Document:

Exhibit 10.1

 

AGREEMENT
BETWEEN SHANDONG YAOHUA MEDICAL INSTRUMENT

CORPORATION AND GUIDED THERAPEUTICS, INC.

CONFIDENTIAL,
FINAL 22 JANUARY 2017

 

This
agreement is dated 22 January, 2017 and is between Guided Therapeutics, Inc., a Georgia, United States of America corporation
(“GTI”), located at 5835 Peachtree Corners East, Suite D, Norcross, GA 30092, USA and Shandong Yaohua Medical Instrument
Corporation, located at No. 5 Zhuijian Street, High-Tech Development Zone, Laiwu Shandong, People’s Republic of China (“SMI”).

 

WHEREAS
GTI has developed a platform technology for the early detection of disease that leads to cancer;

 

WHEREAS
GTI’s first non-invasive cancer detection product is the LuViva® Advanced Cervical Scan device (the “Device”)
and the related disposable cervical guides (the “Disposables” and, with the Device, “LuViva). LuViva is in use
in Canada, Latin America, Europe, Turkey, Asia and Africa. GTI owns the worldwide manufacturing, distribution and intellectual
property (“IP”) rights to LuViva. LuViva is designed to:

 

		A.	Determine
                                         the true likelihood of treatable cervical disease that may lead to cancer in women aged
                                         16 years and over who have been screened for cervical cancer and have an abnormal result.

 

		B.	Be
                                         used as a screening tool both in the developed and developing world where the Papanicolaou
                                         test and/or the Human Papillomavirus Virus tests are not widely available.

 

WHEREAS
GTI asserts that they have the rights to license the global manufacturing rights, excepting the Disposable Cervical guides for
the Republic of Turkey, for LuViva, and the distribution rights and sales rights for LuViva in the Peoples Republic of China,
Macau, Hong Kong and Taiwan (hereinafter collectively referred to as the “Jurisdictions”);

 

WHEREAS
SMI is a medical device company in China with an established distribution and sales capability and has indicated a capability
and willingness to manufacture for the global market, and distribute and sell LuViva in the Jurisdictions,

 

WHEREAS
under this agreement between the Parties, SMI is granted exclusive rights by GTI for global manufacture as the optimum way to
achieve economies in global manufacturing and exclusive commercialization, both distribution and sales, of LuViva within the Jurisdictions
(“Global Manufacturing License”)

 

 

    	 	1	 

    CONFIDENTIAL
    TREATMENT REQUESTED BY GUIDED THERAPEUTICS, INC. – CONFIDENTIAL PORTIONS OF THIS DOCUMENT, MARKED BY *****, HAVE BEEN
    REDACTED AND HAVE BEEN SEPARATELY FILED WITH THE SECURITIES AND EXCHANGE COMMISSION PURSUANT TO RULE 24B-2 PROMULGATED UNDER
    THE SECURITIES EXCHANGE ACT OF 1934, AS AMENDED. 

    

 

 

IT
IS HEREBY AGREED AS FOLLOWS between SMI and GTI that SMI is granted exclusive manufacturing rights, excepting the Disposable Cervical
Guides for the Republic of Turkey, and exclusive distribution rights and sales rights for LuViva in the Jurisdictions, subject
to the following terms and conditions.

 

		1.	Payments
                                         by SMI and Transfer of Stock to SMI:

 

		A.	Payment
                                         Instructions:

 

1.
GTI shall provide payment instructions to SMI for SMI payments to GTI within 5 business days of signing this Agreement.

2.
SMI shall provide disbursement instructions to GTI for distribution of GTI stock within 15 business days of signing of this Agreement.

3.
Both Parties will undertake to ensure that the payment or disbursement instructions are mutually satisfactory and compliant with
all applicable regulations.

		B.	SMI
                                         shall make payments to GTI based on the following schedule

 

		·	$50,000
                                         due within 15 business days of signing this Agreement

		·	$200,000
                                         due on or before 20 February 2017*

		·	$250,000
                                         due on or before 30 April 2017

		·	$250,000
                                         due on or before 30 July 2017

		·	$250,000
                                         due on or before 30 October 2017

 

*To
be paid to GTI providing that GTI provides all documents and data, including manufacturing transfer plan, product production,
guidance documents, product quality standards, relevant patent certificates, fixed costs of products, personnel data, etc. as
reasonably required by SMI within 10 business days after GTI receives the initial payment of USD $50,000. During the first quarter
of 2017, GTI and SMI will agree on the plan and schedule for transfer of manufacturing.

