**Exhibit 10.6**

** **

**AGREEMENT**

 

 

                Thisagreement is made as of the 6th day of April, 2001, between CytoGenix, Inc.,9881 South Wilcrest, Houston, TX 77099 (“CytoGenix”) and HEMCO Onshore, L.L.C.,1601 Elm Street, Suite 1500, Dallas, Texas 75201 and concerns the terms andconditions of a secured loan to be made by Hemco to CytoGenix  in the amount of  Two Hundred Fifty Thousand Dollars ($250,000.00) without interest(“the Loan”), such Loan to be made in order to pay  vendors of CytoGenix.  Allof the representations made herein by CytoGenix to Hemco are material to theagreement of Hemco to make the Loan. For and in consideration of the Loan and other good and valuable consideration, CytoGenix and Hemcocontract,  as follows:

 

                                                                                                1.             CytoGenix will  execute a Promissory Note to the order ofHemco in the amount of Two Hundred Fifty Thousand Dollars ($250,000.00),bearing no interest until default (“Note”), such Note being due ninety (90)daysfrom date, the form of the Note being attached hereto and incorporated herein asExhibit “A”.   CytoGenix will provide toHemco a written list of the vendors or employees (and invoices for same) whichwill be paid by CytoGenix from the proceeds of the Loan and Hemco, as a portion of the total amount represented by theLoan, will advance such sum to CytoGenix for payment to such vendors or employees only.

 

                                                                                                2.             CytoGenixwill execute a Security Agreement/Pledge in favor of Hemco, securing payment ofthe Note, such Security Agreement/Pledge listing certain US Patents,International Patents or applications for Patents  and, including all science associated in any manner with suchPatents or applications.  The SecurityAgreement/Pledge will be in the form attached hereto as Exhibit “B” andwill  be recorded or filed for record insuch place or places as will grant Hemco a first and prior lien on such USPatents, International Patents or applications for Patents.  In no event will the property interestsdescribed in the Security Agreement/Pledge cover or be deemed to cover anyinterest in any property not owned, in whole or in part, by CytoGenix.

 

                                                                                                3.             Untilthe Loan is completely repaid, within thirty (30) days of receipt, CytoGenixagrees to pay to Hemco, when entitled to be received by CytoGenix, fiftypercent (50%) of the proceeds from the receipt of any equity sales of stock orother securities by CytoGenix.  To theextent possible, CytoGenix grants to Hemco a security interest in all of suchproceeds for repayment of the Loan.

 

                                                                                                4.             Asa commitment fee for such loan by Hemco, CytoGenix will  assign to Hemco an undivided ten per cent(10%) interest in all of such  USPatents, International Patents or applications for Patents, including allscience associated in any manner with such Patents or applications, entitlingHemco to an undivided ten percent  (10%)interest in any monetary proceeds or other property associated with the sale,lease, transfer or any other type of disposition of the Patents, applicationsand science associated therewith.  Hemcogrants CytoGenix from the date hereof the right to acquire the ten percent(10%) interest owned by Hemco in the US Patents, International Patents orapplications for patents for the sum of One Million Dollars($1,000,000.00)(“Buy Back Price”),  suchright to acquire to be exercised by CytoGenix within two (2) 

 

 

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years from the date hereof by the payment in full toHemco of such amount.  Hemco agrees thatsaid monetary proceeds Hemco receives from the sale, lease, transfer or othertype of disposition of CytoGenix Intellectual Property (including withoutlimitation, the US Patents, International Patents or applications for patents)shall reduce said One Million Dollar ($1,000,000.00) Buy Back Price by theamount of said monetary proceeds and that Hemco’s right to receive saidmonetary proceeds shall terminate when the Buy Back Price is paid toHemco.  Hemco agrees that it will notencumber or transfer such ten percent (10%) interest during the following two (2)years from the date hereof.  Prior tofunding of any amounts under this agreement, CytoGenix will provide Hemco theoriginal Transfer and Assignments of the US Patents, International Patents orapplications for patent into CytoGenix, copies of which are attached to thisagreement as Exhibits “C” 1 though 4. In no event will Hemco’s ten per cent (10%) undivided interest be deemedto cover any interest in any property not owned or to be owned, in whole or inpart, by CytoGenix.

