Document:

ex10-2.htm

Exhibit 10.2

 

REGISTRATION RIGHTS AGREEMENT

This Registration Rights Agreement (this “Agreement”) is made and entered into as of  February 27, 2012, between Photovoltaic Solar Cells, Inc. (to be renamed MetaStat, Inc.), a Nevada corporation (the “Company”), Albert Einstein College of Medicine of Yeshiva University, a Division of Yeshiva University, a New York corporation (“Albert Einstein College of Medicine”), Massachusetts Institute of Technology, a Massachusetts corporation (“MIT”), Cornell University, a New York non-profit institution (“Cornell”), IFO-Regina Elena Cancer Institute, an Italian institute (“IFO”), and each of the several investors signatory hereto (each, an “Investor” and collectively, the “Investors” and, together with Albert Einstein College of Medicine, MIT, Cornell, and IFO, each a “Purchaser” and collectively, the “Purchasers”).

               This Agreement is made pursuant to the Securities Purchase Agreement, dated as of the date hereof, between the Company and the Investors (the “Purchase Agreement”).

               The Company and each Purchaser hereby agrees as follows:

        1.                      Definitions.

               Capitalized terms used and not otherwise defined herein that are defined in the Purchase Agreement shall have the meanings given such terms in the Purchase Agreement. As used in this Agreement, the following terms shall have the following meanings:

               “Advice” shall have the meaning set forth in Section 6(d).

“Effectiveness Date” means, with respect to the Initial Registration Statement required to be filed hereunder, the 180th calendar day following the date hereof (or, in the event of a “full review” by the Commission, the 270th calendar day following the date hereof) and with respect to any additional Registration Statements which may be required pursuant to Section 2(c), the 60th calendar day following the date on which an additional Registration Statement is required to be filed hereunder (or, in the event of a “full review” by the Commission, the 90th calendar day following the date such additional Registration Statement is required to be filed hereunder); provided, however, that in the event the Company is notified by the Commission that one or more of the above Registration Statements will not be reviewed or is no longer subject to further review and comments, the Effectiveness Date as to such Registration Statement shall be the fifth Trading Day following the date on which the Company is so notified if such date precedes the dates otherwise required above, provided, further, if such Effectiveness Date falls on a day that is not a Trading Day, then the Effectiveness Date shall be the next succeeding Trading Day.

“Effectiveness Period” shall have the meaning set forth in Section 2(a).

“Filing Date” means, with respect to the Initial Registration Statement required hereunder, the 120th calendar day following the date hereof and, with respect to any additional Registration Statements which may be required pursuant to Section 2(c), the earliest practical date on which the Company is permitted by SEC Guidance to file such additional Registration Statement related to the Registrable Securities.

“Holder” or “Holders” means the holder or holders, as the case may be, from time to time of Registrable Securities.

“Indemnified Party” shall have the meaning set forth in Section 5(c).

“Indemnifying Party” shall have the meaning set forth in Section 5(c).

“Initial Registration Statement” means the initial Registration Statement filed pursuant to this Agreement.

  

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“Losses” shall have the meaning set forth in Section 5(a).

“Plan of Distribution” shall have the meaning set forth in Section 2(a).

“Prospectus” means the prospectus included in a Registration Statement (including, without limitation, a prospectus that includes any information previously omitted from a prospectus filed as part of an effective registration statement in reliance upon Rule 430A promulgated by the Commission pursuant to the Securities Act), as amended or supplemented by any prospectus supplement, with respect to the terms of the offering of any portion of the Registrable Securities covered by a Registration Statement, and all other amendments and supplements to the Prospectus, including post-effective amendments, and all material incorporated by reference or deemed to be incorporated by reference in such Prospectus.

“Registrable Securities” means, as of any date of determination, (a) all Shares, (b) all Warrant Shares then issuable upon exercise of the Warrants (assuming on such date the Warrants are exercised in full without regard to any exercise limitations therein), (c) 1,150,242 shares of Common Stock held by Albert Einstein College of Medicine, 824,723 shares of Common Stock held by MIT, 383,414 shares of Common Stock held by Cornell, 766,832 shares of Common Stock held by IFO and 325,518 shares of Common Stock held by Dr. Frank Gertler, and (d) any securities issued or then issuable upon any stock split, dividend or other distribution,  recapitalization or similar event with respect to the foregoing; provided, however, that the Holder has completed and delivered to the Company a Selling Stockholder Questionnaire and that any such Registrable Securities shall cease to be Registrable Securities (and the Company shall not be required to maintain the effectiveness of any, or file another, Registration Statement hereunder with respect thereto) for so long as (a) a Registration Statement with respect to the sale of such Registrable Securities is declared effective by the Commission under the Securities Act and such Registrable Securities have been disposed of by the Holder in accordance with such effective Registration Statement, (b) such Registrable Securities have been previously sold in accordance with Rule 144, or (c) such securities become eligible for resale without volume or manner-of-sale restrictions pursuant to Rule 144 (assuming that such securities and any securities issuable upon exercise, conversion or exchange of which, or as a dividend upon which, such securities were issued or are issuable, were at no time held by any Affiliate of the Company), as reasonably determined by the Company, upon the advice of counsel to the Company.

“Registration Statement” means any registration statement required to be filed hereunder pursuant to Section 2(a) and any additional registration statements contemplated by Section 2(c), including (in each case) the Prospectus, amendments and supplements to any such registration statement or Prospectus, including pre- and post-effective amendments, all exhibits thereto, and all material incorporated by reference or deemed to be incorporated by reference in any such registration statement.

 “Rule 415” means Rule 415 promulgated by the Commission pursuant to the Securities Act, as such Rule may be amended or interpreted from time to time, or any similar rule or regulation hereafter adopted by the Commission having substantially the same purpose and effect as such Rule.

“Rule 424” means Rule 424 promulgated by the Commission pursuant to the Securities Act, as such Rule may be amended or interpreted from time to time, or any similar rule or regulation hereafter adopted by the Commission having substantially the same purpose and effect as such Rule.

“Selling Stockholder Questionnaire” means a questionnaire in the form attached as Annex B hereto, or such other form of questionnaire as may reasonably be adopted by the Company from time to time.

“SEC Guidance” means (i) any publicly-available written or oral guidance of the Commission staff, or any comments, requirements or requests of the Commission staff and (ii) the Securities Act.

  

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   2.           Resale Registration.

(a) On or prior to each Filing Date, the Company shall prepare and file with the Commission a Registration Statement covering the resale of all of the Registrable Securities that are not then registered on an effective Registration Statement for an offering to be made on a continuous basis pursuant to Rule 415.  Each Registration Statement filed hereunder shall be on Form S-1 and shall contain substantially the “Plan of Distribution” attached hereto as Annex A. Subject to the terms of this Agreement, the Company shall use its commercially reasonable efforts to cause a Registration Statement filed under this Agreement to be declared effective under the Securities Act as promptly as possible after the filing thereof, but in any event no later than the applicable Effectiveness Date, and shall use its commercially reasonable efforts to keep such Registration Statement continuously effective under the Securities Act until all Registrable Securities covered by such Registration Statement (i) have been sold, thereunder or pursuant to Rule 144, or (ii) may be sold without volume or manner-of-sale restrictions pursuant to Rule 144 and without the requirement for the Company to be in compliance with the current public information requirement under Rule 144, as determined by the counsel to the Company pursuant to a written opinion letter to such effect, addressed and acceptable to the Transfer Agent and the affected Holders (the “Effectiveness Period”).  The Company shall promptly notify the Holders via facsimile or by e-mail of the effectiveness of a Registration Statement within one Trading Day that the Company telephonically confirms effectiveness with the Commission.  The Company shall, within two (2) Trading Days after the effective date of such Registration Statement, file a final Prospectus with the Commission as required by Rule 424.

(b)  Notwithstanding the registration obligations set forth in Section 2(a), if the Commission informs the Company that all of the Registrable Securities cannot, as a result of the application of Rule 415, be registered for resale as a secondary offering on a single registration statement, the Company agrees to promptly inform each of the Holders thereof and use its commercially reasonable efforts to file amendments to the Initial Registration Statement as required by the Commission, covering the maximum number of Registrable Securities permitted to be registered by the Commission, on Form S-1 or such other form available to register for resale the Registrable Securities as a secondary offering, subject to the provisions of Section 2(e); provided, however, that prior to filing such amendment, the Company shall be obligated to use its commercially reasonable efforts to advocate with the Commission for the registration of all of the Registrable Securities in accordance with the SEC Guidance, including without limitation, Compliance and Disclosure Interpretation 612.09.

(c) Notwithstanding any other provision of this Agreement, if the Commission or any SEC Guidance sets forth a limitation on the number of Registrable Securities permitted to be registered on a particular Registration Statement as a secondary offering (and notwithstanding that the Company used commercially reasonable efforts to advocate with the Commission for the registration of all or a greater portion of Registrable Securities), unless otherwise directed in writing by a Holder as to its Registrable Securities, the number of Registrable Securities to be registered on such Registration Statement will be reduced as follows:

	
a.  

	
First, the Company shall reduce or eliminate any securities to be included by any Person other than a Holder, including the shares listed on Schedule 6(b) attached hereto in the order of priority indicated thereon; and

	
b.  

	
Second, the Company shall reduce Registrable Securities represented by Warrant Shares (applied, in the case that some Warrant Shares may be registered, to the Holders on a pro rata basis based on the total number of unregistered Warrant Shares held by such Holders).

  

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In the event of a cutback hereunder, the Company shall give the Holder at least two (2) Trading Days prior written notice along with the calculations as to such Holder’s allotment.  In the event the Company amends the Initial Registration Statement in accordance with the foregoing, the Company will use its commercially reasonable efforts to file with the Commission, as promptly as allowed by Commission or SEC Guidance provided to the Company or to registrants of securities in general, one or more registration statements on Form S-1 or such other form available to register for resale those Registrable Securities that were not registered for resale on the Initial Registration Statement, as amended.

(d) Each Holder agrees to furnish to the Company a completed Selling Stockholder Questionnaire not more than ten (10) Business Days following the date of this Agreement. Each Holder further agrees that it shall not be entitled to be named as a selling security holder in the Registration Statement or use the Prospectus for offers and resales of Registrable Securities at any time, unless such Holder has returned to the Company a completed and signed Selling Stockholder Questionnaire. If a Holder of Registrable Securities returns a Selling Stockholder Questionnaire after the deadline specified in the previous sentence, the Company shall use its commercially reasonable efforts to take such actions as are required to name such Holder as a selling security holder in the Registration Statement or any pre-effective or post-effective amendment thereto and to include (to the extent not theretofore included) in the Registration Statement the Registrable Securities identified in such late Selling Stockholder Questionnaire; provided that the Company shall not be required to file an additional Registration Statement solely for such shares. Each Holder acknowledges and agrees that the information in the Selling Stockholder Questionnaire will be used by the Company in the preparation of the Registration Statement and hereby consents to the inclusion of such information in the Registration Statement.

3.           Registration Procedures.

               In connection with the Company’s registration obligations hereunder, the Company shall:

(a) Not less than two (2) Trading Days prior to the filing of each Registration Statement and not less than one (1) Trading Day prior to the filing of any related Prospectus or any amendment or supplement thereto (including any document that would be incorporated or deemed to be incorporated therein by reference), the Company shall (i) furnish to each Holder copies of all such documents proposed to be filed, which documents (other than those incorporated or deemed to be incorporated by reference) will be subject to the reasonable review of such Holders, and (ii) use its commercially  reasonable efforts to cause its officers and directors, counsel and independent registered public accountants to respond to such inquiries as shall be necessary, in the reasonable opinion of respective counsel to each Holder, to conduct a reasonable investigation within the meaning of the Securities Act. Notwithstanding the above, the Company shall not be obligated to provide the Holders advance copies of any universal shelf registration statement registering securities in addition to those required hereunder, or any Prospectus prepared thereto.

(b) (i) Prepare and file with the Commission such amendments, including post-effective amendments, to a Registration Statement and the Prospectus used in connection therewith as may be necessary to keep a Registration Statement continuously effective as to the applicable Registrable Securities for the Effectiveness Period and prepare and file with the Commission such additional Registration Statements in order to register for resale under the Securities Act all of the Registrable Securities, (ii) cause the related Prospectus to be amended or supplemented by any required Prospectus supplement (subject to the terms of this Agreement), and, as so supplemented or amended, to be filed pursuant to Rule 424, (iii) respond as promptly as reasonably practicable to any comments received from the Commission with respect to a Registration Statement or any amendment thereto and provide as promptly as reasonably practicable to the Holders true and complete copies of all correspondence from and to the Commission related to and/or applicable to a Holder in the reasonable opinion of the Company relating to a Registration Statement (provided that, the Company shall excise any information contained therein which would constitute material non-public information regarding the Company or any of its

  

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 Subsidiaries), and (iv) comply in all material respects with the applicable provisions of the Securities Act and the Exchange Act with respect to the disposition of all Registrable Securities covered by a Registration Statement during the Effectiveness Period in accordance (subject to the terms of this Agreement) with the intended methods of disposition by the Holders thereof set forth in such Registration Statement as so amended or in such Prospectus as so supplemented.