 

		C.	GTI
                                         shall issue shares of its common stock to SMI or as directed by SMI with each of the
                                         five payments equal in value to the amount of the payment (e.g $50,000, $200,000 or $250,000)
                                         within 30 days after receipt of payments. The number of shares issued will be calculated
                                         at the lesser of the end of day per share price for the average of five consecutive days
                                         preceding the payment or $1.25 per share. The shares of stock shall be transferred to
                                         SMI or as directed by SMI within 30 days of SMI’s payment.

 

		2.	2017
                                         Orders:

		a.	Subject
                                         to purchase orders from SMI to GTI, the schedule of minimum orders for 2017 shown in
                                         the table below will be maintained in order to maintain Jurisdiction sales and distribution
                                         rights.

 

 

    	 	2	 

    CONFIDENTIAL
    TREATMENT REQUESTED BY GUIDED THERAPEUTICS, INC. – CONFIDENTIAL PORTIONS OF THIS DOCUMENT, MARKED BY *****, HAVE BEEN
    REDACTED AND HAVE BEEN SEPARATELY FILED WITH THE SECURITIES AND EXCHANGE COMMISSION PURSUANT TO RULE 24B-2 PROMULGATED UNDER
    THE SECURITIES EXCHANGE ACT OF 1934, AS AMENDED. 

    

 

 

	2017	Number
    of LuViva Devices	Price
                                         Per Device

        (by
        air, CIF BEIJING; by sea CIF QINGDAO
	Anticipated
    Use
	By
    31 March	5	$*****	-
                                         Chinese FDA Sample (1)

        -
        Clinical Samples (2)

        -
        Transfer Manufacturing Sample (1)

        -
        Seed outside PRC Market (1)

	By
    31 December	5	$*****	-
                                         Seed PRC Commercial Market (4)*

        -
        Sales outside of PRC (1)

 

*If
Chinese Food and Drug Administration (CFDA) approval is delayed, then these four device orders can be moved to Q1 2018. If SMI
needs to order single use Cervical Guides or other supplies directly from GTI instead of manufacturing them in China, the prices
shall be pursuant to the published price list for international distributors adjusted by a 10% discount. For clinical trials,
GTI agrees to supply 200 Cervical Guides at no cost.

 

		b.	If
                                         additional orders are placed by SMI to GTI prior to SMI having established its own manufacturing
                                         facility, the devices will be priced as follows:

 

	Quantity	Price
    (by air, CIF BEIJING; by sea CIF QINGDAO)
	11
    – 20	$*****
	21
    – 40	$*****
	41
    and greater	International
    distributor list price

 

 

 

3.
Minimum Sales: People’s Republic of China (Beginning first full calendar year following CFDA approval). It is expected
that full or partial manufacturing will occur in China, so that minimum orders will not necessarily occur, unless agreed by both
parties. Notwithstanding the foregoing, SMI will be responsible for minimum royalty payments based on the minimum sales of LuViva
products as shown in the Table below.

 

 

 

    	 	3	 

    CONFIDENTIAL
    TREATMENT REQUESTED BY GUIDED THERAPEUTICS, INC. – CONFIDENTIAL PORTIONS OF THIS DOCUMENT, MARKED BY *****, HAVE BEEN
    REDACTED AND HAVE BEEN SEPARATELY FILED WITH THE SECURITIES AND EXCHANGE COMMISSION PURSUANT TO RULE 24B-2 PROMULGATED UNDER
    THE SECURITIES EXCHANGE ACT OF 1934, AS AMENDED. 

