Contract No 840/08624332/1609-14


 


Date of signature: June 23, 2014


 


THE SELLER/THE MANUFACTURER


 


Open Joint Stock Company «Institute of The Nuclear Materials»
(JSC «INM»)


624250, Russia, Sverdlovsk Region,


Zarechniy, PO Box 29


Phone.: 7 (34377) 362 64 


FAX: 7 (34377) 733 46


E-mail: shipping@inm-rosatom.ru


 


THE BUYER


The Company IsoRay Medical Inc.


350 Hills Street, Suite 106


Richland, WA 99354-5411 USA


 


THE CONSIGNEE


The Company IsoRay Medical Inc.


350 Hills Street, Suite 106


Richland, WA 99354-5411 US


Airport of destination: Seattle or Portland, USA


 


NOTIFICATION


FedEX Trade Networks 16353 NE Cameron Blvd


Portland, Oregon 97230 USA


Phone: +1503-255 1391 ext.14


 


THE END USER 


The Company IsoRay Medical Inc.


350 Hills Street, Suite 106


Richland, WA 99354-5411 USA


 


THE
SHIPPER


Open Joint Stock Company «Institute of The Nuclear Materials»
(JSC «INM»)


624250, Russia, Sverdlovsk Region,


Zarechniy, PO Box 29


Phone:7 (34377) 362 64


FAX: 7 (34377) 733 46


E-mail: shipping@inm-rosatom.ru


 


TERMS OF DELIVERY


CPT airport Seattle or Portland, USA


(Incoterms 2010)


 


THE BUYERS and THE SELLERS have mutually agreed
that under the present Contract during 2014-2015 the Sellers will deliver to the Buyers the following Goods:


 




    	 



    	 



    

 


	Denomination and Specifications of the Goods.	 	Total activity 
 of the lot on 
 the 
 calibration 
 date, Ci	 	 	Quantity of 
 lots, pcs	 	 	Price, USD 
 per one lot	 	 	Amount,
  USD	 
	Dehydrated water soluble cesium-131 salt	 	 	[**]	 	 	 	[**]	 	 	 	[**]	 	 	 	[**]	 



 


The Goods are to be shipped in non-returnable
type A transport packing sets. The value of the packing sets is included into the Goods price.


 


Total activity of the lot is established
in accordance with the calibration date provided in the Buyers written order set to 12:00 p.m. (noon) Pacific Standard Time.


 


The Amount of the Contract: [**]


 


End purpose usage: for medical purpose.


 


The above number of the Goods and total
amount of the contract are to be considered as framework value only, whereas the actual number of the Goods and total amount will
be based on the Buyer’s written orders, confirmed by the Seller, by means of sending to the Buyer the acceptance of the Buyer’s
order.


 


The present contract comes in force from
the date of signing and will be valid till January 31, 2015.


 


All other terms and conditions of the Contract
are nominated in Appendixes 1,2 and 3 and are the integral parts thereof.


 


The Contract and any Appendixes and Addenda
to it shall be considered legally binding if provided by facsimile transmission.


 


 


	THE SELLERS	 	THE BUYERS
	/s/ Dmitrii Vladimirovich Markov	 	/s/ Dwight Babcock
	Director of Closed Stock Company «Science and Inovation», 	 	Dwight Babcock
	managing company for JSC «INM»	 	CEO IsoRay Medical


 





 






[**]Certain information in this
document has been omitted and filed separately with the Securities and Exchange Commission. Confidential treatment has been requested
with respect to the omitted portions.


 




    	2



    	 



    

 


APPENDIX 1


to Contract No 840/08624332/1609-14


 


Date of signing: June 23, 2014


 


TERMS OF PAYMENT


 


Payment is to be sent by the Buyer in US dollars within 30 (thirty)
calendar days from the date of delivery of the goods.