 

                                                                                                5.             CytoGenixand its officers  represent thatthey  have received all corporateauthority required in order to complete and comply with all of the provisionsof this agreement and that it owns, without claim or interest of any otherperson or entity, the US Patents, International Patents or applications forPatents listed in Exhibit “B” hereto and, that upon closing, Hemco will have a good and valid first lien forrepayment of the Promissory Note on such US Patents, International Patents orapplications for Patents, including all science associated in any mannertherewith, as listed in the Security Agreement/Pledge, subject however, to anyclaims or interests of third parties under Sponsored Research Agreementsbetween CytoGenix and such third parties. CytoGenix represents that it is not in default in or under any agreementor undertaking which would impair the rights of Hemco to the security interestand interest granted by the documents executed and to be executed in connectionwith the Loan.

 

                                                                                                6.             CytoGenixrepresents to Hemco that as of the date hereof and that at closing and fundingof the Loan, CytoGenix is and will be a corporation in good standing in thestate of its incorporation and in each and every state in which it is thendoing business.  CytoGenix representsthat it is in the process of obtaining reinstatement for trading on the OTCBulletin Board, that prior to any funding of the Promissory Note by Hemco,CytoGenix will provide to Hemco, in form acceptable to it, an opinion ofcounsel of CytoGenix, to the effect that CytoGenix is in the process of beingso reinstated on the OTC Bulletin Board, that counsel  is not aware of any material impediment to such reinstatement ofCytoGenix and the date of the expected reinstatement on the OTC Bulletin Board.

 

                                                                                                7.             Untilthe Loan has been repaid in full by CytoGenix, if requested by Hemco, CytoGenixagrees to execute from time to time any and all documents deemed by Hemco orits counsel reasonably necessary to better secure the obligations of CytoGenixunder this agreement.

 

 

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                This agreement is executed as ofthe date first above written and it is performable in Dallas, Dallas County,Texas.

 

 

CytoGenix, Inc.                                                                     HEMCOOnshore, L.L.C.

 

 
| By:  | /s/ Malcolm Skolnick |   | By:       | /s/ Charles B. Middlekauf |   |
|------|----------------------|--------|-----------|---------------------------|--------|
| Its: | President/CEO        | Its:   | President |

 

 

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**Transfer and Assignment**

 

 

                                Forthe sum of One Dollar ($1.00), and other good and valuable consideration, thereceipt of which is hereby acknowledged, the undersigned does hereby:

 

                                SELL,ASSIGN and TRANSFER to **HEMCO Onshore, L.L.C.**( “Assignee”), a limited liability company, having a place of business at 1601 Elm Street, Suite 1500, Dallas,Texas  75201, an undivided ten percent(10%) interest in and to any and all improvements which are disclosed in theU.S. and International patents and patent applications listed in the attachedExhibit “A”, and the same interest in all divisional, continuing, substitute,renewal, reissue and other applications for patent which have been or shall befiled in the United States or in any other country on any of such improvementsand the same undivided interest in and to all original and reissued patentswhich have been or shall be issued in the United States or in any countryoutside the United States on such improvements for the full term(s) for whichthe same may be granted;

 

                                AUTHORIZEand REQUEST the Patent and Trademark Office and the appropriate authorities ofany countries outside the United States to issue any and all such patentsgranted on such improvements to the Assignee;

 

                                COVENANTthat, when requested and at the expense of the Assignee, to carry out in goodfaith the intent and purpose of this assignment, the undersigned will executeand deliver to the Assignee an undivided ten percent (10%) interest in alldivisional, continuing, substitute, renewal, reissue, and all other patentapplications on any and all such improvements, execute and deliver to theAssignee all rightful oaths, declaration, assignments, powers of attorney andother papers, communicate to the Assignee all facts known to the undersignedrelating to such improvements and the history thereof, and generally doeverything possible which the Assignee shall consider desirable for vestingtitle to such improvements in the Assignee, and for securing, maintaining andenforcing proper patent protection for such improvements.

 

                                SAIDASSIGNMENT TO BE BINDING on the heirs, assigns, representatives and successorsof the undersigned and extend to the successors, assigns and nominees of theAssignee.

 

                                                                                                                **CYTOGENIX,INC.**

 

 
|   |                 |   |   |   |   |   |             |
|--------|----------------------|--------|--------|--------|--------|--------|------------------|
| By:    | /s/ Malcolm Skolnick |   |   |   |   |
|   |                 |   |   |   |   |   |             |
|   |                 |   |   |   |   |   | Malcolm Skolnick |
|   |                 |   |   |   |   |   | Printed Name     |
| Its:   | President/CEO        |   |   |   |   |
|   |                 |   |   |   |   |   |             |

 

 

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| STATE OF TEXAS   | § |
|------------------|--------|
|             | § |
| COUNTY OF HARRIS | § |

 

 

                This instrumentwas acknowledged before me, the undersigned authority, on this 6th day ofApril, 2001, by Malcolm Skolnick, President/CEO of CytoGenix, Inc., on behalfof said corporation, as the act and deed of said corporation.