(c) Notify the Holders of Registrable Securities to be sold (which notice shall, pursuant to clauses (iii) through (vi) hereof, be accompanied by an instruction to suspend the use of the Prospectus until the requisite changes have been made) as promptly as reasonably possible (and, in the case of (i)(A) below, not less than one (1) Trading Day prior to such filing) and (if requested by any such Person) confirm such notice in writing no later than one (1) Trading Day following the day (i)(A) when a Prospectus or any Prospectus supplement or post-effective amendment to a Registration Statement is proposed to be filed, (B) when the Commission notifies the Company whether there will be a “review” of such Registration Statement and whenever the Commission comments in writing on such Registration Statement, and (C) with respect to a Registration Statement or any post-effective amendment, when the same has become effective, (ii) of any request by the Commission or any other federal or state governmental authority for amendments or supplements to a Registration Statement or Prospectus or for additional information, (iii) of the issuance by the Commission or any other federal or state governmental authority of any stop order suspending the effectiveness of a Registration Statement covering any or all of the Registrable Securities or the initiation of any Proceedings for that purpose, (iv) of the receipt by the Company of any notification with respect to the suspension of the qualification or exemption from qualification of any of the Registrable Securities for sale in any jurisdiction, or the initiation or threatening of any Proceeding for such purpose, (v) of the occurrence of any event or passage of time that makes the financial statements included in a Registration Statement ineligible for inclusion therein or any statement made in a Registration Statement or Prospectus or any document incorporated or deemed to be incorporated therein by reference untrue in any material respect or that requires any revisions to a Registration Statement, Prospectus or other documents so that, in the case of a Registration Statement or the Prospectus, as the case may be, it will not contain any untrue statement of a material fact or omit to state any material fact required to be stated therein or necessary to make the statements therein, in light of the circumstances under which they were made, not misleading, and (vi) of the occurrence or existence of any pending corporate development with respect to the Company that the Company believes may be material and that, in the determination of the Company, makes it not in the best interest of the Company to allow continued availability of a Registration Statement or Prospectus, provided, however, in no event shall any such notice contain any information which would constitute material, non-public information regarding the Company or any of its Subsidiaries.

(d) Use its commercially reasonable efforts to avoid the issuance of, or, if issued, obtain the withdrawal of (i) any order stopping or suspending the effectiveness of a Registration Statement, or (ii) any suspension of the qualification (or exemption from qualification) of any of the Registrable Securities for sale in any jurisdiction, at the earliest practicable moment.

(e) Furnish to each Holder, without charge, at least one conformed copy of each such Registration Statement and each amendment thereto, including financial statements and schedules, all documents incorporated or deemed to be incorporated therein by reference to the extent requested by such Person, and all exhibits to the extent requested by such Person (including those previously furnished or incorporated by reference) promptly after the filing of such documents with the Commission; provided, that any such item which is available on the EDGAR system (or successor thereto) need not be furnished in physical form.

(f) Subject to the terms of this Agreement, the Company hereby consents to the use of such Prospectus and each amendment or supplement thereto by each of the selling Holders in connection with the offering and sale of the Registrable Securities covered by such Prospectus and any amendment or supplement thereto, except after the giving of any notice pursuant to Section 3(c).

  

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(g)  Prior to any resale of Registrable Securities by a Holder, use its commercially reasonable efforts to register or qualify or cooperate with the selling Holders in connection with the registration or qualification (or exemption from the Registration or qualification) of such Registrable Securities for the resale by the Holder under the securities or Blue Sky laws of such jurisdictions within the United States as any Holder reasonably requests in writing, to keep each registration or qualification (or exemption therefrom) effective during the Effectiveness Period and to do any and all other acts or things reasonably necessary to enable the disposition in such jurisdictions of the Registrable Securities covered by each Registration Statement; provided, that, the Company shall not be required to qualify generally to do business in any jurisdiction where it is not then so qualified, subject the Company to any material tax in any such jurisdiction where it is not then so subject or file a general consent to service of process in any such jurisdiction.

(h) If requested by a Holder, cooperate with such Holder to facilitate the timely preparation and delivery of certificates representing Registrable Securities to be delivered to a transferee pursuant to a Registration Statement, which certificates shall be free, to the extent permitted by the Purchase Agreement (solely with respect to Holders a party thereto) and applicable securities laws, of all restrictive legends, and to enable such Registrable Securities to be in such denominations and registered in such names as any such Holder may reasonably request.

(i) Upon the occurrence of any event contemplated by Section 3(c), as promptly as reasonably practicable under the circumstances taking into account the Company’s good faith assessment of any adverse consequences to the Company and its stockholders of the premature disclosure of such event, prepare a supplement or amendment, including a post-effective amendment, to a Registration Statement or a supplement to the related Prospectus or any document incorporated or deemed to be incorporated therein by reference, and file any other required document so that, as thereafter delivered, neither a Registration Statement nor such Prospectus will contain an untrue statement of a material fact or omit to state a material fact required to be stated therein or necessary to make the statements therein, in light of the circumstances under which they were made, not misleading. If the Company notifies the Holders in accordance with clauses (iii) through (vi) of Section 3(c) above to suspend the use of any Prospectus until the requisite changes to such Prospectus have been made, then the Holders shall suspend use of such Prospectus.  The Company will use its commercially reasonable efforts to ensure that the use of the Prospectus may be resumed as promptly as is practicable.  In addition, if (i) there is material non-public information regarding the Company which the Company’s Board of Directors (the “Board”) determines not to be in the Company’s best interest to disclose and which the Company is not otherwise required to disclose, (ii) there is a significant business opportunity (including, but not limited to, the acquisition or disposition of assets (other than in the ordinary course of business) or any merger, consolidation, tender offer or other similar transaction) available to the Company which the Board determines not to be in the Company’s best interest to disclose, or (iii) the Company is required to file a post-effective amendment to the Registration Statement to incorporate the Company’s quarterly and annual reports and audited financial statements on Forms 10-Q and 10-K, then the Company may (x) postpone or suspend filing of a registration statement for a period not to exceed forty-five (45) consecutive days or (y) postpone or suspend effectiveness of a registration statement for a period not to exceed forty-five (45) consecutive days; provided that the Company may not postpone or suspend effectiveness of a registration statement under this Section for more than ninety (90) days in the aggregate during any three hundred sixty (360) day period; provided, however, that no such postponement or suspension shall be permitted for consecutive twenty (20) day periods arising out of the same set of facts, circumstances or transactions.

(j) Comply in all material respects with all applicable rules and regulations of the Commission.

(k) The Company shall require each selling Holder to furnish to the Company a certified statement as to the number of shares of Common Stock beneficially owned by such Holder and, if required by the Commission, the natural persons thereof that have voting and dispositive control over the shares, pursuant to the Selling Stockholder Questionnaire.

  

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        4.                      Registration Expenses. All fees and expenses incident to the performance of or compliance with, this Agreement by the Company shall be borne by the Company whether or not any Registrable Securities are sold pursuant to a Registration Statement. The fees and expenses referred to in the foregoing sentence shall include, without limitation, (i) all registration and filing fees (including, without limitation, fees and expenses of the Company’s counsel and independent registered public accountants) (A) with respect to filings made with the Commission, (B) with respect to filings required to be made with any Trading Market on which the Common Stock is then listed for trading, (C) in compliance with applicable state securities or Blue Sky laws reasonably agreed to by the Company in writing (including, without limitation, fees and disbursements of counsel for the Company in connection with Blue Sky qualifications or exemptions of the Registrable Securities) and (D) if not previously paid by the Company in connection with an Issuer Filing, with respect to any filing that may be required to be made by any broker through which a Holder intends to make sales of Registrable Securities with FINRA pursuant to FINRA Rule 5110, so long as the broker is receiving no more than a customary brokerage commission in connection with such sale, (ii) printing expenses (including, without limitation, expenses of printing certificates for Registrable Securities), (iii) messenger, telephone and delivery expenses, (iv) fees and disbursements of counsel for the Company, (v) Securities Act liability insurance, if the Company so desires such insurance, and (vi) fees and expenses of all other Persons retained by the Company in connection with the consummation of the transactions contemplated by this Agreement.  In addition, the Company shall be responsible for all of its internal expenses incurred in connection with the consummation of the transactions contemplated by this Agreement (including, without limitation, all salaries and expenses of its officers and employees performing legal or accounting duties), the expense of any annual audit and the fees and expenses incurred in connection with the listing of the Registrable Securities on any securities exchange as required hereunder.  In no event shall the Company be responsible for any broker or similar commissions of any Holder or, except to the extent provided for in the Transaction Documents, any legal fees or other costs of the Holders.

        5.                      Indemnification.

(a) Indemnification by the Company. The Company shall, notwithstanding any termination of this Agreement, indemnify and hold harmless each Holder, the officers, directors, members, partners, agents, brokers (including brokers who offer and sell Registrable Securities as principal as a result of a pledge or any failure to perform under a margin call of Common Stock), investment advisors and employees (and any other Persons with a functionally equivalent role of a Person holding such titles, notwithstanding a lack of such title or any other title) of each of them, each Person who controls any such Holder (within the meaning of Section 15 of the Securities Act or Section 20 of the Exchange Act) and the officers, directors, members, stockholders, partners, agents and employees (and any other Persons with a functionally equivalent role of a Person holding such titles, notwithstanding a lack of such title or any other title) of each such controlling Person, to the fullest extent permitted by applicable law, from and against any and all losses, claims, damages, liabilities, costs (including, without limitation, reasonable attorneys’ fees) and expenses (collectively, “Losses”), as incurred, arising out of or relating to (1) any untrue or alleged untrue statement of a material fact contained in a Registration Statement, any Prospectus or any form of prospectus or in any amendment or supplement thereto or in any preliminary prospectus, or arising out of or relating to any omission or alleged omission of a material fact required to be stated therein or necessary to make the statements therein (in the case of any Prospectus or supplement thereto, in light of the circumstances under which they were made) not misleading or (2) any violation by the Company of the Securities Act, the Exchange Act or any state securities law, or any rule or regulation thereunder, in connection with the performance of its obligations under this Agreement, except to the extent, but only to the extent, that (i) such untrue statements or omissions are based solely upon information regarding such Holder furnished in writing to the Company by such Holder expressly for use therein, or to the extent that such information relates to such Holder or such Holder’s proposed method of distribution of Registrable Securities and was reviewed and expressly approved in writing by such Holder expressly for use in a Registration Statement, such Prospectus or in any amendment or supplement thereto (it being understood that the Holder has approved Annex A hereto for this purpose) or (ii) in the case of an occurrence of an event of the type specified in Section 3(c)(iii)-(vi), the use by such Holder of an outdated, defective or otherwise unavailable Prospectus after the Company has notified such Holder in writing that the Prospectus is outdated, defective or otherwise unavailable for use by such Holder and prior to the receipt by such Holder of the Advice contemplated in Section 6(d), but only if and to the extent that

  

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following the receipt of the Advice the misstatement or omission giving rise to such Loss would have been corrected.  The Company shall notify the Holders promptly of the institution, threat or assertion of any Proceeding arising from or in connection with the transactions contemplated by this Agreement of which the Company is aware. Such indemnity shall remain in full force and effect regardless of any investigation made by or on behalf of such indemnified person and shall survive the transfer of any Registrable Securities by any of the Holders in accordance with Section 6(h).

(b) Indemnification by Holders. Each Holder shall, severally and not jointly, indemnify and hold harmless the Company, its directors, officers, agents and employees, each Person who controls the Company (within the meaning of Section 15 of the Securities Act and Section 20 of the Exchange Act), and the directors, officers, agents or employees of such controlling Persons, to the fullest extent permitted by applicable law, from and against all Losses, as incurred, to the extent arising out of or based solely upon: (x) such Holder’s failure to comply with any applicable prospectus delivery requirements of the Securities Act through no fault of the Company or (y) any untrue or alleged untrue statement of a material fact contained in any Registration Statement, any Prospectus, or in any amendment or supplement thereto or in any preliminary prospectus, or arising out of or relating to any omission or alleged omission of a material fact required to be stated therein or necessary to make the statements therein (in the case of any Prospectus or supplement thereto, in light of the circumstances under which they were made) not misleading (i) to the extent, but only to the extent, that such untrue statement or omission is contained in any information so furnished in writing by such Holder to the Company expressly for inclusion in such Registration Statement or such Prospectus or (ii) to the extent, but only to the extent, that such information relates to such Holder’s proposed method of distribution of Registrable Securities and was reviewed and expressly approved in writing by such Holder expressly for use in a Registration Statement (it being understood that the Holder has approved Annex A hereto for this purpose), such Prospectus or in any amendment or supplement thereto or (iii) in the case of an occurrence of an event of the type specified in Section 3(c)(iii)-(vi), to the extent, but only to the extent, related to the use by such Holder of an outdated, defective or otherwise unavailable Prospectus after the Company has notified such Holder in writing that the Prospectus is outdated, defective or otherwise unavailable for use by such Holder and prior to the receipt by such Holder of the Advice contemplated in Section 6(d), but only if and to the extent that following the receipt of the Advice the misstatement or omission giving rise to such Loss would have been corrected.  In no event shall the liability of any selling Holder under this Section 5(b) be greater in amount than the dollar amount of the net proceeds received by such Holder upon the sale of the Registrable Securities giving rise to such indemnification obligation.

(c) Conduct of Indemnification Proceedings. If any Proceeding shall be brought or asserted against any Person entitled to indemnity hereunder (an “Indemnified Party”), such Indemnified Party shall promptly notify the Person from whom indemnity is sought (the “Indemnifying Party”) in writing, and the Indemnifying Party shall have the right to assume the defense thereof, including the employment of counsel reasonably satisfactory to the Indemnified Party and the payment of all fees and expenses incurred in connection with defense thereof; provided, that, the failure of any Indemnified Party to give such notice shall not relieve the Indemnifying Party of its obligations or liabilities pursuant to this Agreement, except (and only) to the extent that it shall be finally determined by a court of competent jurisdiction (which determination is not subject to appeal or further review) that such failure shall have materially and adversely prejudiced the Indemnifying Party.