    

 

 

	Full
    year following CFDA Approval	Number
    of machines placed or sold	Number
    of tests per day	Days
                                         per week

         
	Weeks
    per year
	1	500	30	5	48
	2	1000	30	5	48
	3	2000	30	5	48

 

4.
Cost of CFDA Approval: SMI shall underwrite the entire cost of securing approval of LuViva with Chinese FDA.

 

5.
Manufacturing:

 

		a.	SMI,
                                         shall arrange, at its sole cost, for a manufacturer in China to build tooling to support
                                         manufacture.

		b.	The
                                         price payable by GTI for each Device and each packet of Disposables supplied by the manufacturer
                                         for resale by GTI outside of the Territories will be no higher than the then current
                                         internal costs to GTI for manufacturing the Device and the then current price paid by
                                         GTI to its current supplier of Disposables. 

		c.	In
                                         the event that this is not possible, the Parties agree to discuss the following options:

		a.	SMI
                                         retains the right to manufacture for China, Hong Kong, Macau and Taiwan, where SMI has
                                         distribution and sales rights.

		b.	SMI
                                         elects to manufacture just the Cervical Guides which is anticipated to be able to be
                                         at a lower price in China

		c.	SMI
                                         buys the devices and Cervical Guides, or just the devices from GTI

		d.	Other
                                         options that may be identified and available to find a mutually satisfactory solution.

 

If
SMI fails to achieve manufacturing capabilities for either the Devices and Disposables in accordance with ISO 13485 for medical
devices by 24 months after the date hereof, SMI shall no longer have any rights to manufacture, distribute or sell LuViva.

 

6.
Technical Assistance for Manufacturing and Sales:

 

		a.	Both
                                         GTI and SMI recognize the need for technical assistance to set up manufacturing and to
                                         establish sales protocols and marketing materials. To that end, both parties pledge cooperation
                                         in helping to establish the manufacturing and sales in China.

		b.	GTI
                                         shall provide the Curricula Vitae or Resume (personal data) of the inventor of the LuViva
                                         technology to SMI

		c.	SMI
                                         shall send over its manufacturing expert to GTI at SMI’s expense to learn the manufacturing
                                         process. GTI will be responsible for all in-country (US) expenses.

		d.	GTI
                                         shall send over its technical expert within 10 days of a request or as soon as reasonably
                                         possible from SMI to SMI at GTI’s expense to assist with the establishment of the
                                         manufacturing and sales protocols in China. SMI will be responsible for all in-country
                                         (China) expenses.

		e.	GTI
                                         shall provide technical support and training for product upgrades consistent with the
                                         technical support provided to other international distributors of LuViva.

 

 

    	 	4	 

    CONFIDENTIAL
    TREATMENT REQUESTED BY GUIDED THERAPEUTICS, INC. – CONFIDENTIAL PORTIONS OF THIS DOCUMENT, MARKED BY *****, HAVE BEEN
    REDACTED AND HAVE BEEN SEPARATELY FILED WITH THE SECURITIES AND EXCHANGE COMMISSION PURSUANT TO RULE 24B-2 PROMULGATED UNDER
    THE SECURITIES EXCHANGE ACT OF 1934, AS AMENDED.

    

 

 

7.
Royalties:

 

		a.	For
                                         each single-use Cervical Guide chip sold by SMI in the Jurisdictions, SMI shall transfer
                                         funds to the Escrow Agent at a rate of $***** per chip..in the amount equaling the number
                                         of chips sold. Funds shall be transferred monthly.

 

		b.	The
                                         Parties agree to reassess these royalty amounts at the end of the second year of commercial
                                         sales in China to determine if an adjustment to the royalty amounts, up or down, is warranted.
                                         Any adjustments to the royalty amounts must be mutually agreeable.

 

8.
Commercialization: If within 18 months of this License’s Effective Date, SMI fails to achieve commercialization of
LuViva (as defined below) in China. SMI shall no longer have any rights to manufacture, distribute or sell LuViva.

 

Commercialization
of LuViva is defined as SMI achieving all of the following:

 

		a.	Filing
                                         an application with the CFDA for approval of LuViva

 

		b.	Any
                                         assembly or manufacture of the Device or Disposables that begins in China

 

		c.	Purchase
                                         of at least 10 Devices and associated Disposables for clinical evaluations and regulatory
                                         use and or sales in the Jurisdictions, according to the schedule described in Section
                                         2. above.

 

9.
Best Efforts: The Rights described herein must be maintained by diligent development and commercial efforts. SMI agrees
to use its best efforts to maximize the royalty payments contemplated herein. Both parties agree to conduct quarterly reviews
to mark progress and agree on forecasts for orders.

