Document:

EXHIBIT 10.38

 

COMMERCIAL LEASE

 

	
  1.   PARTIES

  (fill in)

  	
   

  	
  58
  Charles Street Limited Partnership, A Massachusetts Limited Partnership, 

  c/o The Cambridge Company, 87 Blanchard Road, Cambridge, MA 02138

  LESSOR, which expression shall include its heirs, successors, and assigns where the context so
  admits, does hereby lease to Sontra
  Medical, Inc. 
                                   21
  Erie Street, Suite 22 Cambridge, MA 

  LESSEE, which expression shall include its successors, executors, administrators, and assigns where
  the context so admits, and the LESSEE hereby leases the following described
  premises:

  
	
   

  	
   

  	
   

  
	
  2.   PREMISES 

  (fill in and include if applicable, suite number, floor
  number, and square feet)

  	
   

  	
  7,602 square feet on the terrace level (as shown on Exhibit
  P) of the building known as of 58 Charles Street, Cambridge, MA and seven
  parking spaces, in the building parking lot.

   

   

  together with the right to
  use in common, with others entitled thereto, the hallways, stairways, and
  elevators, necessary for access to said leased premises and lavatories
  nearest thereto.

  
	
   

  	
   

  	
   

  
	
  3.   TERM

  (fill in)

  	
   

  	
  The term of this lease
  shall be for five years 

  commencing on September 1, 1998 and
  ending on July 31, 2003.

  
	
   

  	
   

  	
   

  
	
  4.   RENT

  (fill in)

  	
   

  	
  The LESSEE shall pay to
  the LESSOR rent at the rate of see
  Exhibit A dollars per year,
  payable in advance in monthly installments of                            .

  
	
   

  	
   

  	
   

  
	
  5.   SECURITY DEPOSIT

  (fill in)

  	
   

  	
  Upon the execution of this
  lease, the LESSEE shall pay to the LESSOR the amount of $31,675.00 dollars, which shall be held
  as a security for the LESSEE’s performance as herein provided and promptly
  refunded to the LESSEE at the end of this lease with accrued interest
  calculated at prevailing money market rates subject to the LESSEE’s
  satisfactory compliance with the conditions hereof.  The deposit will also be promptly returned to the LESSEE with
  appropriate interest, provided the LESSEE is in good standing, if this lease
  is terminated before the end of the term as per any section in this lease.

  
	
   

  	
   

  	
   

  
	
  6.   RENT ADJUSTMENT

   

   

   

  A.  TAX

  ESCALATION

  (fill in or delete)

  	
   

  	
  If in any tax year
  commencing with the fiscal year 1999
  the real estate taxes on the land and buildings, of which the leased premises
  are a part, are in excess of the amount of the real estate taxes thereon for
  the fiscal year 1998
  (hereinafter called the “Base Year”), LESSEE will pay to LESSOR as additional
  rent hereunder, when and as designated by notice in writing by LESSOR, 15.92 per cent of such excess that may
  occur in each year of the term of this lease or any extension or renewal
  thereof and proportionately for any part of a fiscal year.  If the LESSOR obtains an abatement of any
  such excess real estate tax, a proportionate share of such abatement, less
  the reasonable fees and costs incurred in obtaining the same, if any, shall
  be refunded to the LESSEE.

  

 

 

	
  B.   OPERATING COST ESCALATION

  (fill in or delete)

  	
   

  	
  The LESSEE shall pay to
  the LESSOR as additional rent hereunder when and as designated by notice in
  writing by LESSOR, 15.92 per
  cent of any increase in operating expenses over those incurred during the
  calendar year 1998.  Operating expenses are defined for the
  purposes of this agreement as:

   

  1. All
  building operating expenses including electricity delivered to the premises
  for lights and outlets (which shall be a pro-rated share of the electricity
  used on the Terrace Level based on occupancy).  Tenant’s share shall be 61.55% of the Terrace electric bill.

   

  See Exhibit B. 

  This
  increase shall be prorated should this lease be in effect with respect to
  only a portion of any calendar year.

  
	
   

  	
   

  	
   

  
	
  7.   UTILITIES 

  	
   

  	
  The LESSOR agrees to
  furnish electricity, reasonably hot and cold water, and reasonable heat and
  air conditioning to the leased premises, the hallways, stairways, elevators,
  and lavatories during normal business hours on regular business days of the
  heating and air conditioning seasons of each year, to furnish elevator
  service and to light passageways and stairways during business hours, and to
  furnish such cleaning service as is customarily furnished in similar first
  class office buildings in Cambridge, all subject to interruption due to any
  accident, to the making of repairs, alterations, or improvements, to labor
  difficulties, to trouble in obtaining fuel electricity, service, or supplies
  from the sources from which they are usually obtained for said building, or
  to any cause beyond the LESSOR’s reasonable control.  Normal business hours are from 8 AM to 6
  PM, Monday through Friday.  After
  hours air conditioning will be billed at $35 per hour. 

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  LESSOR shall have no
  obligation to provide utilities or equipment other than the utilities and
  equipment within the premises as of the commencement date of this lease.  In the event LESSEE requires additional
  utilities or equipment, the installation and maintenance thereof shall be the
  LESSEE’s sole obligation, provided that such installation shall be subject to
  the written consent of the LESSOR. 

  
	
   

  	
   

  	
   

  
	
  8.   USE OF LEASED PREMISES

  (fill in)

  	
   

  	
  The LESSEE shall use the
  leased premises only for the purpose of 

  a business office and lab space for light
  manufacturing and research and development

  
	
   

  	
   

  	
   

  
	
  9.   COMPLIANCE

  	
   

  	
  The LESSEE acknowledges
  that no trade or occupation shall be conducted in the leased premises or use
  made thereof which will be unlawful, improper, noisy or offensive, or
  contrary to any law or any municipal bylaw or ordinance in force in the city
  or town in which the premises are situated.

