Draft Dated October 4, 2005


Confidential


 


CERTAIN PORTIONS OF THIS EXHIBIT HAVE BEEN
OMITTED PURSUANT TO A CONFIDENTIAL 


TREATMENT REQUEST. OMITTED INFORMATION IS
INDICATED BY AN ASTERIK MARKING (***) AND HAS BEEN FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION 


 





EXCLUSIVE LICENSE AGREEMENT


 


dated October 5, 2005


 


between


 


Q Therapeutics, Inc.


 


and


 


UNIVERSITY OF UTAH RESEARCH FOUNDATION


 



    	 



    	 



    

 


Draft Dated October 4, 2005


Confidential


 


TABLE OF CONTENTS


 


	ARTICLE l.  DEFINITIONS	2
	ARTICLE 2.  LICENSE GRANT	3
	ARTICLE 3.  TERM AND SCOPE OF AGREEMENT	4
	ARTICLE 4.  SUBLICENSES	4
	ARTICLE 5.  LICENSE ISSUE FEES	6
	ARTICLE 6.  ROYALTIES	7
	ARTICLE 7.  DUE DILIGENCE	9
	ARTICLE 8.  CONFIDENTIALITY	11
	ARTICLE 9.  QUARTERLY & ANNUAL REPORTS	11
	ARTICLE 10.  PATENT PROSECUTION AND MAINTENANCE	12
	ARTICLE 11.  PATENT MARKING	13
	ARTICLE 12.  BOOKS AND RECORDS	13
	ARTICLE 13.  TERMINATION BY LICENSOR	13
	ARTICLE 14.  TERMINATION BY LICENSEE	14
	ARTICLE 15.  DISPOSITION OF LICENSED PRODUCTS ON HAND	14
	ARTICLE 16.  WARRANTY BY LICENSOR	14
	ARTICLE 17.  INFRINGEMENT	15
	ARTICLE 18.  WAIVER	16
	ARTICLE 19.  ASSIGNABILITY	16
	ARTICLE 20.  INDEMNIFICATION BY LICENSEE	16
	ARTICLE 21.  INDEMNIFICATION BY LICENSOR	16
	ARTICLE 22.  LATE PAYMENTS	17
	ARTICLE 23.  NOTICES	17
	ARTICLE 24.  REGULATORY COMPLIANCE	18
	ARTICLE 25.  GOVERNING LAW	18
	ARTICLE 26.  RELATIONSHIP OF PARTIES	18
	ARTICLE 27.  NON-USE OF NAMES	18
	ARTICLE 28.  DISPUTE RESOLUTION	19
	ARTICLE 29.  GENERAL PROVISIONS	19
	EXHIBIT “A” - PATENT RIGHTS	21
	EXHIBIT “B” - -LICENSE TO THE UNITED STATES GOVERNMENT	23
	EXHIBIT “C” - Quarterly Report	24
	EXHIBIT “D – Due Diligence	25


  



    	 



    	 



    

 


EXCLUSIVE LICENSE AGREEMENT


 


THIS EXCLUSIVE LICENSE
AGREEMENT (“agreement”) is entered into this 5TH day of October, 2005
by and between the UNIVERSITY OF UTAH RESEARCH FOUNDATION, a Utah nonprofit corporation, having its principal place of business
at 615 Arapeen Drive, Suite 310, Salt Lake City, UT 84108, hereinafter referred to as “LICENSOR,” and Q Therapeutics,
Inc., a Delaware corporation having its principal place of business at 615 Arapeen Drive, Suite 102, Salt Lake City, UT 84108,
hereinafter referred to as “LICENSEE.” This AGREEMENT replaces and consolidates a previous set of three license agreements
entered into the 9th day of August, 2002 by and between LICENSOR and LICENSEE (then formerly known as Cue Therapeutics),
identified by LICENSOR as Exclusive License #0837 for APCs, Exclusive License #0838 for GRPs, NCSCs and NEPs, and Non-Exclusive
License #0840 for NEPs.


 


WITNESSETH


 


WHEREAS, certain
inventions, generally characterized as GENERATION, CHARACTERIZATION AND ISOLATION OF NEUROEPITHELIAL STEM CELLS (NEPs) AND LINEAGE
RESTRICTED INTERMEDIATE PRECURSOR; A COMMON NEURAL PROGENITOR FOR THE CENTRAL NERVOUS SYSTEM AND PERIPHERAL NERVOUS SYSTEM (Neural
Crest Stem Cells or NCSCs); LINEAGE RESTRICTED GLIAL PRECURSORS (GRPs) FROM THE CENTRAL NERVOUS SYSTEM; METHOD OF ISOLATING HUMAN
NEUROEPITHELIAL PRECURSOR CELLS FROM HUMAN FETAL TISSUE; AND PURE POPULATIONS OF ASTROCYTE RESTRICTED PRECURSOR CELLS (APCs); AND
METHODS FOR ISOLATION AND USES THEREOF and assigned University of Utah identification numbers U-2383, U-2536, U-3184, and U-3275
(which is equivalent to work developed in continuation with research at the NIH and referred to by Public Health Service (PHS)
identification number E-187-02/0), hereinafter collectively referred to as “the INVENTION”, have been made in the course
of research at the University of Utah conducted by Drs. Mahendra Rao, Margot Mayer-Proschel, Tahmina Mujtaba, Patrick Tresco, Darrin
Messina, Ying Liu, Yuan Yuan Wu, and Mark Noble and are COVERED BY PATENT RIGHTS (as defined below);


WHEREAS, LICENSOR
desires that the PATENT RIGHTS be developed and utilized to the fullest extent so that their benefits can be enjoyed by the general
public;


WHEREAS, LICENSEE
wishes to obtain from LICENSOR an exclusive license for the commercial development, production, manufacture, use and sale of the
PATENT RIGHTS, and LICENSOR is willing to grant such a license upon the terms and conditions hereinafter set forth;


 


CERTAIN PORTIONS
OF THIS EXHIBIT HAVE BEEN OMITTED PURSUANT TO A CONFIDENTIAL 


TREATMENT REQUEST.
OMITTED INFORMATION IS INDICATED BY AN ASTERIK MARKING (***) AND HAS 


BEEN FILED
SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION 


 



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WHEREAS, the PATENT
RIGHTS were developed in the course of research sponsored in part by the U.S. Government, and as a consequence are subject to overriding
obligations of LICENSOR to the U.S. Government;


NOW THEREFORE, for
and in consideration of the covenants, conditions and undertakings hereinafter set forth, the parties hereby agree as follows:


ARTICLE
l. DEFINITIONS


Section 1.1           “PATENT
RIGHTS” shall mean and include all of the following LICENSOR intellectual property:


The United States
patents and/or patent applications listed in Exhibit “A”; United States patents issued from the applications listed
in Exhibit “A” and from divisionals and continuations (other than continuations-in-part) of these applications and
any reissues of such United States patents; claims of continuation-in-part applications and patents directed to subject matter
specifically described in the applications listed in Exhibit “A”; and claims of all foreign applications and patents
which are directed to subject matter specifically described in the United States patents and/or patent applications listed in Exhibit
“A”.


Section 1.2           “LICENSED
PRODUCT” shall mean any product, apparatus, kit or component part thereof, or any other subject matter the manufacture, use
or sale of which is COVERED BY any claim or claims included within PATENT RIGHTS.


Section 1.3           “LICENSED
METHOD” shall mean any method, procedure, process or other subject matter, the manufacture, use or sale of which is COVERED
BY any claim or claims included within PATENT RIGHTS.


Section 1.4           “...COVERED
BY...” shall mean a product, apparatus, kit or component part thereof or other item that when made, used, or sold, or
a method, procedure, process or other item, that, when practiced, would constitute, but for the license granted to LICENSEE pursuant
to this AGREEMENT, an infringement of any claim or claims included within PATENT RIGHTS.


Section 1.5           “NET
SALES” shall mean sales and/or billings and/or transfer for any consideration, including revenue neutral remuneration by
LICENSEE, or in the case of a sublicense by SUBLICENSEE (as defined below), for (a) any LICENSED PRODUCT sold or leased, and (b)
services performed using any LICENSED PRODUCT or LICENSED METHOD, in all cases, net of the sum of the following items (where applicable):
(1) cash, trade or quantity discounts actually allowed; (2) sales, use, tariff, customs duties or other excise taxes directly imposed
upon particular sales; (3) outbound transportation charges prepaid or allowed; and (4) allowances or credits to third parties for
rejections or returns. A LICENSED PRODUCT and services performed using a LICENSED PRODUCT or LICENSED METHOD shall be considered
sold when billed out or invoiced or, if not invoiced, when delivered or performed. There shall be no deductions from NET SALES
for costs of commissions or collections. NET SALES shall not include billings for LICENSED PRODUCTS sold or services performed
by LICENSEE to any AFFILIATE unless such AFFILIATE is an end-user of any LICENSED PRODUCT or service performed using any LICENSED
PRODUCT or LICENSED METHOD.


CERTAIN
PORTIONS OF THIS EXHIBIT HAVE BEEN OMITTED PURSUANT TO A CONFIDENTIAL 


TREATMENT REQUEST.
OMITTED INFORMATION IS INDICATED BY AN ASTERIK MARKING (***) AND HAS 


BEEN FILED
SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION 


 



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Section 1.6           “AFFILIATE”
means any person or entity that controls, is controlled by, or is under common control with LICENSEE, directly or indirectly. For
purposes of this definition, “control” and its various inflected forms means the possession, directly or indirectly,
of the power to direct or cause the direction of the management and policies of such person or entity, whether through ownership
of voting securities, by contract or otherwise.