 

10.
Breach or Failure to Perform: Under the following circumstances, SMI shall forfeit this License and shall no longer have
any rights to manufacture, distribute or sell LuViva in the Jurisdictions if SMI is unable to cure in a timely manner:

 

		a.	A
                                         material breach of any of SMI’s obligations set forth in this section.

 

 

    	 	5	 

    CONFIDENTIAL
    TREATMENT REQUESTED BY GUIDED THERAPEUTICS, INC. – CONFIDENTIAL PORTIONS OF THIS DOCUMENT, MARKED BY *****, HAVE BEEN
    REDACTED AND HAVE BEEN SEPARATELY FILED WITH THE SECURITIES AND EXCHANGE COMMISSION PURSUANT TO RULE 24B-2 PROMULGATED UNDER
    THE SECURITIES EXCHANGE ACT OF 1934, AS AMENDED.

    

 

		b.	Failure
                                         to achieve CFDA approval within 30 months from the date of this agreement.

 

In
the event of Breach or Failure to Perform,

 

		c.	GTI
                                         shall provide written notification of the breach or failure to perform.

		d.	SMI
                                         shall be given a 45 day period in which to cure the breach or failure to perform.

		e.	If
                                         the breach or failure to perform is not cured, SMI shall return to GTI, at SMI’s
                                         cost, all samples, data, hardware, software, regulatory documents, bench and clinical
                                         test results and all other information pertaining to LuViva in the Jurisdictions

 

11.
Notices and Communications: All notices and other communications required by this Agreement will be effective upon deposit
in the mail, postage prepaid and addressed to the parties at their respective addresses set forth below until such notice that
a different person or address shall have been designated:

 

If
to SMI:

No.
5 Zhuijian Street, High-Tech Development Zone, Laiwu Shandong, People’s Republic of China

 

 

If
to GTI:

5835
Peachtree Corners East, Suite D,

Norcross,
GA 30092, USA

 

12.
Relationship of Parties: The Parties to this Agreement are and shall remain independent contractors and nothing herein
shall be construed to create a partnership, agency or joint venture between the parties. Each party shall be responsible for wages,
hours and conditions of employment of its personnel during the term of, and under this Agreement.

 

13.
Dispute Resolution: In the event a dispute arises out of or in connection with this Agreement, the parties will attempt
to resolve the dispute through friendly consultation. If the dispute is not resolved within a reasonable period then any or all
outstanding issues may be submitted to mediation in accordance within any statutory rules of mediation. If mediation is not successful
in resolving he entire dispute or is unavailable, any outstanding issues will be submitted to final and binding arbitration in
accordance with the laws of the State of Georgia, United States of America. The arbitrator’s award will be final, and judgment
may be entered upon it by any Court having jurisdiction within the State of Georgia, United States of America.  Each party
shall choose one (1) arbitrator and the two (2) chosen arbitrators shall select a third arbitrator, who shall be the Chairman
of the Arbitration Panel.  As soon as the mediation process has been unsuccessful, either party may select an arbitrator
by sending the name of the arbitrator, in writing, to the other party.  The party receiving the name of the said arbitrator
shall, within fifteen (15) days of receipt, select their arbitrator and shall send their selection, in writing, to the other party. 
Should that party fail to select their arbitrator within fifteen (15) days of receipt of the name of the first party’s arbitrator,
the initial party may seek Court appointment of the receiving party’s arbitrator and the latter shall be responsible for
the initial party’s reasonable attorney’s fees and costs in connection with the Court appointment.  If the two
(2) appointed arbitrators fail to select the third arbitrator within thirty (30) days from the appointment of the second
arbitrator, either party, or the parties jointly, may seek Court appointment of the third arbitrator.

 

    	 	6	 

    CONFIDENTIAL
    TREATMENT REQUESTED BY GUIDED THERAPEUTICS, INC. – CONFIDENTIAL PORTIONS OF THIS DOCUMENT, MARKED BY *****, HAVE BEEN
    REDACTED AND HAVE BEEN SEPARATELY FILED WITH THE SECURITIES AND EXCHANGE COMMISSION PURSUANT TO RULE 24B-2 PROMULGATED UNDER
    THE SECURITIES EXCHANGE ACT OF 1934, AS AMENDED.

