Document:

Exhibit
      10.17

     

    CONTRACT
      

    #840/08624332/04031

    Date:
      August 25, 2005

     

    For
      Selling the Compounds Based on Radioactive Isotopes. 

     

    The
      Company “IsoRay” Inc., USA, (<<the Buyer>>) and the Federal State
      Unitary Enterprise <<Institute of Nuclear Materials>> (FSUE “INM”),
      Russia, (<<the Seller>>) herein are collectively referred to as
<<the Parties>>concluded this contract. 

     

    
      	1.	
              SUBJECT.
                

            

    

     

    The
      Seller shall sell and the Buyer shall buy the following products labeled with
      the radioactive isotopes (hereinafter “the Goods”) products as follows:

    
       

      1.1  Barium
        carbonate labeled with BA-131 manufactured from natural Barium. 

       

      1.2  Barium
        carbonate labeled with BA-131 manufactured from 10% enriched BA-130.

       

      1.3  Cesium-131
        in a condition (chemical form) equivalent to the output manufactured product
        according to and by the technology provide by the Buyer. The technical
        characteristics of the goods are according to, 1.1 and 1.2 of this Contract
        and
        are specified in Appendix 1 which is also part of this Contract. 

       

    

    The
      Goods
      delivery will be performed on the conditions stipulated in paragraph 3 of the
      Contract. 

     

    
      
        	2.	
                PURCHASE
                  PRICE AND CONTRACT VALUE.

              

      

    

     

    2.1  The
      unit
      price for Goods will be in US dollars for the entire Contract period.

     

    2.2  The
      unit
      price for Goods is according to 1.1 and 1.2 and shall be three hundred ($300.00)
      dollars US for one (1) Ci of the Goods. 

     

    2.3  They
      Buyer shall pay the cost of Barium Carbonate enriched by BA-130 isotope against
      the Seller’s invoice separately for each shipment of the Goods and the invoiced
      amount shall be a Manufacturer’s cost plus the costs incurred by purchase
      handling and delivery. 

     

    2.4  The
      unit
      price for Goods is according to 1.3 and shall be estimated in a separate
      Agreement by May 25, 2006. 

     

    2.5  As
      agreed
      and determined by the Parties the Contract value is three hundred thousand
      dollars US
      ($300,000) for the first year of the Contract for the Goods delivered in the
      quantity of one thousand (1,000) Curies. 

     

    2.6  The
      Contract value over the seven year term is thirty million (30,000,000.00)
      dollars US. 

     

    2.7  Each
      year
      the Parties determine the shipping amount and the cost of the Goods three months
      before the expiration of the existing Contract. The Seller shall ship the Goods
      in the forms and the denominations that shall be covered by the annual
      Agreement. 

     

    
      	3.	
              DELIVERY
                DATES AND ARRANGEMENTS. 

            

    

     

    3.1  They
      Buyer shall include in the Purchase Order and confirm the following information:
      

     

    
      
         

      

      
         

        
          

        

      

      
         

      

       

    

    
      
        	
              	
                
                  ·

                

              	
                Contract
                  number; 

              

      

    

     

    
      
        	
              	
                ·

              	
                Goods
                  purchase date, 

              

      

    

     

    
      
        	
              	
                ·

              	
                Amount
                  of Goods for the date of purchase, and the quality requirements
                  for the
                  date of delivery, 

              

      

    

     

    
      
        	
              	
                ·

              	
                The
                  Goods delivery date to the designated airport,

              

      

    

     

    
      
        	
              	
                ·

              	
                The
                  designated airport, 

              

      

    

     

    
      
        	
              	
                ·

              	
                Other
                  additional information required by the Buyer.

              

      

    

     

    The
      time
      period between the purchase date and delivery date is set by the Buyer to ensure
      the optimal quality of the Goods. 

     

    3.2.  The
      Seller shall independently nominate the Forwarder at the boundary and shall
      send
      an Air Way Bill (“AWB”) by Facsimile to the Buyer on the day of the Goods
      departure from the Seller. 

     

    3.3.  The
      Seller shall deliver the shipping amount by lots on CIF terms. 

     

    3.4.  The
      shipping date is the date of the flight indicated in the AWB. 

     

    3.5.  The
      Buyer
      shall place a Purchase Order and the Seller shall commit to ship each lot as
      per
      the Purchase Order solely submitted in written form. 

     

    3.6.  The
      Buyer
      shall send a Purchase Order to the Seller thirty (30) days before a shipping
      date and the Seller shall confirm the receipt of the Purchase Order within
      three
      (3) business days by facsimile. 

     

    3.7.  The
      Purchase Order is accepted for commitment by the Seller unless the Seller
      notifies the Buyer about a justified cancellation of the Purchase Order ten
      (10)
      days before a shipping date. 

     

    3.8.  If
      the
      delivery will be prevented by a contingency, the Seller shall notify the Buyer
      about such non-delivery by phone or facsimile no later than five (5) days before
      shipping date. 

     

    3.9.  Title
      to
      the Goods shall be transferred to the Buyer upon a Customs clearance at the
      Buyer’s designated international airport. 

     

    3.10.  The
      Seller shall notify the Buyer about the Goods transferred to a Forwarder by
      facsimile or phone within twenty four (24) hours after the receipt of an AWB
      by
      the Seller. 

     

    The
      Seller shall send an issue date and a number of the AWB, a flight number, a
      date
      and time of Goods departure to the Buyer. 

     

    
      	4.	
              QUALITY
                AND QUANTITY OF THE GOODS.

            

    

     

    4.1  The
      quality of the Goods delivered to the Buyer shall comply with the Specifications
      as stipulated in Appendix 1 and in the Purchase Order accepted for commitment.
      

     

    4.2  The
      Quality Certificate (the Certificate of Compliance) shall be attached to each
      item in a lot in each shipment. 

     

    4.3  The
      quantity of the Goods delivered shall comply with the requirements indicated
      in
      the Purchase Order. The quantity of the Goods shall be measured with an error
      being no more than +
      5% of
      the indicated quantity and should be the amount for the date of purchase.

     

    
      
         

      

      
         

        
          

        

      

      
         

      

       

    

    
      	
              5.

            	
              SPECIFIC
                CONDITIONS. 

            

    

     

    5.1  The
      Seller shall produce Cs-131 by the Technology provided by the Buyer. The
      Technology shall be transferred to the Seller under a separate Agreement.

     

    5.2  The
      Right
      of Authorship of the Buyer with respect the technology transferred shall be
      based on the Agreement on Intellectual Property (as specified in Appendix 2).
      

     

    5.3  The
      Seller shall give the Buyer the Exclusive right to sell isotopes of Ba-131
      and
      Cs-131 for the 10 year period staring from the date of the current Contract
      up
      to October 25, 2015. 

     

    The
      exclusive right is granted to the Buyer upon the following conditions:

     

    
      
        
          	
                	
                  ·

                	
                  The
                    Buyer transfers the above mentioned technology to the
                    Seller; 

                

        

      

       

      
        
          	
                	
                  ·

                	
                  The
                    amount of the purchase order is no less than two thousand (2000)
                    Ci per
                    year starting from the year 2007;

                

        

      

       

      
        
          	
                	
                  ·

                	
                  If
                    the Buyer does not begin marketing Cs-131 medical product in
                    Russia within
                    four years from the date of this Contract the Seller shall have
                    the right
                    to sell CS-131 in Russia produced with the application of technology
                    which
                    is different from the Buyer’s
                    technology. 

                

        

      

       

    

    
      	
              6.

