intellectual Property of Artann existingon the Effective Date, and any Intellectual Property, developed solely byemployees of, or consultants working for Artann in the course of the Agreement,shall be the property of Artann and ProUroCare shall not acquire any rightstherein except pursuant to the License Agreement.  Any Intellectual Property developed jointlyby employees or consultants of Artann and ProUroCare in the course of workperformed under this Agreement shall be jointly owned by ProUroCare and Artann,with each party having an undivided interest therein, subject to the LicenseAgreement.

 

7.2           Protection of IntellectualProperty.  If either Artann orProUroCare proposes to file for any U.S. or foreign patent, copyright and maskwork registration, or any continuation or modification thereof, with respect toany Joint Invention, or proposes to prosecute any alleged infringement of anyJoint Invention, then such party proposing to file such registration orprosecute such alleged infringement (“the first party”) shall notify the otherparty (“the second party”) in writing and the second party shall have option ofjoining in such action.  If the secondparty elects to join in such action, the second party shall (i) payone-half of the total expenses incurred by ProUroCare and Artann therein, (ii) beentitled to participate in all material steps in such action, and (iii) inthe event of prosecution of alleged infringement, be entitled to share in one-halfof all recoveries.  If the second partyelects not to join in such action, the first party shall be entitled to controlsuch action and retain all recoveries from the prosecution of allegedinfringement, but such failure to participate shall not affect the second party’sownership interest in the Joint Inventions or in any Intellectual Propertyrights therein.  Whether or not thesecond party elects to join in such action, the second party shall, upon therequest of the first party, cooperate with and assist the first party in suchaction to the extent required by statute, regulation, or government agency,including without limitation, executing and delivering all documents inconnection therewith and using its reasonable efforts to obtain such executionsfrom all appropriate employees and agents of the second party; provided that ifthe second party has elected not to participate in such action, the first partyshall reimburse the second party for costs and expenses incurred by the secondparty in connection with such cooperation, including any filing and attorneysfees, but not including internal administrative or personnel expenses of thesecond party.  Each party will treatJoint Inventions as Confidential Information so long as they remain trade secretsunder applicable state statutes or common law except to the extent that suchJoint Invention are protected by federal copyright, patent or mask workstatutes.  Except as set forth in this Section 7.2and the License Agreement, each party may freely license or assign JointInventions (provided that any assignee agrees in writing to be bound by theobligations of the licensing or assigning party hereto and obligations ofconfidentiality as they apply to Confidential Information hereunder) andneither party will have any obligation to account to the other with respect toJoint Inventions.  The obligations ofthis Section 7.2 shall survive any termination or expiration of thisAgreement.

 

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**ARTICLE 8**

**TERM AND TERMINATION**

 

8.1           Term.  Subject to earlier termination as provided inSection 8.2 of this Agreement, this Agreement shall commence upon theEffective Date and is for an initial term of three (3) years and maythereafter be renewed for additional one (1) year terms upon mutualagreement of the parties.

 

## 8.2           Termination.  Notwithstanding the provisions of Section 8.1above, this Agreement may be terminated in accordance with the followingprovisions:

##  

## (a)           A party mayterminate this Agreement by giving notice in writing to the other party if theother party is in breach of any material obligation (e.g., obligation ofProUroCare to make a payment as specified under Sections 3.1, 3.2 and 3.3hereof and Sections 3.1 and 3.3 of the License Agreement), representation,warranty or covenant of this Agreement and shall have failed to cure suchbreach within sixty (60) days of receipt of written notice thereof from thefirst party;

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(b)           A party may terminate this agreementat any time by giving notice in writing to the other party, which notice shallbe effective upon dispatch, should the other party become insolvent, make anassignment for the benefit of creditors, go into liquidation or receivership orotherwise lose legal control of its business.

 

8.3           Effect of Termination.

 

### (a)           Upon termination of this Agreement for any reason, nothingherein shall be construed to release either party from any obligation thatmatured prior to the effective date of such termination.

###  

### (b)           The provisions of Article 6 (Certain Representations,Warranties, and Indemnities); Article 5 (Intellectual Property); Section 9.1(Non-Disclosure) and Section 9.12 (Arbitration) shall survive atermination under Section 8.2.

 

**ARTICLE 9**

**MISCELLANEOUS**

 

9.1           Non-Disclosure.  Each party agrees not to disclose or use(except as permitted or required for performance by the party receiving suchConfidential Information of its rights or duties hereunder or under the LicenseAgreement) any Confidential Information of the other party obtained during theterm of this Agreement until (i) the expiration of four (4) yearsafter the termination or expiration of this Agreement or (ii) the end of2015, whichever is last to occur.  Eachparty further agrees to take appropriate measures to prevent any suchprohibited disclosure by its present and future employees, officers, agents,subsidiaries, or consultants during the term of this Agreement and for a periodof (i) four (4) years thereafter or (ii) the end of 2015,whichever is last to occur.  Artann TradeSecrets shall be kept confidential perpetually.

 

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9.2           Assignment.  This Agreement shall be binding upon andinure to the benefit of the parties hereto and the successors or assigns of theparties hereto; provided, that (i) the rights and obligations of Artannherein may not be assigned except to any person who succeeds to substantiallyall of Artann’s business, and (ii) the rights and obligations ofProUroCare herein may not be assigned except to any person who succeeds to allor a substantial portion of ProUroCare’s business to which this Agreementrelates.  Any attempted assignment ofthis Agreement in violation of this Section 9.2 shall be null and void.