               An Indemnified Party shall have the right to employ separate counsel in any such Proceeding and to participate in the defense thereof, but the fees and expenses of such counsel shall be at the expense of such Indemnified Party or Parties unless:  (1) the Indemnifying Party has agreed in writing to pay such fees and expenses, (2) the Indemnifying Party shall have failed promptly to assume the defense of such Proceeding and to employ counsel reasonably satisfactory to such Indemnified Party in any such Proceeding, or (3) the named parties to any such Proceeding (including any impleaded parties) include both such Indemnified Party and the Indemnifying Party, and counsel to the Indemnified Party shall reasonably believe that a material conflict of interest is likely to exist if the same counsel were to represent such Indemnified Party and the Indemnifying Party (in which case, if such Indemnified Party notifies the Indemnifying Party in writing that it elects to employ

  

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 separate counsel at the expense of the Indemnifying Party, the Indemnifying Party shall not have the right to assume the defense thereof and the reasonable fees and expenses of no more than one separate counsel shall be at the expense of the Indemnifying Party).  The Indemnifying Party shall not be liable for any settlement of any such Proceeding effected without its written consent, which consent shall not be unreasonably withheld or delayed.  No Indemnifying Party shall, without the prior written consent of the Indemnified Party, effect any settlement of any pending Proceeding in respect of which any Indemnified Party is a party, unless such settlement includes an unconditional release of such Indemnified Party from all liability on claims that are the subject matter of such Proceeding.

(d) Contribution. If the indemnification under Section 5(a) or 5(b) is unavailable to an Indemnified Party or insufficient to hold an Indemnified Party harmless for any Losses, then each Indemnifying Party shall contribute to the amount paid or payable by such Indemnified Party, in such proportion as is appropriate to reflect the relative fault of the Indemnifying Party and Indemnified Party in connection with the actions, statements or omissions that resulted in such Losses as well as any other relevant equitable considerations. The relative fault of such Indemnifying Party and Indemnified Party shall be determined by reference to, among other things, whether any action in question, including any untrue or alleged untrue statement of a material fact or omission or alleged omission of a material fact, has been taken or made by, or relates to information supplied by, such Indemnifying Party or Indemnified Party, and the parties’ relative intent, knowledge, access to information and opportunity to correct or prevent such action, statement or omission.  The amount paid or payable by a party as a result of any Losses shall be deemed to include, subject to the limitations set forth in this Agreement, any reasonable attorneys’ or other fees or expenses incurred by such party in connection with any Proceeding to the extent such party would have been indemnified for such fees or expenses if the indemnification provided for in this Section was available to such party in accordance with its terms.

               The parties hereto agree that it would not be just and equitable if contribution pursuant to this Section 5(d) were determined by pro rata allocation or by any other method of allocation that does not take into account the equitable considerations referred to in the immediately preceding paragraph.  Notwithstanding the provisions of this Section 5(d), no Holder shall be required to contribute pursuant to this Section 5(d), in the aggregate, any amount in excess of the amount by which the net proceeds actually received by such Holder from the sale of the Registrable Securities subject to the Proceeding exceeds the amount of any damages that such Holder has otherwise been required to pay by reason of such untrue or alleged untrue statement or omission or alleged omission.

The indemnity and contribution agreements contained in this Section are in addition to any liability that the Indemnifying Parties may have to the Indemnified Parties.

        6.                      Miscellaneous.

(a) Remedies.  In the event of a breach by the Company or by a Holder of any of their respective obligations under this Agreement, each Holder or the Company, as the case may be, in addition to being entitled to exercise all rights granted by law and under this Agreement, including recovery of damages, shall be entitled to specific performance of its rights under this Agreement.  Each of the Company and each Holder agrees that monetary damages would not provide adequate compensation for any losses incurred by reason of a breach by it of any of the provisions of this Agreement and hereby further agrees that, in the event of any action for specific performance in respect of such breach, it shall not assert or shall waive the defense that a remedy at law would be adequate.

  

-9-

  

(b) No Piggyback on Registrations; Prohibition on Filing Other Registration Statements.  Except as set forth on Schedule 6(b) attached hereto, neither the Company nor any of its security holders (other than the Holders in such capacity pursuant hereto) may include securities of the Company in any Registration Statements other than the Registrable Securities.  The Company shall not file any other registration statements until all Registrable Securities are registered pursuant to a Registration Statement that is declared effective by the Commission, provided that this Section 6(b) (i) shall not prohibit the Company from filing amendments to registration statements filed prior to the date of this Agreement and (ii) shall not prohibit the Company from filing a shelf registration statement on Form S-3 for a primary offering by the Company, provided that the Company makes no offering of securities pursuant to such shelf registration statement prior to the effective date of the Registration Statement required hereunder that includes all of the Registrable Securities.

(c) Compliance. Each Holder covenants and agrees that it will comply with the prospectus delivery requirements of the Securities Act as applicable to it (unless an exemption therefrom is available) in connection with sales of Registrable Securities pursuant to a Registration Statement.

(d) Discontinued Disposition.  By its acquisition of Registrable Securities, each Holder agrees that, upon receipt of a notice from the Company of the occurrence of any event of the kind described in Section 3(c)(iii) through (vi), such Holder will forthwith discontinue disposition of such Registrable Securities under a Registration Statement until it is advised in writing (the “Advice”) by the Company that the use of the applicable Prospectus (as it may have been supplemented or amended) may be resumed.  The Company will use its commercially reasonable efforts to ensure that the use of the Prospectus may be resumed as promptly as is practicable.

(e) Piggy-Back Registrations. If, at any time during the Effectiveness Period, there is not an effective Registration Statement covering all of the Registrable Securities and the Company shall determine to prepare and file with the Commission a registration statement relating to an offering for its own account or the account of others under the Securities Act of any of its equity securities, other than on Form S-4 or Form S-8 (each as promulgated under the Securities Act) or their then equivalents relating to equity securities to be issued solely in connection with any acquisition of any entity or business or equity securities issuable in connection with the Company’s stock option or other employee benefit plans, then the Company shall deliver to each Holder a written notice of such determination and, if within fifteen days after the date of the delivery of such notice, any such Holder shall so request in writing, the Company shall include in such registration statement all or any part of such Registrable Securities such Holder requests to be registered; provided, however, that the Company shall not be required to register any Registrable Securities pursuant to this Section 6(e) that are eligible for resale pursuant to Rule 144 (without volume restrictions or current public information requirements) promulgated by the Commission pursuant to the Securities Act or that are the subject of a then effective Registration Statement.

(f) Amendments and Waivers. The provisions of this Agreement, including the provisions of this sentence, may not be amended, modified or supplemented, and waivers or consents to departures from the provisions hereof may not be given, unless the same shall be in writing and signed by the Company and the Holders of at least a majority of the then outstanding Registrable Securities (for purposes of clarification, this includes any Registrable Securities issuable upon exercise or conversion of any Security).  If a Registration Statement does not register all of the Registrable Securities pursuant to a waiver or amendment done in compliance with the previous sentence, then the number of Registrable Securities to be registered for each Holder shall be reduced pro rata among all Holders and each Holder shall have the right to designate which of its Registrable Securities shall be omitted from such Registration Statement. Notwithstanding the foregoing, a waiver or consent to depart from the provisions hereof with respect to a matter that relates exclusively to the rights of a Holder or some Holders and that does not directly or indirectly affect the rights of other Holders may be given only by such Holder or Holders of all of the Registrable Securities to which such waiver or consent relates. No consideration shall be offered or paid to any Person to amend or consent to a waiver or modification of any provision of this Agreement unless the same consideration also is offered to all of the parties to this Agreement.

  

-10-

  

(g) Notices. Any and all notices or other communications or deliveries required or permitted to be provided hereunder shall be delivered as set forth in the Purchase Agreement or with respect to Albert Einstein College of Medicine, MIT, Cornell and IFO, as set forth in the respective Selling Stockholder Questionnaire of each such party.

(h) Successors and Assigns. This Agreement shall inure to the benefit of and be binding upon the successors and permitted assigns of each of the parties and shall inure to the benefit of each Holder. The Company may not assign (except by merger) its rights or obligations hereunder without the prior written consent of all of the Holders of the then outstanding Registrable Securities.  Each Holder may assign their respective rights hereunder to any Person to whom such Purchaser assigns or transfers any Registrable Securities, provided that such transferee agrees in writing to be bound, with respect to the transferred Registrable Securities, by the provisions of this Agreement and any other Transaction Document that applies to the Purchasers.

(i) No Inconsistent Agreements. Neither the Company nor any of its Subsidiaries has entered, as of the date hereof, nor shall the Company or any of its Subsidiaries, on or after the date of this Agreement, enter into any agreement with respect to its securities, that would have the effect of impairing the rights granted to the Holders in this Agreement or otherwise conflicts in any material respect with the provisions hereof.  Except as set forth on Schedule 6(i), neither the Company nor any of its Subsidiaries has previously entered into any agreement granting any registration rights with respect to any of its securities to any Person that have not been satisfied in full.

(j) Execution and Counterparts. This Agreement may be executed in two or more counterparts, all of which when taken together shall be considered one and the same agreement and shall become effective when counterparts have been signed by each party and delivered to the other party, it being understood that both parties need not sign the same counterpart.  In the event that any signature is delivered by facsimile transmission or by e-mail delivery of a “.pdf” format data file, such signature shall create a valid and binding obligation of the party executing (or on whose behalf such signature is executed) with the same force and effect as if such facsimile or “.pdf” signature page were an original thereof.

(k) Governing Law.  All questions concerning the construction, validity, enforcement and interpretation of this Agreement shall be determined in accordance with the provisions of this Agreement and the Purchase Agreement.

(l) Cumulative Remedies. The remedies provided herein are cumulative and not exclusive of any other remedies provided by law.

(m) Severability. If any term, provision, covenant or restriction of this Agreement is held by a court of competent jurisdiction to be invalid, illegal, void or unenforceable, the remainder of the terms, provisions, covenants and restrictions set forth herein shall remain in full force and effect and shall in no way be affected, impaired or invalidated, and the parties hereto shall use their commercially reasonable efforts to find and employ an alternative means to achieve the same or substantially the same result as that contemplated by such term, provision, covenant or restriction. It is hereby stipulated and declared to be the intention of the parties that they would have executed the remaining terms, provisions, covenants and restrictions without including any of such that may be hereafter declared invalid, illegal, void or unenforceable.

(n) Headings. The headings in this Agreement are for convenience only, do not constitute a part of the Agreement and shall not be deemed to limit or affect any of the provisions hereof.

  

-11-

  

(o) Independent Nature of Holders’ Obligations and Rights. The obligations of each Holder hereunder are several and not joint with the obligations of any other Holder hereunder, and no Holder shall be responsible in any way for the performance of the obligations of any other Holder hereunder. Nothing contained herein or in any other agreement or document delivered at any closing, and no action taken by any Holder pursuant hereto or thereto, shall be deemed to constitute the Holders as a partnership, an association, a joint venture or any other kind of group or entity, or create a presumption that the Holders are in any way acting in concert or as a group or entity with respect to such obligations or the transactions contemplated by this Agreement or any other matters. Each Holder shall be entitled to protect and enforce its rights, including without limitation the rights arising out of this Agreement, and it shall not be necessary for any other Holder to be joined as an additional party in any proceeding for such purpose. It is expressly understood and agreed that each provision contained in this Agreement is between the Company and a Holder, solely, and not between the Company and the Holders collectively and not between and among Holders.

********************

 

(Signature Pages Follow)

  

-12-

  

               IN WITNESS WHEREOF, the parties have executed this Registration Rights Agreement as of the date first written above.

	 	
PHOTOVOLTAIC SOLAR CELLS, INC. 

(to be renamed MetaStat, Inc.)

 

 

	 	
By:__________________________________________

     Name:

     Title:

 

 

[SIGNATURE PAGE OF HOLDERS FOLLOWS]

  

-13-

  

[SIGNATURE PAGE OF HOLDERS TO  RRA]

Name of Holder: __________________________

Signature of Authorized Signatory of Holder: __________________________

Name of Authorized Signatory: _________________________

Title of Authorized Signatory: __________________________

[SIGNATURE PAGES CONTINUE]

  

-14-

  

Schedule 6(b)

Other Securities to be Included on the Registration Statement

	
Priority IV*

	  
	
Jonanthan Balk Cust. UTMA/UGMA Amara Balk

	
 500

	
Jonanthan Balk Cust. UTMA/UGMA Dharma Balk

	
 500

	
Jonathan Balk

	
 1,500

	
Frank Gertler, Ph.D.