            	
              PACKING
                AND LABELLING.
                

            

    

     

    6.1  The
      Goods
      shall be packed into a Type-A Package Design (herein after referred to as a
      transport container), which is responsibility of the Seller. The transport
      container is a non-returnable package where a purchased quantity of the Goods
      is
no
      more than
      0.5
      Curie in one package. 

     

    6.1.1  The
      transport container is a returnable package if a purchased amount is more than
      0.5 Ci in one package. The Buyer shall pay the return costs for the container.
      

     

    6.1.2  They
      Buyer shall provide the delivery of the transport container with the Certificate
      of Compliance before the shipments start for the Seller to get the Certificates
      of Approval for the package design and the transportation. 

     

    6.2  The
      Seller shall label the transport conformity with the ICAO and IATA regulations
      and the IAEA safety standards, Safety series 6 (1990). The Seller shall be
      responsible for the safety package. 

     

    6.3  The
      Seller will enclose a Packing List and the Certificate of Compliance for each
      lot of the goods into the transport container. An Invoice for each lot will
      be
      sent by facsimile only to the Buyer’s address. 

     

    6.4  The
      Seller shall label each transport container in conformity with the data
      indicated in the Purchase Order from the Buyer. 

     

    
      	7.	
              PAYMENT
                TERMS. 

            

    

     

    7.1  The
      Buyer
      shall pay for the Goods in dollars US to the Seller’s bank account indicated in
      paragraph 15. 

     

    7.2  The
      Seller shall invoice the Buyer for each lot of the Goods delivered. The Buyer
      shall pay the Invoice within thirty (30) days from the invoice date.

     

    
      
         

      

      
         

        
          

        

      

      
         

      

       

    

    7.3  The
      Buyer
      shall make the payment against the Seller’s invoice and notify the Buyer within
      twenty four (24) hours about a wire transfer date, a wire transfer number,
      the
      name and address of the transfer bank. The Contract number and the Invoice
      number shall be indicated in the outgoing payment transfer document.

     

    7.4  Other
      payment arrangements may be possible upon agreement between the Parties.

     

    
      	8.	
              DELIVERY
                AND ACCEPTANCE.
                

            

    

     

    The
      Goods
      are considered to be delivered by the Seller and accepted by the Buyer with
      respect to quantity as per the weight and the number of cargo pieces indicated
      in the shipping documents, and with respect to the quality: as per the data
      in
      the Certificate of Compliance. 

     

    
      	9.	
              INSURANCE.
                

            

    

     

    The
      Seller, while in possession of the Goods, may insure the Goods for the amount
      of
      the invoiced value of the Goods and against all risks. 

     

    After
      the
      title is transferred to the Buyer the Goods may be insured by the Seller only
      upon a special request of the Buyer and at the Buyer’s expense. 

     

    
      	10.	
              CLAIMS.
                

            

    

     

    10.1  In
      case
      of noncompliance of the Goods (delivered by the Seller) with the Purchase Order
      Specifications (herein after the “Quality”) and/or the radioactivity data
      (herein the “Quantity”) the Buyer may present the Seller Claims with the Expert
      Survey Report compiled and signed by the Buyer. 

     

    10.2  The
      Buyer
      may submit the Claims on quality and/or quantity of the goods within twenty
      (20)
      business days of the date of the delivery. The Claims shall be submitted only
      in
      writing. 

     

    10.3  The
      Claims shall specify the following: 

    
       

      
        
          
            	
                  	
                    ·

                  	
                    
                      the
                        number and the date of the Contract, Purchase order, AWB,
                        Packing list and
                        the Certificate of
                        Compliance.  

                    

                  

          

        

         

        
          
            	
                  	
                    ·

                  	
                    
                      an
                        information on integrity of the transport package and overpack;
                        

                    

                  

          

        

         

        
          
            	
                  	
                    ·

                  	
                    
                      the
                        place, date and time of the examination by experts, the name
                        of the
                        material and a quantity of the sampling,
                        

                    

                  

          

        

         

      

      
        
          
            
              	
                    	
                      ·

                    	
                      the
                        investigation method applied,

                    

            

          

           

          
            
              	
                    	
                      ·

                    	
                      
                        the
                          name and address of competent independent expert(s) a description
                          of an
                          examination procedure in writing shall include the following:
                          

                      

                    

            

          

           

          
            
              	
                    	
                      ·

                    	
                      
                        true
                          numerical and/or graphic data;

                      

                    

            

          

          
             

            
              
                
                  	
                        	
                          ·

                        	
                          
                            the
                              Buyer’s judgment on the Seller and the Forwarder responsibilities
                              for
                              noncompliance of the quality and/or quantity of the
                              Goods delivered;
                              

                          

                        

                

              

               

              
                
                  	
                        	
                          ·

                        	
                          
                            the
                              cost calculation of a missing quantity and suggested
                              options of
                              compensations. 

                          

                        

                

              

               

              10.4  The
                Expert Survey Report, shall be attached to and incorporated in the
                Claims text
                and signed by the Buyer. 

            

          

        

      

    

     

    10.5  The
      Claims shall be in the English and Russian languages in the original and a
      copy.

     

    
      
         

      

      
         

        
          

        

      

      
         

      

       

    

    10.6  The
      original in English and Russian shall be mailed to the Seller by a registered
      letter and the copy shall be transmitted by facsimile. 

     

    10.7  The
      Seller shall confirm by facsimile the receipt of the Claims and consider it
      no
      later than seven (7) days after the date of receipt and shall provide the
      judgment and suggest the reasonably acceptable option of compensations.

     

    10.8  No
      Claims
      presented previously can be regarded by the Buyer as a reason for rejecting
      and
      nonpayment for any other lot(s) to be shipped under this Contract until the
      Contract is completed. 

     

    10.9  Other
      options of resolving the Claims may be possible upon agreement between the
      Parties. 

     

    
      	11.	
              RESPONSIBILITIES
                OF THE PARTIES 

            

    

     

    THE
      SELLER:
      

     

    11.1  The
      responsibilities of the Parties shall be limited by the cost of a delivered
      lot
      of the Goods. 

     

    11.2  If
      there
      are exceptions to the quality and/or quantity of the Goods as received and
      under
      the condition that the Goods are usable), the Goods shall not be returned to
      the
      Seller. 

     

    11.3  The
      Seller shall revise the invoiced amount and the Buyer shall pay only for the
      usable quantity of the Goods the Seller shall send the revised Invoice to the
      Buyer by facsimile. 

     

    THE
      BUYER:
      

     

    11.4  If
      the
      Buyer fails to fulfill the requirements of paragraphs 9.2 and 9.3 of the
      Contract the Claims from the Buyer shall not be accepted and considered by
      the
      Seller and the Buyer shall pay in full for the Goods delivered. 

     

    11.5  If
      the
      Buyer fails to fulfill the requirements of paragraph 6.2 the Buyer shall send
      by
      facsimile the justification for that in writing within three (3) days in order
      to resolve the appropriate issue and make a mutual decision by the Parties.
      If
      the Buyer omits to send the justification, then an amount of damage shall be
      paid in favor of the Seller. The penalty per each day of the delay shall be
      0.1%
      for of the invoiced cost for the entire period from the invoice date to the
      day
      of payment included. 

     

    11.6  In
      ninety
      (90) days from the date of shipment included all amounts payable are stopped
      and
      cancelled and the Buyer shall pay a penalty of 10% of the invoiced amount within
      five (5) business days from the date of invoicing to the date of payment
      included. 