 

9.3           Entire Agreement.  This Agreement and the Development and CommercializationAgreement, and the agreements contemplated herein and therein constitute theentire agreements of the parties with respect to the subject matter of suchagreements and supersede all previous proposals or agreements, oral or written,and all negotiations, conversations or discussions heretofore had between theparties related to the subject matter of such agreements.

 

9.4           Governing Law.  This Agreement shall be governed by, andinterpreted and construed in accordance with, the laws of the State of NewJersey, without giving effect to principles of conflicts of laws.  The parties hereby agree to submit alldisputes arising hereunder to the jurisdiction of the Federal District Courtfor New Jersey where Artann is resident.

 

9.5           Amendment, Waiver, Discharge, etc.  This Agreement may not be amended, released,discharged, abandoned, changed or modified in any manner, except by aninstrument in writing signed on behalf of each of the parties to this Agreementby their duly authorized representatives. The failure of either party to enforce at any time any of the provisionsof this Agreement shall in no way be construed to be a waiver of any suchprovision, nor in any way to affect the validity of this Agreement or any partof it or the right of either party after any such failure to enforce each andevery such provision.  No waiver of anybreach of this Agreement shall be held to be a waiver of any other orsubsequent breach.

 

9.6           Execution in Counterparts.  This Agreement may be executed in one or morecounterparts, all of which shall be considered one and the same agreement, andshall become a binding agreement when one or more counterparts have been signedby each party and delivered to the other party.

 

9.7           Titles and headings; Construction.  The titles and headings to Sections hereinare inserted for the convenience of reference only and are not intended to be apart of or to affect the meaning or interpretation of this Agreement.  This Agreement shall be construed withoutregard to any presumption or other rule requiring construction hereofagainst the party causing this Agreement to be drafted.

 

9.8           Benefit.  Nothing in this Agreement, expressed orimplied, is intended to confer on any person other than the parties to thisAgreement or their respective successors or permitted assigns, any rights,remedies, obligations or liabilities under or by reason of this Agreement.

 

9.9           Notices.  All notices or other communications to aparty required or permitted hereunder shall be in writing and shall be deliveredpersonally or by facsimile (receipt 

 

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confirmed) to suchparty (or, in the case of an entity, to an executive officer of such party) orshall be given by certified mail, postage prepaid with return receiptrequested, addressed as follows:

 

if to ProUroCare to:

 

ProUroCare Medical, Inc.

5500 Wayzata Boulevard, #310

Golden Valley, MN  55416

Attention: CEO

Phone: 952-476-9093

Fax: 763-591-5039

 

ifto Artann to:

 

Artann Laboratories, Inc.

1459 Lower Ferry Road

West Trenton, NJ 08618-1414

Fax:  (609)333-0710

Phone:  (609) 333-0712

 

Artann or ProUroCare maychange their respective above-specified recipient and/or mailing address bynotice to the other party given in the manner herein prescribed.  All notices shall be deemed given on the daywhen actually delivered as provided above (if delivered personally or byfacsimile) or on the day shown on the return receipt (if delivered by mail).

 

## 9.10         Severability.  If any provision of this Agreement is held invalidby a court of competent jurisdiction, such provision shall be enforced to themaximum extent permissible and the remaining provisions shall nonetheless beenforceable according to their terms.

##  

## 9.11         Execution of Further Documents.  Each party agrees to execute and deliverwithout further consideration any further applications, licenses, assignmentsor other documents, and to perform such other lawful acts as the other partymay reasonably request to fully secure and/or evidence the rights or interestsherein.

##  

## 9.12         Purposely Left Blank.

##  

## 9.13.        Compliance with Laws.  The parties will, and ProUroCare shall causeany permitted sublicensees of ProUroCare to, comply with all applicableinternational, national, state, regional and local laws and regulations,including all applicable import and export control laws, in exercising rightsor performing their duties under this Agreement.

##  

9.14.        ForceMajeure.  Neither party shall be indefault because of any failure to perform this Agreement if such failure arisesfrom causes beyond the control of such party (“the first party”) and withoutthe fault or negligence of such first party, including without limitation, Actsof God or of the public enemy, acts of the Government in either its sovereignor contractual capacity, fires, floods, earthquakes, epidemics, quarantinerestrictions, strikes, freight embargoes 

 

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or unusuallysevere weather.  In each instance, thefailure to perform must be beyond the reasonable control and without the faultor negligence of the first party.

 

9.15.        Non-Solicitation.  ProUroCare agrees not to solicit any Artannemployee or agent for employment by ProUroCare, irrespective of whether theproposed employment by ProUroCare shall be in a different capacity than thecapacity in which such person provided services to or for Artann.

 

IN WITNESS WHEREOF, each of the parties has caused this LicenseAgreement to be executed in the manner appropriate to each.

 
|   | ARTANN LABORATORIES, INC. |
|--------|---------------------------|
|   |                      |
|   |                      |
|   | By:                       | /s/ Noune Sarvazyan |
|   |                      |   |
|   | Its:                      | CEO |
|   |                      |
|   |                      |
|   | PROUROCARE MEDICAL, INC.  |
|   |                      |
|   |                      |
|   | By:                       | /s/Richard C. Carlson |
|   |                      |   |
|   | Its:                      | CEO |

 

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