  

 

2

 

	
  10. FIRE INSURANCE 

  	
   

  	
  The LESSEE shall not
  permit any use of the leased premises which will make voidable any insurance
  on the property of which the leased premises are a part, or on the contents
  of said property or which shall be contrary to any law or regulation from
  time to time established by the New England Fire Insurance Rating Association
  or any similar body succeeding to its powers.  The LESSEE shall on demand reimburse the LESSOR, and all other
  tenants, all extra insurance premiums caused by the LESSEE’s use of the
  premises. 

  
	
   

  	
   

  	
   

  
	
  11. MAINTENANCE

   

   

  A.  LESSEE’S OBLIGATIONS

   

  	
   

  	
  The LESSEE agrees to
  maintain the leased premises in good condition, normal wear and tear and
  damage by fire and other casualty only excepted, unless such maintenance is
  required because of the LESSOR or those for who conduct the LESSOR is legally
  responsible, and whenever necessary, to replace plate glass and other glass
  therein, acknowledging that the lease premises are now in good order and the
  glass whole.  The LESSEE shall not
  permit the premises to be overloaded, damaged, stripped, or defaced, nor
  suffer any waste.  LESSEE shall obtain
  written consent of LESSOR before erecting any sign on the premises. 

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  All
  LESSEE’s personal property, fixtures and equipment kept at the leased
  premises shall be at the sole risk and hazard of the LESSEE; provided,
  however, Lessor shall be responsible for casualties resulting from Lessor’s
  negligence or willful misconduct.  

  
	
   

  	
   

  	
   

  
	
  B.   LESSOR’S OBLIGATIONS 

  	
   

  	
  The LESSOR agrees to
  maintain the structure of the building of which the leased premises are a
  part in the same good sound condition as it is at the commencement of the
  term or as it may be put in during the term of this lease, reasonable wear
  and tear, damage by fire and other casualty only excepted, unless such
  maintenance is required because of the LESSEE or those for whose conduct the
  LESSEE is legally responsible.  LESSOR
  also agrees to maintain in good operating condition the plumbing, heating and
  air conditioning, and electrical systems serving the demised premises. 

  
	
   

  	
   

  	
   

  
	
  12. ALTERATIONS

  	
   

  	
  The LESSEE shall not make
  structural alterations or additions to the leased premises, but may make
  nonstructural alterations provided the LESSOR consents thereto in writing,
  which consent shall not be unreasonably withheld or delayed.  All such allowed alterations shall be at
  LESSEE’s expense and shall be in quality at least equal to the present
  construction.  LESSEE shall not permit
  any mechanics’ liens, or similar liens, to remain upon the leased premises
  for labor and material furnished to LESSEE or claimed to have been furnished
  to LESSEE in connection with work of any character performed or claimed to
  have been performed at the direction of LESSEE and shall cause any such lien
  to be released of record forthwith without cost to LESSOR.  Any alterations or improvements made by
  the LESSEE shall become the property of the LESSOR at the termination of
  occupancy as provided herein. 
  Notwithstanding the foregoing, LESSOR hereby consents to the
  installation by LESSEE, at LESSEE’S sole expense, of up to two (2) fume hoods
  provided such fume hoods are installed in compliance with all applicable
  laws, codes, and regulations.  LESSEE
  shall provide LESSOR a drawing identifying the locations of the fume hoods,
  and LESSEE shall utilize the existing exhaust ventillation stack which is
  connected to a building rooftop vent used by the former lab tenant.  LESSEE shall provide architectural
  drawings, equipment specifications, and copies of all City of Cambridge and
  state permits to LESSOR.

  
	
   

  	
   

  	
   

  
	
  13. ASSIGNMENT— SUBLEASING

  	
   

  	
  The LESSEE shall not
  assign or sublet the whole or any part of the leased premises without
  LESSOR’s prior written consent which consent shall not be unreasonably
  withheld.  Notwithstanding such
  consent, LESSEE shall remain liable to LESSOR for the payment of a rent and
  for the full performance of the covenants and conditions of this lease.  Notwithstanding the foregoing provisions
  of the Section 13.  LESSEE may upon
  written notice but without the consent of LESSOR, assign this lease or sublet
  all or a part of the leased premises to (i) an institutional lender by way of
  a leasehold mortgage as collateral security, (ii) subsidiary or other
  affiliate of LESSEE or (iii) a business entity of equal or greater net worth
  than LESSEE which acquires LESSEE through acquisition or merger.

  
	
   

  	
   

  	
   

  
	
  14. SUBORDINATION 

  	
   

  	
  This lease shall be
  subject and subordinate to any and all mortgages, deeds of trust and other
  instruments in the nature of a mortgage, now or at any time hereafter, a lien
  or liens on the property of which the leased premises are a part and the
  LESSEE shall, when requested, promptly execute and deliver such written
  instruments as shall be necessary to show the subordination of this lease to
  said mortgages, deeds of trust or other such instruments in the nature of a
  mortgage.  The LESSOR will obtain a
  non-disturbance agreement from such mortgagee, and provided the LESSEE
  maintains the lease in good standing, LESSEE will be entitled to quiet
  enjoyment and possession of the leased premises, in accordance with the provisions
  of the lease, notwithstanding any default by the LESSOR under its mortgage,
  deeds of trust or other such instruments in the nature of a mortgage. 