	
 1,820

	
Matthew Levine

	
 2,000

	
Richard Melnick

	
 2,500

	
Dan Schneiderman

	
 2,500

	
David and Margaret Skriloff Irrev. Des. Trust FBO Olivia Skriloff

	
 3,750

	
David and Margaret Skriloff Irrev. Des. Trust FBO Samuel Skriloff

	
 3,750

	
Elliot Groffman

	
 5,000

	
Rob Nathan

	
 5,000

	
Robert Bernstein

	
 5,000

	
Andrew Mitchell

	
 5,000

	
Cass G. Adelman Cust. Philippa G Adelman UTMA NY

	
 25,000

	
Cass G Adelman Cust. Jasper G Adelman UTMA NY

	
 35,000

	
David Wiener

	
 5,000

	
Pat Mooney

	
 5,000

	
Jonathan Balk

	
 5,000

	
David & Marilyn Balk JTWROS

	
 5,000

	
Chaim Davis

	
 5,000

	
Craig Pierson

	
 5,000

	
Richard Melnick

	
 5,000

	
Jason Adelman

	
 10,000

	
Marsha Bronsther

	
 10,000

	
Elizabeth Lau

	
 10,000

	
Travis Lau

	
 10,000

	
Michael Goldberg

	
 10,000

	
Daniel Schneiderman

	
 10,000

	
David Siegel

	
 12,500

	
Jason Adelman

	
 20,000

	
David Balk

	
 20,000

	
Daniel Balk

	
 20,000

	
Richard Hoffman

	
 52,500

	
Sean R. Campbell

	
 52,500

	  	
 371,320

	  	  

  

-15-

  

	
Priority III*

	  
	
Alberto M. Sutton 1999 Investment Trust

	
 13,334

	
Andrew Mitchell

	
 60,000

	
Anil Narang

	
 33,333

	
Barry A. Silkowitz

	
 25,000

	
David N. Siegel Revocable Trust dated April 7, 2010

	
 24,667

	
David Wiener cust Enzo Wiener

	
 10,000

	
David Wiener cust Hans Wiener

	
 10,000

	
David Wiener cust Weston Wiener

	
 10,000

	
David Wiener Rev. Trust

	
 33,333

	
Elliot Groffman

	
 3,333

	
Emily Sara Siegal 1999 Trust

	
 8,000

	
Hyannis Port Capital, Inc. (John B. Wilson)

	
 16,667

	
J. Bradley Engen

	
 5,000

	
James H. Engen

	
 10,000

	
Jason Adelman

	
 16,667

	
Jeff Hermanson (Matt Petcoff)

	
 16,667

	
Johan M. Spoor

	
 6,667

	
Kate Wiener Rev. Trust

	
 33,334

	
Katherine Wiener

	
 16,667

	
Mark Eugene Reaman

	
 6,666

	
Mark Wierenga

	
 3,333

	
Marsha Bronsther

	
 6,667

	
Matthew Levine

	
 3,334

	
MKM Opportunity Master Fund, Ltd.

	
 469,999

	
One East Partners Master LP

	
 166,667

	
One East Partners Opportunities LP

	
 166,667

	
Revach Fund, LP

	
 16,667

	
Richard Hoffman

	
 10,001

	
Robert Bernstein

	
 10,000

	
Robert M. Bernstein IRA

	
 5,000

	
Roger Sherman

	
 7,000

	
Rohan Campbell

	
 13,334

	
Ryan H. Engen

	
 5,000

	
Scott Campbell

	
 15,000

	
Stephen M. Wolf

	
 33,333

	
Steve Golden

	
 33,333

	
Steven Ostrofsky

	
 13,334

	
Stuart E. Katz, M.D., Carmen Scoseria Katz, JTWROS

	
 13,000

	
The Elliot Sutton 1999 Investment Trust

	
 6,667

	
Tim Engen

	
 3,333

	  	
 1,361,004

	  	  
	
Priority II*

	  
	
Alberto M. Sutton 1999 Investment Trust

	
 6,667

	
Andrew Mitchell

	
 30,000

	
Narang Family Partnership LP

	
 16,667

	
Barry A. Silkowitz

	
 12,500

	
David N. Siegel Revocable Trust dated April 7, 2010

	
 12,334

	
David Wiener cust Enzo Wiener

	
 5,000

	
David Wiener cust Hans Wiener

	
 5,000

	
David Wiener cust Weston Wiener

	
 5,000

	
David Wiener Rev. Trust

	
 16,667

	
Elliot Groffman

	
 1,667

	
Emily Sara Siegal 1999 Trust

	
 4,000

	
Hyannis Port Capital, Inc.

	
 8,334

	
J. Bradley Engen

	
 2,500

	
James H. Engen

	
 5,000

	
Jason Adelman

	
 8,334

	
Jeff Hermanson

	
 8,334

	
Johan M. Spoor

	
 3,334

	
Kate Wiener Rev. Trust

	
 16,667

	
Katherine Wiener

	
 8,334

	
Mark Eugene Reaman

	
 3,333

	
Mark Wierenga

	
 1,667

	
Marsha Bronsther

	
 3,334

	
Matthew Levine

	
 1,667

	
MKM Opportunity Master Fund, Ltd.

	
 235,001

	
One East Partners Master LP

	
 83,333

	
One East Partners Opportunities LP

	
 83,333

	
Revach Fund, LP

	
 8,334

	
Richard Hoffman

	
 5,001

	
Robert Bernstein

	
 7,500

	
Roger Sherman

	
 3,500

	
Rowan Campbell

	
 6,667

	
Ryan H. Engen

	
 2,500

	
Scott Campbell

	
 7,500

	
Stephen M. Wolf

	
 16,667

	
Steve Golden

	
 16,667

	
Steven Ostrofsky

	
 6,667

	
Stuart E. Katz, M.D., Carmen Scoseria Katz, JTWROS

	
 6,500

	
The Elliot Sutton 1999 Investment Trust

	
 3,334

	
Tim Engen

	
 1,667

	  	
 680,511

  

-16-

  

	
Priority I*

	  
	
Harvey Judkowitz

	
 29,250

	
Robert Scheme

	
 19,250

	
Richard Friedman

	
 10,000

	
Martin Sumichrast

	
 112,500

	
Ralph Olsen

	
 112,500

	
Castle Bison, Inc.

	
 112,500

	
Waterford Capital Acquisition Co. IX, LLC

	
 719,595

	  	
 1,115,595

* With respect to the securities listed on this Schedule 6(b), the shares contained in Priority IV shall be cut-back first; the shares contained in Priority III shall be cut-back second; the shares contained in Priority II shall be cut-back third; and the shares contained in Priority I shall be cut back last.

  

-17-

  

Annex A

Plan of Distribution

Each Selling Stockholder (the “Selling Stockholders”) of the securities and any of their pledgees, assignees and successors-in-interest may, from time to time, sell any or all of their securities covered hereby on the principal Trading Market or any other stock exchange, market or trading facility on which the securities are traded or in private transactions.  These sales may be at fixed or negotiated prices.  A Selling Stockholder may use any one or more of the following methods when selling securities:

 

	
·  

	
ordinary brokerage transactions and transactions in which the broker-dealer solicits purchasers;

 

	
·  

	
block trades in which the broker-dealer will attempt to sell the securities as agent but may position and resell a portion of the block as principal to facilitate the transaction;

 

	
·  

	
purchases by a broker-dealer as principal and resale by the broker-dealer for its account;

 

	
·  

	
an exchange distribution in accordance with the rules of the applicable exchange;

 

	
·  

	
privately negotiated transactions;

 

	
·  

	
settlement of short sales entered into after the effective date of the registration statement of which this prospectus is a part;

 

	
·  

	
in transactions through broker-dealers that agree with the Selling Stockholders to sell a specified number of such securities at a stipulated price per security;

 

	
·  

	
through the writing or settlement of options or other hedging transactions, whether through an options exchange or otherwise;

 

	
·  

	
a combination of any such methods of sale; or

 

	
·  

	
any other method permitted pursuant to applicable law.

 

The Selling Stockholders may also sell securities under Rule 144 under the Securities Act of 1933, as amended (the “Securities Act”), if available, rather than under this prospectus.

 

Broker-dealers engaged by the Selling Stockholders may arrange for other brokers-dealers to participate in sales.  Broker-dealers may receive commissions or discounts from the Selling Stockholders (or, if any broker-dealer acts as agent for the purchaser of securities, from the purchaser) in amounts to be negotiated, but, except as set forth in a supplement to this Prospectus, in the case of an agency transaction not in excess of a customary brokerage commission in compliance with FINRA Rule 2440; and in the case of a principal transaction a markup or markdown in compliance with FINRA IM-2440.

 

  

-18-

  

In connection with the sale of the securities or interests therein, the Selling Stockholders may enter into hedging transactions with broker-dealers or other financial institutions, which may in turn engage in short sales of the securities in the course of hedging the positions they assume.  The Selling Stockholders may also sell securities short and deliver these securities to close out their short positions, or loan or pledge the securities to broker-dealers that in turn may sell these securities.  The Selling Stockholders may also enter into option or other transactions with broker-dealers or other financial institutions or create one or more derivative securities which require the delivery to such broker-dealer or other financial institution of securities offered by this prospectus, which securities such broker-dealer or other financial institution may resell pursuant to this prospectus (as supplemented or amended to reflect such transaction).

 

The Selling Stockholders and any broker-dealers or agents that are involved in selling the securities may be deemed to be “underwriters” within the meaning of the Securities Act in connection with such sales.  In such event, any commissions received by such broker-dealers or agents and any profit on the resale of the securities purchased by them may be deemed to be underwriting commissions or discounts under the Securities Act.  Each Selling Stockholder has informed the Company that it does not have any written or oral agreement or understanding, directly or indirectly, with any person to distribute the securities. In no event shall any broker-dealer receive fees, commissions and markups which, in the aggregate, would exceed eight percent (8%).

 

The Company is required to pay certain fees and expenses incurred by the Company incident to the registration of the securities.  The Company has agreed to indemnify the Selling Stockholders against certain losses, claims, damages and liabilities, including liabilities under the Securities Act.

 

Because Selling Stockholders may be deemed to be “underwriters” within the meaning of the Securities Act, they will be subject to the prospectus delivery requirements of the Securities Act including Rule 172 thereunder.  In addition, any securities covered by this prospectus which qualify for sale pursuant to Rule 144 under the Securities Act may be sold under Rule 144 rather than under this prospectus. The Selling Stockholders have advised us that there is no underwriter or coordinating broker acting in connection with the proposed sale of the resale securities by the Selling Stockholders.

 

We agreed to keep this prospectus effective until the earlier of (i) the date on which the securities may be resold by the Selling Stockholders without registration and without regard to any volume or manner-of-sale limitations by reason of Rule 144, without the requirement for the Company to be in compliance with the current public information under Rule 144 under the Securities Act or any other rule of similar effect or (ii) all of the securities have been sold pursuant to this prospectus or Rule 144 under the Securities Act or any other rule of similar effect.  The resale securities will be sold only through registered or licensed brokers or dealers if required under applicable state securities laws. In addition, in certain states, the resale securities covered hereby may not be sold unless they have been registered or qualified for sale in the applicable state or an exemption from the registration or qualification requirement is available and is complied with.

 

Under applicable rules and regulations under the Exchange Act, any person engaged in the distribution of the resale securities may not simultaneously engage in market making activities with respect to the common stock for the applicable restricted period, as defined in Regulation M, prior to the commencement of the distribution.  In addition, the Selling Stockholders will be subject to applicable provisions of the Exchange Act and the rules and regulations thereunder, including Regulation M, which may limit the timing of purchases and sales of securities of the common stock by the Selling Stockholders or any other person.  We will make copies of this prospectus available to the Selling Stockholders and have informed them of the need to deliver a copy of this prospectus to each purchaser at or prior to the time of the sale (including by compliance with Rule 172 under the Securities Act).

 

  

-19-

  

Annex B

 

PHOTOVOLTAIC SOLAR CELLS, INC.

 

Selling Stockholder Notice and Questionnaire

 

The undersigned beneficial owner of common stock (the “Registrable Securities”) of PHOTOVOLTAIC SOLAR CELLS, INC. (to be renamed MetaStat, Inc.), a Nevada corporation (the “Company”), understands that the Company has filed or intends to file with the Securities and Exchange Commission (the “Commission”) a registration statement (the “Registration Statement”) for the registration and resale under Rule 415 of the Securities Act of 1933, as amended (the “Securities Act”), of the Registrable Securities, in accordance with the terms of the Registration Rights Agreement (the “Registration Rights Agreement”) to which this document is annexed.  A copy of the Registration Rights Agreement is available from the Company upon request at the address set forth below.  All capitalized terms not otherwise defined herein shall have the meanings ascribed thereto in the Registration Rights Agreement.

 

In order to sell or otherwise dispose of any Registrable Securities pursuant to the Registration Statement, a holder of Registrable Securities generally will be required to be named as a selling stockholder in the related prospectus or a supplement thereto (as so supplemented, the “Prospectus”), deliver the Prospectus to purchasers of Registrable Securities (including pursuant to Rule 172 under the Securities Act) and be bound by the provisions of the Registration Rights Agreement (including certain indemnification provisions, as described below). Holders must complete and deliver this Notice and Questionnaire in order to be named as selling stockholders in the Prospectus. Holders of Registrable Securities who do not complete, execute and return this Notice and Questionnaire within ten (10) Business Days following the date of the Agreement (1) will not be named as selling stockholders in the Resale Registration Statement or the Prospectus and (2) may not use the Prospectus for resales of Registrable Securities.

Certain legal consequences arise from being named as a selling stockholder in the Registration Statement and the related prospectus.  Accordingly, holders and beneficial owners of Registrable Securities are advised to consult their own securities law counsel regarding the consequences of being named or not being named as a selling stockholder in the Registration Statement and the related prospectus.

 

NOTICE

 

The undersigned beneficial owner (the “Selling Stockholder”) of Registrable Securities hereby elects to include the Registrable Securities owned by it in the Registration Statement.

 

  

-20-

  

The undersigned hereby provides the following information to the Company and represents and warrants that such information is accurate:

 

QUESTIONNAIRE

 

	
  

	
1.

	
Name.