Section 1.7           “FIELD
OF USE” shall mean (1) use of GRPs, NCSCs, APCs and NEPs for drug screening, drug discovery, diagnostics, drug target discovery,
genomics, and human therapeutics; and (2) the sale of GRPs, NCSCs, APCs and NEPs to third parties.


Section 1.8           “TERRITORY”
shall mean world wide.


Section 1.9           “RESEARCH
LICENSE” shall mean a nontransferable, nonexclusive license to make and use the PATENT RIGHTS for purposes of research and
not for purposes of commercial manufacture or distribution or in lieu of purchase.


 


ARTICLE
2. LICENSE GRANT


Section 2.1           Subject
to the terms and conditions set forth herein, LICENSOR hereby grants to LICENSEE an exclusive license to make, have made, use and
sell any LICENSED PRODUCT and to practice any LICENSED METHOD in the FIELD OF USE under LICENSOR’S PATENT RIGHTS throughout
the TERRITORY.


Section 2.2           The
license granted in Section 2.1 hereof is expressly made subject to LICENSOR’S reservation of the right to practice under
LICENSOR’S PATENT RIGHTS for academic purposes.


Section 2.3           The
license granted in Section 2.1 hereof is expressly made subject to a non-exclusive, irrevocable, royalty-free license heretofore
granted to the U.S. Government and in the general form as attached hereto as Exhibit “B” and incorporated herein by
reference.


 


CERTAIN PORTIONS
OF THIS EXHIBIT HAVE BEEN OMITTED PURSUANT TO A CONFIDENTIAL 


TREATMENT REQUEST.
OMITTED INFORMATION IS INDICATED BY AN ASTERIK MARKING (***) AND HAS 


BEEN FILED
SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION 


 



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ARTICLE
3. TERM AND SCOPE OF AGREEMENT


Section 3.1           This
AGREEMENT shall be in full force and effect from the date of full payment of any License Issue Fee required by Section 5 of this
AGREEMENT, payment for patent costs required by Section 10 (and covered by invoices delivered by LICENSOR to LICENSEE prior to
the execution of this AGREEMENT), and any and all other fees and payments due hereunder upon the date of execution of this AGREEMENT
(hereinafter “EFFECTIVE DATE”). This AGREEMENT shall be in full force and effect from the EFFECTIVE DATE until the
end of the term of the last-to-expire of LICENSOR’S PATENT RIGHTS licensed under this AGREEMENT unless otherwise terminated
by operation of law or by acts of the parties pursuant to the terms of this AGREEMENT.


Section 3.2           The
license granted under Section 2.1 shall be exclusive (subject only to the reservations set forth in Sections 2.2 and 2.3 above
and Section 4.5 below) and LICENSOR hereby agrees that it shall not grant any other license to make, have made, use, or sell LICENSED
PRODUCT or to practice LICENSED METHOD throughout the TERRITORY and in the FIELD OF USE during the term of this AGREEMENT.


 


ARTICLE
4. SUBLICENSES


Section 4.1           LICENSOR
hereby grants to LICENSEE the right to enter into sublicensing agreements with third parties (hereinafter referred to as “SUBLICENSEES”)
to the extent of LICENSEE’S rights under the grant provided in Section 2.1 and provided that LICENSEE has current exclusive
license rights, pursuant to Section 3.2, to the PATENT RIGHTS to which the sublicense applies, with respect to the portion of the
Field of Use and TERRITORY to which the sublicense relates. Upon any termination of this AGREEMENT, each SUBLICENSEE’s sublicensed
rights with respect to PATENT RIGHTS shall also terminate, unless: (a) the sublicense is subject to all of the terms and conditions
of this AGREEMENT and incorporates all of the terms and conditions hereof which are protective of and beneficial to LICENSOR, which
incorporation can be made by reference, (b) LICENSOR has received a copy of the sublicense and related information as provided
under Section 4.4 below; (c) SUBLICENSEE is in good standing with all the terms and conditions of the sublicense and LICENSEE is
not in current breach of the sublicense; (d) all of the rights and benefits due LICENSEE under the sublicense are directed to LICENSOR;
(e) LICENSOR shall not be liable, financially or otherwise, for any existing or potential breach or liability of LICENSEE under
the sublicense; (f) LICENSOR shall assume no obligations or liabilities of LICENSEE to SUBLICENSEE other than LICENSOR’S
obligations to LICENSEE as defined by this Agreement; and (g) the payments due to LICENSOR from SUBLICENSEE under the sublicense
shall be no less than the payments LICENSEE is obligated under this Agreement to pay to LICENSOR with respect to the sublicense.
If each of these qualifications is met, and the SUBLICENSEE desires for the sublicense to survive, the SUBLICENSEE and LICENSOR
shall enter a letter of understanding, acknowledging the survival of the sublicense and placing the LICENSOR and SUBLICENSEE in
a direct contract relationship for the sublicense. In addition, LICENSOR shall negotiate in good faith with any other SUBLICENSEE
in good standing at the time of termination for a license.


CERTAIN
PORTIONS OF THIS EXHIBIT HAVE BEEN OMITTED PURSUANT TO A CONFIDENTIAL 


TREATMENT REQUEST.
OMITTED INFORMATION IS INDICATED BY AN ASTERIK MARKING (***) AND HAS 


BEEN FILED
SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION 


 



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Section 4.2           Any
sublicense granted by LICENSEE to a SUBLICENSEE shall be subject to all of the terms and conditions of this AGREEMENT, and shall
include an express provision to this effect. LICENSEE shall use commercially reasonable efforts to collect all payments due LICENSOR
from SUBLICENSEES.


Section
4.3           LICENSEE shall pay to LICENSOR *** of any lump-sum fee
or advance payment received by LICENSEE from any SUBLICENSEE pursuant to a sublicense under this AGREEMENT, regardless of
how the LICENSEE and SUBLICENSEE characterize such payments, including but not limited to license fees, minimum annual royalties,
milestone payments, etc. (except for amounts paid to LICENSEE for the purpose of conducting research and development activities).
LICENSEE shall not receive from SUBLICENSEES anything of value in lieu of cash payments in consideration for any sublicense under
this AGREEMENT without the express prior written permission of LICENSOR. In addition, LICENSEE shall pay
to LICENSOR a royalty on NET SALES made under any sublicense which royalty shall be *** NET SALES of services. In the event
a sublicense grant from LICENSEE also incorporates technology licensed in by LICENSEE from one or more third parties, then LICENSEE
shall make a good faith allocation of the lump-sum or advanced payments received by the LICENSEE for the sublicense, as well as
all royalties payable pursuant to such sublicense, as between the LICENSOR’S PATENT RIGHTS and third party technology also
included in the sublicense, based on the relative values of the licensed technologies to the products or services generating the
SUBLICENSEE’S NET SALES. The payments due LICENSOR under this Section 4.3 shall only apply to that portion of the amounts
received by LICENSEE attributable to the LICENSOR’S PATENT RIGHTS, in accordance with LICENSEE’s good faith determination,
so that the percentage of lump sums or advance payments due to LICENSOR will be determined by multiplying the percentage payment
obligation referenced above by the portion of such lump sums or advanced payments attributable to the PATENT RIGHTS, and the royalty
payable to LICENSOR with respect to royalties received by LICENSEE on NET SALES by the SUBLICENSEE will be based on the portion
of such NET SALES attributable to the PATENT RIGHTS. LICENSOR may contest whether any determination by LICENSEE hereunder was made
in good faith, pursuant to the dispute resolution procedure set forth in Article 28 of this Agreement.


CERTAIN PORTIONS
OF THIS EXHIBIT HAVE BEEN OMITTED PURSUANT TO A CONFIDENTIAL 


TREATMENT REQUEST.
OMITTED INFORMATION IS INDICATED BY AN ASTERIK MARKING (***) AND HAS 


BEEN FILED
SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION


 



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Section 4.4           LICENSEE
shall within thirty (30) days of: (a) execution, provide LICENSOR with a copy of each sublicense granted by LICENSEE hereunder
and any amendments thereto or terminations thereof; and (b) receipt, summarize and deliver copies of all reports due to LICENSEE
from SUBLICENSEES with respect to license rights granted hereunder or NET SALES by SUBLICENSEE or royalties payable by SUBLICENSEE
to LICENSEE.


Section 4.5           In
the event that LICENSOR receives a written request from Public Health Services to grant a RESEARCH LICENSE to a third party non-profit
entity to use the PATENT RIGHTS, LICENSOR shall so notify LICENSEE, and LICENSEE agrees to negotiate in good faith to grant a RESEARCH
LICENSE (in the form of a sublicense of the PATENT RIGHTS licensed by LICENSEE hereunder) to said third party non-profit entity
on reasonable terms. If such negotiation has not been successfully completed within six (6) months from the date LICENSEE first
receives such request, LICENSOR shall have the right to grant a RESEARCH LICENSE to the third party non-profit entity.


Section 4.6           The
provisions of this AGREEMENT shall be construed so as to avoid any double counting on NET SALES (whether by LICENSEE or SUBLICENSEES)
and royalty payments; that is, any NET SALES shall not be subject to two different royalty payment obligations. In furtherance
of the foregoing, LICENSOR and LICENSEE agree that any NET SALES by SUBLICENSEE or attributed to or received by LICENSEE that are
subject to the royalty payment provisions of Section 4.3 shall not also be subject to the royalty payment provisions of Section
6.1. In addition, to the extent that any lump sum fees or advanced payments received by LICENSEE from any SUBLICENSEE (of which
LICENSEE is obligated to *** LICENSOR pursuant to the first sentence of Section 4.3) represent
an advance payment of, or are credited against, royalties charged by LICENSEE on NET SALES by such SUBLICENSEE, then the
maximum royalties on NET SALES payable pursuant to the third sentence of Section 4.3 shall be calculated net of the amount paid
to LICENSOR pursuant to the first sentence of Section 4.3. Similarly, the provisions of Sections 6.1 and 6.5 of this Agreement
regarding allocation of value between intellectual property subject to this Agreement and intellectual property not covered by
this Agreement, and the allocation of value between products, services or components covered by this Agreement and products, services
or components not covered by this Agreement, shall be construed so as to avoid all improper doubling-up of reductions from payments
otherwise payable by LICENSEE to LICENSOR pursuant to the terms of this Agreement.