After the delivery the Seller sends to the Buyer the following
documents by Express mail:


 


1. Invoices (3 copies),


2. Transport Waybill (1 copy),


3. Quality Certificate (2 copies),


4. Shipping Specification (2 copies).


 


The payment is to be made by the Buyer by bank wire transfer
to the following Seller’s account:


 


The Open Joint Stock Company «Institute of Nuclear
Materials», (JSC «INM»)


Acc.  No [**]


GAZPROMBANK, MOSCOW


SWIFT CODE: GAZPRUMM


Ekaterinburg branch


(Account No [**])


Intermediary Bank (correspondent):


Deutche Bank Trust Company Americas, New York


New York, USA


SWIFT CODE: BKTR US 33


 


All expenses and commission fees of the Buyer’s Bank are
to be paid by the Buyers, all expenses and commission fees of other Banks, including correspondent Banks, are to be paid by the
Seller. The funds due to the Seller from amount of payment are less fees and commissions of the corresponding Banks and all other
banks except for the Buyer's Bank commissions. The Buyer’s payment obligation is considered fulfilled when the payment has
entered the above-mentioned Seller’s account.


 


	THE SELLERS	 	THE BUYERS
	/s/ Dmitrii Vladimirovich Markov	 	/s/ Dwight Babcock
	Director of Closed Stock Company «Science and Inovation»,	 	Dwight Babcock
	managing company for JSC «INM»	 	CEO IsoRay Medical


 





 






[**]Certain information in this document has been
omitted and filed separately with the Securities and Exchange Commission. Confidential treatment has been requested with respect
to the omitted portions.


 




    	3



    	 



    

 


APPENDIX 2


to Contract No 840/08624332/1609-14


 


Date of signing: June 23, 2014


 


GENERAL CONDITIONS OF DELIVERY


 


1. Terms of delivery.


1.1. When delivering the goods on terms
under CPT (INCOTERMS 2010) the SELLER shall hand over the goods to the selected carrier, bears the transportation expense (air
freight) to the agreed destination place.


 


1.1.2. The title as well as all the risks
which the goods may be subject to, shall be transferred from the Seller to the Buyer from the [**].


1.1.3. The [**].


1.1.4. The Seller is responsible for delivery of the Goods to
the Buyer at 12:00 p.m. local time in the designated airport of delivery on the first Monday following the date of shipment.


1.1.5. The Seller is obligated to provide the Buyer with a [**]
notice in the event of a planned interruption of service.


 


2. Quality of the Goods.


2.1. The quality of the goods should meet the contractual technical
requirements and should be confirmed by the Quality Certificate issued by the producer of goods.


 


3. Quantity of Goods.


3.1. The quantity of sent goods and commodities in specified
units should be attested by the Shipping Specification drawn up by the producer of goods and commodities or by the Seller, or by
the Certificate of Weight, or by the Packing List depending on the character of goods.


 


4. Terms of Transportation.


4.1. Not later than [**] prior to the date
of delivery the Buyer is obliged to provide shipping instructions to the Seller, advising it on all necessary shipping requisites.
In case the Buyer fails to send any information in due time without which the shipment of Goods is impossible, it bears all additional
expenses arising out of this and all the risks which the goods may be exposed to, starting from the agreed date of delivery or
after the expiry of the agreed time of delivery.


 


5. Notice of Shipment.


5.1. During [**] after the shipment the
Seller is to notify the Buyer by fax of the following data:


- data of shipment;


- denomination of goods;


- quantity of goods;


- Contract number;


- quality characteristics (Quality Certificate);


- flight and Waybill numbers.


 


6. Delivery and Acceptance of Goods,
Claims.


6.1. The Goods are considered delivered
by the Seller or the Shipper and accepted by the Buyer with respect to quality and quantity in accordance with the Certificate
of Quality and Shipping Specifications including an invoice.


6.2. In case of nonconformity of the Goods
quantity or quality to the documents referenced in Section 6.1 above or any other nonconformity, (e.g. damage or loss in transit),
the Buyer shall inform the Seller no later than [**] days after the receipt of the defective Goods by the Buyer.


 





 






[**]Certain information in this
document has been omitted and filed separately with the Securities and Exchange Commission. Confidential treatment has been requested
with respect to the omitted portions.


 




    	4



    	 



    

 


6.3. Claims in respect of the Goods quality
and quantity shall be accompanied with a written statement drawn up at the place of destination with the participation of the Seller’s
representatives and quality control department.