  

 

3

 

	
  15. LESSOR’S ACCESS

  	
   

  	
  The LESSOR or agents of the
  LESSOR may, at reasonable times, enter to view the leased premises (provided
  such entry does not interfere with LESSEE’s normal business operations) and
  may remove placards and signs not approved and affixed as herein provided,
  and make repairs and alterations as LESSOR should elect to do and may show
  the leased premises to others, and at any time within six (6) months before
  the expiration of the term, may affix to any suitable part of the leased
  premises a notice for letting or selling the leased premises or property of
  which the leased premises are a part and keep the same so affixed without
  hindrance or molestation.

  
	
   

  	
   

  	
   

  
	
  16. INDEMNIFICATION AND
  LIABILITY

  (fill in)

  	
   

  	
  The LESSEE shall save the
  LESSOR harmless from all loss and damage occasioned by the use or escape of
  water or by the bursting of pipes, as well as from any claim or damage
  resulting from neglect in not removing snow and ice from the roof of the
  building or form the sidewalks bordering upon the premises so leased, or by
  any nuisance made or suffered on the leased premises, unless such loss is
  caused by the negligence or willful misconduct of the LESSOR its agents,
  servants, employees and/or contractors. 
  The removal of snow and ice from the sidewalks bordering upon the
  leased premises shall be LESSOR’s
  responsibility.

  
	
   

  	
   

  	
   

  
	
  17. LESSEE’S LIABILITY INSURANCE

  (fill in)

  	
   

  	
  The LESSEE shall maintain
  with respect to the leased premises and the property of which the leased
  premises are a part comprehensive public liability insurance in the amount of
  $2,000,000 with property damage
  insurance in limits of $1,000,000
  in responsible companies qualified to do business in Massachusetts and in
  good standing therein insuring the LESSOR as well as LESSEE against injury to
  persons or damage to property as provided. 
  The LESSEE shall deposit with the LESSOR certificates for such
  insurance at or prior to the commencement of the term, and thereafter within
  thirty (30) days prior to the expiration of any such policies.  All such insurance certificates shall
  provide that such policies shall not be canceled without at least ten (10)
  days prior written notice to each assured named therein.

  
	
   

  	
   

  	
   

  
	
  18. FIRE CASUALTY, EMINENT
  DOMAIN

  	
   

  	
  Should a substantial
  portion of the leased premises, or of the property of which they are a part,
  be substantially damaged by fire or other casualty, or be taken by eminent
  domain, the LESSOR may elect to terminate this lease.  When such fire, casualty, or taking
  renders more than one half of the leased premises substantially unsuitable
  for their intended use, a just and proportionate abatement of rent shall be
  made, and the LESSEE may elect to terminate this lease if:

  (a)  The LESSOR fails to give written notice
  within thirty (30) days of intention to restore leased premises, or

  (b) The LESSOR fails to restore the leased
  premises to a condition substantially suitable for their intended use within
  ninety (90) days of said fire, casualty or taking. 

  The LESSOR reserves, and
  the LESSEE grants to the LESSOR, all rights which the LESSEE may have for
  damages or injury to the leased premises for any taking by eminent domain,
  except for damage to the LESSEE’s fixtures, property or equipment.

  

 

4

 

	
  19. DEFAULT AND BANKRUPTCY 

  	
   

  	
  In the event that: 

  (a) The LESSEE shall
  default in the payment of any installment of rent or other su herein
  specified and such default shall continue for ten (10) days after written
  notice thereof; or

  (b) The LESSEE shall
  default in the observance or performance of any other of the LESSEE’s
  covenants, agreements, or obligations hereunder and such default shall not be
  corrected within thirty (30) days or within a period of time in excess to
  remedy any default that could not be reasonably corrected within such a
  period so long as the LESSEE continuously and diligently attempts to remedy
  the default except for a financial default after written notice thereof; or 

  (c) The LESSEE shall be
  declared bankrupt or insolvent according to law, or, if any assignment shall
  be made of LESSEE’s property for the benefit of creditors, then the LESSOR
  shall have the right thereafter, while such default continues, to reenter and
  take complete possession of the leased premises, to declare the term of this
  lease ended, and remove the LESSEE’s effects, without prejudice to any
  remedies which might be otherwise used for arrears of rent or other
  default.  The LESSEE shall indemnify
  the LESSOR against all loss of rent and other payments which the LESSOR may
  incur by reason of such termination during the residue of the term.  If the LESSEE shall default, after
  reasonable notice thereof, in the observance or performance of any conditions
  or covenants on LESSEE’s part to be observed or performed under or by virtue
  of any of the provisions in any article of this lease, the LESSOR, without
  being under any obligation to do so and without thereby waiving such default,
  after five business days’ written notice to LESSEE, may remedy such default
  for the account and at the expense of the LESSEE.  If the LESSOR makes any expenditures or incurs any obligations
  for the payment of money in connection therewith, including but not limited
  to, reasonable attorney’s fees in instituting, prosecuting or defending any
  action or proceeding, such sums paid or obligations insured, with interest at
  the rate of BankBoston Prime +4%
  per cent per annum and costs, shall be paid to the LESSOR by the LESSEE as
  additional rent. 

  
	
   

  	
   

  	
   

  
	
  20. NOTICE

  (fill in)

  	
   

  	
  Any notice from the LESSOR
  to the LESSEE relating to the leased premises or to the occupancy thereof,
  shall be deemed duly served, to LESSEE if mailed to LESSEE registered or
  certified mail, return receipt requested, postage prepaid, addressed to the
  LESSEE, at Sontra Medical, Inc., 58 Charles Street, Cambridge, MA 02140.  Any notice from the LESSEE to the LESSOR
  relating to the leased premises or to the occupancy thereof, shall be deemed
  duly served, if mailed to the LESSOR by registered or certified mail, return
  receipt requested, postage prepaid, addressed to the LESSOR as the LESSOR may
  from time to time advise in writing. 
  All rent notices shall be paid and sent to the LESSOR at 87 Blanchard
  Road, Cambridge, MA 02138.