 

	
  

	
(a)

	
Full Legal Name of Selling Stockholder

 

	  
	  

 

	
  

	
(b)

	
Full Legal Name of Registered Holder (if not the same as (a) above) through which Registrable Securities are held:

 

	  
	  

 

	
  

	
(c)

	
Full Legal Name of Natural Control Person (which means a natural person who directly or indirectly alone or with others has power to vote or dispose of the securities covered by this Questionnaire):

	
 

 

	  

	  
	  

	
  

	
2.  Address for Notices to Selling Stockholder:

 

	  
	  
	  
	
Telephone:

	
Fax:

	
Contact Person:

	
  

	
3.  Broker-Dealer Status:

 

	
  

	
(a)

	
Are you a broker-dealer?

 

Yes                         No   

 

	
  

	
(b)

	
If “yes” to Section 3(a), did you receive your Registrable Securities as compensation for investment banking services to the Company?

 

Yes                         No   

 

	
Note:

	
If “no” to Section 3(b), the Commission’s staff has indicated that you should be identified as an underwriter in the Registration Statement.

 

	
  

	
(c)

	
Are you an affiliate of a broker-dealer?

 

Yes                         No   

 

  

-21-

  

	
  

	
(d)

	
If you are an affiliate of a broker-dealer, do you certify that you purchased the Registrable Securities in the ordinary course of business, and at the time of the purchase of the Registrable Securities to be resold, you had no agreements or understandings, directly or indirectly, with any person to distribute the Registrable Securities?

 

Yes                         No   

 

	
Note:

	
If “no” to Section 3(d), the Commission’s staff has indicated that you should be identified as an underwriter in the Registration Statement.

 

	
  

	
4.  Beneficial Ownership of Securities of the Company Owned by the Selling Stockholder.

 

Except as set forth below in this Item 4, the undersigned is not the beneficial or registered owner of any securities of the Company other than the securities issuable pursuant to the Purchase Agreement.

 

	
  

	
(a)

	
Type and Amount of other securities beneficially owned by the Selling Stockholder:

	
 

 

	  

	
  

	
(b)

	
Number of shares of Common Stock to be registered pursuant to this Notice for resale:

	
 

 

	  

 

	
  

	
5.  Relationships with the Company:

 

Except as set forth below, neither the undersigned nor any of its affiliates, officers, directors or principal equity holders (owners of 5% of more of the equity securities of the undersigned) has held any position or office or has had any other material relationship with the Company (or its predecessors or affiliates) during the past three years.

 

	
  

	
State any exceptions here:

 

	  
	  
	  

 

The undersigned agrees to promptly notify the Company of any inaccuracies or changes in the information provided herein that may occur subsequent to the date hereof at any time while the Registration Statement remains effective.

  

-22-

  

By signing below, the undersigned consents to the disclosure of the information contained herein in its answers to Items 1 through 5 and the inclusion of such information in the Registration Statement and the related prospectus and any amendments or supplements thereto.  The undersigned understands that such information will be relied upon by the Company in connection with the preparation or amendment of the Registration Statement and the related prospectus and any amendments or supplements thereto.

 

IN WITNESS WHEREOF the undersigned, by authority duly given, has caused this Notice and Questionnaire to be executed and delivered either in person or by its duly authorized agent.

 

Date:                                                      Beneficial Owner:                                                                         

By:                                                                         

Name:

Title:

PLEASE FAX A COPY (OR EMAIL A .PDF COPY) OF THE COMPLETED AND EXECUTED NOTICE AND QUESTIONNAIRE, AND RETURN THE ORIGINAL BY OVERNIGHT MAIL, TO:ex10-3.htm

Exhibit 10.3

LICENSE AGREEMENT

 

This Agreement is entered into as of August 26, 2010 (“Effective Date”), by and among Albert Einstein College of Medicine of Yeshiva University, a Division of Yeshiva University, a corporation organized and existing under the laws of the State of New York, having an office and place of business at 1300 Morris Park Avenue, Bronx, New York 10461 (“Einstein”), Massachusetts Institute of Technology, a Massachusetts corporation organized and existing under the laws of the State of Massachusetts, having an office and place of business at 77 Massachusetts Avenue, Cambridge, MA 02139-4307 (“MIT”), Cornell University, a non-profit institution organized and existing under the laws of the State of New York, having an office and place of business at 395 Pine Tree Road, Ithaca, NY 14850 (“Cornell”), Isituti Fisioterapici Ospitalieri, a company organized and existing under the laws of Italy, having an office and place of business at Via Elio Chianesi, 53-00144 Roma, Italy (“IFO”) (Einstein, MIT, Cornell and IFO shall be referred to individually and collectively as “Licensors”), on the one hand, and Metastat, Inc., a corporation organized and existing under the laws of the State of Delaware, having an office and place of business at 4 Autumnwood Court, The Woodlands, Texas 77380 (“Licensee”), on the other hand.

 

S t a t e m e n t

 

Licensors have developed certain hybridoma cell lines that produce (**) (related to MIT case # (**); “(**)”, by Frank B. Gertler and Matthias Krause) and are the owners of patent applications related to (**) and uses thereof in diagnosis, prognosis and treatment of tumors.  Licensee wishes to acquire an exclusive license to Licensors’ rights in the aforementioned cell line and patent rights, and Licensors wish to grant such rights to Licensee.

 

NOW, THEREFORE, in consideration of the promises and mutual covenants, conditions and limitations herein contained and other good and valuable consideration, the receipt and sufficiency of which is hereby acknowledged, Licensors and Licensee agree as follows:

 

1. Definitions

 

	
1.01  

	
“Agreement Patents” means the patent applications listed on Appendix A, together with any and all patents and patent applications which issue from or are based on such patent applications and from any and all divisionals, continuations, continuations-in-part (but only to the extent the claims thereof are enabled by disclosure of the parent application) and foreign counterparts of such patents and patent applications, and any and all reissues, renewals and extensions or the like of such patents and patent applications and any and all U.S. and foreign patents which are based on such patents and patent applications. Appendix A shall be updated from time-to-time by the parties.

 

	
1.02  

	
“Cell Line” means a hybridoma cell line that produces (**)

 

	
1.03  

	
“Materials” means (**) produced by the Cell Line.

 

	
1.04  

	
“Diagnostic Field” means products and services for diagnostic use.

 

	
1.05  

	
“Therapeutic Field” means products and services for therapeutic use.

 

	
1.06  

	
“Diagnostic Licensed Product” means any product or service in the Diagnostic Field, the development, manufacture, use, provision or sale of which: (a) is covered by a claim in an Agreement Patent; and/or (b) utilizes or includes Materials.

 

  

-1-

  

 

	
1.07  

	
“Therapeutic Licensed Product” means any product or service in the Therapeutic Field, the development, manufacture, use, provision or sale of which: (a) is covered by a claim in an Agreement Patent; and/or (b) utilizes or includes Materials.

 

	
1.08  

	
“Licensed Product” means, individually and collectively, Diagnostic Licensed Product and Therapeutic Licensed Product.

 

	
1.09  

	
“Net Sales” means the total consideration, in any form, received by Licensee, Affiliates and Sublicensees as consideration for the sale, lease, provision or other disposition of Licensed Products by Licensee and/or Affiliates and/or Sublicensees to an independent third party, less:

 

	
(a)  

	
customary and reasonable trade discounts actually taken, refunds, returns and recalls; and

 

	
(b)  

	
when included in gross sales, customary and reasonable freight, shipping, duties, and sales, V.A.T. and/or use taxes based on sales prices, but not including taxes when assessed on incomes derived from such sales.

 

If Licensee and/or Affiliates and/or Sublicensees intend to accept from independent third parties any non-cash consideration as Net Sales, Licensee must first obtain Licensors’ written approval.  For any non-cash consideration approved by Licensors and received as Net Sales, the parties will appoint an independent third party to determine, at Licensee’s expense, the present day value of such consideration and that value shall be added to Net Sales in place of the non-cash consideration.

 

In the event that, during a particular calendar quarter, a Licensed Product is sold in combination with one or more other products, whether or not such other products are packaged or otherwise physically combined with such Licensed Product, for a single price (a “Combination Product”), Net Sales from sales of a Combination Product, for purposes of calculating royalties due under this Agreement, shall be calculated by multiplying the Net Sales of the Combination Product by the fraction A/(A+B), where A is the average per unit sales price for such calendar quarter of the Licensed Product sold separately in the country of sale and B is the average per unit sales price for such calendar quarter of the other product(s) sold separately in the country of sale.  In the event that no separate sales are made of the Licensed Product and/or the other product(s) in the country of sale, separate sale prices in commensurate countries may be used instead.  In the event that no separate sales are made of the Licensed Product and/or the other product(s), Net Sales from sales of a Combination Product, for purposes of determining royalty payments on such Combination Products, shall be calculated using the entire Net Sales of such Combination Products.

 

	
1.10  

	
“Net Proceeds” shall mean the total consideration, in any form (including, but not limited to, license signing fees, maintenance fees, milestone and minimum payments, whether or not such fees and payments are creditable against future royalties to be paid to Licensee, research and development funds, and just that portion of the funds received for equity purchases of Licensee which exceeds the fair market value of the equity; but excluding royalties based on Net Sales of Sublicensees) that is received by Licensee from a Sublicensee in connection with the grant to said Sublicensee of rights under the Agreement Patents. If Licensee intends to accept from a Sublicensee any non-cash consideration as Net Proceeds, Licensee must first obtain Licensors’ written approval.  For any non-cash consideration approved by Licensors and received as Net Proceeds, the parties will appoint an independent third party to determine the present day value of such consideration and that value shall be added to Net Proceeds in place of the non-cash consideration.

 

  

-2-

  

 

	
1.11  

	
“Affiliate” means any entity, that, directly or indirectly, through one or more intermediates, controls, is controlled by, or is under common control with Licensee.  For the purposes of this definition, control shall mean the direct or indirect ownership of at least fifty percent (50%) of (i) the stock shares entitled to vote for the election of directors or (ii) ownership interest.

 

	
1.12  

	
“Sublicensee” shall mean any non-Affiliate third party to whom Licensee has granted the right to make and sell (or otherwise dispose of) Licensed Products.

 

	
1.13  

	
“Confidential Information” means any information designated as such in writing by the disclosing party, whether by letter or by the use of an appropriate proprietary stamp or legend, prior to or at the time any such confidential or proprietary materials or information are disclosed by the disclosing party to the recipient.  Notwithstanding the foregoing, information or materials which are orally or visually disclosed to the recipient by the disclosing party, or are disclosed in a writing or other tangible form without an appropriate letter, proprietary stamp or legend, shall constitute Confidential Information if the disclosing party, within thirty (30) days after such disclosure, delivers to the recipient a written document or documents describing such information or materials and referencing the place and date of such oral, visual, written or other tangible disclosure.

 

	
1.14  

	
“Marketable Securities” means shares of the common stock of Licensee that are listed or quoted for trading on the NASDAQ Global Market, the NASDAQ Global Select Market, the New York Stock Exchange, or the New York Stock Exchange Amex (each, a “Trading Market”) (a) all of which the holders thereof would have the right to sell in a sale registered pursuant to a registration statement under the Securities Act of 1933, as amended (a “Public Sale”) within 60 days following their issuance to the holders regardless of any lock-up agreements or other contractual restrictions on transfer, and (b) all of which can be reasonably expected to be able to be sold in Public Sales within 60 days of their issuance without having a material adverse effect upon the market for such securities.

 

	
1.15  

	
“Volume Weighted Average Price” means, for the applicable date, the price determined by the average of the daily volume weighted average price of the common stock of Licensee for the twenty (20) consecutive trading days ending on the trading day immediately before the applicable date on the applicable Trading Market as reported by Bloomberg L.P., based on a trading day from 9:30 a.m. to 4:02 p.m. (New York City time).

 

2. Licensors’ Agreements With U.S. Government

 

	
2.01  

	
Certain of the Licensors, through their employees, have and will perform research sponsored in part by the United States Government.  As a result of this government sponsorship of the aforementioned research, the United States Government retains certain rights in such research as set forth in 35 U.S.C. §200 et. seq. and applicable regulations.

 

	
2.02  

	
The continuance of such government sponsored research by Licensors and their employees during the term of this Agreement will not constitute a breach of this Agreement.  All rights reserved to the U.S. Government under 35 U.S.C. §200 et. seq. and applicable regulations shall remain so reserved and shall in no way be affected by this Agreement. Licensors and their employees are not obligated under this Agreement to take any action which would conflict in any respect with their past, current or future obligations to the U.S. Government as to work already performed and to be performed in the future.

 

  

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3. Agreement Patents

 

	
3.01  

	
Within ninety (90) day of the Effective Date, Licensee will reimburse Licensors for all expenses incurred prior to the Effective Date in connection with the preparation, filing, prosecution and maintenance of the Agreement Patents.  Amounts paid by Licensee pursuant to this Section 3.01 are non-refundable and not creditable against any other payment due to Licensors.

 

	
3.02  

	
As of and after the Effective Date, Licensee will pay the cost of preparing, filing, prosecuting, maintaining and resisting challenges to the validity of the Agreement Patents (as well as the cost of preparing, filing, prosecuting, maintaining and resisting challenges to the validity of corresponding applications in at least the United States, Europe (an EPO filing designating all member countries), Canada, Japan, and Australia, and in such other jurisdictions as Licensee shall determine), using patent counsel selected by Licensors.  Such payments will be due within thirty (30) days of Licensee’s receipt of an invoice from Licensors relating to said costs.  Licensee will pay the cost of defending and/or prosecuting any interference, reexamination, reissue, opposition, cancellation and nullity proceedings involving Agreement Patents.  Licensors will keep Licensee informed concerning such patents and applications and will consult with Licensee concerning the preparation, filing, prosecution, maintenance and challenges to the validity of such patents and applications.  Licensee shall cooperate with any reasonable request of Licensors in connection with any such preparation, filing, prosecution, maintenance and/or defense.  In the event that Licensee elects not to maintain, defend or prosecute any patent or patent application within the Agreement Patents, Licensee shall give Licensors thirty (30) days prior written notice of such election.  Any patents or patent applications so elected shall at the end of the notice period cease to be considered Agreement Patents, and Licensors shall then be free, at their election, to abandon or maintain the prosecution of such patent application or issued patent or grant rights to such patent application or issued patent to third parties.