6.4 The Claim must specify:


−        the numbers and dates of the
following documents: the Contract, the Purchase Order, the AWB, the Packing Slip and the Certificate of Quality;


−        information on the integrity
of the Type-A Shipping package and its internal contents;


−        detailed results of the analytical
measurements including analysis methods used;


−        the Buyer's conclusions regarding
failure to meet the quality and/or quantity requirements of the Goods;


−        the cost calculation of a missing
quantity of the Goods or the Quantity that cannot be used in production.


The Claim must be signed by the Buyer.


 


Each claim shall be provided in English
and Russian.


One copy of the claim shall be sent to
the Seller via express mail and another copy shall be sent via fax or electronic mail.


6.5. Seller shall confirm the Claim receipt
via fax or electronic mail and issue a reply no later than 7 (seven) business days after the Claim receipt. The reply must be sent
in the same manner as the Claim, as described in Section 6.4 above.


 


6.6. Other than with respect to Goods which
are damaged in transit by the Shipper or delayed beyond the time for delivery as required by Section 1.1.4. as a result of Shipper’s
sole actions alone, the Buyer shall pay only for the Goods actually received that can be used in production. Payment amounts shall
be based on the corrected invoice provided by the Seller, as adjusted for failures in quantity and quality described in Section
6.2 above. The copy of the corrected invoice shall be sent to the Buyer via fax or electronic mail.


6.7. Seller shall not be liable for the changes in the quality
or quantity of the Goods caused by either damages caused by or delays resulting from the third party shipper of the Goods. Buyer
shall be solely liable for carrying all insurance for Goods in transit.


 


6.8. In case of return of the claimed goods the Buyer is to
deliver the goods in packing which secure safety of goods during transportation.


 


7. Penalties


7.1. In case the Buyer does not send the
payment in the terms stipulated in the Contract the Buyer is to pay the penalty amounted to [**] for each day of delay but no more
than [**] of delivered value.


7.2. The obligation of the defaulting party
to pay the penalty arises upon written demand submitted by the other party. In case of delay in performance the penalty shall accrue
form the due date of due performance the party of its obligation hereunder.


 


8. Licenses.


8.1. The Seller is obliged at its risk
and expense to obtain and maintain the Export License, and the Buyer - the Import License.


8.2. The Buyer is obliged to inform the
Seller on the obtaining the License for importation of goods under the present Contract, in case of necessity of such License,
not later than 30 days prior the month of delivery.


 


9. Force-majeure.


9.1. Neither Party shall bear responsibility
for the complete or partial non-performance of any of its obligations (except for failure to pay any sum which has become due under
the provisions hereof), if the non-performance results from such circumstances as flood, fire, earthquake and other acts of God
as well as war, military operations, blockade, acts or actions of state authorities or any other circumstances beyond the Party’s
control that have arisen after the conclusion of the contract. In this case the time stipulated for the performance of an obligation
under the contract is extended correspondingly for the period of time of action of these circumstances and their consequences.


 


 






[**]Certain information in this
document has been omitted and filed separately with the Securities and Exchange Commission. Confidential treatment has been requested
with respect to the omitted portions.


 




    	5



    	 



    

 


9.2. The Party for which the performance
of obligation became impossible shall immediately


notify in written form the other Party
of the beginning, expected time of duration and cessation of above circumstances. Certificate of a Chamber of Commerce (Commerce
and Industry) or other competent authority or organization of the respective country shall be a sufficient proof of commencement
and cessation of the above circumstances.


 


10. Termination


10.1. Buyer may terminate this Contract
upon 5 days written notice to Seller, upon failure to deliver the Goods meeting the quality and quantity specifications set forth
in Section 6.1 above, requested by Buyer for shipment within 7 days of the date scheduled for delivery to the designated airport
(Section 1.1.4.) over any consecutive four (4) week period regardless of the reason delivery has not occurred whether as a result
of delays caused by a shipper, closure of reactor facilities, or any other factors outside control of the Buyer causing the delay
in receipt of the Goods.