  
	
   

  	
   

  	
   

  
	
  21. SURRENDER

  	
   

  	
  The LESSEE shall at the
  expiration or other termination of this lease remove all LESSEE’s goods and
  effects from the leased premises, (including, without hereby limiting the
  generality of the foregoing, all signs and lettering affixed or painted by
  the LESSEE, either inside or outside the leased premises).  LESSEE shall deliver to the LESSOR the
  leased premises and all keys, locks thereto, and other fixtures connected
  therewith and all alterations and additions made to or upon the leased
  premises, in good condition, reasonable wear and tear, damage by fire or
  other casualty only excepted, unless such maintenance is required because of
  the LESSOR or those for who conduct the LESSOR is legally responsible.  In the event of the LESSEE’s failure to
  remove any of LESSEE’s property from the premises, LESSOR is hereby
  authorized, without liability to LESSEE for loss or damage thereto, and at
  the sole risk of LESSEE, to remove and store any of the property at LESSEE’s
  expense, or to retain same under LESSOR’s control or to sell at public or
  private sale, without notice any or all of the property not so removed and to
  apply the net proceeds of such sale to the payment of any sum due hereunder,
  or to destroy such property.

  
	
   

  	
   

  	
   

  
	
  22. QUIET ENJOYMENT

  	
   

  	
  So long as the LESSEE is
  in full compliance with the terms and conditions of this lease, LESSOR shall
  warrant and defend LESSEE in the quiet enjoyment and possession of the
  premises during the term against any and all claims made by, through or under
  LESSOR, subject to the terms of this lease.

  

 

5

 

	
  23. ESTOPPEL

  	
   

  	
  LESSEE agrees, from time
  to time, within ten (10) days after request by LESSOR, to deliver to LESSOR
  or LESSOR’s designee an estoppel certificate stating that this LEASE is
  unmodified and in full force and effect (or if there have been modifications,
  that this lease is in full force and effect as modified and stating the
  modifications), the date to which rent and other charges have been paid, the
  unexpired term of this LEASE, whether there are any defaults or rent
  abatements or offsets claimed by LESSEE and such other matters pertaining to
  this LEASE as may be reasonably requested by LESSOR, it being intended that
  any such statement delivered pursuant to this subparagraph may be relied upon
  by any prospective purchaser of the fee or mortgage or assignee of any
  mortgage upon the fee of the premises or any other party and their respective
  successors and assigns.

  
	
   

  	
   

  	
   

  
	
  24. BROKERAGE

  (fill in or delete)

  	
   

  	
  The Brokers named herein:
  The Codman Co. and The Conrad Group warrant that they are duly licensed as
  such by the Commonwealth of Massachusetts, and join in this agreement and
  become a party hereto, insofar as any provisions of this agreement expressly
  apply to them, and to any amendments or modifications of such provisions to
  which they agree in writing.  LESSOR
  agrees to pay the above named Brokers upon the term commencement date &
  fee for professional services.

  
	
   

  	
   

  	
   

  
	
  25. OTHER PROVISIONS

  	
   

  	
   

  

 

1) Rent and parking payments are due on the first day of each
and every month.  Any rent payment made
more than five (5) days after the due date shall bear interest at BankBoston
Prime +4% as additional rent charged retroactively to the first of the month.

 

IN WITNESS WHEREOF, the said
parties hereunto set their hands and seals this 25 day of August,
1988 

 

	
  /s/ Sontra Medical, Inc.

  	
   

  	
   

  	
  [ILLEGIBLE]

  
	
  LESSEE

  	
   

  	
   

  	
  LESSOR

  
	
   

  	
   

  	
   

  	
  58
  Charles Street Limited Partnership

  
	
  /s/ Shawn E. Stovall

  	
   

  	
  BY:

  	
  The
  Cambridge Company, Inc.

  
	
  General Manager

  	
   

  	
   

  	
  Its
  General Partner

  
	
   

  	
   

  	
   

  	
  Robert
  Lee Wolff, Jr., President

  
	
   

  	
   

  	
   

  	
   

  
	
  /s/ Kevin Sullivan, V.P.

  	
   

  	
   

  	
  /s/ Frank E. Wheatly III

  
	
  THE CONRAD GROUP

  	
   

  	
   

  	
  THE CODMAN CO.

  

 

6

 

Exhibit A 

 

	
  

  Term

  	
   

  	
  Base

  Rent

  	
   

  	
  

  Parking

  	
   

  	
  Operating Expenses

  and Real Estate Tax

  
	
  Year 1

  	
   

  	
  $

  	
  182,448.00

  	
   

  	
  $

  	
  9,240.00

  	
   

  	
  Included in Base Rent

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Year 2 — Year 5

  	
   

  	
  $

  	
  190,050.00

  	
   

  	
  $

  	
  9,240.00

  	
   

  	
  15.92% of increase over
  1998 (If applicable)

  

 

 

 

Exhibit C

 

Holding Over Tenant shall
pay to Landlord two hundred percent (200%) of the total of the rents and other
charges herein then applicable for each month or any part thereof during which
Tenant, without Landlord’s prior written consent, shall retain possession of
the premises or any part thereof after the termination of this Lease, whether
by lapse of time or otherwise, and shall also pay to Landlord the amount of all
damages sustained by Landlord on account thereof, provided, however, that
neither the foregoing nor any other term or provision of this Lease shall be
deemed to permit Tenant to retain possession of the premises or hold over in
the premises after the expiration or earlier termination of the Lease term.