 


ARTICLE
5. LICENSE ISSUE FEES


In consideration
of full payment for the obligations of the previous set of three license agreements, which
shall be replaced by this AGREEMENT, LICENSEE shall pay to LICENSOR ***. Such consideration is already deemed earned and
immediately payable.


CERTAIN
PORTIONS OF THIS EXHIBIT HAVE BEEN OMITTED PURSUANT TO A CONFIDENTIAL 


TREATMENT REQUEST.
OMITTED INFORMATION IS INDICATED BY AN ASTERIK MARKING (***) AND HAS 


BEEN FILED
SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION


 



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ARTICLE
6. ROYALTIES


Section
6.1           As consideration for the license under this AGREEMENT,
LICENSEE shall pay to LICENSOR *** of any services, including but not limited to drug screening,
drug discovery, drug target discovery, diagnostics, and genomics services. LICENSEE shall also pay to LICENSOR an earned
royalty on the LICENSEE’s NET SALES of human therapeutics ***.


 


Earned royalties
shall accrue in each country with respect to NET SALES in that country for the duration of PATENT RIGHTS in that country. LICENSEE
shall pay all royalties accruing to LICENSOR in U.S. Dollars within forty-five (45) days following the calendar quarter in which
NET SALES occur.


The parties recognize
and agree that, in order to develop and commercialize LICENSED PRODUCTS and LICENSED METHODS, or services utilizing LICENSED PRODUCTS
or LICENSED METHODS in the FIELD OF USE, it may be necessary or desirable for LICENSEE and/or its LICENSEES to make use of and/or
incorporate multiple elements of intellectual property from multiple sources. LICENSEE and/or its SUBLICENSEES shall determine,
in their sole judgment, which elements of intellectual property are necessary and/or desirable for the development and/or commercialization
of the licensed PATENT RIGHTS. In the event that any LICENSED PRODUCTS or LICENSED METHODS, or services provided utilizing LICENSED
PRODUCTS or LICENSED METHODS, which are marketed by or through LICENSEE, incorporate or utilize technology licensed from one or
more third parties, then LICENSEE shall make a good faith determination of the relative values (as percentages adding up to 100%)
of the various licensed technologies to the resulting LICENSED PRODUCTS, LICENSED METHODS or services, as applicable, and shall
promptly notify LICENSOR of such determination. Upon such determination, the royalty payable to LICENSOR pursuant to this Section
6.1 shall be based on the portion of LICENSEE’S NET SALES that corresponds to the percentage value assigned to the LICENSOR’S
PATENT RIGHTS, multiplied by the applicable royalty rate as set forth in this Section 6.1. For example, if the applicable
royalty rate for a specified period were ***, and LICENSEE achieved NET SALES of $1,000,000 with respect to such period,
and LICENSEE had determined in good faith that the relative value to the LICENSED PRODUCTS sold to generate such NET SALES of various
technologies licensed by LICENSEE were as follows:


 


(a) value of PATENT RIGHTS licensed from LICENSOR:
60%


(b) value of technologies licensed from other parties:
40%,


CERTAIN
PORTIONS OF THIS EXHIBIT HAVE BEEN OMITTED PURSUANT TO A CONFIDENTIAL 


TREATMENT REQUEST.
OMITTED INFORMATION IS INDICATED BY AN ASTERIK MARKING (***) AND HAS 


BEEN FILED
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then the royalty payable to LICENSOR pursuant to this Section
6.1 would be determined by multiplying the NET SALES for the period in question ($1,000,000) by the percentage value to the LICENSED
PRODUCT of the licensed PATENT RIGHTS (60%), and then multiplying the resulting product
by the applicable ***. As a result, the royalty payable to LICENSOR with respect to LICENSOR’S NET SALES with respect
to such period would be: ($1,000,000 x .60) x *** = $***. In the event that LICENSOR believes
that LICENSEE’S determination of the relative values of various licensed technologies to the LICENSED PRODUCTS or
LICENSED METHODS in question was not made in good faith, then it may dispute such determination, and such dispute will be resolved
in accordance with the dispute resolution procedure set forth in Article 28 below.


Section 6.2           Commencing
with the first calendar quarter to occur following the date of first occurrence of NET SALES pertaining to NEPs, GRPs, NCSCs, or
APCs (U-2383, U-2536, U-3184, or U-3275), LICENSEE shall pay to LICENSOR within forty-five (45) days of the end of said quarter
a minimum annual royalty ***


LICENSEE shall continue
to pay such minimum annual royalty until the end of the term of the last to expire of LICENSOR’S PATENT RIGHTS. LICENSOR
shall fully credit each payment of minimum annual royalties against any earned royalties payable by LICENSEE with respect to the
year for which the minimum annual royalty is made (being the year commencing with the calendar quarter ending prior to the calendar
quarter in which the minimum annual royalty is payable).


Section 6.3           If
any patent or any claim thereof included within LICENSOR’S PATENT RIGHTS shall be found invalid by a court of competent jurisdiction
and last resort, from which decision no appeal may be taken, LICENSEE’S obligation to pay LICENSOR royalties based on such
patent or claim or any claim patentably indistinct there from shall cease as of the date of such decision. LICENSEE shall not,
however, be relieved from paying LICENSOR any royalties, fees, expenses, or other liabilities that accrued prior to the date of
such decision or that are based on any of LICENSOR’S PATENT RIGHTS not the subject of such decision.


Section 6.4           By
way of clarification, no royalties shall be payable with respect to, and the definitions of LICENSED PRODUCT and LICENSED METHOD
shall not apply to, products or methods that LICENSEE may manufacture, use, sell or practice, as applicable, in any jurisdiction,
without the grant of the license set forth in Article 2 above, and without constituting an illegal infringement of any valid and
enforceable Patent Rights. No royalty shall accrue with respect to any LICENSED PRODUCTS sold, or any services with respect to
LICENSED PRODUCTS or LICENSED METHODS provided, after they no longer fall within the definition of LICENSED PRODUCTS or LICENSED
METHODS, as applicable, as a result of expiration or termination of applicable PATENT RIGHTS.


CERTAIN
PORTIONS OF THIS EXHIBIT HAVE BEEN OMITTED PURSUANT TO A CONFIDENTIAL 


TREATMENT REQUEST.
OMITTED INFORMATION IS INDICATED BY AN ASTERIK MARKING (***) AND HAS 


BEEN FILED
SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION


 



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Section 6.5           If
a LICENSED PRODUCT or LICENSED METHOD is sold in combination by LICENSEE or applicable SUBLICENSEE, as a single product, service,
or in a kit, with another product, service or components for which no royalty would be due hereunder if sold separately, NET SALES
from such combination sales for purposes of calculating the amounts due under this Article 6 shall be calculated by multiplying
the NET SALES price of the combination by the fraction A/(A+B), where A is the NET SALES price, during the royalty period in question,
of the LICENSED PRODUCT or LICENSED METHOD sold separately, and B is the total market price, during the royalty period in question,
of the other products, services or components sold separately. If the LICENSED PRODUCT, LICENSED METHOD, or other products, services
or components are not sold separately by LICENSEE, or as applicable SUBLICENSEE, during that royalty period, then the NET SALES
price of the combination will be as reasonably allocated by LICENSEE between such LICENSED PRODUCT or LICENSED METHOD on the one
hand, and such other product, service or component on the other hand, based upon their relative importance and proprietary protection.
LICENSOR reserves the right to assert the dispute resolution process if it disputes whether allocations
set by LICENSEE and SUBLICENSEE as described above are commercially reasonable. The allocation contemplated by this Section is
to be made in a manner consistent with the allocation contemplated by Section 6.1 above.


 


ARTICLE
7. DUE DILIGENCE


Section 7.1           Upon
execution of this AGREEMENT, LICENSEE shall diligently proceed with the development, manufacture, sale and use of LICENSED PRODUCTS
and/or LICENSED METHODS in order to make them readily available to the general public as soon as possible on commercially reasonable
terms. LICENSEE shall continue active, diligent marketing efforts for one or more LICENSED PRODUCT(S) and/or LICENSED METHOD(S)
throughout the term of this AGREEMENT.


Section 7.2           In
addition, LICENSEE shall perform the following obligations as part of its due diligence activities hereunder;





		(a)	LICENSEE shall deliver to LICENSOR, within two months of the EFFECTIVE DATE, a comprehensive executive
summary including, but not limited to, a discussion of the technology, product, funding proposals, market, competition, intellectual
property, business model, and management team; and within twelve months of the EFFECTIVE DATE, a more detailed, comprehensive business
plan including, but not limited to, a discussion of the same topics. Within six (6) months of the EFFECTIVE DATE, LICENSEE shall
deliver to LICENSOR a specific research and commercialization plan showing the amount of money, number and kind of personnel and
time budgeted and planned for each phase of development of the initial LICENSED PRODUCT(S) and/or LICENSED METHOD(S) targeted for
development by LICENSEE;








 


CERTAIN
PORTIONS OF THIS EXHIBIT HAVE BEEN OMITTED PURSUANT TO A CONFIDENTIAL 


TREATMENT REQUEST.
OMITTED INFORMATION IS INDICATED BY AN ASTERIK MARKING (***) AND HAS 


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		(b)	LICENSEE shall pay LICENSOR a due diligence payment of *** until the first occurrence
of NET SALES in this AGREEMENT;
	 	 	 



		(c)	LICENSEE shall spend at *** on research, development and commercialization of LICENSED
PRODUCTS and/or LICENSED METHODS during the four year period ending on August 9, 2006;
	 	 	 



		(d)	LICENSEE shall file an IND or BLA during the eight-year period following the EFFECTIVE DATE. In the instance that LICENSEE
does not meet this requirement within the specified time period, at LICENSOR’s discretion, additional 18 month periods may
be granted to LICENSEE upon payment *** providing that LICENSEE can demonstrate commercially
reasonable efforts to advancing LICENSED PRODUCTS and/or LICENSED METHODS to a marketable product. Examples of such efforts
may include but are not limited to, annual funding commitments comparable to Section 7.2 (c) above.
	 	 	 