 

 

 
|   |   |   |   |   |   |   | /s/ LeAnne McCall-Wisner       |
|--------|--------|--------|--------|--------|--------|--------|--------------------------------|
|   |   |   |   |   |   |   | Notary Public, State of  Texas |
|   |   |   |   |   |   |   |                           |
|   |   |   |   |   |   |   | LeAnne McCall-Wisner           |
|   |   |   |   |   |   |   | Printed Name of Notary         |
|   |   |   |   |   |   |   | My Commission Expires:         | 07/29/2002 |

 

 

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**Exhibit “A”**

** **

**Patents andPatent Applications**

 

1.                                     U.S. PatentApplication — Serial No. 08/236,504 (filed April 29, 1994 and abandoned) —entitled “Stem-Loop Cloning Vector and Method” Inventor: Charles A. Conrad[Atty File No INGA 002]

 

2.                                     U.S. Patent No.6,054,299 (filed June 17, 1997 — Continuation of 08/236,504, 04/29/94) —entitled “Stem-Loop Cloning Vector and Method” Inventor: Charles A Conrad —Issued April 25, 2000 [Atty File No. INGA 002/FWC]

 

3.                                     U.S. PatentApplication — Serial No. 09/169,793 (filed October 9, 1998 — Continuation in Partof application 08/877,251) — entitled “Production of ssDNA In Vivo” Charles A.Conrad [Atty File No. INGA 004]

 

4.                                     U.S. PatentApplication — Serial No. 09/397,782 (filed September 16, 1999 — Continuation inPart of 09/169,793 10/09/98) — entitled “In Vivo Production of ssDNA UsingReverse Transcriptase with Predefined Reaction Termination via Step-LoopFormation” Inventor:  Charles a. Conrad[Atty File No. INGA 004/CIP]

 

5.                                     U.S. PatentApplication — Serial No. 09/397,783 (filed September 16, 1999 — Continuation inPart 09/169,793) — entitled “Enzymatic Synthesis of ssDNA” Inventors: CharlesA. Conrad, Michael D. Skillern and Jonathan F. Elliston [Atty File No. CRYA008]

 

6.                                     U.S. PatentApplication — Serial No. 09/411,568 (filed October 4, 1999 — Continuation inPart of 09/397,782 and 09/169,793) — entitled “In Vivo Production of ssDNAContaining DNA Enzyme Sequence with Rnase Activity” Inventor: Charles A. Conrad[Atty File No. INGA 004/C/CIP]

 

7.                                     InternationalApplication — No. PCT/US99/23936 — Publication No. WO 00/22114 (filed October12, 1999) — entitled “Production of ssDNA In Vivo” Inventor: Charles A. Conrad[Atty File No. INGA 004/PCT]

 

8.                                     InternationalApplication - No. PCT/US99/23933 — Publication No. WO 00/22113 (filed October12, 1999) - entitled “Enzymatic Synthesis of ssDNA” Inventors: Charles A.Conrad, Michael D. Skillern and Jonathan F. Elliston [Atty File No. CRYA008/PCT]

 

9.                                     U.S. PatentApplication (filed February 28, 2000 — CIP of 09/411,568 and 09/397,782 and09/169,793 and 08/877,251 and 08/236,504) — entitled “Altering Gene Expressionwith ssDNA Produced In Vivo” Inventors: Charles A. Conrad and Yin Chen [AttyFile No. INGA 004/C/2CIP]

 

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10.                               U.S. PatentApplication (filed March 6, 2000 — CIP of 09/397,783 and 09/169,793 and08/877,251 and 08/236,504) — entitled “Enzymatic Synthesis of ssDNA In Vivo”Inventors:  Charles A. Conrad, MichaelD. Skillern and Jonathan F. Elliston [Atty File No. CRYA 008/CIP]

 

11.                               InternationalApplication — No. PCT/US00/27381 (filed October 4, 2000 — CIP of No.PCT/US99/23936 filed on October 12, 1999) — entitled “Altering Gene Expressionwith ssDNA Produced in Vivo” Inventor: Charles A. Conrad [Atty File No. INGA004/CIP/PCT]

 

 

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