 

	
3.03  

	
Amounts paid by Licensee pursuant to Section 3.02 will be non-refundable and not creditable against any other payment due to Licensors.

 

4. License Grant

 

	
4.01  

	
Subject to Article 2, Licensors hereby grant to Licensee and Affiliates: (a) a worldwide, exclusive license to use (but not to sell or transfer) the Cell Line to make Materials for use in connection with Licensed Products; (b) a worldwide, exclusive license to make, use, offer to sell and sell Materials in connection with Licensed Products; and (c) a worldwide, exclusive license to Licensors’ rights in the Agreement Patents, along with the right by Licensee only to grant sublicenses, to make, have made, use, have used, provide, import, have imported, offer to sell, sell and have sold Licensed Products. Licensee will not grant any sublicense (or amend any sublicense) under Agreement Patents unless it first submits a full and complete draft of any such proposed sublicense (or amendment) to Licensors and then receives the prior written consent of Licensors.  Licensee shall provide Licensors with a full and complete copy of any approved sublicense (or amendment) within thirty (30) days of execution thereof by Licensee. The terms of any sublicense agreement shall be consistent with the terms of this Agreement and shall include (at least) the following provisions: prohibiting any use of Licensors’ names (consistent with Section 9.01), requiring indemnification of Licensors (consistent with Section 12.04), requiring appropriate insurance (consistent with Section 12.09), and disclaiming any warranties or representations by Licensors (consistent with Sections 12.05 and 12.06).

 

	
4.02  

	
Notwithstanding the exclusive rights granted to Licensee pursuant to Section 4.01, Licensors shall retain the right to make, use and practice:  (i) Agreement Patents; and (ii) the Cell Line and Materials in their own laboratories solely for non-commercial scientific purposes and for continued non-commercial research.  Further, Licensors shall have the right to make available to not-for-profit scientific institutions and non-commercial researchers materials covered under Agreement Patents and the Materials, solely for non-commercial scientific and research purposes, provided this is done under a material transfer agreement.

 

  

-4-

  

 

	
4.03  

	
Nothing contained in this Agreement shall be construed or interpreted as a grant, by implication or otherwise, of any license except as expressly specified in Section 4.01 hereof.  Licensee will not transfer the Cell Line to any third party or use the Cell Line or the Materials except as permitted by this Agreement. The license granted herein shall apply to the Licensee and Affiliates, except that Affiliates shall not have the right to grant sublicenses.  If any Affiliate exercises rights under this Agreement, such Affiliate shall be bound by all terms and conditions of this Agreement, including but not limited to indemnity and insurance provisions, which shall apply to the exercise of the rights, to the same extent as would apply had this Agreement been directly between Licensors and the Affiliate.  In addition, Licensee shall remain fully liable to Licensors for all acts and obligations of Affiliates such that acts of Affiliates shall be considered the acts of Licensee.

 

	
4.04  

	
Within (**) (**) months of Licensee’s request, Licensors will provide the Cell Line to Licensee using the shipper specified by and at the expense of Licensee.  Licensee shall be responsible for all documentation required by customs officials in the United States of America or the equivalent in any relevant foreign jurisdiction.

 

5. Confidentiality

 

	
5.01  

	
Nothing herein contained shall preclude Licensors from making required reports or disclosures to the NIH or to any other philanthropic or governmental funding organization, provided, however, that no Licensee Confidential Information is disclosed in the process.

 

	
5.02  

	
Licensee will retain in confidence Confidential Information of Licensors and Licensee will not disclose any such Confidential Information to any third party without the prior written consent of Licensors, except that Licensee shall have the right to disclose such information to any third party for commercial or research and development purposes under written terms of confidentiality and non-disclosure which are commercially reasonable.  Licensee will keep confidential all Confidential Information of Licensors for a period of (**) (**) years after termination or expiration of this Agreement, provided, however, that the obligation of confidentiality will not apply to any such information which:

 

	
(a)  

	
was known to Licensee or generally known to the public prior to its disclosure hereunder; or

 

	
(b)  

	
subsequently becomes known to the public by some means other than a breach of this Agreement, including but not limited to publication and/or laying open to inspection of any patent applications or patents; or

 

	
(c)  

	
is subsequently disclosed to Licensee by a third party having a lawful right to make such disclosure; or

 

	
(d)  

	
is required to be disclosed by regulation, law or court order to the most limited extent necessary to comply therewith, provided Licensors are given a fair opportunity to defend against such disclosure; or

 

	
(e)  

	
is independently developed by Licensee as evidenced by Licensee’s written records.

 

  

-5-

  

 

	
5.03  

	
During the term of this Agreement, it is contemplated that Licensors may become aware of Confidential Information of Licensee (“Licensee Confidential Information”).  Licensors agree to retain such Licensee Confidential Information in confidence and not to disclose any such Licensee Confidential Information to a third party without prior written consent of Licensee for a period ending (**) (**) years after termination or expiration of this Agreement, except that such obligations shall not apply to any information which:

 

	
(a)  

	
was known to Licensors or generally known to the public prior to their disclosure hereunder; or

 

	
(b)  

	
subsequently becomes known to the public by some means other than a breach of this Agreement; or

 

	
(c)  

	
is subsequently disclosed to Licensors by a third party having a lawful right to make such disclosure; or

 

	
(d)  

	
is required to be disclosed by regulation, law or court order to the most limited extent necessary to comply therewith, provided Licensee is given a fair opportunity to defend against such disclosure; or

 

	
(e)  

	
is independently developed by Licensors as evidenced by Licensors’ written records.

 

6. Royalties and Payments

 

	
6.01  

	
Licensee shall make the following payments to Licensors:

 

	
(a)  

	
Licensee will pay to Licensors (**) percent (**%) of Net Sales.

 

	
(i)  

	
Royalty Offset/Stacking Royalties. In the event that, with respect to Net Sales of Licensed Products, Licensee is paying royalties to unaffiliated third parties for patent rights such that the practice of the Agreement Patent(s) would infringe such rights, the amount due and payable to Licensor hereunder shall be proportionally reduced by (**) per cent (**%) due such third party, but in no event shall the Royalty payable to Licensors be less than (**) per cent (**%) of net sales. By example, if the royalty due other third parties equals (**) per cent (**%) of Net Sales, the Royalty due Licensor shall be (**) per cent (**%); if the royalty due other third parties equals (**) per cent (**%) of Net Sales, the Royalty due Licensors shall be (**) per cent (**%).

 

	
(b)  

	
Licensee will pay to Licensors twenty percent (**%) of Net Proceeds received by Licensee.

 

	
6.02  

	
Upon execution of this Agreement by the parties, Licensee shall issue to Licensors or their designees an aggregate number of shares (the “Shares”) of the common stock of Licensee equal to (**) percent (**%) of Licensee’s issued and outstanding common stock calculated on a fully diluted, as converted basis.  The Shares shall be issued to Licensors or their designees pursuant to a separate stock subscription agreement among Licensee and Licensors, and Licensee, Licensors and certain other stockholders of Licensee shall enter into a stockholders agreement.

 

  

-6-

  

 

	
6.03  

	
Licensee shall make the following license signing and license maintenance payments to Licensors:

 

	
(a)  

	
Upon execution of this Agreement by the parties, Licensee will pay to Licensors (**) Dollars (US$**) as a license signing fee, which payment is non-refundable and not creditable against any other payment due to Licensors pursuant to this Agreement.

 

	
(b)  

	
On each of the first, second, third and fourth anniversaries of the Effective Date, Licensee will pay to Licensors (**) Dollars (US$**) as a license maintenance fee. This payment is non-refundable but is creditable against actual royalties and payments due to Licensors pursuant to Section 6.01 during the twelve (12) month period following each such anniversary.

 

	
(c)  

	
On the fifth anniversary of the Effective Date, Licensee will pay to Licensors (**) Dollars (US$**) as a license maintenance fee.  This payment is non-refundable but is creditable against actual royalties and payments due to Licensors pursuant to Section 6.01 during the twelve (12) month period following this anniversary.

 

	
(d)  

	
On the sixth anniversary of the Effective Date, Licensee will pay to Licensors (**) Dollars (US$**) as a license maintenance fee.  This payment is non-refundable but is creditable against actual royalties and payments due to Licensors pursuant to Section 6.01 during the twelve (12) month period following this anniversary.

 

	
(e)  

	
On the seventh anniversary of the Effective Date and every anniversary of the Effective Date thereafter, Licensee will pay to Licensors (**) Dollars (US$**) as a license maintenance fee.  Each such payment is non-refundable but is creditable against actual royalties and other payments due to Licensors pursuant to Section 6.01 during the twelve (12) month period following each such anniversary.

 

	
6.04  

	
Licensee shall make the following milestone payments to Licensors for Diagnostic Licensed Products:

 

	
(a)  

	
Upon each request by Licensee or an Affiliate for marketing clearance for each Diagnostic Licensed Product (or each indication for a Diagnostic Licensed Product) in any country, Licensee shall either (i) pay to Licensors (**) Dollars (US$**) in cash or, at Licensee’s option, (ii) issue to Licensors or their designees Marketable Securities having an aggregate value of (**) Dollars (US$**) as of the date of the request for the applicable marketing clearance, determined using a Volume Weighted Average Price.  Notwithstanding the foregoing, if no such request for marketing clearance has occurred by (**) (**) years from the Effective Date, then Licensee shall pay to Licensors (**) Dollars (US$**); and

 

	
(b)  

	
Upon the first commercial sale of each Diagnostic Licensed Product (or each indication for a Diagnostic Licensed Product) by Licensee or an Affiliate, Licensee shall either (i) pay to Licensors (**) Dollars (US$**) in cash or, at Licensee’s option, (ii) issue to Licensors or their designees Marketable Securities having an aggregate value of (**) Dollars (US$**) as of the date of such sale, determined using a Volume Weighted Average Price.  Notwithstanding the foregoing, if no such commercial sale has occurred by (**) (**) years from the Effective Date, then Licensee shall pay to Licensors (**) Dollars (US$**).

 

	
(c)  

	
The payments or issuances of Marketable Securities pursuant to Sections 6.04(a) and (b) are non-refundable and not creditable against any other payment due to Licensors.

 

  

-7-

  

 

	
6.05  

	
Licensee shall make the following milestone payments to Licensors for Therapeutic Licensed Products:

 

	
(a)  

	
Upon the initiation by Licensee or an Affiliate of the first Phase (**) clinical trial (or its foreign equivalent) for each Therapeutic Licensed Product (or each indication for a Therapeutic Licensed Product) anywhere in the world, Licensee shall either (i) pay to Licensors (**) Dollars (US$**) in cash or, at Licensee’s option, (ii) issue to Licensors or their designees Marketable Securities having an aggregate value of (**) Dollars (US$**) as of the date of the initiation of such clinical trial, determined using a Volume Weighted Average Price.  Notwithstanding the foregoing, if no such Phase (**) clinical trial has occurred by (**) (**) years from the Effective Date, then Licensee shall pay to Licensors (**) Dollars (US$**);

 

	
(b)  

	
Upon the initiation by Licensee or an Affiliate of the first Phase (**) clinical trial (or its foreign equivalent) for each Therapeutic Licensed Product (or each indication for a Therapeutic Licensed Product) anywhere in the world, Licensee shall either (i) pay to Licensors (**) Dollars (US$**) in cash or, at Licensee’s option, (ii) issue to Licensors or their designees Marketable Securities having an aggregate value of (**) Dollars (US$**) as of the date of the initiation of such clinical trial, determined using a Volume Weighted Average Price.  Notwithstanding the foregoing, if no such Phase (**) clinical trial has occurred by (**) (**) years from the Effective Date, then Licensee shall pay to Licensors (**) Dollars (US$**);

 

	
(c)  

	
Upon the submission of a new drug application to the FDA (or its foreign equivalent) for each Therapeutic Licensed Product (or each indication for a Therapeutic Licensed Product), Licensee shall either (i) pay to Licensors (**) Dollars (US$**) in cash or, at Licensee’s option, (ii) issue to Licensors or their designees Marketable Securities having an aggregate value of (**) Dollars (US$**) as of the date of such submission, determined using a Volume Weighted Average Price.  Notwithstanding the foregoing, if no such new drug application has been submitted to the FDA by (**) (**) years from the Effective Date, then Licensee shall pay to Licensors (**) Dollars (US$**);

 

	
(d)  

	
Upon first commercial sale of each Therapeutic Licensed Product (or each indication for a Therapeutic Licensed Product) by Licensee or an Affiliate, Licensee shall either (i) pay to Licensors (**) Dollars (US$**) in cash or, at Licensee’s option, (ii) issue to Licensors or their designees Marketable Securities having an aggregate value of (**) Dollars (US$**) as of the date of such sale, determined using a Volume Weighted Average Price; and

 

	
(e)  

	
The payments or issuances of Marketable Securities due pursuant to Sections 6.05(a) - (d) are non-refundable and not creditable against any other payment due to Licensors.