		(e)	LICENSEE shall pay LICENSOR *** for each IND or BLA filed for a cell based human
therapeutic developed using LICENSED PRODUCTS and/or LICENSED METHODS; and
	 	 	 



		(f)	LICENSEE shall pay LICENSOR *** upon NDA approval of each IND or BLA referenced in
(e) above.








 





Section 7.3           Commencing
on January 1, 2006, and on each July 1 and January 1 thereafter, until the first occurrence of NET SALES and annually thereafter
each January 1, LICENSEE shall submit to LICENSOR a written report covering LICENSEE’S progress in (a) development and testing
of all LICENSED PRODUCTS and LICENSED METHODS; (b) achieving the due diligence milestones specified herein; and (c) preparing,
filing, and obtaining of any approvals necessary for marketing the LICENSED PRODUCTS and LICENSED METHODS. Each report shall be
in substantially similar form and contain at least the information required by Exhibit “D” attached hereto and incorporated
herein.


Section 7.4
         Upon a written request made by LICENSOR with respect to attendance at any meeting of LICENSEE’s Board of Directors, LICENSEE
shall permit a representative of LICENSOR to attend such meeting (provided that LICENSEE shall not be required to permit a LICENSOR
representative to attend more than two meetings of LICENSEE’s Board of Directors meetings in any calendar year. LICENSOR’S
representative shall not be compensated and will have no voting rights and may be excluded from specific discussions of a confidential
nature as determined to be appropriate by a vote of the Board of Directors. LICENSEE shall provide LICENSOR with at least 30 days
notice of such meetings, and any information discussed in such meetings will be subject to Article 8 herein.


CERTAIN
PORTIONS OF THIS EXHIBIT HAVE BEEN OMITTED PURSUANT TO A CONFIDENTIAL 


TREATMENT REQUEST.
OMITTED INFORMATION IS INDICATED BY AN ASTERIK MARKING (***) AND HAS 


BEEN FILED
SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION


 



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ARTICLE
8. CONFIDENTIALITY


Section 8.1           LICENSEE
and LICENSOR acknowledge that either party may provide certain information to the other about the other party’s business
plans, technology, relationships, research, developments and proprietary information that is considered to be confidential. LICENSEE
and LICENSOR shall take reasonable precautions to protect such confidential information. Such precautions shall involve at least
the same degree of care and precaution that the recipient customarily uses to protect its own confidential information.


Section 8.2           LICENSEE
acknowledges that LICENSOR is subject to the Utah Governmental Records Access and Managemment Act (“GRAMA”), as amended.
LICENSOR shall keep confidential any information provided to LICENSOR by LICENSEE that LICENSEE considers confidential, as well
as information originated or maintained by or relating to the technology transferred or sponsored research record as referenced
therein, to the extent allowable under GRAMA and as provided in Section 53B-16-301 et seq., Utah Code Ann. In order
to be eligible for such protection under GRAMA, confidential information of LICENSEE disclosed to LICENSOR must be in written or
other tangible form, marked as proprietary, and accompanied by a written claim by LICENSEE stating the reasons that such information
must be kept confidential.


 


ARTICLE
9. QUARTERLY & ANNUAL REPORTS


Section 9.1           Within
forty-five (45) days after the calendar year in which NET SALES first occur, and within 45 days after each calendar quarter thereafter,
LICENSEE shall provide LICENSOR with a written report detailing all sales and uses, if any, made of LICENSED PRODUCTS and LICENSED
METHODS during the preceding calendar quarter, and detailing the amount of NET SALES made during such quarter and calculating the
royalties due pursuant to Sections 6.1 and 4.3 hereof. Each report shall include at least the following:


	 	a.	number of LICENSED PRODUCTS manufactured, leased and sold by and/or for LICENSEE and all SUBLICENSEES;
	 	 	 
	 	b.	accounting for all LICENSED METHODS used or sold by and/or for LICENSEE and all SUBLICENSEES;
	 	 	 
	 	c.	accounting for NET SALES, noting the deductions applicable as provided in Section 1.5;
	 	 	 
	 	d.	royalties due under Section 6.2;
	 	 	 
	 	e.	running royalties due under Section 6.1;


CERTAIN
PORTIONS OF THIS EXHIBIT HAVE BEEN OMITTED PURSUANT TO A CONFIDENTIAL 


TREATMENT REQUEST.
OMITTED INFORMATION IS INDICATED BY AN ASTERIK MARKING (***) AND HAS 


BEEN FILED
SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION


 



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	 	f.	royalties due on other payments from SUBLICENSEES and assignees under Section 4.3;
	 	 	 
	 	g.	total royalties due;
	 	 	 
	 	h.	names and addresses of all SUBLICENSEES of LICENSEE;
	 	 	 
	 	i.	the amount spent on development of LICENSED PRODUCTS or LICENSED METHODS; and
	 	 	 
	 	j.	the number of full-time equivalent employees working on the LICENSED PRODUCTS and/or LICENSED METHODS.


 


Section 9.2           Each
report shall be in substantially similar form as Exhibit “C” attached hereto. Each such report shall be signed by an
officer of LICENSEE (or the officer’s designee). With each such report submitted, LICENSEE shall pay to LICENSOR the royalties
and fees due and payable under this AGREEMENT. If no royalties shall be due, LICENSEE shall so report.


Section 9.3           In
addition to the regular reports required by Section 9.1, LICENSEE shall provide a written report to LICENSOR of the date of first
occurrence of NET SALES in each country within sixty (60) days of its occurrence.


 


ARTICLE
10. PATENT PROSECUTION AND MAINTENANCE


Section 10.1         LICENSOR,
at its sole discretion, may diligently prosecute and maintain PATENT RIGHTS with legal counsel of its choice, after consultation
with LICENSEE. LICENSOR shall incorporate reasonable comments from LICENSEE in such prosecution and maintenance of PATENT RIGHTS.
LICENSOR shall provide LICENSEE with copies of all relevant documentation and keep LICENSEE informed and apprised of the continuing
prosecution. LICENSEE shall keep any such documentation and information confidential.


Section 10.2         LICENSEE
shall pay all costs and legal fees incurred by LICENSOR in the preparation, prosecution and maintenance of PATENT RIGHTS, including
without limitation, any taxes on such patent rights, within thirty (30) days of receipt of invoice by LICENSEE.


Section
10.3         LICENSOR may exclude by written notice any patent or patent application
from this AGREEMENT if LICENSEE declines or fails to pay the costs and legal fees for the preparation, prosecution and maintenance
of said patent or application within the time period provided for herein, or the thirty day cure period as referenced in Article
13 below.


Section 10.4         LICENSEE
may pursue the prosecution of a patent or patent claims or foreign applications, with legal counsel of its choice, with respect
to any intellectual property included within the PATENT RIGHTS if LICENSOR declines to do so, provided that LICENSEE shall be responsible
for all fees and costs related thereto.


CERTAIN PORTIONS
OF THIS EXHIBIT HAVE BEEN OMITTED PURSUANT TO A CONFIDENTIAL 


TREATMENT REQUEST.
OMITTED INFORMATION IS INDICATED BY AN ASTERIK MARKING (***) AND HAS 


BEEN FILED
SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION


 



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ARTICLE
11. PATENT MARKING


 


LICENSEE shall mark all LICENSED PRODUCTS made,
used or sold under the terms of this AGREEMENT, or their containers, in accordance with all applicable patent-marking laws.


 


ARTICLE
12. BOOKS AND RECORDS


 


LICENSEE shall keep complete,
true and accurate books of account containing all particulars that may be necessary for the purpose of showing the amounts payable
to LICENSOR hereunder. Said books of account shall be kept at LICENSEE’S principal place of business or the principal place
of business of the appropriate division of LICENSEE to which this AGREEMENT relates. Said books and the supporting data shall be
open at all reasonable terms for five (5) years following the end of the calendar year to which they pertain, to inspection by
LICENSOR or its agents, upon notice to LICENSEE, for the purpose of verifying LICENSEE’S royalty statement or compliance
in other respects with this AGREEMENT. Should such inspection lead to the discovery of a greater than five percent (5%) discrepancy
in reporting to LICENSOR’S detriment, LICENSEE agrees to pay the full cost of such inspection. LICENSEE shall permit an in-facilities
inspection by LICENSOR on or before January 1, 2006, and thereafter permit in-facilities inspections by LICENSOR at regular intervals
with at least twelve (12) months between each such inspection.


 


ARTICLE
13. TERMINATION BY LICENSOR


 


Section 13.1         If
LICENSEE should: (a) fail to deliver to LICENSOR any statement or report required hereunder when due; (b) fail to make any payment
at the time that the same should be due; (c) violate or fail to perform any covenant, condition, or undertaking of this AGREEMENT
to be performed by it hereunder; (d) file a bankruptcy action, or have a bankruptcy action against it, or become insolvent, enter
into an agreement or be involved in a proceeding with creditors, or have a receiver appointed for it; or (e) cease to carry on
its business with respect to the rights granted in this Agreement; then LICENSOR may give written notice of such default to LICENSEE.
If LICENSEE should fail to cure such default within thirty (30) days of such notice, the rights, privileges, and license granted
hereunder shall automatically terminate.