    

 

 

14.
Applicable Law: All questions concerning the validity, operation, interpretation and construction of this Agreement will
be governed by and determined in accordance with the laws of the State of Georgia, United States of America.

 

15.
Waivers of Breach: No waiver by either Party of any breach of any provision shall constitute a waiver of any other breach
of that provision or any other provision hereof.

 

16.
Warrants and Representations: Each Party represents and warrants that the terms of this Agreement are not inconsistent
with any other contractual or legal obligations it may have or with the policies of any institution or company with which such
Party is associated.

 

17.
Interpretation: The Parties have participated jointly in the negotiation and drafting of this Agreement. In the event of
an ambiguity or question of intent or interpretation arises, this Agreement shall be construed as if drafted jointly by the parties
and no presumption or burden of proof shall arise favoring or disfavoring any Party by virtue of the authorship of any the provisions
of this agreement.

 

18.
Assignment: SMI may not assign this Agreement in whole or in part, other than manufacturing, without GTI’s consent,
that shall not be unreasonably be withheld. SMI may outsource all or parts of the manufacturing at their discretion, provided
that SMI is able to maintain and verify that the quality of the manufacturing maintains CFDA, ISO 14485 and other regulatory standards
that GTI may rely upon in sourcing LuViva.

 

19.
Effective Agreement: This Agreement may be signed by the parties via facsimile or electronic signatures. This Agreement
will constitute an effective Agreement when signed by both Parties.

 

20.
Entire Agreement: This Agreement, sets forth the entire agreement and understanding between the parties as to the subject
matter hereof and merges all prior discussions between them; and neither party shall be bound by any conditions, definitions,
warranties, understandings or representations with respect to such subject matter other than as expressly provided herein. This
Agreement may not be modified or altered except in writing by an instrument duly executed by authorized officers of both parties.

 

 

    	 	7	 

    CONFIDENTIAL
    TREATMENT REQUESTED BY GUIDED THERAPEUTICS, INC. – CONFIDENTIAL PORTIONS OF THIS DOCUMENT, MARKED BY *****, HAVE BEEN
    REDACTED AND HAVE BEEN SEPARATELY FILED WITH THE SECURITIES AND EXCHANGE COMMISSION PURSUANT TO RULE 24B-2 PROMULGATED UNDER
    THE SECURITIES EXCHANGE ACT OF 1934, AS AMENDED.

    

 

 

IN
WITNESS WHEREOF, the parties hereto have caused this Agreement to be duly executed by their duly authorized officers as of
the _22___ day of January, 2017.

 

	 

GTI

 

 

 

 

/s/
Gene Cartwright___________________________

Gene
Cartwright

Chief
Executive Officer, Guided Therapeutics Inc.

 

 

SMI

 

 

 

 

 

/s/
Yaohua Li__________________________________

Yaohua
Li

Chairman,
Shandong Yaohua Medical Instrument Corporation

 

 

 

 

 

 

    	 	8	 

    CONFIDENTIAL
    TREATMENT REQUESTED BY GUIDED THERAPEUTICS, INC. – CONFIDENTIAL PORTIONS OF THIS DOCUMENT, MARKED BY *****, HAVE BEEN
    REDACTED AND HAVE BEEN SEPARATELY FILED WITH THE SECURITIES AND EXCHANGE COMMISSION PURSUANT TO RULE 24B-2 PROMULGATED UNDER
    THE SECURITIES EXCHANGE ACT OF 1934, AS AMENDED.Exhibit 10.2 

 

GUIDED
THERAPEUTICS-SHENGHUO MEDICAL AGREEMENT

22
Jan 2017

 

  

This
Agreement is between Guided Therapeutics, Inc. (“GTI”), a Georgia corporation with the address of 5835 Peachtree Corners
East, Suite D, Norcross, GA 30092, and Shenghuo Medical LLC, a privately held U.S. limited liability company with the address
of 175 Strafford Ave., Wayne, PA 19087 (“Shenghuo”).