 

 

 

[GROUND
FLOOR PLAN]EXHIBIT 10.39

 

MASSACHUSETTS
INSTITUTE OF TECHNOLOGY

 

and

 

SONTRA
MEDICAL, INC.

 

PATENT
LICENSE AGREEMENT

 

 

(EXCLUSIVE)

 

 

 

 

TABLE
OF CONTENTS

 

	
  WITNESSETH

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  1

  	
  DEFINITIONS

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  2

  	
  GRANT

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  3

  	
  DILIGENCE

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  4

  	
  ROYALTIES

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  5

  	
  REPORTS
  AND RECORDS

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  6

  	
  PATENT
  PROSECUTION

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  7

  	
  INFRINGEMENT

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  8

  	
  PRODUCT LIABILITY

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  10

  	
  NON-USE OF NAMES

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  11

  	
  ASSIGNMENT

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  12

  	
  DISPUTE
  RESOLUTION

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  13

  	
  TERMINATION

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  14

  	
  PAYMENTS,
  NOTICES AND OTHER COMMUNICATIONS

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  15

  	
  MISCELLANEOUS
  PROVISIONS

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  16

  	
  CONFIDENTIAL
  INFORMATION

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  APPENDIX A

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  APPENDIX B

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  APPENDIX C1

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  APPENDIX C2

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  APPENDIX D

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  APPENDIX E

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  APPENDIX F

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  APPENDIX G

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  APPENDIX H

  	
   

  	
   

  

 

 

MASSACHUSETTS INSTITUTE OF TECHNOLOGY

and

SONTRA MEDICAL, INC.

PATENT
LICENSE AGREEMENT

 

This
Agreement is made and entered into this 30th of June 1998, (the “EFFECTIVE
DATE”) by and between the MASSACHUSETTS INSTITUTE OF TECHNOLOGY, a corporation
duly organized and existing under the laws of the Commonwealth of Massachusetts
and having its principal office at 77 Massachusetts Avenue, Cambridge,
Massachusetts 02139, U.S.A. (hereinafter referred to as “M.I.T.”), and SONTRA
MEDICAL, INC. a corporation duly organized under the laws of Delaware and
having its principal office at 21 Erie Street, Suite 22, Cambridge, MA 02139
(hereinafter referred to as “LICENSEE”).

WITNESSETH

 

WHEREAS, M.I.T. is the owner
of certain PATENT RIGHTS (as later defined herein) relating to M.I.T. Case No.
4126, “Ultrasound Enhancement of Transdermal Drug Delivery,” by Joseph Kost,
Robert S. Langer and Drora Levy and has the right to grant licenses under said
PATENT RIGHTS, subject only to a royalty-free, nonexclusive license heretofore
granted to the United States Government;

 

WHEREAS, M.I.T. desires to
have the PATENT RIGHTS developed and commercialized to benefit the public and
is willing to grant a license thereunder;

 

WHEREAS, LICENSEE has
represented to M.I.T., to induce M.I.T. to enter into this Agreement, that LICENSEE
is experienced in the start-up and building of companies that develop, produce,
manufacture, market and sell medical device and biopharmaceutical products,
medical products similar to the LICENSED PRODUCT(s) (as later defined herein)
and/or the use of the LICENSED PROCESS(es) (as later defined herein) and that
it shall commit itself to a thorough, vigorous and diligent program of
exploiting the PATENT RIGHTS so that public utilization shall result therefrom;

 

WHEREAS, Robert Langer an
inventor of the PATENT RIGHTS, how holds or shall shortly acquire an equity
position in LICENSEE, and will be remaining at M.I.T. as a Professor in the
department of Chemical Engineering, has signed the Conflict Avoidance Statement
attached hereto as APPENDIX C1;

 

WHEREAS, James Weaver an
inventor of the PATENT RIGHTS, how holds or shall shortly acquire an equity
position in LICENSEE, and will be remaining at M.I.T. as a Senior Research
Scientist in HST, has signed the Conflict Avoidance Statement attached hereto
as APPENDIX C2;

 

3

 

WHEREAS Robert Langer,
Joseph Kost, Samir Mitragotri, inventors of the PATENT RIGHTS, now hold or
shall shortly acquire an equity position in LICENSEE, their waiver’s of
participation in M.I.T.’s institutional equity share are attached hereto as
APPENDICES D, E, and F;

 

WHEREAS, M.I.T. is accepting
equity in partial lieu of royalties, M.I.T.’s Vice President for Research has
granted his approval; and

 

WHEREAS, LICENSEE desires to
obtain a license under the PATENT RIGHTS upon the terms and conditions
hereinafter set forth.

 

NOW,
THEREFORE, in consideration of the premises and the mutual covenants contained
herein, the parties hereto agree as follows:

1 - DEFINITIONS

 

For the purposes of this Agreement,
the following words and phrases shall have the following meanings:

 

1.1  “AFFILIATE” shall mean any legal entity
(such as a corporation, partnership or limited liability company) that is
controlling, controlled by, or under common control with LICENSEE.  For the purposes of this definition, the
term “control” means (i) beneficial ownership of at least fifty percent (50%)
of the voting securities of a corporation or other business organization with
voting securities of (ii) a fifty percent (50%) or greater interest in the net
assets or profits of a partnership or other business organization without
voting securities.

 

1.2  “BLOCKING PATENT” shall mean any issued and
unexpired patent not within the PATENT RIGHTS the claims of which cover a
LICENSED PRODUCT or any method, process or procedure within the PATENT RIGHTS
and, but for rights and license granted by the party that owns or controls such
patent, would be infringed by the manufacture, use or sale of such LICENSED
PRODUCT or the practice of any method, process or procedure within the PATENT
RIGHTS.