 


10.2. Seller may terminate this Contract
upon 5 days written notice if Buyer fails to pay any Invoice within 10 days of the due date, provided that no invoice involving
a shipment subject to a Claim shall be due until after such claim is either mutually resolved by the Parties or settled by Arbitration
under Section 11.


 


11. Arbitration.


11.1. All disputes or differences which
may arise out of or in connection with the present Contract (including disputes or differences connected with the non-validity
and the conclusion of the Contract) are to be settled by Arbitration in accordance with the Rules of the Arbitration Institute
of the Chamber of Commerce of Stockholm as are at present in force. The place of Arbitration shall be Stockholm, Sweden. The appointing
authority shall be the Arbitration Institute of the Stockholm Chamber of Commerce.


11.2. The arbitral tribunal shall be composed
of a sole arbitrator, appointed by the Arbitration Institute of the Stockholm Chamber of Commerce.


11.3. The present Contract is governed
by the substantive law of Sweden with the exclusion of the provisions of conflict of laws. The language to be used in the arbitration
proceeding shall be English. The award of the Arbitration is final and binding upon both parties. All expenses with respect to
the Arbitration shall be born by the losing Party except as otherwise set forth by the Arbitration award.


 


12. Other conditions.


12.1. All taxes, duties, fees and other
expenses whatsoever connected with the fulfillment of the Contract in the territory of the Seller’s country are to be paid
by the Seller and beyond it – at the expenses of the Buyer.


12.2. Neither of the Parties is entitled
to transfer its rights and obligations under the Contract to any third party without the written consent of the other Party.


12.3. Any alterations and/or appendices
to the Contract are valid only if they are made out in the written form and signed by the duly authorized representatives of the
Parties.


 


12.5. All Appendixes mentioned in the Contract
are its integral parts.


12.6. After the signing of the Contract
all preceding negotiations and correspondence connected with it are out of force.


12.7. Zarechny Sverdlovsk region is considered
to be the place of the Contract signing.


12.8. Facsimile signature of the Contract
and all Appendixes and Addendums is permissible.


12.9. The present Contract is signed in
Russian and English, both texts being authentic in duplicate, one original for each party concerned.


 


	THE SELLERS	 	THE BUYERS
	/s/ Dmitrii Vladimirovich Markov	 	/s/ Dwight Babcock
	Director of Closed Stock Company «Science and Inovation»,	 	Dwight Babcock
	managing company for JSC «INM»	 	CEO IsoRay Medical


 




    	6



    	 



    

 


APPENDIX 3


to Contract No 840/08624332/1609-14


 


Date of signing: June 23, 2014


 


PRODUCT QUALITY REQUIREMENTS


 


1. Physical form.


1.1. Dried product with solids content
of approximately [**] per shipment.


2. Chemical form.


2.1.
Аny soluble salt of Cesium. There are no requirements for the determination of the specific
chemical composition of the Cesium salt.


 


3. Radiochemical purity.


 


3.1. Cs isotopes activity ratios per calibration
(alert levels):


 


Cs-132/Cs-131:< [**];


Cs-134/Cs-131:< [**];


Cs-136/Cs-131:< [**];


Cs-137/Cs-131: <[**];


 


3.2. Impurities activity ratios per calibration (alert levels):


 


Ba-131/Cs-131: < [**];


Ba-133/Cs-131: < [**];


La-140/Cs-131: < [**];


Co-60/Cs-131: < [**];


Sb-122/Cs-131: < [**];


Sb-124/Cs-131: < [**];


Au-198/Cs-131: < [**];


Zn-65/Cs-131: < [**];


Ir-192/Cs-131: < [**];


 


Sum of all other gamma emitters: < [**].


 


	THE SELLERS	 	THE BUYERS
	/s/ Dmitrii Vladimirovich Markov	 	/s/ Dwight Babcock
	Director of Closed Stock Company «Science and Inovation»,	 	Dwight Babcock
	managing company for JSC «INM»	 	CEO IsoRay Medical


 





 






[**]Certain information in this document has been
omitted and filed separately with the Securities and Exchange Commission. Confidential treatment has been requested with respect
to the omitted portions.


 




    	7