     

    11.7  Other
      options of resolving the outstanding issues may be possible upon agreement
      between the parties. 

     

    
      	12.	
              FORCE
                MAJEURE. 

            

    

     

    THE
      SELLER: If
      delivery in whole or in part for a period not exceeding sixty (60) days shall
      be
      prevented by causes beyond the control of the Seller, including, but not limited
      to acts of God, labor disputes, failure of essential means of transportation
      or
      changes in policy with respect to either exports or imports, by the Russian
      Government and/or the Government of the Buyer, this Contract shall be extended
      for an additional period up to a maximum of six (6) months. If, however, such
      non-delivery continues after such extended period, either the Seller or the
      Buyer shall have the right to cancel this Contract to the extent of such
      non-delivery by written notice, and in such case there shall be no obligation
      or
      liability on the part of either Party with respect to such undelivered Goods;
      provided that any such notice from the Buyer shall not apply to Goods which
      the
      Seller has prepared or loaded for transportation to the port of shipment prior
      to the receipt by the Seller of such notice. 

     

    
      
         

      

      
         

        
          

        

      

      
         

      

       

    

    THE
      BUYER:
      If the
      Buyer is unable to perform the obligations under this Contract due to causes
      beyond the control of the Buyer, including, but not limited to acts of God,
      labor disputes, failure of essential means of transportation or changes in
      policy with respect to either exports or imports, by the Government of the
      Buyer
      and/or the Russian Government, or winding up or insolvency of the Buyer, either
      the Buyer or the Seller shall have the right to cancel this Contract by written
      notice; and in such case there shall be no obligation or liability on the part
      of either Party with respect to such undelivered Goods. 

     

    
      	13.	
              ARBITRATION. 

            

    

     

    13.1  All
      disputes and differences which may arise out of this Contract or in connection
      with it are to be settled by negotiations between the Parties within three
      (3)
      months from the date of infringement of the terms of the Contract by either
      Party. All issued unresolved (except those being in competence of courts of
      law)
      by the negotiations are to be settled by the international commercial
      arbitration tribunal of the chamber of commerce & industry of the Russian
      Federation in Moscow, Russia. 

     

    13.2  The
      awards of this Arbitration shall be considered final and binding upon both
      Parties. The shares of the arbitration costs to be paid by the Parties shall
      be
      determined only by an Arbitration Tribunal decision. 

     

    
      	14.	
              OTHER
                CONDITIONS. 

            

    

     

    14.1  The
      Seller shall have the Export License granted. 

     

    Where
      the
      License has not been issued or received the Parties have the option of altering
      the delivery schedule to allow for the issue of the License without there being
      any liability attaching to the Seller and the Buyer. 

     

    14.2  Neither
      Party is entitled to assign its rights and obligations under this Contract
      to
      the third party without the mutual agreement in writing with the other Party.
      

     

    14.3  All
      addendums and amendments to the Contact are valid only if they are made in
      writing and sighed by the Parties. 

     

    14.4  This
      Contract is originally drafted and signed in English and Russian,, respectively.
      Both English and Russian versions of the Contract are of equal force.

     

    14.5  Neither
      Party has a right to change the Contract Terms and Conditions or discontinue
      to
      fulfill its obligations under the Contract without a written consent of the
      other Party. 

     

    14.6  The
      Contract shall be binding from the date of Export License issue and continue
      to
      October 25, 2012. 

     

    14.7  Some
      other terms and conditions may be added upon agreement in writing between the
      Parties.

     

    
      
         

      

      
         

        
          

        

      

      
         

      

       

    

    
      	15.	
              LEGAL
                ADDRESSES OF THE PARTIES.
                

            

    

     

    THE
      SELLER: 

     

    The
      Federal State Unitary Enterprise <<Institute of Nuclear Materials >>
      (FSUE <<INM>>), P.O. Box 29, Zarechhny, Sverdlovsk region, Russia
      624250 

     

    Bank
      Information 

    “Industry
      & Construction Bank” Branch Uralsky, SWIFT: ICSP RU 2P; 5, Marshal Zhykov
      street, Ekaterinburg, 620219, Russia. 

    acc.
      #
      40502840767002000065 for INM 

    

    Intermediary
      Bank:
      Wachovia Bank, NA, New York, PNBP US 3 N NYC, 11 Penn Plaza, 4 Floor, New York,
      N.Y., USA 10038 

    acc.
      #
      2000193002942 

     

    THE
      BUYER 

     

    Bank
      Information:
      

    Columbia
      River Bank 

    Kennewick,
      WA, USA 

    

    Account
      #0171082926914 

     

    Signature
      

     

    /s/
      Roger E. Girard_____________    

    Roger
      E. Girard 

    Date
      8/25/2005 

    IsoRay,
      Inc. 

    Chief
      Executive Officer / Chairman / 

     

    
      
         

      

      
         

        
          

        

      

      
         

      

    

     

    APPENDIX
      1

    Contract
      #840/0824332/04031

    Date:
      August, 25th,
      2005

    

    Technical
      Specifications

    

    
      	
              Element

            	
              Maximum
                concentration

              (ppm)

            	
              Element

            	
              Maximum
                concentration

              (ppm)

            
	
              Ag

            	
              1

            	
              Na

            	
              1

            
	
              Al

            	
              1

            	
              Ni

            	
              5

            
	
              As

            	
              100

            	
              P

            	
              300

            
	
              Au

            	
              2

            	
              PB

            	
              2

            
	
              B

            	
              2

            	
              Rb

            	
              100

            
	
              Bi

            	
              1

            	
              Sb

            	
              20

            
	
              Ca

            	
              1

            	
              Si

            	
              7

            
	
              Cd

            	
              1

            	
              Sn

            	
              2

            
	
              Co

            	
              1

            	
              Sr

            	
              10

            
	
              Cr

            	
              3

            	
              Te

            	
              30

            
	
              Cs

            	
              100

            	
              Ti

            	
              10

            
	
              Cu

            	
              1

            	
              Tl

            	
              3

            
	
              Fu

            	
              1

            	
              V

            	
              3

            
	
              Mg

            	
              1

            	
              W

            	
              100

            
	
              Mn

            	
              1

            	
              Zn

            	
              100

            
	
              Mo

            	
              3

            	
              Zr

            	
              30

            
	
              Note:
                Cs-131/Cs-132 = 0.001

            	 	 

    

    

    Signature
      

    

    /s/
      Roger Girard 

    The
      Buyer 

    

    Roger
      E. Girard 

    Chief
      Executive Officer / Chairman / 

     

    
      
         

      

      
         

        
          

        

      

      
         

      

    

     

    Appendix
      2

    CONTRACT
      #840/08624332/04031

    August
      25, 2005

     

    Agreement
      on Intellectual Property 

     

    Intellectual
      Property shall mean, trade marks, service marks, trade names, domain names,
      design rights, patents, copyright (including rights in computer software and
      databases, and moral rights), rights in know how and other intellectual property
      rights, in each case whether registered or unregistered and including
      applications for the grant of any of the foregoing and all rights or forms
      of
      protection having equivalent or similar effect to any of the foregoing which
      may
      subsist in any country in the world.(See overleaf for details) 

     

    A. INTELLECTUAL
      PROPERTY RIGHTS 

     

    A.1 Subject
      to any pre-existing rights of the Seller (or any third party), the Results
      of
      the Contract shall become the absolute property of the Buyer. 

     

    A.2. If
      the
      Seller becomes aware of or has good reasons to believe that patentable
      Intellectual Property is contained in or has arisen from the Results of the
      Contract (or any part thereof), it shall notify Buyer in writing giving such
      details as if may reasonably provide. 