 

1.3  “EP COMPANY” shall mean a company which has
licensed at least half of the WEAVER PATENTS and is actively working toward
commercializing them in the field of electroporation.

 

1.4  “EXCLUSIVE PERIOD” is defined as commencing
on the EFFECTIVE DATE and continuing in full force and effect until expiration,
revocation or invalidation of the last patent within the PATENT RIGHTS licensed
to LICENSEE, unless terminated earlier pursuant to this Section 13.

 

1.5  “FIELD OF USE” shall mean all fields.

 

4

 

1.6  “LICENSED PROCESS” shall mean any process
which is covered in whole or in part by a VALID CLAIM contained in the PATENT
RIGHTS.

 

1.7  “LICENSED PRODUCT” shall mean any product or
part thereof which:

 

a.                                       is covered in
whole or in part by an issued, VALID CLAIM contained in the PATENT RIGHTS in
the country in which any such product or part thereof is made, used or sold; or

b.                                      is manufactured
by using a process or is employed to practice a process which is covered in
whole or in part by an issued, VALID CLAIM contained in the PATENT RIGHTS in
the country in which any LICENSED PROCESS is used or in which such product or
part thereof is used or sold.

1.8  “LICENSEE” shall mean SONTRA MEDICAL, INC.

 

1.9  “M.I.T. HOLDER” shall mean those entities
listed in APPENDIX G.

 

1.10  “NET SALES” shall mean the gross revenues
actually received by LICENSEE or AFFILIATES from the SALE of LICENSED PRODUCTS,
less the sum of the following:

 

a.                         normal and
customary rebates, and cash and trade discounts;

 

b.                        sales, use
and/or other excise taxes or duties actually paid;

 

c.                         the cost of any
packages and packing;

 

d.                        insurance costs
and outbound transportation charges prepaid or allowed;

 

e.                         import and/or
export duties actually paid; and

 

f.                           amounts allowed
or credited due to returns.

 

No deductions shall be made
for commissions paid to individuals whether they be with independent sales
agencies or regularly employed by LICENSEE and on its payroll, or for cost of
collections.  NET SALES shall occur when
a LICENSED PRODUCT or LICENSED PROCESS shall be actually paid.

 

1.11  “PATENT RIGHTS” shall mean all of the
following M.I.T. intellectual property:

 

(a)                    the United States and
international patents listed on Appendix A;

 

(b)                   the United States and
international patent applications listed on Appendix A and the resulting
patents;

 

(c)                    any divisionals,
continuations, continuation-in-part applications, and continued prosecution
applications (and their relevant international equivalents) filed after the
EFFECTIVE DATE of the patent applications listed on Appendix A to the extent
the claims are directed to subject matter specifically described in the patent
applications listed on Appendix A, and the resulting patents;

 

5

 

(d)                   any patents resulting from
reissues, reexaminations, or extensions (and their relevant international
equivalents) of the patents described in (a), (b), and (c) above; and

 

(e)                    international (non-United
States) patent applications filed after the EFFECTIVE DATE and the relevant
international equivalents to divisionals, continuations, continuation-in-part
applications and continued prosecution applications of such patent applications
to the extent the claims are directed to subject matter specifically described
in the patents or patent applications referred to in (a), (b), (c), and (d)
above, and the resulting patents.

1.12  “SALE” or “SELL” or “SOLD” shall mean the
transfer or disposition of a LICENSED PRODUCT for value to a party other than
LICENSEE or a AFFILIATE, which transfer or disposition would, but for the
rights and license granted hereunder, infringe a VALID CLAIM in the Country in
which such LICENSED PRODUCT is transferred or disposed.

 

1.13  “SUBLICENSE FEES” shall mean all cash
license fees paid or payable to LICENSEE or to an AFFILIATE upon execution of a
sublicense between  LICENSEE or a
AFFILIATE and a third party relating to LICENSED PRODUCTS and/or the PATENT
RIGHTS, and any later fees paid under such sublicense, but such fees shall not
include royalties, advances against future royalties that are to be credited
against future running royalties to be paid by SUBLICENSEE on sale of LICENSED
PRODUCTS, LICENSED PRODUCT development funds, equity investments, or scientific
benchmark payments or payments for past research expenditures relating to
development of LICENSED PRODUCTS. 
“SUBLICENSEE FEES” shall include shares of stock, or any other types of
securities receiving by LICENSEE for such sublicenses.

 

1.14  “SUBLICENSEE” shall mean any non-AFFILIATE
sublicensee of the rights granted to LICENSEE under paragraph 2.1 of this
Agreement.

 

1.15  “TERRITORY” shall mean worldwide.

 

1.16  “VALID CLAIM” shall mean either (a) a claim of
an issued and unexpired patent included within the PATENT RIGHTS, which has not
been held unenforceable, unpatentable or invalid by a court or other
governmental agency of competent jurisdiction, and which has not been admitted
to be invalid or unenforceable through reissue, disclaimer or otherwise, or (b)
a claim in a hypothetical issued patent corresponding to a pending claim in a
patent application within the PATENT RIGHTS, provided that if such pending
claim has not issued as a claim of an issued patent within the PATENT RIGHTS
within six (6) years after the filing date from which such patent application
takes priority, such pending claim shall not be a VALID CLAIM for purposes of
this LICENSE AGREEMENT.  In the event
that a claim of an issued patent within the PATENT RIGHTS is held by a court or
other governmental agency of competent jurisdiction to be 

 

6

 

unenforceable, unpatentable or invalid, and
such holding is reversed on appeal by a higher court or agency of competition
jurisdiction, such claim shall be reinstated as a VALID CLAIM hereunder.