 


Section 13.2         No
termination of this AGREEMENT by LICENSOR shall relieve LICENSEE of its obligation to pay any monetary obligation due or owing
at the time of such termination and shall not impair any accrued right of LICENSOR. LICENSEE shall pay all attorneys’ fees
and costs incurred by LICENSOR in enforcing any obligation of LICENSEE or accrued right of LICENSOR. Articles
8, 12, 13.2, 15, 16.2, 16.3, 20, 22, 25, 27, 28 and 29.7 shall survive any termination of this AGREEMENT.


 


CERTAIN PORTIONS
OF THIS EXHIBIT HAVE BEEN OMITTED PURSUANT TO A CONFIDENTIAL 


TREATMENT REQUEST.
OMITTED INFORMATION IS INDICATED BY AN ASTERIK MARKING (***) AND HAS 


BEEN FILED
SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION 


 



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ARTICLE
14. TERMINATION BY LICENSEE


Section 14.1         LICENSEE
may terminate this AGREEMENT, in whole or as to any specified PATENT RIGHTS, at any time and from time to time without cause, by
giving written notice thereof to LICENSOR. Such termination shall be effective ninety (90) days after such notice and all LICENSEE’S
rights associated therewith shall cease as of that date.


Section 14.2         Any
termination pursuant to Section 14.1 shall not relieve LICENSEE of any obligation or liability accrued hereunder prior to such
termination, or rescind or give rise to any right to rescind any payments made or other consideration given to LICENSOR hereunder
prior to the time such termination becomes effective. Such termination shall not affect in any manner any rights of LICENSOR arising
under this AGREEMENT prior to the date of such termination.


 


ARTICLE
15. DISPOSITION OF LICENSED PRODUCTS ON HAND


Upon expiration or termination of this
AGREEMENT by either party, LICENSEE shall provide LICENSOR with a written inventory of all LICENSED PRODUCTS in process of manufacture,
in use or in stock. LICENSEE may dispose of any such LICENSED PRODUCTS within the ninety (90) day period following such expiration
or termination, provided, however, that LICENSEE shall pay royalties and render reports to LICENSOR thereon in the manner specified
herein.


 


ARTICLE
16. WARRANTY BY LICENSOR


Section 16.1         LICENSOR
warrants that it has the lawful right to grant the license set forth in this AGREEMENT.


Section 16.2           EXCEPT
AS EXPRESSLY PROVIDED IN SECTION 16.1, THE PARTIES ACKNOWLEDGE AND AGREE THAT LICENSOR HAS MADE NO REPRESENTATIONS OR WARRANTIES,
EXPRESS OR IMPLIED, INCLUDING BUT NOT LIMITED TO, WARRANTIES OF MERCHANTABILITY OR FITNESS FOR A PARTICULAR PURPOSE. IN NO EVENT
SHALL LICENSOR BE HELD RESPONSIBLE FOR ANY SPECIAL, INDIRECT OR CONSEQUENTIAL DAMAGES ARISING OUT OF THE USE OF PATENT RIGHTS,
EVEN IF LICENSOR IS ADVISED IN ADVANCE OF THE POSSIBILITY OF SUCH DAMAGES.


Section 16.3         Nothing
in this AGREEMENT shall be construed as:


	 	a.	a warranty or representation by LICENSOR as to the validity of scope of any PATENT RIGHTS.


 


CERTAIN
PORTIONS OF THIS EXHIBIT HAVE BEEN OMITTED PURSUANT TO A CONFIDENTIAL 


TREATMENT REQUEST.
OMITTED INFORMATION IS INDICATED BY AN ASTERIK MARKING (***) AND HAS 


BEEN FILED
SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION 


 



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	 	b.	a warranty or representation by LICENSOR that anything made, used, sold or otherwise disposed of pursuant to any license granted under this AGREEMENT is or will be free from infringement of intellectual property rights of third parties.
	 	 	 
	 	c.	an obligation by LICENSOR to bring or prosecute actions or suits against third parties for patent infringement, except as expressly provided in Article 17 hereof.
	 	 	 
	 	d.	conferring by implication, estoppel or otherwise any license or rights under any patents of LICENSOR other than PATENT RIGHTS.


 


Section 16.4         Any
breach of the representations or warranties made in this Article 16 shall entitle LICENSEE to a refund of all payments made to
LICENSOR as consideration for the rights granted under this AGREEMENT, and said refund shall be the sole remedy available to LICENSEE
for breach or violation of any provisions contained in this Article 16.


 


ARTICLE
17. INFRINGEMENT


Section 17.1         If
either party learns of a claim of infringement of or by any of LICENSOR’S PATENT RIGHTS licensed under this AGREEMENT, that
party shall give written notice of such claim to the other party. LICENSOR shall then use reasonable efforts to terminate such
infringement. In the event LICENSOR fails to abate the infringing activity within ninety (90) days after such written notice or
to bring legal action against the third party, LICENSEE may bring suit for patent infringement, naming LICENSOR as nominal party
plaintiff. No settlement, consent judgment or other voluntary final disposition of the suit may be entered into without the consent
of LICENSOR, which consent shall not be unreasonably withheld.


Section 17.2         Any
such legal action shall be at the expense of the party by whom suit is filed, hereinafter referred to as the “Litigating
Party”. Any damages or costs recovered by the Litigating Party in connection with a legal action filed by it hereunder, and
remaining after the Litigating Party is reimbursed for its costs and expenses reasonably incurred in the lawsuit, and after any
royalties or other payments due to LICENSOR under Articles 4, 5 and 6 are paid, shall be equally divided between LICENSEE and LICENSOR.


Section 17.3         LICENSEE
and LICENSOR shall cooperate with each other in litigation proceedings instituted hereunder, provided that such cooperation shall
be at the expense of the Litigating Party, and such litigation shall be controlled by the Litigating Party.


 


CERTAIN PORTIONS
OF THIS EXHIBIT HAVE BEEN OMITTED PURSUANT TO A CONFIDENTIAL 


TREATMENT REQUEST.
OMITTED INFORMATION IS INDICATED BY AN ASTERIK MARKING (***) AND HAS 


BEEN FILED
SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION 


 



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ARTICLE
18. WAIVER


No waiver by either
party hereto of any breach or default of any of the covenants or agreements herein set forth shall be deemed a waiver as to any
subsequent and/or similar breach or default.


 


ARTICLE
19. ASSIGNABILITY


Subject to the
limitations set forth below, this AGREEMENT is binding upon and shall inure to the benefit of the parties, their successors and
assigns. Subject to LICENSEE’s rights to sublicense, as set forth in Article 4 hereof, LICENSEE may assign this AGREEMENT
only with the written consent of LICENSOR, which consent shall not be reasonably withheld, provided that LICENSEE, without consent,
may assign this AGREEMENT in connection with the transfer or sale of all or substantially all of its assets, or in the event of
merger or consolidation, in either case to or with another company having assets and stockholder equity exceeding that of LICENSEE. 


ARTICLE
20. INDEMNIFICATION BY LICENSEE


LICENSEE shall
indemnify, hold harmless and defend LICENSOR, the University of Utah, and their respective officers, employees and agents, against
any and all claims, suits, losses, damages, costs, liabilities, fees and expenses (including reasonable fees of attorneys) resulting
from or arising out of exercise of: (a) any license granted under this AGREEMENT; or (b) any act, error, or omission of LICENSEE,
its agents, employees or SUBLICENSEES, except where such claims, suits, losses, damages, costs, fees, or expenses result solely
from the negligent acts or omissions, or willful misconduct of the LICENSOR, its officers, employees or agents. LICENSEE shall
give LICENSOR timely notice of any claim or suit instituted of which LICENSEE has knowledge that in any way, directly or indirectly,
affects or might affect LICENSOR, and LICENSOR shall have the right at its own expense to participate in the defense of the same. 


ARTICLE
21. INDEMNIFICATION BY LICENSOR


The LICENSOR is
a governmental entity and is subject to the Utah Governmental Immunity Act, Section 63-30(d)-101 et seq., Utah Code
Ann. (as amended) (the “Act”). The Act limits judgments for certain kinds of claims as specified. Subject to the provisions
of the Act, LICENSOR shall indemnify, defend and hold harmless LICENSEE, its officers, agents and employees against any and all
claims, suits, losses, damages, costs, liabilities, fees, and expenses (including reasonable fees of attorneys) resulting solely
from the negligent acts or omissions or willful misconduct of LICENSOR, its officers, agents or employees in connection with this
AGREEMENT. Nothing in this AGREEMENT shall be construed as a waiver of any rights or defenses applicable to LICENSOR under the
Act, including without limitation, the provisions of the Act regarding limitation of judgments. LICENSOR shall give LICENSEE timely
notice of any claim or suit instituted of which LICENSOR has knowledge that in any way, directly or indirectly, affects or might
affect LICENSEE, and LICENSEE shall have the right at its own expense to participate in the defense of the same. 


CERTAIN
PORTIONS OF THIS EXHIBIT HAVE BEEN OMITTED PURSUANT TO A CONFIDENTIAL 


TREATMENT REQUEST.
OMITTED INFORMATION IS INDICATED BY AN ASTERIK MARKING (***) AND HAS 


BEEN FILED
SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION 


 



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ARTICLE
22. LATE PAYMENTS


 


In the event royalty payments
or other fees are not received by LICENSOR when due hereunder, LICENSEE shall pay to LICENSOR interest charges at the rate of ten
percent (10%) per annum on the amount of due but unpaid royalties, from the due date until paid.