     

    A.3 The
      Buyer
      shall determine whether any registered protection should be sought for any
      registerable Intellectual Property arising directly or indirectly from or
      contained in the Results of the Contract (or any part thereof) and shall have
      the absolute right to register and apply to register such Intellectual Property
      in its own sole name and at its own expense in any country of the world.

     

    The
      Seller shall use all reasonable endeavours to ensure that his employees agents,
      Sub-Contractor/Sellers and representatives give all reasonable assistance to
      any
      party which may be requested by the Buyer to enable it to seek and obtain such
      protection. 

     

    A.4 The
      Seller acknowledges and agrees that all Intellectual Property arising directly
      or indirectly from or contained in the Results of the Contract (or any part
      thereof) belongs to the Buyer (whether created by the Seller or by any
      Sub-Contractor/Seller) and accordingly: 

     

    A.4.1 The
      Seller shall assign to the Buyer all its rights, title and interest in any
      country of the world in and to any Intellectual Property arising directly or
      indirectly from or contained in the Results of the Contract (or any part
      thereof), together with any extensions, renewals, reversions and revivals of
      such Intellectual Property, (together with its proprietary rights in the
      physical materials in or on which such Intellectual Property and/or Results
      are
      contained or embodied) free from any third party lien, charge or other
      encumbrance; 

     

    A.4.2 The
      Seller shall use all reasonable endeavors to procure the assignment to the
      Buyer
      and any Intellectual Property arising directly or indirectly from or contained
      in the Results of the Contract (or any part thereof) owned in any country of
      the
      world by any of its Sub-Contractor/Sellers or any other third party commissioned
      by it to produce materials on its behalf in connection with any work (and any
      such third party shall be deemed for the purposes of this clause A4 to be a
      Sub-Contractor/Seller), together with any extensions, renewals, reversions
      and
      revivals of any such Intellectual Property, (together with all its proprietary
      rights in the physical materials in or on which such Intellectual Property
      and/or Results are Contained or embodied) free from any third party lien, charge
      or other encumbrance; and 

     

    
      
         

      

      
         

        
          

        

      

      
         

      

       

    

    A.4.3 The
      Seller shall waive or use all reasonable endeavors to procure the waiver of
      (or
      if applicable hereby waives) any and all moral rights in the Results of the
      Contract (or any part thereof) to which it or any Sub-Contractor/Seller may
      be
      entitled under the Copyright Designs and Patents Act 1988 or any similar or
      analogous law in any jurisdiction. 

     

    A.5 The
      Buyer
      shall have the right to make such use as it thinks fit of the Results of the
      Contract without further payment to the Seller. The Seller shall ensure that
      any
      Results of the Contract prepared by him or the Buyer, not already pre-printed
      to
      the effect that copyright belongs to the Buyer, shall bear the wording on the
      cover and first page “Copyright in this document (or drawings) belongs to Pebble
      Bed Modular Reactor (Pty) Ltd”. Where the form of results prepared by the
      Contractor/Seller for the Buyer does not readily allow such a method of marking
      then they shall be similarly endorsed in the most suitable manner available.
      

     

    B. PATENT
      CLAIMS, ETC BY THIRD PARTIES 

     

    B.1 The
      Seller shall indemnify and keep the Buyer fully and effectively indemnified
      against any and all actions, claims, proceedings, demands, damages, costs,
      charges and expenses occasioned to the Buyer as a result of any infringement
      of
      any Intellectual Property of any third party arising directly or indirectly
      as a
      result of the use by the Buyer or by any of its sub licensees, agents, Sellers,
      sub Sellers or assignees of the Results of the Contract (or any part thereof)
      provided by or on behalf of the Seller arising out of any work (provided that
      such indemnity shall not cover any use of such Results of Contract otherwise
      than for the purpose indicated by, or reasonably to be inferred from, any
      specification or instruction issued by the Buyer). 

     

    B.2 If
      any
      claim is made or action brought against the Buyer arising our of the matters
      referred to in clause B5, the Seller shall be promptly notified and shall at
      his
      own expense promptly conduct all negotiations for the settlement of the same
      and
      any litigation that may arise. The Buyer will not, unless and until the Seller
      shall have failed promptly to take over the conduct of the negotiations or
      litigation, make any admission which might be prejudicial to such litigation.
      The conduct by the Seller of such negotiations or litigation shall be
      conditional upon the Seller having first given to the Buyer such reasonable
      security as shall from time to time be required by the Buyer to cover the amount
      ascertained or agreed or estimated, as the case may be, of any compensation,
      damages or expenses for which the Buyer may become liable. The Buyer shall,
      at
      the request of Seller, afford all available assistance for the purpose of
      contesting any such claim or action and shall be repaid any expenses incurred
      in
      so doing. 

     

    B.3 The
      Seller warrants and represents to the Buyer that: 

     

    B3.1
      it
      has the legal capacity, right, power and authority or shall use all reasonable
      endeavors to procure from Sub-Contractor/Sellers the right and authority to
      enter into such assignment or license of the Intellectual Property as is
      provided for in the Contract; 

     

    B.3.2
      it
      is, or shall use all reasonable endeavors to become, the legal and beneficial
      owner of the Results of the Contract (and each part thereof); 

     

    B.3.3
      the
      Results of the Contract do not infringe (and no part thereof infringes) any
      Intellectual Property of any third party in any jurisdiction; 

     

    
      
         

      

      
         

        
          

        

      

      
         

      

       

    

    B.3.4
      it
      has not entered nor shall it enter without prior written consent of the Buyer
      into any agreement or arrangement (whether or not legally enforceable) for
      the
      assignment or licensing or other use of the Results of the Contract (or any
      part
      thereof) which would in any way prevent, restrict or otherwise inhibit the
      Buyer’s use and exploitation of the Results of the Contract (or any part
      thereof). 

     

    B.4 The
      Buyer
      represents that any design or written instruction furnished or given by it
      to
      the Seller under this Contract shall not be such as shall cause the Seller
      to
      infringe any third party patent, registered design or copyright to the best
      of
      the Buyer’s knowledge in any jurisdiction in the performance by the Seller of
      the Works. 

     

    B.5 The
      Seller shall execute (or procure the execution of) such further documents and
      do
      (or procure the doing of) such further acts as the Buyer may reasonably request
      from time to time, at the Buyer’s expense, by way of further assurance of the
      rights assigned or licensed to it pursuant to the provisions of the Contract.
      

     

    THE
      BUYER 

     

    /s/
      Roger E. Girard_____________   

     

    Roger
      E.
      Girard 

     

    Chief
      Executive Officer / Chairman /Exhibit
      10.18

     

    
      

      State
        of Washington

      Radioactive
        Materials License

      Page
        1 of
        11 Pages

    

     

    Pursuant
      to the Nuclear Energy and Radiation Control Act, RCW 70.98, and the Radiation
      Control Regulations, chapters 246-220 through
      246-255 WAC, and in reliance on statements and representations heretofore made
      by the licensee designated below, a license is hereby issued authorizing such
      licensee to transfer, receive, possess and use the radioactive material(s)
      designated below, and to use such

    radioactive
      materials for the purpose(s) and at the place(s) designated below. This
      license is subject to all applicable rules and regulations
      promulgated by the State of Washington Department of Health.