 

1.17  “WEAVER PATENT” shall mean U.S. Patent
Numbers: 5,019,034, 5,389,069, 5,547,467, 5,667,470, 5,749,847, and patents
resulting from U.S. patent serial numbers: 08/695,367, 08/695,032, 09/083,497,
and corresponding foreign equivalent patents directed toward subject matter
described in the above referenced U.S. patents and patent applications.

2 - GRANT

 

2.1  M.I.T. hereby grants to LICENSEE and to it
AFFILIATES the exclusive right and license in the TERRITORY for the FIELD OF
USE to practice under the PATENT RIGHTS and, to the extent not prohibited by
other patents, to make, have made, use, lease, sell and import LICENSED
PRODUCTS and to practice the LICENSED PROCESSES, until the expiration of the
last to expire of the PATENT RIGHTS, unless this Agreement shall be sooner
terminated according to the terms hereof. 
This exclusive license shall be subject to the license rights of the
U.S. Government under P. 2.3 below, and the rights of M.I.T. reserved under P.
2.4 below.

 

2.2  LICENSEE agrees, to the extent required by
law, that LICENSED PRODUCTS leased or sold in the United States shall be
manufactured substantially in the United States.

 

2.3  In order to establish a period of
exclusivity for LICENSEE, M.I.T. hereby agrees that it shall not grant any
other license to make, have made, use, lease, sell and import LICENSED PRODUCTS
or to utilize LICENSED PROCESSES subject to the royalty-free, nonexclusive
license rights of the United States Government per FAR 52.227-11, in the
TERRITORY for the FIELD OF USE.

 

2.4  M.I.T. also grants to LICENSEE a first
option to add to this Agreement patent rights to new improvement inventions
arising from the Laboratory of Professor Robert Langer before August 28, 1998,
which are dominated by the PATENT RIGHTS of this Agreement existing as of the
Effective Date, provided that:

(a)                    For each new invention,
LICENSEE’s option shall extend for ninety (90) days from the date at which M.I.T.
shall notify LICENSEE of the invention.

 

(b)                   The Option for each new
invention shall be exercisable for a License Issue Fee to be negotiated in good
faith, based on the importance of the improvement, but not to exceed Fifteen
Thousand Dollars ($15,000) and patenting costs.  If LICENSEE exercises its option, the patent rights of the new
invention shall be added by Amendment to Appendix A of this Agreement.

 

(c)                    The options granted to
LICENSEE under this P. 2.4 shall, however, be subject to any rights granted to
sponsors of the research leading to the new inventions, and this P. 2.4 shall
not restrict M.I.T.’s right to prospectively grant options or licenses to such
invention to sponsors of the research prior to the existence of the new
inventions.

 

7

 

2.5  M.I.T. reserves the right to practice under
the PATENT RIGHTS for noncommercial research purposes.

 

2.6  LICENSEE and any AFFILIATE may grant and
authorize sublicenses within the scope of the right and license granted to
LICENSEE pursuant to this LICENSE AGREEMENT. 
LICENSEE and any AFFILIATE, if applicable, shall monitor the operations
of their respective SUBLICENSEES in connection with the obligations of LICENSEE
and any AFFILIATE pursuant to this LICENSE AGREEMENT, and shall take all
reasonable steps to ensure that such SUBLICENSEES comply fully with such
obligations.  LICENSEE shall promptly
inform M.I.T. of the name and address of each such SUBLICENSEE.  Any SUBLICENSEE shall also be required to
indemnify and hold harmless M.I.T. and to carry insurance pursuant to Article 8
of this Agreement.  Upon termination of
this LICENSE AGREEMENT, any and all existing sublicenses granted by LICENSEE or
any AFFILIATE, if applicable, shall survive; provided that such SUBLICENSEES
promptly agree in writing to be bound by the terms of this License Agreement
including payment of license maintenance fees under P. 4.1 and payment of
patenting costs under Article 6, with such payments prorated by SUBLICENSEES as
appropriate.

 

2.7  LICENSEE agrees to incorporate Articles 2,
5, 7, 8, 9, 10, 12, 13, 15 and 16 of this Agreement into its sublicense
agreements, so that these Articles shall be binding upon such SUBLICENSEES as
if they were parties to this Agreement.

 

2.8  LICENSEE agrees to forward to M.I.T. a copy
of any and all sublicense agreements promptly upon execution by the parties.

 

2.9  If at any time following five (5) years
after the Effective Date of this Agreement, M.I.T. establishes a bona fide
detailed plan to develop a product covered by the PATENT RIGHTS (a “PLANNED
PRODUCT”), or receives such a plan from a reputable third party with resources
reasonably necessary to develop and commercialize such PLANNED PRODUCT, M.I.T.
may give written notice to LICENSEE of such event.  If LICENSEE, an AFFILIATE, or a SUBLICENSEE is not then
developing, producing or using a LICENSED PRODUCT that is substantially similar
to or intended for a similar purpose as the PLANNED PRODUCT that M.I.T. or such
third party proposes to develop, and the development or sublicensing of such a
product similar to a PLANNED PRODUCT is not within LICENSEE’S, its AFFILIATES,
or SUBLICENSEE’S business plans or activities for development and
commercialization on a schedule that either reasonably approximates that of
such third party or is more favorable than that of such third party, LICENSEE
shall elect one of the following options, within 120 days of M.I.T.’s notice:

 

a.                                       Undertake
reasonable efforts to undertake research within a reasonable period of time toward
the development of such PLANNED PRODUCT (directly or indirectly through third
parties); or

 

8

 

b.                                      Enter into good
faith negotiations with the third party for a sublicense to the PATENT RIGHTS
in the third party’s field of use.  If
such a sublicense has not been granted within six months after such
notification, LICENSEE shall release its exclusive rights under this LICENSE
AGREEMENT to such third party in the appropriate field of use, and M.I.T. may
negotiate with the third party to grant such a sublicense, provided that any
sublicense granted by M.I.T. shall:

 

i.                                          Be confined to
a single class of therapeutic products not competitive with any LICENSED
PRODUCT under development or sold by LICENSEE, an AFFILIATE, or a SUBLICENSEE
at the time of granting of the sublicense or within LICENSEE’s business plans
or activities for development and commercialization; and

 

ii.                                       Be
nonexclusive; and

 

iii.                                    Require the
third party to commit to a development plan in the third party field of use
committing a minimum of $250,000 per year in development funds beginning within
six months of the granting of the sublicense; and

 

iv.                                   Require running
royalties no less than those specified for LICENSEE in subparagraph 4.1 (c)
below.