 

WHEREAS,
GTI has developed a platform technology for the early detection of disease that leads to cancer;

 

WHEREAS
GTI’s first non-invasive cancer detection product is the LuViva® Advanced Cervical Scan device (the “Device”)
and the related disposable cervical guides (the “Disposables” and, with the Device, “LuViva”).LuViva is
in use in Canada, Latin America, Europe, Turkey, Asia and Africa and is under premarket application (PMA) review by the U.S. Food
and Drug Administration. GTI owns the worldwide manufacturing, distribution and intellectual property (“IP”) rights
to LuViva. LuViva is designed to:

 

A.
Determine the true likelihood of treatable cervical disease that may lead to cancer in women aged 16 years and over who have
been screened for cervical cancer and have an abnormal result.

 

B.
Be used as a screening tool both in the developed and developing world where the Pap and/or HPV tests are not widely available.

 

WHEREAS
GTI previously has granted an exclusive license (“Original License”) to manufacture, sell and distribute LuViva in
Peoples Republic of China (“China”), Macau and Hong Kong, Taiwan, Brunei Darussalam, Cambodia, Laos, Myanmar, Philippines,
Singapore, Thailand, and Vietnam (the “Jurisdictions”) to Shenghuo pursuant to that certain License Agreement, dated
June 5, 2016, between GTI and Shenghuo (the “Original Agreement”);

 

WHEREAS
Shandong Yaohua Medical Instrument Co. Ltd (“SMI”) is a medical device manufacturing and sales company located at
No. 5 Zhujiang Street, High-Tech Development Zone, Laiwu Shandong, Peoples Republic of China;

 

WHEREAS
GTI and Shenghuo have determined that the optimum way to achieve commercialization of LuViva within China, Macau, Hong Kong and
Taiwan (the “Territories”) is for Shenghuo to relinquish the Original License as it applies to the exclusive rights
to manufacture LuViva and to the sale and distribution of LuViva in the Territories, so that GTI can grant SMI a new license for
the exclusive rights to manufacture LuViva and to sell and distribute LuViva in the Territories (the “SMI License”
and the agreement between GTI and SMI providing for the grant of the SMI License, the “SMI Agreement”);

 

    	 	1	 

     

    

 

 

IT
IS HEREBY AGREED AS FOLLOWS between GTI and Shenghuo:

 

1.
Shenghuo agrees to (i) relinquish the Original License to facilitate the SMI Agreement, whereby SMI will acquires the SMI License,
and (ii) except as expressly provided herein, permanently waive all of its rights under the Original Agreement. Notwithstanding
the foregoing, Shenghuo shall retain the rights under the Original License to sell and distribute LuViva in those Jurisdictions
that are not Territories. If SMI makes combined payments to GTI and Shenghuo totaling $500,000 or more, the condition in the Original
License requiring Shenghuo to enter into an agreement with an established commercial partner that invests at least $500,000 in
Shenghuo to commercialize LuViva in China shall be deemed satisfied.

 

2.
GTI agrees as follows:

 

A.
All Up-Front Payments and Royalty Payments (including the payments for minimum royalties) due from SMI to GTI under the SMI Agreement
shall be divided equally into two different accounts, one controlled by GTI and one controlled by Shenghuo, to be equally divided
by an escrow agent, or other manner as agreed to by GTI, SMI as set forth in the SMI agreement. Notwithstanding the foregoing,
funds from SMI destined for Shenghuo must be deposited directly into a separate account that does not allow GTI discretionary
control over said funds. “Up-Front Payments” means the $1,000,000 in cash payable by SMI to GTI in four installments
of $250,000 (with an advance of $50,000 on the first installment) through October 30, 2017, pursuant to the SMI Agreement. “Royalty
Payments” means the royalty payments payable by SMI to GTI pursuant to the SMI Agreement for each Disposable sold by SMI,
net of the costs of the RFID chip constituting part of each such Disposable and net of per-Disposable payments to Three Bridges
LLC pursuant to the Business Development Service Agreement, dated November 11, 2016, between GTI and Three Bridges LLC. If (i)
SMI fails to equally divide and pay the Up-Front Payments as provided herein, and (ii) upon subsequent written request from Shenghuo,
GTI fails to terminate the SMI License as a result of such SMI failure, then GTI shall immediately pay to Shenghuo an amount in
cash such that the total amount of all Up-Front Payments actually made by SMI (regardless of the actual payee) is split equally
between GTI and SMI.