    

    
      	
              1.
                Licensee Name:

               

              ISORAY

            	
              3.
                License Number:

               

              WN-L0213-1

              AMENDMENT
                NO. 5

              (AMENDMENT
                IN ENTIRETY)

            
	
              2.
                Address:

               

              350
                Hills Street Suite 106

              Richland
                Washington 99354

            	
              Expiration
                Date:

               

              31
                July 2009

              __________________________________

              5.
                Reference Number(s):

               

              04-04-66;
                04-07-27; 04-07-39; 04-08-37; 04-08-62; 05-02-44; 05-04-42; 05-04-45;
                05-05-42; 05-05-33; 05-05-55; 05-05-62; 05-05-63; 05-07-01; 05-07-15;
                05-05-55; 05-08-73; 05-09-46;
                05-09-47; 05-09-56; 05-10-01.

               

              Fee
                Code 5, Large Manufacturer

            

    

    

    
      	
              6. Radioactive
                Material

                 
                (element and mass number).

            	
              7. Chemical
                and/or Physical Form.

               

            	
              8. Maximum
                quantity licensee may possess at
                any one time.

               

            

    

    

    
      	
              A. Cesium
                131.

               

            	
              A. Any.

               

            	
              A. 740
                gigabecquerels

               (20
                curies)

            
	 	 	
              Annual
                Possession Quantity not
                to exceed

              37.37
                terabecquerels

              (1010.12
                curies).*

            
	 	 	 
	
              B. Radioactive
                material, atomic
                numbers 3 to 83,
                inclusive.

               

            	
              B. Any.

               

            	
              B. Total
                activity of material not to exceed
                

               740
                megabecquerels

               (20
                millicuries).

            
	 	 	
              Total
                Annual Possession Quantity not
                to exceed

               2.05
                gigabecquerels

               (55.4
                millicuries).*

            
	 	 	 
	
              C. Barium
                131.

               

            	
              C. Liquid
                and/or solid.

               

            	
              C. 2.22
                terabecquerels

               (60
                curies).

            
	 	 	
               Annual
                Possession Quantity not
                to exceed

               37
                terabecquerels

               (1000
                curies).*

            

    

     

    
      
         

      

      
         

        
          

        

      

      
         

      

    

    

    
      

      State
        of Washington

      Radioactive
        Materials License

      Page 2
        of
        11 Pages

      License
        Number: WN-L0213-1

      
        Amendment
          No. 5

      

    

     

    
      	
              D. Barium
                133.

               

            	
              D. Liquid
                and/or solid.

               

            	
              D. 185
                gigabecquerels

               (5
                curies).

            
	 	 	
               Annual Possession
                Quantity not
                to exceed

               185
                gigabecquerels

               (5
                curies).*

            
	 	 	 
	
              E. Barium
                133m.

               

            	
              E. Liquid
                and/or solid.

               

            	
              E. 37
                gigabecquerels

               (1
                curie).

            
	 	 	
               Annual
                Possession Quantity not
                to exceed

               1.85
                terabecquerels

               (50
                curies).*

            
	 	 	 
	
              F. Barium
                135m.

               

            	
              F. Liquid
                and/or solid.

               

            	
              F. 185
                gigabecquerels

               (5
                curies).

            
	 	 	
               Annual
                Possession Quantity not
                to exceed

               9.25
                terabecquerels

               (250
                curies).*

            
	 	 	 
	
              G. Barium
                140.

               

            	
              G.
                 Liquid
                and/or solid.

               

            	
              G. 185
                megabecquerels

               (5
                millicuries).

            
	 	 	
              Annual
                Possession Quantity not
                to exceed

               7.4
                gigabecquerels

               (200
                millicuries).*

            
	 	 	 
	
              H. Cesium
                132.

               

            	
              H. Any.

               

            	
              H. 740
                megabecquerels

               (20
                millicuries).

               

            
	 	 	
               Annual
                Possession Quantity not
                to exceed

               37.37
                gigabecquerels

               (1.01
                curies).*

            

    

    

    
      
         

      

      
         

        
          

        

      

      
         

      

    

     

    
      
        

        State
          of Washington

        Radioactive
          Materials License

        Page 3
          of
          11 Pages

        License
          Number: WN-L0213-1

        
          Amendment
            No. 5

        

      

    

     

    
      	
              I. Lanthanum-140.

               

            	
              I. Liquid
                and/or solid.

               

            	
              I. 7.4
                gigabecquerels

               (200
                millicuries).

            
	 	 	
               Annual
                Possession Quantity not
                to exceed

               462.5
                gigabecquerels

               (12.5
                curies).*

            
	 	 	 
	
              J. Cesium
                131.

               

            	
              J. Sealed
                Source:

              Sealed
                source &

              Device
                Registry

              WA-1220-S-101-S.

            	
              J. No
                single source to exceed

               2.41
                gigabecquerels

               (65
                millicuries). **

            
	 	 	 
	
              K. Radioactive
                material, atomic
                numbers 3 to 83,
                inclusive.

               

            	
              K. Sealed
                source (manufactured
                or distributed
                under a specific
                license 

               issued
                by a Licensing
                State or an
                Agreement State).

               

            	
              K. No
                single source to exceed

               11.1
                megabecquerels

               (300
                microcuries).

               

               Total
                activity shall not exceed

               185
                megabecquerels

               (5
                millicuries).

            
	 	 	 
	
              L. Cobalt
                57.

               

            	
              L. Sealed
                source (manufactured
                or distributed
                under a specific
                license

               issued
                by a Licensing
                State or an
                Agreement State).

               

            	
              L. No
                single source to exceed

               222
                megabecquerels

               (6
                millicuries);

               

               Total
                activity shall not exceed

               1.11
                gigabecquerels

               (30
                millicuries).

            
	 	 	 
	
              M. Cesium
                137

               

            	
              M. Sealed
                source (J.L.
                Shepherd model
                6810)

               

            	
              M. 1.48
                gigabecquerels

               (40
                millicuries)

            

    

     

    * Annual
      Possession Quantity as defined in WAC 246-247-030(5).

    
      ** In
        addition to the possession limits in Item 8, the licensee shall further restrict
        the possession
        of licensed material to quantities below the minimum limit specified in WAC
        246-235-077,
        Special Requirements for Emergency Planning.

    

    

    
      
         

      

      
         

        
          

        

      

      
         

      

    

     

      
        

        State
          of Washington

        Radioactive
          Materials License

        Page 4
          of
          11 Pages

        License
          Number: WN-L0213-1

        
          Amendment
            No. 5

           

        

      

    

    CONDITIONS

    
      	9.	
              Authorized
                Use.

            

    

    

    
      	 	
              A-J.

            	
              Research
                and development; processing and
                processing byproducts,
                manufacturing and distribution of sealed sources; storage and
                waste.

            

    

     

    
      	 	
              B.

            	
              Residual
                contaminants of the elution process and leak test
                samples.

            

    

    

    
      	 	
              K
                -
                M.

            	
              To
                be used for quality assurance and calibration of radiation detection
                instrumentation and/or dose
                calibrators.

            

    

     

    
      	
              10.

            	
              A.

            	
              Subitems
                A, B and J ONLY
                of
                License Items 6, 7 and 8, shall be stored and/or used
                at the Radiochemical Processing Laboratory, Building 325 in the Hanford
                Site
                300 area, Redwood Street, Richland,
                Washington.

            

    

    

    

    
      	 	
              B.

            	
              Subitems
                A - M of License Items 6, 7 and 8 shall be stored and/or used in
Building
                13, Bay-3, of the Pacific EcoSystems (PECOS) facility, 2025 Battelle
                Boulevard,
                Richland, Washington
                99354.

            

    

     

    
      	
              11.