 

	
6.06  

	
Only one royalty will be payable on Net Sales by Licensee and Affiliates and Sublicensees on a Licensed Product under Section 6.01(a), regardless of the number of patent claims in Agreement Patents which cover such Licensed Product.

 

	
6.07  

	
Licensee’s failure to pay full royalties, transfer stock or make complete payments under Sections 6.01, 6.02, 6.03, 6.04 or 6.05 shall be a breach of this Agreement.

 

7. Payment Reports and Records

 

	
7.01  

	
All cash payments required to be made by Licensee to Licensors pursuant to this Agreement shall be made to Licensors in U.S. Dollars by wire transfer or by check payable to Einstein and sent to Einstein’s address set out in Section 13.01. All Shares and Marketable Securities shall be issued to Licensors or their designees at Licensors’ respective addresses set out in Section 13.01 or at such address(es) provided to Licensee by Licensors as follows: (a) one-third (1/3) to Einstein; (b) one-third (1/3) to MIT; (c) two-ninths (2/9) to IFO; and (d) one-ninth (1/9) to Cornell.

 

  

-8-

  

 

	
7.02  

	
All payments required to be made by Licensee to Licensors (or their designees) pursuant to this Agreement shall be subject to a charge of one and one-half percent (1.5%) per month or Two Hundred and Fifty Dollars (US$250), whichever is greater, if late.  Conversion of foreign currency to U.S. dollars shall be made at the conversion rate quoted by the Wall Street Journal, averaged on the last business day of each of the three (3) consecutive calendar months constituting the calendar quarter in which the payment was earned.  Licensee will bear any loss of exchange or value and pay any expenses incurred in the transfer or conversion to U.S. dollars.

 

	
7.03  

	
Payment due from Licensee to Licensors pursuant to Section 6.01 will be paid within thirty (30) days after the end of each calendar year quarter during which the payment accrued.  If no royalties or other payments are due for any quarter, Licensee will send a statement signed by an officer of Licensee to that effect to Licensors.  Payment shall be accompanied by a statement of the number of Licensed Products and Combination Products sold by Licensee, Affiliates and Sublicensees in each country, total billings for such Licensed Products and Combination Products, the values of A and B used to calculate the Net Sales of Combination Products, deductions applicable to determine the Net Sales thereof, the amount of Net Sales and Net Proceeds realized by Licensee and Affiliates and Sublicensees, the amount of any deduction and a detailed listing thereof, and the total payment due from Licensee to Licensors (the “Royalty Report”).  Such Royalty Report shall be signed by an officer of Licensee. Licensee shall send copies of the Royalty Report to MIT, Cornell and IFO at the same time the Report is sent to Einstein.

 

	
7.04  

	
Licensee and Affiliates shall maintain complete and accurate books of account and records showing Net Sales and Net Proceeds.  Such books and records of Licensee and Affiliates shall be open to inspection, in confidence, during usual business hours, upon at least ten (10) business days prior notice to Licensee, by an independent certified public accountant appointed by Licensors on behalf of Licensors, who has entered into a written agreement of confidentiality with Licensors which is no less protective of Licensee’s Confidential Information than the provisions of Section 5.03 hereof and to whom Licensee has no reasonable objection, for five (5) years after the calendar year to which they pertain, for the purpose of verifying the accuracy of the payments made to Licensors by Licensee pursuant to this Agreement.  Licensee will require any Sublicensees hereunder to maintain such books and allow such inspection by Licensee and shall, on request, disclose such information, if available to Licensee, to Licensors as part of such inspection.  Inspection shall be at Licensors’ sole expense and reasonably limited to those matters related to Licensee’s payment obligations under this Agreement and shall take place not more than once per calendar year.  Any underpayment revealed by any inspection, plus interest on the underpayment amount at the rate of one and one-half percent (1.5%) per month or Two Hundred and Fifty Dollars (US$250), whichever is greater, shall be promptly paid by Licensee to Licensors.  Further, if any inspection reveals an underpayment to Licensors of ten percent (10%) or greater, then the cost of the inspection shall be paid by Licensee.

 

8. Infringement

 

	
8.01  

	
Licensee shall have the right, in its sole discretion and its expense, to initiate legal proceedings on its behalf or in Licensors’ names, if necessary, against any infringer, or potential infringer, of an Agreement Patent who imports, makes, uses, sells or offers to sell products.  Licensee shall notify Licensors of its intention to initiate such proceedings at least twenty (20) days prior to commencement thereof.  Any settlement or recovery received from any such proceeding shall be divided (**) percent (**%) to Licensee and (**) percent (**%) to Licensors after Licensee deducts from any such settlement or recovery its actual counsel fees and out-of-pocket expenses relative to any such legal proceeding.  If Licensee decides not to initiate legal proceedings against any such infringer, then Licensors shall have the right to initiate such legal proceedings.  Any settlement or recovery received from any such proceeding initiated by Licensors shall be divided (**) percent (**%) to Licensee and (**) percent (**%) to Licensors after Licensors deduct from any such settlement or recovery their actual counsel fees and out-of-pocket expenses relative to any such legal proceeding.

 

  

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8.02  

	
In the event that any party initiates or carries on legal proceedings to enforce any Agreement Patent against an alleged infringer, the other parties shall fully cooperate with and supply all assistance reasonably requested at the expense of the party requesting such assistance.  Further, the other parties, at their expense, shall have the right to be represented by counsel of their choice in any such proceeding.  However, if Licensee initiates legal proceedings in Licensors’ name, Licensee shall reimburse Licensors for any reasonable out-of-pocket counsel fees of Licensors associated with the legal proceedings.  The party who initiates or carries on the legal proceedings shall have the sole right to conduct such proceedings provided, however, that such party shall consult with the other parties to this Agreement prior to entering into any settlement thereof.

 

9. Prohibition on Use of Names; No Publicity

 

	
9.01  

	
No party to this Agreement shall use the name of any other party without the prior written consent of such other party, except if the use of such name is required by law, regulation, federal securities law, or judicial order, in which event the party intending to use such name will promptly inform the relevant other party prior to any such required use.  No party to this Agreement will make any public announcement regarding the existence of this Agreement and/or the collaboration hereunder without obtaining the prior written consent of the other parties, except if such announcement is required by law, regulation, federal securities law or judicial order, in which event the party intending to make such announcement will promptly inform the other parties prior to such announcement.

 

10. Term and Termination

 

	
10.01  

	
Unless terminated earlier under other provisions hereof, this Agreement will expire upon the expiration of the last Agreement Patent.  Upon termination or expiration of this Agreement for any reason, Sections 5, 9, 10.08, 10.09, 12.01 through 12.10, 12.13 and 13 shall survive and all payment obligations under Articles 3 and 6 hereof accrued as of the termination date shall be paid by Licensee within thirty (30) days of such termination or expiration.

 

	
10.02  

	
Licensee may terminate this Agreement and the licenses granted hereunder by giving notice to Licensors sixty (60) days prior to such termination.  Upon such termination, Licensee shall not use Agreement Patents, the Cell Line or the Materials for any purpose and all of Licensee’s rights in Agreement Patents, the Cell Line and the Materials shall be terminated.  Further, the Cell Line and all Materials in Licensee’s possession shall be immediately destroyed (with written confirmation to Licensors) or returned to Licensors at the expense of Licensee.

 

	
10.03  

	
If Licensors or Licensee defaults on or breaches any condition of this Agreement, the aggrieved party may serve notice upon the other parties of the alleged default or breach.  If such default or breach is not remedied within sixty (60) days from the date of such notice, the aggrieved party may at its election terminate this Agreement.  Any failure to terminate hereunder shall not be construed as a waiver by the aggrieved party of its right to terminate for future defaults or breaches.  Licensee’s damages for any breach of this Agreement by Licensors will be limited to a reduction or suspension of the payment obligations of Licensee hereunder.  Upon termination of this Agreement by Licensors pursuant to this Section 10.03, the licenses granted by Licensors to Licensee shall terminate and Licensee shall not use Agreement Patents, the Cell Line or the Materials for any purpose and all of Licensee’s rights in Agreement Patents, the Cell Line and the Materials shall be terminated.  Further, the Cell Line and all Materials in Licensee’s possession shall be immediately destroyed (with written confirmation to Licensors) or returned to Licensors at the expense of Licensee.

 

  

-10-

  

 

	
10.04  

	
If Licensee makes an assignment for the benefit of creditors or if proceedings for a voluntary bankruptcy are instituted on behalf of Licensee or if Licensee is declared bankrupt or insolvent, Licensors may, at their election, terminate this Agreement by notice to Licensee.  Upon termination of this Agreement by Licensors pursuant to this Section 10.04, the licenses granted by Licensors to Licensee shall terminate and Licensee shall not use Agreement Patents, the Cell Line or the Materials for any purpose and all of Licensee’s rights in Agreement Patents, the Cell Line and the Materials shall be terminated.  Further, the Cell Line and all Materials in Licensee’s possession shall be immediately destroyed (with written confirmation to Licensors) or returned to Licensors at the expense of Licensee.

 

	
10.05  

	
If Licensee is convicted of a felony relating to the manufacture, use or sale of Licensed Products or a felony relating to moral turpitude, Licensors may, at their election, terminate this Agreement by notice to Licensee.  Upon termination of this Agreement by Licensors pursuant to this Section 10.05, the licenses granted by Licensors to Licensee shall terminate and Licensee shall not use Agreement Patents, the Cell Line or the Materials for any purpose and all of Licensee’s rights in Agreement Patents, the Cell Line and the Materials shall be terminated.  Further, the Cell Line and all Materials in Licensee’s possession shall be immediately destroyed (with written confirmation to Licensors) or returned to Licensors at the expense of Licensee.

 

	
10.06  

	
Notwithstanding the provisions of Section 10.03 hereof, should Licensee fail to pay Licensors any cash, or issue to Licensors or their designees any Marketable Securities, as applicable, when due and payable under this Agreement, then upon thirty (30) days written notice Licensors may, at their election, terminate this Agreement, unless within the thirty (30) day period all delinquent amounts together with interest due and unpaid have been paid in cash, or issued in Marketable Securities (as applicable), by Licensee.  Upon termination of this Agreement by Licensors pursuant to this Section 10.06, the licenses granted by Licensors to Licensee shall terminate and Licensee shall not use Agreement Patents, the Cell Line or the Materials for any purpose and all of Licensee’s rights in Agreement Patents, the Cell Line and the Materials shall be terminated.  Further, the Cell Line and all Materials in Licensee’s possession shall be immediately destroyed (with written confirmation to Licensors) or returned to Licensors at the expense of Licensee.

 

	
10.07  

	
Termination of this Agreement by Licensee or Licensors shall not prejudice the rights of the parties accruing herein.

 

	
10.08  

	
If Licensee terminates this Agreement pursuant to Section 10.02 or if Licensors terminate this Agreement pursuant to Sections 10.03, 10.04, 10.05 or 10.06, then Licensee shall, upon such termination, assign to Licensors all right, title and interest in and to any Dependent Patents and Dependent Know-How (as defined below) developed by or for Licensee or Affiliates during the term of this Agreement, and shall, within thirty (30) days of termination, provide copies of all documents and other materials embodying Dependent Know-How to Licensors.  As used in this Section 10.08, the term “Dependent Patents” means any U.S. or foreign patent application or patent which claims an invention the practice of which would infringe a claim of a patent or patent application of the Agreement Patents or the practice of which results in a product covered by a claim of a patent or patent application of Agreement Patents.  “Dependent Know-How” means confidential information, including clinical trial information, the practical application of which would infringe a claim of a patent or patent application of Agreement Patents, or which results in a product covered by a claim of a patent or patent application of Agreement Patents. Licensee agrees to take all actions and execute any and all documents reasonably requested by Licensors to effectuate the terms of this Section 10.08.  During the time period between notice of termination and the effective date of termination Licensee will take whatever actions are necessary to prevent any Dependent Patent from becoming abandoned or canceled.

 

	
10.09  

	
If Licensee terminates this Agreement pursuant to Section 10.02 or if Licensors terminate this Agreement pursuant to Sections 10.03, 10.04, 10.05 or 10.06, Licensee shall submit a final Royalty Report to Licensors and any payments and patent costs due to Licensors hereunder as of the date of termination shall be payable within thirty (30) days of the date of termination. In addition, within ten (10) days of notice of such termination, Licensee shall provide Licensors with a report showing the status of all Dependent Patents, including, without limitation, a list of all countries where Dependent Patents have been filed and a list of all actions which must be taken with respect to the Dependent Patents and relevant due dates.

 

	
10.10  

	
Notwithstanding any provision herein to the contrary, no termination of this Agreement shall be construed as a termination of any valid sublicense of any Sublicensee hereunder, and thereafter each such Sublicensee shall be considered a direct licensee of Licensors, provided that (i) such Sublicensee is not in material breach of its sublicense agreement with Licensee, and (ii) such Sublicensee agrees in writing to assume all applicable obligations of Licensee under this Agreement.

 

11. Amendment and Assignment

 

	
11.01  

	
This Agreement sets forth the entire understanding between Licensors, on the one hand, and Licensee on the other hand, pertaining to the subject matter hereof and, with respect to Licensee only, supersedes and replaces the Confidential Disclosure and Non-Use Agreement between Licensor and Warren C. Lau having an effective date of April 2, 2009.

 

	
11.02  

	
Except as otherwise provided herein, this Agreement may not be amended, supplemented or otherwise modified, except by an instrument in writing signed by both parties.