 

B.
If, pursuant to the terms of the SMI Agreement, GTI terminates the SMI License, GTI shall re-grant the Original License to Shenghuo,
on the same terms as the original grant of the Original License (except that to the extent that milestones set forth in the Original
Agreement have been met by SMI, then those milestones shall be deemed as having been satisfied by Shenghuo), and Shenghuo’s
waiver of its rights under the Original Agreement shall be rescinded.

 

C.
If GTI and SMI do not execute the SMI Agreement within 72 hours of the signing this Agreement, then GTI shall re-grant the Original
License to Shenghuo, on the same terms as the original grant of the Original License (except that to the extent that milestones
set forth in the Original Agreement, and this Agreement shall be deemed terminated and of no further force and effect, and Shenghuo’s
waiver of its rights under the Original Agreement shall be rescinded).

 

 

    	 	2	 

     

    

 

 

D.
Up Front Payment Schedule – Each of the Up Front Payments from SMI shall be divided in the following manner:

 

	Payment
    Date	Total
    Amount	Amount
    to GTI	Amount
    to Shenghuo*
	10
    days after SMI Agreement signed	$50,000	$48,000	$2,000
	20
    February 2017	$200,000	$146,000	$54,000
	30
    April 2017	$250,000	$98,000	$152,000
	30
    July 2017	$250,000	$98,000	$152,000
	30
    October 2017	$250,000	$98,000	$152,000

*Includes
all finder’s fees including the 2% fee for the initial $50,000 payment made by SMI to GTI in connection with their letter
of intent.

 

Late
payments, if delayed by GTI, shall be subject to a one percent (1%) monthly late fee.

 

E.
Shenghuo shall sell to GTI, and GTI shall buy back, by the earlier of April 30, 2017 and the time a purchase order is received
by SMI, the five (5) LuViva devices previously sold to Shenghuo for a total of $92,500 (i.e., exactly what Shenghuo paid GTI for
them as part of the Original License terms).

 

F.
GTI reaffirms its obligations under the Original Agreement with regard to the note and warrant agreements provided therein and
the four percent (4%) finders’ fee on any funds that go to GTI as a result of direct introductions made by Shenghuo. In
instances whereby Shenghuo is the initial finder or co-finder, but an intermediary or co-finder has introduced the person or entity
that contributes the funds to GTI and receives a fee greater than two percent (2%), the finder’s fee to Shenghuo shall be
reduced to two percent (2%), with such consideration to include all funds collected by GTI in connection with the SMI agreements,
with the exception of royalties resulting from product sales. Shenghuo will invoice GTI for its commissions and payment will be
due within 30 days of the invoice, or at Shenghuo’s option, paid out of the payments from SMI under the SMI Agreement. If
invoiced, finder’s fees shall be paid within ten (10) business days of receipt of invoice by GTI and late payments will
be assessed at one percent (1%) late charge per month.

 

G.
GTI shall not amend the SMI Agreement in any way that adversely affects Shenghuo without Shenghuo’s approval.

 

    	 	3	 

     

    

 

 

H.
The parties shall cooperate in good faith to facilitate GTI’s full enforcement of SMI’s obligations under the SMI
Agreement, and GTI shall inform Shenghuo in advance of any waiver by GTI of SMI’s performance under the SMI Agreement.

 

3.
Miscellaneous

 

A.
All notices and other communication required by this Agreement or permitted to be given under this Agreement will be effective
upon deposit in the mail, postage prepaid and addressed to the parties at their respective addresses set forth below unless by
such notice a different person or address shall have been designated.

 

If
to GTI:

 

Gene
Cartwright, President and CEO

5835
Peachtree Corners East, Suite D,

Norcross,
GA 30092

 

 

If
to Shenghuo:

 

Richard
Blumberg, Esq., Managing Member

Michael
Antonoplos, Managing Member

Shenghuo
Medical, LLC

C/O
Mark S. Pearlstein, Esq.