            	
              The
                licensee shall comply with the provisions of chapter 246-220 WAC
                "Radiation Protection - General
                Provisions"; chapter 246-221 WAC "Radiation Protection Standards";
                chapter
                246-222 WAC
                "Radiation Protection - Worker Rights"; chapter 246-231 WAC “Packaging and
                Transportation
                of Radioactive Material”; chapter 246-232 WAC "Radioactive Material
                -Licensing
                Applicability"; chapter 246-235 WAC "Radioactive Materials - Specified
                Licenses"; chapter
                246-247 WAC "Radiation Protection - Air Emissions"; and chapter 246-249
                WAC "Radioactive
                Waste - Use of the Commercial Disposal
                Site".

            

    

    

    

    
      	
              12.

            	
              The
                Radiation Safety Officer for this program shall be Garrett N. Brown,
                Ph.D.

            

    

    

    
      	
              13.

            	
              Radioactive
                material, as described in Subitems below, shall be used by, or under
                the
                supervision of:

            

    

     

    
      	
            	A.
              Garrett N. Grown, Ph.D.	
               Subitems
                A - M of Items 6, 7, and
                8.

            

    

     

    
      	
            	B. David
              J. Swanberg, P.E.	
               Subitems
                A - J of Items 6, 7, and 8.

            

       

      
        	
              	C. Lemuel
                Matthews	
                 Subitems
                  A - M of Items 6, 7, and 8.

              

         

        
          	
                	D. Dale
                  E. Boyce	
                   Subitems
                    A - M of Items 6, 7, and 8.

                

           

          
            	
                  	E. Matthew
                    J. Bales	
                     Subitems
                      A - L of Items 6, 7, and 8.

                  

            
               

            

          

        

      

    

    
      
         

      

      
         

        
          

        

      

      
         

      

       

      
        
          

          State
            of Washington

          Radioactive
            Materials License

          Page 5
            of
            11 Pages

          License
            Number: WN-L0213-1

          
            Amendment
              No. 5

          

        

      

    

     

    
      	
              14.

            	
              The
                licensee is authorized to transport and/or ship licensed material
                only in
                accordance with the provisions of chapter 246-231 WAC, “Packaging and
                Transportation of Radioactive
                Material”.

            

    

     

    
      	
              15.

            	
              The
                licensee shall conduct a bioassay program in accordance with the
                criteria
                set forth in WAC 246-221-040 and WAC
                246-221-100.

            

    

     

    
      	
              16.

            	
              Personnel
                dosimetry for external exposure:

            

    

    

    
      	 	
              A.

            	
              Extremity
                monitoring (finger rings) shall be provided to individuals work
                with:

            

    

    

    
      	 	 	
              1.

            	
              Any
                radioactive materials inside hot cells or glove boxes,
                or

            

    

    

    
      	 	 	
              2.

            	
              Greater
                than 37 megabecquerels (1 millicurie) at a time or 370 megabecquerels
                (10
                millicuries)
                per month of high-energy beta or gamma emitters such as Phosphorus-32,
                or
                Iodine-131.

            

    

    

    

    
      	 	
              B.

            	
              Whole
                body dosimeters shall be provided to individuals working with more
                than
                370 megabecquerels
                (10 millicuries) per month of high-energy beta emitters or more than
                37
                megabecquerels
                (1 millicurie) per month of gamma emitters with energies greater
                than 200
                keV.

            

    

    

    

    
      	 	
              C.

            	
              Whole
                body dosimeters shall be provided to declared pregnant workers working
                with more
                than 370 megabecquerels (10 millicuries) per month of high-energy
                beta
                emitters or more
                than 3.7 megabecquerels (0.1 millicurie) per month of gamma emitters
                with
                energies greater
                than 200 keV.

            

    

    

    

    
      	
              17.

            	
              The
                licensee's emergency procedures shall conform to procedures outlined
                in
                the Washington State Radiation Emergency Handbook revised November
                1991,
                or subsequent revisions.

            

    

     

    
      	
              18.

            	
              A.

            	
              1.

            	
              Each
                sealed source, except for subitem 6.J, containing licensed material
                shall
                be tested
                for leakage and/or contamination at intervals not to exceed six months.
                In
                the absence
                of a certificate from a transferor indicating that a test has been
                made
                within six
                months prior to transfer, a sealed source received from another person
                shall not
                be put into use until
                tested.

            

    

     

    
      	 	 	
              2.

            	
              Notwithstanding
                the periodic leak test required by this condition, any licensed sealed
                source
                is exempt from such leak tests when the source contains 3.7 megabecquerels
                (100
                microcuries) or less of beta and/or gamma emitting material or 370
                kilobecquerels
                (10 microcuries) or less of alpha emitting
                material.

            

    

    

    

    
      
         

      

      
         

        
          

        

      

      
         

      

       

      
        
          

          State
            of Washington

          Radioactive
            Materials License

          Page 6
            of
            11 Pages

          License
            Number: WN-L0213-1

          
            Amendment
              No. 5

             

          

        

      

    

    
      	
              18.

            	
              A.

            	
              3.

            	
              Notwithstanding
                the periodic leak test required by this Condition, any licensed sealed
                source
                is exempt from such leak tests when the source is in permanent storage.
                In
                lieu
                of leak tests, the storage area shall be surveyed every six months
                and the
                sources shall
                be leak tested prior to any handling or removal from
                storage.

            

    

    

    

    
      	 	
              B.

            	
              The
                test shall be capable of detecting the presence of 185 becquerels
                (0.005
                microcurie) of radioactive
                material on the test sample. The test sample shall be taken from
                the
                sealed source
                or from the surfaces of the device in which the sealed source is
                permanently mounted
                or stored on which one might expect contamination to accumulate.
                Records
                of leak
                test results shall be kept in units of becquerels (or microcuries)
                and
                maintained for inspection
                by the department.

            

    

     

    
      	 	
              C.

            	
              If
                the test reveals the presence of 185 becquerels (0.005 microcurie)
                or more
                of removable contamination,
                the licensee shall immediately withdraw the sealed source from use
                and
                shall
                cause it to be decontaminated and repaired or to be disposed in accordance
                with department
                regulations. A report shall be filed within five (5) days of the
                test with
                the department
                describing the equipment involved, the test results, and the corrective
                action taken.

            

    

    

    

    
      	 	
              D.

            	
              The
                licensee is authorized to perform leak test sampling in accordance
                with
                their Radioactive
                Materials License Application. The analysis shall be performed by
                persons
                specifically
                authorized by the department, the U.S. Nuclear Regulatory Commission,
                an
                Agreement
                State, or a Licensing State to perform such services. Alternatively,
                leak
                test samples
                may be collected and/or analyzed by other persons specifically authorized
                by the department,
                the U.S. Nuclear Regulatory Commission, an Agreement State, or a
                Licensing
                State
                to perform such services. Licensing State Authorization applies to
                naturally occurring
                and accelerator produced radioactive material (NARM)
                only.

            

    

    

    

    
      	
              19.

            	
              The
                licensee shall maintain security and control of all radioactive materials
                received and possessed under the
                license.

            

    

     

    
      	 	
              A.

            	
              The
                licensee shall conduct a physical inventory every six months to account
                for all sealed sources
                received and possessed under the license. The inventory shall include
                activities, radionuclides,
                source descriptions, serial numbers, locations, name of the person
                conducting
                the inventory, and the date of the
                inventory.

            

    

    

    

    
      	 	
              B.

            	
              The
                licensee shall maintain a documented running inventory of all unsealed
                radioactive materials
                received, possessed, used, transferred and disposed of under the
                license.
                The records
                shall include, radionuclides, activities, and disposition. Records
                shall
                be maintained
                for inspection by the
                department.