 


ARTICLE
23. NOTICES


 


Any payment, notice or
other communication required or permitted to be given to either party hereto shall be in writing and shall be deemed to have been
properly given and effective: (a) on the date of delivery if delivered in person during recipient’s normal business hours;
or (b) on the date of attempted delivery if delivered by courier, express mail service or first-class mail, registered or certified.
Such notice shall be sent or delivered to the respective addresses given below, or to such other address as either party shall
designate by written notice given to the other party as follows:


 


In the case of LICENSEE:


Q THERAPEUTICS, INC.


615 Arapeen Drive, Suite 102


Salt Lake City, UT 84108


Attn: CEO


 


With a copy to:


Snell & Wilmer, LLP


15 West South Temple, Suite 1200


Salt Lake City, Utah 84101


Attn: Chris Anderson


 


In the case of LICENSOR:


UNIVERSITY OF UTAH RESEARCH FOUNDATION


Technology Transfer Office


615 Arapeen Drive, Suite 310


Salt Lake City, UT 84108 





 


CERTAIN PORTIONS
OF THIS EXHIBIT HAVE BEEN OMITTED PURSUANT TO A CONFIDENTIAL 


TREATMENT REQUEST.
OMITTED INFORMATION IS INDICATED BY AN ASTERIK MARKING (***) AND HAS 


BEEN FILED
SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION 


 



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With a copy to: 


 


OFFICE OF GENERAL COUNSEL


University of Utah


309 Park Building


Salt Lake City, Utah 84112


 


ARTICLE
24. REGULATORY COMPLIANCE


Section 24.1         When
required by local/national law, LICENSEE shall register this AGREEMENT, pay all costs and legal fees connected therewith, and otherwise
insure that the local/national laws affecting this AGREEMENT are fully satisfied.


Section 24.2         LICENSEE
shall comply with all applicable U.S. laws dealing with the export and/or management of technology or information.


Section 24.3         LICENSEE
agrees that products used or sold in the United States embodying LICENSED PRODUCTS or produced through use of the LICENSED METHOD
shall be manufactured in compliance with all applicable U.S. laws.


 


ARTICLE
25. GOVERNING LAW


 


This AGREEMENT shall be
interpreted and construed in accordance with the laws of the State of Utah, without application of any principles of choice of
laws.


 


ARTICLE
26. RELATIONSHIP OF PARTIES


 


In assuming and performing
the obligations of this AGREEMENT, LICENSEE and LICENSOR are each acting as independent parties and neither shall be considered
or represent itself as a joint venturer, partner, agent or employee of the other.


 


ARTICLE
27. NON-USE OF NAMES


 


LICENSEE shall not use
the names or trademarks of LICENSOR, the University of Utah, or its employees, nor any adaptation thereof, nor the names of any
of their employees, in any advertising, promotional or sales literature without prior written consent obtained from LICENSOR, or
said employee, in each case, except that LICENSEE may state that it is licensed by LICENSOR under one or more of the patents and/or
applications comprising the PATENT RIGHTS.


 


CERTAIN PORTIONS
OF THIS EXHIBIT HAVE BEEN OMITTED PURSUANT TO A CONFIDENTIAL 


TREATMENT REQUEST.
OMITTED INFORMATION IS INDICATED BY AN ASTERIK MARKING (***) AND HAS 


BEEN FILED
SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION 


 



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ARTICLE
28. DISPUTE RESOLUTION


 


Except for the right of
either party to apply to a court of competent jurisdiction for a temporary restraining order, a preliminary injunction, or other
equitable relief to preserve the status quo or prevent irreparable harm, any and all claims, disputes or controversies arising
under, out of, or in connection with the AGREEMENT, including but not limited to any dispute relating to patent validity or infringement
or the existence of a breach or default hereunder, which the parties shall be unable to resolve within sixty (60) days shall be
mediated in good faith. The party raising such dispute shall promptly advise the other party of such dispute. By not later than
five (5) business days after the recipient has received such notice of dispute, each party shall have selected for itself a representative
who shall have the authority to bind such party, and shall additionally have advised the other party in writing of the name and
title of such representative. By not later than ten (10) days after the date of such notice of dispute, the party against whom
the dispute shall be raised shall select a mediator in the Salt Lake City area and such representatives shall schedule a date with
such mediator for a hearing. The parties shall enter into good faith mediation and shall share the costs equally. If the representatives
of the parties have not been able to resolve the dispute within fifteen (15) business days after such mediation hearing, then any
and all claims, disputes or controversies arising under, out of, or in connection with this AGREEMENT, including any dispute relating
to patent validity or infringement, shall be resolved through arbitration if the parties mutually consent, or through any judicial
proceeding either in the courts of the State of Utah or in the United States District Court for the District of Utah, to whose
jurisdiction for such purposes LICENSEE and LICENSOR each hereby irrevocably consents and submits. All costs and expenses, including
reasonable attorneys’ fees, of the prevailing party in connection with resolution of a dispute by arbitration or litigation
of such controversy or claim shall be borne by the other party.


 


ARTICLE
29. GENERAL PROVISIONS


  


Section 29.1     The
headings of the several sections are inserted for convenience of reference only and are not intended to be a part of or to affect
the meaning or interpretation of this AGREEMENT.


 


Section 29.2      This
AGREEMENT shall not be binding upon the parties until it has been signed herein below by or on behalf of each party, and as of
the EFFECTIVE DATE.


 


Section 29.3      No
amendment or modification of this AGREEMENT shall be valid or binding upon the parties unless made in writing and signed by both
parties.


 


Section 29.4      This
AGREEMENT embodies the entire understanding of the parties and supersedes all previous communications, representations or understandings,
either oral or written, between the parties relating to the subject matter hereof, including without limitation the three license
agreements referenced in the preamble of this AGREEMENT.


 


CERTAIN PORTIONS
OF THIS EXHIBIT HAVE BEEN OMITTED PURSUANT TO A CONFIDENTIAL 


TREATMENT REQUEST.
OMITTED INFORMATION IS INDICATED BY AN ASTERIK MARKING (***) AND HAS 


BEEN FILED
SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION 


 



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Section 29.5     The
provisions of this AGREEMENT are severable, and in the event that any provision of this AGREEMENT shall be determined to be invalid
or unenforceable under any controlling body of the law, such invalidity or unenforceability shall not in any way affect the validity
or enforceability of the remaining provisions hereof.


 


Section 29.6     This
AGREEMENT may be signed in counterparts, each of which when taken together shall constitute one fully executed document. Each individual
executing this AGREEMENT on behalf of a legal entity does hereby represent and warrant to each other person so signing that he
or she has been duly authorized to execute this AGREEMENT on behalf of such entity.


 


Section 29.7      In
the event of any litigation, arbitration, judicial reference or other legal proceeding involving the parties to this AGREEMENT
to enforce any provision of this AGREEMENT, to enforce any remedy available upon default under this AGREEMENT, or seeking a declaration
of the rights of either party under this AGREEMENT, the prevailing party shall be entitled to recover from the other such attorneys’
fees and costs as may be reasonably incurred, including the costs of reasonable investigation, preparation and professional or
expert consultation incurred by reason of such litigation, arbitration, judicial reference, or other legal proceeding.


 


IN WITNESS WHEREOF, LICENSOR
and LICENSEE have executed this AGREEMENT by their respective officers hereunto duly authorized, on the day and year hereinafter
written.


 


	“LICENSEE”	“LICENSOR”
	 	 
	Q THERAPEUTICS, INC.	UNIVERSITY OF UTAH
	 	RESEARCH FOUNDATION
		


 


	By	/s/ DEBORAH A. EPPSTEIN PhD 	 	By 	/s/ RAYMOND F. GESTELAND
	 	(Signature)	 	 	(Signature)
	 	 	 	 	 
	Name	Deborah A. Eppstein PhD. 	 	Name	Raymond F. Gesteland
	 	(Please Print)	 	 	 
	 	 	 	 	 
	Title	Chief Executive Officer 	 	Title	Vice President, Research
	 	 	 	 	 
	Date	10/05/2005 	 	Date	10/05/2005 


 


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OF THIS EXHIBIT HAVE BEEN OMITTED PURSUANT TO A CONFIDENTIAL 


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OMITTED INFORMATION IS INDICATED BY AN ASTERIK MARKING (***) AND HAS 


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SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION  


 



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OF THIS EXHIBIT HAVE BEEN OMITTED PURSUANT TO A CONFIDENTIAL 


TREATMENT REQUEST.
OMITTED INFORMATION IS INDICATED BY AN ASTERIK MARKING (***) AND HAS 


BEEN FILED
SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION 


 



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CERTAIN PORTIONS
OF THIS EXHIBIT HAVE BEEN OMITTED PURSUANT TO A CONFIDENTIAL 


TREATMENT REQUEST.
OMITTED INFORMATION IS INDICATED BY AN ASTERIK MARKING (***) AND HAS 


BEEN FILED
SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION 


 



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CERTAIN PORTIONS
OF THIS EXHIBIT HAVE BEEN OMITTED PURSUANT TO A CONFIDENTIAL 


TREATMENT REQUEST.
OMITTED INFORMATION IS INDICATED BY AN ASTERIK MARKING (***) AND HAS 


BEEN FILED
SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION 





 



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CERTAIN PORTIONS
OF THIS EXHIBIT HAVE BEEN OMITTED PURSUANT TO A CONFIDENTIAL 


TREATMENT REQUEST.
OMITTED INFORMATION IS INDICATED BY AN ASTERIK MARKING (***) AND HAS 


BEEN FILED
SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION 





 



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CERTAIN PORTIONS
OF THIS EXHIBIT HAVE BEEN OMITTED PURSUANT TO A CONFIDENTIAL 


TREATMENT REQUEST.
OMITTED INFORMATION IS INDICATED BY AN ASTERIK MARKING (***) AND HAS 


BEEN FILED
SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION 





 



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CERTAIN PORTIONS
OF THIS EXHIBIT HAVE BEEN OMITTED PURSUANT TO A CONFIDENTIAL 


TREATMENT REQUEST.
OMITTED INFORMATION IS INDICATED BY AN ASTERIK MARKING (***) AND HAS 


BEEN FILED
SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION 


 



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CERTAIN PORTIONS
OF THIS EXHIBIT HAVE BEEN OMITTED PURSUANT TO A CONFIDENTIAL 


TREATMENT REQUEST.
OMITTED INFORMATION IS INDICATED BY AN ASTERIK MARKING (***) AND HAS


BEEN FILED
SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION 


 


FIRST AMENDMENT TO EXCLUSIVE LICENSE AGREEMENT


BETWEEN


Q THERAPEUTICS, INC.