 

	
11.03  

	
Without the prior written approval of the other parties, which approval shall not be unreasonably withheld, no party may assign this Agreement except that this Agreement may be assigned to an entity acquiring substantially all of such party’s business to which this Agreement relates, or in the event of a merger, consolidation, change in control or similar transaction of such party.  Any attempted assignment in contravention of this Section 11.03 shall be null and void.

 

12. Miscellaneous Provisions

 

	
12.01  

	
This Agreement shall be construed and the rights of the parties governed in accordance with the laws of the State of New York, excluding its law of conflict of laws.  Any dispute or issue arising hereunder, including any alleged breach by any party, shall be heard, determined and resolved by an action commenced in the state or federal courts in New York, New York, which the parties hereby agree shall have proper jurisdiction and venue over the issues and the parties.  Licensors and Licensee hereby agree to submit to the jurisdiction of the state or federal courts in New York and waive the right to make any objection based on jurisdiction or venue.  The New York courts shall have the right to grant all relief to which Licensors and Licensee are or shall be entitled hereunder, including all equitable relief as the Court may deem appropriate.

 

	
12.02  

	
This Agreement has been prepared jointly.

 

	
12.03  

	
If any term or provision of this Agreement or the application thereof to any person or circumstance shall to any extent be invalid or unenforceable, the remainder of this Agreement or the application of such term or provision to persons or circumstances other than those as to which it is held invalid or unenforceable shall not be affected thereby and each term and provision of this Agreement shall be valid and enforced to the fullest extent permitted by law.

 

  

-11-

  

 

	
12.04  

	
Licensee agrees to indemnify Licensors and their current or former directors, governing board members, trustees, officers, faculty, medical and professional staff, employees, students and agents and their respective successors, heirs and assigns (Licensors and each such person being the “Indemnified Parties”) for the cost of defense and for damages awarded and losses and liabilities incurred, if any, as a result of any third party claims, liabilities, suits or judgments based on or arising out of the research, development, marketing, manufacture, sale and/or provision of the Cell Line and/or the Materials and/or Licensed Products by Licensee, Affiliates and Sublicensees, and/or the licenses granted under this Agreement, or otherwise related to the conduct of Licensee’s, Affiliates’ or Sublicensees’ business, so long as such claims, liabilities, suits, or judgments are not solely attributable to grossly negligent or intentionally wrongful acts or omissions by the Indemnified Parties.  This indemnity is conditioned upon Licensors’ obligation to: (i) advise Licensee of any claim or lawsuit, in writing promptly after Licensors have or the Indemnified Party has received notice of said claim or lawsuit, (ii) assist Licensee and its representatives, at Licensee’s expense, in the investigation and defense of any lawsuit and/or claim for which indemnification is provided, and (iii) permit Licensee to control the defense of such claim or lawsuit for which indemnification is provided.

 

	
12.05  

	
Nothing in this Agreement is or shall be construed as:

 

	
(a)  

	
A warranty or representation by Licensors that anything made or used by Licensee under any license granted in this Agreement (including, without limitation, the Cell Line, the Materials and Licensed Products) is or will be free from infringement of patents, copyrights, and other rights of third parties; or

 

	
(b)  

	
Granting by implication, estoppel, or otherwise any license, right or interest other than as expressly set forth herein.

 

	
12.06  

	
Except as expressly set forth in this Agreement, the parties MAKE NO REPRESENTATIONS AND EXTEND NO WARRANTIES OF ANY KIND, EITHER EXPRESS OR IMPLIED, EITHER IN FACT OR BY OPERATION OF LAW, STATUTE OR OTHERWISE, AND THE PARTIES SPECIFICALLY DISCLAIM ANY IMPLIED WARRANTY OF MERCHANTABILITY OR FITNESS FOR A PARTICULAR PURPOSE, OR WARRANTY OF NON-INFRINGEMENT.  IN ADDITION, NO PARTY SHALL BE LIABLE FOR ANY SPECIAL, INDIRECT, INCIDENTAL OR CONSEQUENTIAL DAMAGES, HOWEVER CAUSED, UNDER ANY THEORY OF LIABILITY AND WHETHER OR NOT SUCH PARTY HAS BEEN ADVISED OF THE POSSIBILITY OF SUCH DAMAGES.

 

	
  

	
IN PARTICULAR, IN NO EVENT SHALL LICENSORS, THEIR RESPECTIVE TRUSTEES, DIRECTORS, OFFICERS, EMPLOYEES OR AFFILIATES BE LIABLE FOR INCIDENTAL OR CONSEQUENTIAL DAMAGES OF ANY KIND, INCLUDING ECONOMIC DAMAGES OR INJURY TO PROPERTY AND LOST PROFITS, REGARDLESS OF WHETHER LICENSORS SHALL BE ADVISED, SHALL HAVE OTHER REASON TO KNOW, OR IN FACT SHALL KNOW OF THE POSSIBILITY OF THE FOREGOING.

 

	
12.07  

	
Licensors and Licensee represent and warrant that, to the best of their knowledge, as of the Effective Date:

 

	
(a)  

	
they have the legal right and authority to enter into this Agreement and to perform all of their obligations hereunder;

 

	
(b)  

	
when executed by all parties, this Agreement will constitute a valid and legally binding obligation and shall be enforceable in accordance with its terms; and

 

	
(c)  

	
there are no existing or threatened actions, suits or claims pending or threatened against them that may affect the performance of their obligations under the Agreement.

 

	
12.08  

	
Licensee represents and warrants that it has not relied on any information provided by Licensors or Licensors’ current or former employees and has conducted its own due diligence investigation to its own satisfaction prior to entering into this Agreement.

 

  

-12-

  

 

	
12.09  

	
Licensee represents and warrants that before Licensee, or an Affiliate or a Sublicensee makes any sales of Licensed Products or performs or causes any third party to perform any clinical trials or tests in human subjects involving Licensed Products, Licensee or Affiliates or Sublicensees will acquire and maintain in each country in which Licensee or Affiliates or Sublicensees shall test or sell Licensed Products, appropriate insurance coverage reasonably acceptable to Licensors, but providing coverage in respect of Licensed Products in an amount no less than (**) (US $**) per claim.  Licensee or Affiliates will not perform, or cause any third party to perform, any clinical trials or any tests in human subjects involving Licensed Products unless and until he/they obtain(s) all required regulatory approvals with respect to Licensed Products in the applicable countries.  Prior to instituting any clinical trials or any tests in human subjects, or sale of any Licensed Product, Licensee shall provide evidence of such insurance to Licensors.  If Licensors determine that such insurance is not reasonably appropriate, they shall so advise Licensee and Licensee shall delay such trials, tests or sales until the parties mutually agree that reasonably appropriate coverage is in place.  Licensors shall be listed as additional insureds in Licensee’s insurance policies.  If such insurance is underwritten on a ‘claims made’ basis, Licensee agrees that any change in underwriters during the term of this Agreement will require the purchase of ‘prior acts’ coverage to ensure that coverage will be continuous throughout the term of this Agreement.

 

	
12.10  

	
Licensee shall exercise its rights and perform its obligations hereunder in compliance with all applicable laws and regulations.  In particular, it is understood and acknowledged that the transfer of certain commodities and technical data is subject to United States laws and regulations controlling the export of such commodities and technical data, including all Export Administration Regulations of the United States Department of Commerce. These laws and regulations, among other things, prohibit or require a license for the export of certain types of technical data to certain specified countries.  Licensee hereby agrees and gives written assurance that he will comply with all United States laws and regulations controlling the export of commodities and technical data, that he will be solely responsible for any violation of such by Licensee or Affiliates or Sublicensees, and that he will defend and hold Licensors harmless in the event of any legal action of any nature occasioned by such violation.

 

	
12.11  

	
Licensee agrees (i) to obtain all regulatory approvals required for the manufacture and sale of Licensed Products prior to marketing or selling any such Licensed Products and (ii) to utilize legally appropriate patent marking on such Licensed Products.  Licensee agrees to register or record this Agreement as is required by law or regulation in any country where the license is in effect.

 

	
12.12  

	
Licensee agrees that any Licensed Products for use or sale in the United States will be manufactured substantially in the United States.

 

	
12.13  

	
Any tax required to be withheld under the laws of any jurisdiction on royalties payable to Licensors by Licensee under this Agreement will be promptly paid by Licensee for and on behalf of Licensors to the appropriate governmental authority, and Licensee will furnish Licensors with proof of payment of the tax together with official or other appropriate evidence issued by the competent governmental authority sufficient to enable Licensors to support a claim for tax credit with respect to any sum so withheld.  Any tax required to be withheld on payments by Licensee to Licensors will be an expense of and be borne solely by Licensors, and Licensee’s royalty payment(s) to Licensors following the withholding of the tax will be decreased by the amount of such tax withholding.  Licensee will cooperate with Licensors in the event Licensors elects to assert, at their own expense, exemption from any tax.

 

	
12.14  

	
 Licensee will meet all of the following due diligence requirements:

 

	
(a)  

	
Produce a business plan within (**) of the Effective Date and update the business plan annually;

 

	
(b)  

	
Raise (**) Dollars (US$**) in debt, equity or other financing or revenues by the (**) anniversary of the Effective Date;

 

	
(c)  

	
Raise (**)Dollars (US$**) in debt, equity or other financing or revenues by the (**) anniversary of the Effective Date; and

 

	
(d)  

	
Raise (**) Dollars (US$(**)) in debt, equity or other financing or revenues by the (**) anniversary of the Effective Date.

 

  

-13-

  

 

	
12.15  

	
If any one of the due diligence requirements in Section 12.14 is not met, the license shall terminate pursuant to Section 10.03 and all rights will revert back to Licensors.

 

	
12.16  

	
In the event Licensee (or any entity acting under Licensee’s control or on its behalf) initiates any proceeding or otherwise asserts any claim challenging the validity or enforceability of any of the Agreement Patents in any court, administrative agency or other forum (“Challenge”), the royalty rates set forth in Section 6.01 and the license maintenance fees set forth in Section 6.03 shall be automatically (**) on and after the date of such Challenge for the remaining term of this Agreement. Moreover, to the extent not already covered by Sections 3.01 and 3.02, Licensee agrees to pay all costs and expenses (including actual attorneys’ fees) incurred by Licensors in connection with defending a Challenge.

 

13. Notices

 

	
13.01  

	
Any notice or report required or permitted hereunder shall be given in writing, and shall be deemed to have been properly given and effective upon delivery, by registered or certified mail, return receipt requested, or by facsimile with proof of receipt and a confirmation copy sent by overnight courier, or by overnight courier, to the following addresses:

 

To Einstein:

Albert Einstein College of Medicine

 of Yeshiva University

1300 Morris Park Avenue

Bronx, New York  10461

Attention:  Office of Biotechnology

With copy to:

Kenneth P. George, Esq.

Amster, Rothstein & Ebenstein, LLP

90 Park Avenue - 21st Floor

New York, New York  10016

To MIT:

Massachusetts Institute of Technology

Technology Licensing Office, Room NE25-230

Five Cambridge Center, Kendall Square

Cambridge, MA 02142-1493

Tel:  

Fax:  

 

Attention: Director

To Cornell

Cornell Center for Technology Enterprise and Commercialization

395 Pine Tree Road, Suite 310

Ithaca, NY 14850

Tel:  

Fax:  

E-Mail:  

 

Attention: Executive Director

  

-14-

  

To IFO

Istituti Fisioterapici Ospitalieri

Via Elio Chianesi

53-00144 Roma, Italy

Tel:  

Fax:  

Email:  

 

Attention: Direzione Generale

To Licensee:

Metastat, Inc.

4 Autumnwood Court

The Woodlands, Texas 77380

Attention:  Warren C. Lau, President and CEO

 

 

IN WITNESS WHEREOF, the parties have entered into this Agreement effective as of the day and year first above written.

 

	 	 	ALBERT EINSTEIN COLLEGE OF MEDICINE OF YESHIVA UNIVERSITY, A DIVISION OF YESHIVA UNIVERSITY
	 	 	 
	WITNESS:	 	/s/ J. Michael Gower
	/s/  T. [Colon]	 	Name:  J. Michael Gower
	Date: October 27, 2010	 	Title: Vice President and CFO
	 	 	Date: October 27, 2010
	 	 	 
	 	 	
MASSACHUSETTS INSTITUTE OF TECHNOLOGY

	 	 	 
	WITNESS:	 	/s/ Lita Nelson
	 /s/ Andrea Barry	 	Name: Lita L. Nelson
	Date: September 8, 2010 	 	Title: Director, Technology Licensing Office
	 	 	Date: September 8, 2010
	 	 	 
	 	 	CORNELL UNIVERSITY
	 	 	 
	WITNESS:	 	/s/ Alan Pacou
	 /s/ Danielle [Reelence]	 	Name: Alan Pacou
	Date: September 1, 2010	 	Title:
	 	 	Date:  September 1, 2010
	 	 	 
	 	 	ISTITUTI FISIOTERAPICI OSPITALIERI
	 	 	 
	WITNESS:	 	/s/ Francesco Bevere
	/s/  P. [Cee**]	 	Name: Francesco Bevere
	Date: October 20, 2010	 	Title: Direttore Generale
	 	 	Date: October 20, 2010

 

  

-15-

  

 

	 	 	METASTAT, INC.
	 	 	 
	WITNESS:	 	/s/ Warren C. Lau
	/s/ Matthew Balk	 	Name: Warren C. Lau
	Date: August 26, 2010	 	Title: President and CEO
	 	 	Date:August 26, 2010

 

  

-16-

  

APPENDIX A - Agreement Patents

 

	
1.

	
(**);

 

	
2.

	
(**);

 

	
3.

	
(**);

 

	
4.

	
(**); and

 

	
5.

	
(**).

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