            

    

    

    

    
      
         

      

      
         

        
          

        

      

      
         

      

       

      
        
          

          State
            of Washington

          Radioactive
            Materials License

          Page 7
            of
            11 Pages

          License
            Number: WN-L0213-1

          
            Amendment
              No. 5

             

          

        

      

    

    
      	
              20.

            	
              All
                hoods used for storage, use and/or control of radioactive material
                shall
                have a flow rate that
                meets the manufacturer’s specifications, with the hood sash at the
                specified working height.
                Hood flow rates shall be annually checked and adjusted as necessary
                . A
                record of the
                annual flow-rate check shall be maintained for inspection by the
                department.

            

    

    

    

    
      	
              21.

            	
              Operations
                involving License Conditions 9.A - 9.J, at the use location in Building
                13, Bay-3,
                of the Pacific EcoSystems (PEcoS) facility, 2025 Battelle Boulevard,
                Richland, Washington
                99354 shall be conducted in accordance with of RP-110, “Radiological
                Environmental
                Monitoring Plan” dated 1 October 2005, approved by the Department of
                Health.

            

    

    

    

    
      	
              22.

            	
              Surveys
                for contamination at the use location in Building 13, Bay-3, of the
                Pacific EcoSystems
                (PEcoS) facility, 2025 Battelle Boulevard, Richland, Washington 99354
                shall
                be performed and recorded in accordance with procedure RP-402,
                “Radiological Survey
                of Work Areas and Equipment” dated 1 July 2005 and RP-110, “Radiological
                Environmental
                Monitoring Plan”, dated 1 October
                2005.

            

    

     

    
      	
              23.

            	
              Full
                and current copies of the facility’s Emergency and Standard Operating
                Procedures shall be maintained
                onsite. The licensee may make minor changes to the Emergency and
                Standard
                Operating
                Procedures that do not affect or compromise radiation safety, or
                cause a
                potential or actual
                increase in exposure to workers or the
                public.

            

    

    

    

    
      	
              24.

            	
              Survey
                instruments and instruments used for the required environmental monitoring
                plan shall be
                calibrated annually by persons specifically authorized by the department,
                the U.S. Nuclear Regulatory
                Commission, or an Agreement State to perform such
                services.

            

    

     

    
      	
              25.

            	
              The
                licensee shall comply with the conditions outlined in Attachment
                One -
                Radioactive Air Emissions.

            

    

     

    
      	
              26.

            	
              In
                the event the licensee chooses to terminate their Radioactive Materials
                License, or vacate authorized
                use locations the licensee shall follow the applicable requirements
                listed
                in chapter 246-221
                WAC; chapter 246-232 WAC and/or chapter 246-246
                WAC.

            

    

    

    

    
      	
              27.

            	
              All
                individuals working directly with radioactive materials or frequenting
                radioactive materials use
                areas shall receive training commensurate with their duties and
                responsibilities before beginning
                work or frequenting the area and at least annually thereafter. At
                a
                minimum training shall
                include; health protection considerations for individuals and potential
                offspring;  procedures
                to minimize exposure; purposes and functions of protective devices;
                company radioactive
                material work procedures; applicable state Regulations (Title 246
                WAC) and
                the conditions
                of this license. Documentation indicating who was trained, subjects
                and
                dates shall be
                maintained for inspection by the
                department.

            

    

     

    
      
         

      

      
         

        
          

        

      

      
         

      

       

      
        
          

          State
            of Washington

          Radioactive
            Materials License

          Page 8
            of
            11 Pages

          License
            Number: WN-L0213-1

          
            Amendment
              No. 5

             

          

        

      

    

    
      	
              28.

            	
              The
                licensee is authorized to hold radioactive material with a physical
                half-life of less than 100 days
                for decay-in-storage before disposal in ordinary trash provided the
                following conditions are met:
                1) Radioactive waste shall be held for a minimum of 10 half-lives;
                2)
                Before disposal as ordinary
                trash radioactive waste must be surveyed with an appropriate survey
                meter,
                without any shielding
                on the meter or package, to determine that it is not distinguishable
                from
                background and
                all radiation labels are removed or obliterated; 3) A record of each
                disposal shall be made. Records
                shall include: date material (container) was put into storage,
                radionuclides disposed, date
                of disposal, survey instrument used, measured count rate (in counts
                per
                minute) on the surface
                of each waste container, background (in counts per minute) radiation
                level
                and name of individual
                performing survey.

            

    

    

    

    
      	
              29.

            	
              The
                licensee shall distribute only sealed sources and/or devices for
                which a
                Sealed Source and Device
                Registry Certificate has been issued by the Washington Department
                of
                Health, the U. S. Nuclear
                Regulatory Commission, or other Agreement/Licensing State. Sealed
                sources
                and/or devices
                distributed must adhere to the design specifications described in
                the
                Sealed Sources and Device
                Registry Certificate. Any changes in the design or specifications
                of these
                sealed sources and/or
                devices require the manufacturer to apply for and receive an amendment
                to
                the Sealed Source
                and Device Registry Certificate prior to
                distribution.

            

    

     

    
      	
              30.

            	
              A.

            	
              Each
                sealed source fabricated by the licensee shall be inspected and tested
                for
                construction defects,
                leakage, and /or contamination prior to use or transfer as a sealed
                source. If the inspection
                or test reveals any construction defects or the presence of 185 becquerels
                (0.005 microcurie)
                or more of removable contamination, the licensee shall immediately
                withdraw the
                sealed source from use and shall cause it to be decontaminated, repaired
                and re-tested, or
                disposed in accordance with department
                regulations.

            

    

     

    
      	 	
              B.

            	
              Records
                of leak test results shall be kept in units of becquerels (or microcuries)
                and maintained
                for inspection by the
                department.

            

    

    

    
      	 	
              C.

            	
              The
                following events require the licensee to file a written report with
                the
                department within
                five (5) days, describing the deviation, failure, or leakage, and
                the
                corrective action taken:

            

    

    

    

    
      	 	 	
              1.

            	
              A
                significant deviation from or failure of the quality control/assurance
                program such that
                product failure occurs during shipping or use in a
                patient.

            

    

    

    
      	 	 	
              2.

            	
              Product
                structural design defects resulting in or causing product
                failure.

            

    

    

    
      	 	 	
              3.

            	
              The
                presence of 185 becquerels (0.005 microcurie) or more of removable
                contamination) is discovered by a user of the
                product.

            

    

     

    
      
         

      

      
         

        
          

        

      

      
         

      

    

     

    
      
        

        State
          of Washington

        Radioactive
          Materials License

        Page 9
          of
          11 Pages

        License
          Number: WN-L0213-1

        
          Amendment
            No. 5

        

      

    
      	
              30.

            	
              D.

            	
              The
                licensee shall provide a certificate of origin for the recipient
                showing
                the sealed source
                leak test results, in units of becquerels or microcuries, for each
                lot of
                sources transferred.
                The document shall certify that less than 185 becquerels or 0.005
                microcurie or
                more of removable contamination is
                present.

            

    

     

    
      	 	
              E.

            	
              The
                licensee is authorized to collect and analyze leak test samples,
                for their
                own sources (not
                as a commercial service), in accordance with procedures described
                in their
                Radioactive
                Materials License Application. Alternatively, leak test samples may
                be
                collected
                and/or analyzed by other persons specifically authorized by the
                department, the U.S.
                Nuclear Regulatory Commission, an Agreement State, or a Licensing
                State to
                perform
                such services. Licensing State authorization applies to naturally
                occurring and accelerator
                produced radioactive material (NARM) only.