AND


UNIVERSITY OF UTAH RESEARCH FOUNDATION


 


This First Amendment to
Exclusive License Agreement (the “Amendment”) is made and entered into effective as of April 24, 2006, by and between
Q Therapeutics, Inc., a Delaware corporation (“Licensee”) and the University of Utah Research Foundation, a Utah nonprofit
corporation (“Licensor”).


 


Recitals


 


A.           Licensor and Licensee
are parties to an Exclusive License Agreement dated October 5, 2005 (the “Agreement”), pursuant to which Licensor has
granted certain rights and licenses to Licensee. For purposes of this Amendment, any capitalized terms used herein but not otherwise
defined will have the meanings given to them in the Agreement.


 


B.           Licensor and Licensee
desire to amend and modify the terms of the Agreement in order to expand the definition of “Patent Rights” to include
certain intellectual property relating to neuronal restricted precursor cells, developed or acquired by Licensor (the “Additional
Intellectual Property”).


 


C.          Licensor and Licensee
desire that Licensee have the right to utilize the Additional Intellectual Property on the same terms and subject to the same restrictions
and obligations as apply to the Patent Rights generally, as currently provided in the Agreement, subject to the terms and conditions
of this Amendment.


 


Agreement


 


NOW THEREFORE, the parties
hereto hereby agree as follows:


 


1.           Modification
of Definition of Patent Rights. Section 1.1 of the Agreement is hereby amended to add the Additional Intellectual Property
to the definition of Patent Rights as currently set forth therein, so that the Patent Rights include, in addition to those items
previously referenced in the Agreement, all of the following Licensor intellectual property:


   


CERTAIN PORTIONS
OF THIS EXHIBIT HAVE BEEN OMITTED PURSUANT TO A CONFIDENTIAL 


TREATMENT REQUEST.
OMITTED INFORMATION IS INDICATED BY AN ASTERIK MARKING (***) AND HAS 


BEEN FILED
SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION 


 


 



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The United States patent(s)
and/or patent application(s) relating to neuronal restricted precursor cells (“NRPs”) which are listed on Exhibit A
attached hereto, and United States patents issued from such applications, and from divisionals and continuations (other than continuations-in-part)
of such applications and any reissuances of such United States patents; claims of continuation-in-part applications and patents
directed to subject matter specifically described in the application(s) referenced above; and claims of all foreign applications
and patents which are directed to subject matter specifically described in the United States patent(s) and/or patent application(s)
listed above.


 


2.            Expansion
of Field of Use. The definition of the term “Field of Use” as used in the Agreement is hereby expanded to include
(i) the use of NRPs for drug screening, drug discovery, diagnostics, drug target discovery, genomics and human therapeutics; and
(2) the sale of NRPs to third parties.


 


3.            Grant
of Warrant in Lieu of Certain Reimbursements. In lieu of Licensee’s obligation to reimburse Licensor for $40,000 of expenses
incurred by Licensor in the preparation, prosecution and maintenance of Patent Rights with respect to the Additional Intellectual
Property (the “Patent Expense Amount”), the Patent Expense Amount shall be treated as an advancement to Licensee pursuant
to the terms of a Convertible Loan Agreement in the form attached hereto as Exhibit B (the “Loan Agreement”), and upon
Licensor’s execution of a counterpart of the Loan Agreement with respect to the Patent Expense Amount, Licensee will issue
to Licensor a Convertible Note (as defined in the Loan Agreement) in a principal amount equal to the Patent Expense Amount, and
will also undertake to issue to Licensor a Warrant (as defined in the Loan Agreement) in accordance with the terms of the Loan
Agreement.


 


4.            Grant
of Additional Warrant. In consideration for Licensor’s agreement to modify the Agreement as provided in this Amendment,
and for other good and valuable consideration, the receipt and sufficiency of which are acknowledged by Licensee, Licensee will
grant to Licensor an additional Warrant, concurrently with the issuance of the Warrant referenced in Section 3 above, on substantially
the same terms, but providing for the purchase of an aggregate of 41,071 shares of Licensee’s Series B Preferred Stock, at
a price of $2.24 per share.


 


5.            Additional
Information for Royalty Calculation. Paragraph 3 of Section 6.1 of the Agreement sets forth a mechanism for determining royalties
with respect to Licensed Products and Licensed Methods incorporating multiple elements for intellectual property from multiple
sources. In order to ensure that appropriate information is provided to Licensor in connection with each such calculation, a new
sentence is hereby added to such paragraph 3, to follow the fourth sentence currently set forth n such paragraph, and to read as
follows:


 





“For any payment
affected by such a determination Licensee shall specifically identify and justify to Licensor in writing: how Licensee weighted
the relative values of the technologies and the formula used to arrive at a final good faith determination of value, which shall
be included and detailed in the quarterly reports required under Section 9.2 of the Agreement, to be in the form referenced in
Exhibit C to the Agreement.”


 


6.            Modification
of Due Diligence Obligations. Section 7.2(b) of the Agreement, which currently sets forth various due diligence obligations
of the Licensee, is hereby amended to replace such obligations with a new payment obligation, and to read in its entirety as follows:


   





CERTAIN PORTIONS
OF THIS EXHIBIT HAVE BEEN OMITTED PURSUANT TO A CONFIDENTIAL 


TREATMENT REQUEST.
OMITTED INFORMATION IS INDICATED BY AN ASTERIK MARKING (***) AND HAS 


BEEN FILED
SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION  


 



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Licensee shall pay Licensor
a due diligence payment of *** on or before October 5, 2008, and on each anniversary of such date, provided that such payment
obligations shall cease upon the first occurrence of Net Sales, as defined in this Agreement.







  


7.            Patent
Prosecution. Article 10 of the Agreement, relating to patent prosecution and maintenance, is hereby amended to add the following
new Section 10.5 to the end of such Article:


“10.5 Alternatively,
Licensee may select the patent attorney who will prosecute the patent applications for said Patent Rights, so long as Licensor
consents to the selected attorney, which consent will not be unreasonably withheld. Licensee will pay all costs and fees for said
selected patent attorney. If there are any transition costs or fees incurred from transferring responsibilities from the patent
attorney who was used previously by Licensor to the selected patent attorney, Licensee will pay said costs and fees. All such patent
applications and patents shall be in the name of Licensor, and owned by Licensor, and included as part of the Patent Rights licensed
pursuant to this Agreement. If Licensee notifies Licensor that it does not intend to pay the cost of an application, or if Licensee
does not respond or make an effort to agree with Licensor on the disposition of rights in the subject application, then Licensor
may file an application at its own expense and Licensee will have no rights to the invention. If Licensee selects a patent attorney
as provided above, Licensee will require such attorney to agree to keep both Licensee and Licensor, as co-clients, equally informed
and involved as to all material information, material communications with governmental patent offices, material issues and decisions,
and related matters applicable to prosecuting the patent applications for the Patent Rights and for maintaining the Patent Rights
in good standing. Decisions for prosecuting the patent applications will be made so as to obtain as broad of patent protection
as is reasonable and practical under the circumstances. Licensor will request that copies of all documents prepared by the selected
patent attorney be provided to Licensee for review and comment prior to filing to the extent practicable under the circumstances.
Licensee will be billed and will pay all documented costs and fees and other charges incident to the preparation, prosecution,
and maintenance of the Licensed Patents within thirty (30) days of receipt of invoice from the selected patent attorney. Licensee
will promptly notify Licensor of its plans to file, revise or drop any patent application or claim which may adversely affect the
Patent Rights or the rights or royalties of Licensor in the Licensed Product(s) under this Agreement. Licensee and the selected
patent attorney shall not change any inventorship designations and shall not drop or reduce any claim in a pending patent application
which may adversely affect the Patent Rights or royalties of Licensor in the Licensed Product(s).


 


8.            Continuation
of Agreement. Except as otherwise specifically modified by this Amendment, the Agreement shall continue in full force and effect.


IN WITNESS WHEREOF, the parties
hereto have executed this Amendment effective as of the date first above written.


 


CERTAIN PORTIONS
OF THIS EXHIBIT HAVE BEEN OMITTED PURSUANT TO A CONFIDENTIAL 


TREATMENT REQUEST.
OMITTED INFORMATION IS INDICATED BY AN ASTERIK MARKING (***) AND HAS 


BEEN FILED
SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION 





  



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	 	LICENSEE:
	 	 
	 	Q Therapeutics, Inc.
	 	 