175
Strafford Ave., Suite One

Wayne,
PA 19087

610-687-7757;
206-330-7030

610-687-7737
(facsimile)

 

Michael
J. Antonoplos, Managing Member

Shenghuo
Medical, LLC

175
Strafford Avenue, Suite One

Wayne,
PA 19087

 

 

B.
The Parties to this Agreement are and shall remain independent contractors and nothing herein shall be construed to create a partnership,
agency or joint venture between the parties. Each party shall be responsible for wages, hours and conditions of employment of
its personnel during the term of, and under, this Agreement.

 

C.
In the event a dispute arises out of or in connection with this Agreement, the parties will attempt to resolve the dispute through
friendly consultation.  If the dispute is not resolved within a reasonable period then any or all outstanding issues may
be submitted to mediation in accordance within any statutory rules of mediation.  If mediation is not successful in resolving
the entire dispute or is unavailable, any outstanding issues will be submitted to final and binding arbitration in accordance
with the laws of the State of Georgia The arbitrator’s award will be final, and judgment may be entered upon it by
any Court having jurisdiction within the Commonwealth of Pennsylvania or State of Georgia, as applicable.  Each party shall
choose one (1) arbitrator and the two (2) chosen arbitrators shall select a third arbitrator, who shall be the Chairman of the
Arbitration Panel.  As soon as the mediation process has been unsuccessful, either party may select an arbitrator by sending
the name of the arbitrator, in writing, to the other party.  The party receiving the  name of the said arbitrator shall,
within fifteen (15) days of receipt, select their arbitrator and shall send their selection, in writing, to the other party. 
Should that party fail to select their arbitrator within fifteen (15) days of receipt of the name of the first party’s arbitrator,
the initial party may seek Court appointment of the receiving party’s arbitrator and the latter shall be responsible for
the initial party’s reasonable attorney’s fees and costs in connection with the Court appointment.  If the two
(2) appointed arbitrators fail to select the third arbitrator within thirty (30) days from the appointment of the second
arbitrator, either party, or the parties jointly, may seek Court appointment of the third arbitrator. 

 

    	 	4	 

     

    

 

 

D.
All questions concerning the validity, operation, interpretation and construction of this Agreement will be governed by and determined
in accordance with the laws of the State of Georgia.

 

E.
No waiver by either party of any breach of any provision hereof shall constitute a waiver of any other breach of that provision
or any other provision thereof.

 

F.
Subject to the receipt of necessary consents disclosed to the other party, each party represents and warrants that the terms of
this Agreement are not inconsistent with any other contractual or legal obligations it may have or with the policies of any institution
or company with which such party is associated.

 

G.
The parties have participated jointly in the negotiation and drafting of this Agreement. In the event of an ambiguity or question
of intent or interpretation arises, this Agreement shall be construed as if drafted jointly by the parties and no presumption
or burden of proof shall arise favoring or disfavoring any party by virtue of the authorship of any of the provisions of this
Agreement.

 

H.
This Agreement may be signed by the parties in counterparts and via facsimile or electronic signatures, which signatures, taken
as a whole, shall constitute an effective Agreement.

 

I.
This Agreement, sets forth the entire agreement and understanding between the parties as to the subject matter hereof and merges
all prior discussions between them; and neither party shall be bound by any conditions, definitions, warranties, understandings
or representations with respect to such subject matter other than as expressly provided herein. This Agreement may not be modified
or altered except in writing by an instrument duly executed by authorized officers of both parties.

 

 

    	 	5	 

     

    

 

 

J.
Nothing herein expressed or implied is intended or should be construed to confer upon or give to any person other than the parties
hereto and their successors or assigns any rights or remedies under, or by reason of this Agreement.

 

IN
WITNESS WHEREOF, the parties hereto have caused this Agreement to be duly executed by their duly authorized officers as of
the 22nd day of January, 2017.

 

	 

For
GTI:

 

	/s/ Gene Cartwright	 	Date: January 22, 2017
	Gene Cartwright, President and CEO	 	 
	 	 	 
	 	 	 
	 	 	 
	For
Shenghuo:	 	 
	 	 	 
	/s/ Richard Blumberg,	 	Date: January 22, 2017
	Richarl Blumberg, Managing Member	 	 
	 	 	 
	/s/ Michael Antonoplos	 	Date: January 22, 2017
	Michael Antonoplos, Managing Member	 	 

 

 

 

 

 

    	 	6

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