               

              The
                Radiation Safety Officer shall maintain a list of persons trained
                and
                authorized to perform
                the analysis of sealed source leak test
                samples.

            

    

     

    
      	
              31.

            	
              The
                licensee shall manufacture, label, and distribute sealed sources
                and/or
                devices in accordance with
                WAC 246-235-102, “Manufacture and Distribution of Sources or Devices
                Containing Radioactive
                Materials For Medical Use” and NUREG-1556, Volume 12, “Consolidated
                Guidance
                About Materials Licenses: Program-Specific Guidance about Possession
                Licenses for Manufacturing
                and Distribution”.

            

    

    

    

    
      	
              32.

            	
              Medical
                brachytherapy sources (i.e. seeds) shall only be distributed to users
                authorized under a specific radioactive materials
                license.

            

    

     

    
      	
              33.

            	
              The
                Radiation Safety Officer shall perform an annual review of the radiation
                safety program for adherence
                to the conditions of the license, Title 246 WAC and ALARA concepts.
                A
                record of this
                audit shall be maintained for inspection by the
                department.

            

    

    

    

    
      	
              34.

            	
              Contamination
                levels in hot cells and glove boxes shall be maintained
                ALARA.

            

    

    

    
      	
              35.

            	
              In
                addition to the possession limits in Item 8, the licensee shall further
                restrict the possession
                of licensed material to quantities below the minimum limit specified
                in
                WAC 246-235-075
                for establishing decommissioning financial
                assurance,

               

              OR,

               

              The
                licensee shall maintain a decommissioning funding plan in accordance
                with
                WAC 246-235-075
                and Nuclear Regulatory Commission NUREG
                1757.

            

    

     

    
      	 	
              A.

            	
              The
                decommissioning funding plan shall be updated and resubmitted during
                each
                license renewal.

            

    

     

    
      
         

      

      
         

        
          

        

      

      
         

      

       

      
        
          

          State
            of Washington

          Radioactive
            Materials License

          Page 10
            of
            11 Pages

          License
            Number: WN-L0213-1

          
            Amendment
              No. 5

             

          

        

      

    

    
      	
              35.

            	
              B.

            	
              Financial
                Surety to cover the decommissioning funding plan shall be maintained
                as
                required by WAC
                246-235-075.

            

    

     

    
      	
              36.

            	
              The
                licensee shall respond in the manner, and within the time frame,
                specified
                to any and all department
                correspondence necessary to keep the license and related information
                current.

               

              Where
                the licensee has submitted proposed corrective action, such action
                shall
                be fully implemented
                in a timely manner, unless the department has subsequently modified
                the
                licensee’s
                proposed corrective action.

            

    

    

    

    
      	
              37.

            	
              In
                accordance with WAC 246-249-020 “Site Use Permits”, each licensee shall
                possess a valid and
                unencumbered site use permit prior to the transfer of radioactive
                waste,
                directly to or through
                an authorized licensed broker, for disposal of such waste at any
                commercial disposal facility
                in the state of Washington. In addition the licensee shall comply
                with the
                permit requirements
                of the Washington Department of Ecology.

               

              The
                Licensee shall retain the valid and unencumbered site use permit
                until
                provided documentation,
                from the disposal facility or broker, that the radioactive waste
                has been
                accepted
                by the disposal facility. The licensee shall retain the records of
                disposal for inspection
                by the Department.

            

    

     

    
      	
              38.

            	
              Except
                as specifically provided by this license, the licensee shall possess
                and
                use radioactive material
                described in Items 6, 7, and 8 of this license in accordance with
                statements, representations
                and procedures contained in the documents listed below. The department's
                "Rules
                and Regulations for Radiation Protection" shall govern the licensee's
                statements in applications
                or letters, unless the statements are more restrictive than the
                regulations.

            

    

     

    
      	 	
              A.

            	
              Application
                and attachments dated 9 April 2004.

            

    

    

    
      	 	
              B.

            	
              Letter
                with attachments dated 13 July 2004; RE: Initial application and
                Building
                Emergency Procedure, Radiochemical Processing Laboratory (RPL)
                Building.

            

    

     

    
      	 	
              C.

            	
              Email
                dated 19 July 2004; RE: clarification of isotope
                limits.

            

    

    

    
      	 	
              D.

            	
              Sealed
                source and device registration
                WA-1220-S-101-S.

            

    

    

    
      	 	
              E.

            	
              Letter
                dated 15 February 2005 and attachments; RE: Procedure
                updates.

            

    

     

    
      
         

      

      
         

        
          

        

      

      
         

      

       

      
        
          

          State
            of Washington

          Radioactive
            Materials License

          Page 11
            of
            11 Pages

          License
            Number: WN-L0213-1

          
            Amendment
              No. 5

             

          

        

      

    

    
      	
              38.

            	
              F.

            	
              Letter
                dated 14 April 2005 and attachments; RE: Copy of Benton County NOC,
Application
                for Installation of an Air Pollution Source regarding WSB-3; Letter
                dated
                15
                February 2005 (received 19 April 2005) and attachments; RE: New facility
                proposal; Attachment
                L 18 April 2005 and; RE: air emissions questionnaire; Letter dated
                11 May
                2005
                and attachments; RE: NOC air license application for WSB-3; Letter
                dated
                11 May 2005;
                RE: Request to add new facility; Memorandum of Understanding dated
                24 May
                2005;
                RE: signed by PECOS and IsoRay; and Letter dated 25 May 2005; RE:
                Authorization
                from PECOS to occupy building and
                construct.

            

    

    

    

    
      	 	
              G.

            	
              Email
                dated 20 April 2005; RE: distances to various members of the public;
                letter and attachments
                dated 11 May 2005; RE: Notice of Construction for Air Emissions Unit;
                letter
                and attachments dated 28 June
                2005.

            

    

    

    
      	 	
              H.

            	
              Letter
                dated 28 June 05 and attachments on CD-R; RE: Updated Application
                for new
                facility
                operations, new authorized user, additional isotopes; updated procedures
                small business
                certificate, etc.

            

    

    

    

    
      	 	
              I.

            	
              Letter
                dated 23 August 2005; RE: new sealed source for instrument calibration
                and
                QA and increase
                Ba 131 activity limit.

            

    

    

    
      	 	
              J.

            	
              RP-110,
                “Radiological Environmental Monitoring Plan” received 23 September
                2005.

            

    

    

    
      	 	
              K.

            	
              Letter
                and Attachments dated 26 September 2005; RE: add new AUR and calibration
                sources.

            

    

     

    
      	 	
              L.

            	
              Revision
                of RP Procedures, 201, 202, 203, 204, 206, 207, 208, 301, 302, 303,
                501,
                502, 503,
                504, 601, 602, 603 and various forms; received 30 September
                2005.

            

    

    

    
      	 	
              M.

            	
              Revision
                of “RP 110, Radiological Environmental Monitoring Plan” and RP Procedures
                100, 106, 107, 404, and 801; received 3 October 2005 and RP Procedures
                108
                and 901 received 6 October
                2005.

            

    

     

    
      	 	 	 
	 	FOR
              THE STATE OF WASHINGTON DEPARTMENT OF HEALTH
	 
 	 
 	 
 
	Date:
              6
              October 2005  	By:  	/s/ Anine
              Grumbles
	 	
              
Anine
              Grumbles
	 	Radioactive
              Materials Licensing

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