	 	/s/ DEBORAH A. EPPSTEIN PHD
	 	By:	Deborah A. Eppstein PhD
	 	 	Chief Executive Officer


 


	 	LICENSOR:
	 	 
	 	University of Utah Research Foundation
	 	 
	 	By:	/s/ RAYMOND F. GESTLAND 
	 	 	Raymond F. Gestland, Vice President, Research


 


CERTAIN PORTIONS
OF THIS EXHIBIT HAVE BEEN OMITTED PURSUANT TO A CONFIDENTIAL 


TREATMENT REQUEST.
OMITTED INFORMATION IS INDICATED BY AN ASTERIK MARKING (***) AND HAS 


BEEN FILED
SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION 





  



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CERTAIN PORTIONS
OF THIS EXHIBIT HAVE BEEN OMITTED PURSUANT TO A CONFIDENTIAL 


TREATMENT REQUEST.
OMITTED INFORMATION IS INDICATED BY AN ASTERIK MARKING (***) AND HAS


BEEN FILED
SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION 


 


SECOND AMENDMENT TO LICENSE AGREEMENT


BETWEEN


Q THERAPEUTICS, INC.


AND


THE UNIVERSITY OF UTAH RESEARCH FOUNDATION


 


This Amendment is made
and entered into effective as of October 13, 2011, by and between Q Therapeutics, Inc., a Delaware corporation, having offices
at 615 Arapeen Drive, Suite 102, Salt Lake City, UT 84108 (“Licensee”), and the University of Utah Research Foundation,
having offices at the Technology Commercialization Office, 615 Arapeen Drive, Suite 310, Salt Lake City, UT 84108 (“Licensor”).
For purposes of this Amendment, capitalized terms used herein but not otherwise defined will have the meanings given to them in
the Agreement (defined below). Licensor and Licensee may be referred to herein separately as “Party” and jointly as
“Parties”.


 


RECITAL


 


WHEREAS, Licensor and Licensee
are parties to an Exclusive License Agreement dated October 5, 2005 (the “Agreement”), pursuant to which Licensor has
granted certain rights and licenses to Licensee; and


 


WHEREAS, Licensor and Licensee
desire to amend and modify the terms of the Agreement excepting from the rights granted to Licensee certain rights previously granted
to ***., under a *** Agreement (as defined below), and consistent with that certain Settlement Agreement entered into by
the Parties dated October 13, 2011.


 


NOW THEREFORE, for and
in consideration of the covenants, conditions and undertakings hereinafter set forth, the Parties hereby agree as follows:


 


AMENDMENT


 


	1.	License Grant.  Section 2.1 of the Agreement is hereby deleted and
    replaced in its entirety with the following:


 


Section 2.1 LICENSEE hereby takes and accepts
the rights granted to it under this AGREEMENT subject to that certain *** Agreement entered
into by and between LICENSOR and ***., dated on or about *** (the “*** Agreement”).
LICENSEE’s grant under this AGREEMENT is therefore co-exclusive with those rights
granted under the *** Agreement.


 


CERTAIN PORTIONS
OF THIS EXHIBIT HAVE BEEN OMITTED PURSUANT TO A CONFIDENTIAL 


TREATMENT REQUEST.
OMITTED INFORMATION IS INDICATED BY AN ASTERIK MARKING (***) AND HAS 


BEEN FILED
SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION 





  



    	31



    	 



    

 


Subject to the
*** Agreement, and subject to the terms and conditions set forth herein, LICENSOR hereby grants to LICENSEE an otherwise
exclusive license to make, have made, use and sell any LICENSED PRODUCT(S) and to practice any LICENSED METHOD(S) in the FIELD
OF USE under LICENSOR’S PATENT RIGHTS throughout the TERRITORY.


 


	2.	Ratification of Agreement.  Except as provided
    herein or as may be required to effectuate the intent of the Parties with respect to the amendments described in paragraph
    1 hereof, the Parties hereby reaffirm and ratify the terms of the Agreement in their entirety.
	 	 
	3.	Further Assurances.  Each of Licensee and Licensor hereby
    agrees to execute, deliver, verify, acknowledge, and file any and all documents, instruments, or agreements as shall be necessary
    or appropriate to reflect the intent of the Parties with respect to the amendments of the Agreement described herein.
	 	 
	4.	Entire Understanding.  This Amendment constitutes the entire
    understanding between the Parties hereto with respect to the subject matter hereof, and any modification of this Amendment
    shall be in writing and shall be signed by a duly authorized representative of each Party.


 


IN WITNESS WHEREOF, Licensor
and Licensee have executed this Agreement by their respective duly authorized officers, on the day and year written above.


 





	“LICENSEE”	 	“LICENSOR”
	Q Therapeutics, Inc.	 	University of Utah Research Foundation


 


	By:	/s/ DEBORAH A. EPPSTEIN PHD	 	By: 	/s/ THOMAS N. PARKS





	(Signature)	 	(Signature)





	Name:	Deborah A. Eppstein, PhD	 	Name: Thomas N. Parks





	(Please Print)	 	(Please Print)





	Title:	Chief Executive Officer 	 	Title: President


 







CERTAIN PORTIONS
OF THIS EXHIBIT HAVE BEEN OMITTED PURSUANT TO A CONFIDENTIAL 


TREATMENT REQUEST.
OMITTED INFORMATION IS INDICATED BY AN ASTERIK MARKING (***) AND HAS 


BEEN FILED
SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION 





  



    	32



    	 



    

 


CERTAIN PORTIONS
OF THIS EXHIBIT HAVE BEEN OMITTED PURSUANT TO A CONFIDENTIAL 


TREATMENT REQUEST.
OMITTED INFORMATION IS INDICATED BY AN ASTERIK MARKING (***) AND HAS


BEEN FILED
SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION 


 


THIRD AMENDMENT TO LICENSE AGREEMENT


BETWEEN


Q THERAPEUTICS, INC.


AND


THE UNIVERSITY OF UTAH RESEARCH FOUNDATION


 


This Amendment is made
and entered into effective as of October 22, 2011, by and between Q Therapeutics, Inc., a Delaware corporation, having offices
at 615 Arapeen Drive, Suite 102, Salt Lake City, UT 84108 (“Licensee”), and the University of Utah Research Foundation,
having offices at the Technology Commercialization Office, 615 Arapeen Drive, Suite 310, Salt Lake City, UT 84108 (“Licensor”).
For purposes of this Amendment, capitalized terms used herein but not otherwise defined will have the meanings given to them in
the Agreement (defined below). Licensor and Licensee may be referred to herein separately as “Party” and jointly as
“Parties”.


 


RECITAL


 


WHEREAS, Licensor and Licensee
are parties to an Exclusive License Agreement dated October 5, 2005 (the “Agreement”), pursuant to which Licensor has
granted certain rights and licenses to Licensee; and


 


WHEREAS, Licensor and Licensee
desire to amend and modify the terms of the Agreement regarding minimum annual royalty payments;


 


NOW THEREFORE, for and
in consideration of the covenants, conditions and undertakings hereinafter set forth, the Parties hereby agree as follows:


 


AMENDMENT


 


	2.	Royalties.  Section 6.2 of the Agreement is hereby deleted and replaced
    in its entirety with the following:


 


Section 6.2        Commencing with the first
calendar quarter to occur following the date of first occurrence of NET SALES pertaining to NEPs, GRPs, NCSCs, or APCs (U-2383,
U-2536, U-3184, or U-3275) for human therapeutic use, LICENSEE shall pay to LICENSOR within forty-five (45) days of the end of
said quarter a minimum annual royalty as provided below:


 


	YEAR 1	$ ***
	YEAR 2	$ ***
	YEAR 3	$ ***
	YEAR 4	$ ***


(and Beyond)


 


CERTAIN PORTIONS
OF THIS EXHIBIT HAVE BEEN OMITTED PURSUANT TO A CONFIDENTIAL 


TREATMENT REQUEST.
OMITTED INFORMATION IS INDICATED BY AN ASTERIK MARKING (***) AND HAS 


BEEN FILED
SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION 





  



    	33



    	 



    

 


LICENSEE shall continue
to pay such minimum annual royalty until the end of the term of the last to expire of LICENSOR’S PATENT RIGHTS. LICENSOR
shall fully credit each payment of minimum annual royalties against any earned royalties payable by LICENSEE with respect to the
year for which the minimum annual royalty is made (being the year commencing with the calendar quarter ending prior to the calendar
quarter in which the minimum annual royalty is payable).


 


	2.	Ratification of Agreement.  Except as provided
    herein or as may be required to effectuate the intent of the Parties with respect to the amendments described in paragraph
    1 hereof, the Parties hereby reaffirm and ratify the terms of the Agreement in their entirety.
	 	 
	3.	Further Assurances.  Each of Licensee and Licensor hereby
    agrees to execute, deliver, verify, acknowledge, and file any and all documents, instruments, or agreements as shall be necessary
    or appropriate to reflect the intent of the Parties with respect to the amendments of the Agreement described herein.
	 	 
	4.	Entire Understanding.  This Amendment constitutes the entire
    understanding between the Parties hereto with respect to the subject matter hereof, and any modification of this Amendment
    shall be in writing and shall be signed by a duly authorized representative of each Party.


 


5. Counterparts. This Amendment may
be executed in counterparts, each of which will be deemed an original and together constitute the same Amendment.


 


IN WITNESS WHEREOF, Licensor
and Licensee have executed this Agreement by their respective duly authorized officers, on the day and year written above.


 





	“LICENSEE”	 	“LICENSOR”
	Q Therapeutics, Inc.	 	University of Utah Research Foundation


 


	By:	/s/ DEBORAH A. EPPSTEIN PHD	 	By: 	/s/ THOMAS N. PARKS





	(Signature)	 	(Signature)





	Name:	Deborah A. Eppstein PhD	 	Name: Thomas N. Parks





	(Please Print)	 	(Please Print)





	Title:	Chief Executive Officer 	 	Title: President


 







CERTAIN PORTIONS
OF THIS EXHIBIT HAVE BEEN OMITTED PURSUANT TO A CONFIDENTIAL 


TREATMENT REQUEST.
OMITTED INFORMATION IS INDICATED BY AN ASTERIK MARKING (***) AND HAS 


BEEN FILED
SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION 


 






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