Any revenue derived by
M.I.T. in M.I.T.’s sublicensing of the PATENT RIGHTS as specified in this
Section 2.10 shall be shared equally between M.I.T. and LICENSEE.

 

2.11  M.I.T.’s notice to LICENSEE under this
Paragraph shall also include notice of the product and medical indication for
which the sublicense is requested.

 

2.12  Nothing in this Agreement shall be construed
to confer any rights upon LICENSEE, its AFFILIATES, or it’s SUBLICENSEES by
implication, estoppel or otherwise as to any technology or patent rights of
M.I.T. or any other entity other than the PATENT RIGHTS, regardless of whether
such patent rights shall be dominant or subordinate to any PATENT RIGHTS.

 

3 - DILIGENCE

 

3.1  LICENSEE shall use its best efforts, or
shall cause its AFFILIATES and SUBLICENSEES to use their best efforts, to bring
one or more LICENSED PRODUCTS or LICENSED PROCESSES to market through a
thorough, vigorous and diligent program for exploitation of the PATENT RIGHTS
and to continue active, diligent marketing efforts for one or more LICENSED
PRODUCTS or LICENSED PROCESSES throughout the life of this Agreement.

 

3.2  LICENSEE shall raise a cumulative total
at each date below of investment capital and/or research and development funds
and/or other funds of at least Two Million Five Hundred Thousand Dollars
($2,500,000) within two years of the EFFECTIVE DATE.

 

9

 

3.3  LICENSEE agrees to enter into good faith
negotiations with an EP COMPANY for the purpose of granting the EP COMPANY a
license to M.I.T. Case 6792, “Transport Enhancement By Simultaneous Application
of Electric And Acoustic Fields,” by Joseph Kost, Robert S. Langer, Jr., Samir
Mitagotri, Uwe Pliquett, and James C. Weaver so that the EP COMPANY may
practice electroporation in combination with sonophoresis, as described in
M.I.T. Case 6792, provided that the EP COMPANY negotiates in good faith with
LICENSEE for a license to the WEAVER PATENTS so that LICENSEE may practice
sonophoresis in combination with electroporation as described in M.I.T. case
6792.

 

3.4  LICENSEE’s failure to perform in accordance
with either Paragraphs 3.1 or 3.2 above shall be grounds for M.I.T. to
terminate this Agreement pursuant to Paragraph 13.3 hereof.

 

3.5  LICENSEE’s failure to perform in accordance
with Paragraph 3.3 above shall be grounds for M.I.T. to terminate LICENSEE’s
rights to case 6792.

 

4 - ROYALTIES

 

4.1  For the rights, privileges and license
granted hereunder, LICENSEE shall pay royalties to M.I.T. in the manner
hereinafter provided to the end of the term of the PATENT RIGHTS or until this
Agreement shall be terminated:

 

(a)                                  License
Maintenance Fees of Twenty Five Thousand Dollars ($25,000) per year payable on
January 1, 1999 and on January 1 of each year thereafter; provided, however,
that Running Royalties subsequently due on NET SALES for each said year, if
any, shall be creditable against the License Maintenance Fee for said
year.  License Maintenance Fees paid in
excess of Running Royalties shall be creditable to Running Royalties for future
years.

 

(b)                                 Running
Royalties in an amount equal to:

 

i.                                          Two Percent
(2%) of NET SALES of the LICENSED PRODUCTS and LICENSED PROCESSES used, leased
or sold by and/or for LICENSEE and/or its AFFILIATES.

 

ii.                                       One percent
(1%) of NET SALES attributed to SALES of LICENSED PRODUCTS by SUBLICENSEES of
either LICENSEE or of an AFFILIATE.

 

(c)                                  A share of
SUBLICENSEE FEES received by LICENSEE for sublicensing of rights granted
hereunder, equal to:

 

(i)                                     Twenty Five
percent (25%) if the PATENT RIGHTS per se are sublicensed without substantial
and essentially simultaneous sublicensing of technology or patents owned by
LICENSEE or its AFFILIATES; or

 

(ii)                                  Ten Percent
(10%) if the PATENT RIGHTS per se are sublicensed with  substantial
and essentially simultaneous sublicensing of technology or patents owned by
LICENSEE or its AFFILIATES.

 

10

 

(d)                                 Equity.

 

(i)                                     Initial Grant.  On or before the EFFECTIVE DATE, LICENSEE
shall issue a total of Two Hundred Sixty Three Thousand One Hundred and Fifty
Eight (263,158) shares of Common Stock of LICENSEE, $[.01] par value per share, (the “Shares”) in
the name of M.I.T. and of such persons as M.I.T. shall direct (“M.I.T.
HOLDER”), and each M.I.T. HOLDER shall receive such number of shares as M.I.T.
shall direct.

 

LICENSEE represents and
warrants to M.I.T. that, as of the Effective Date, the aggregate number of
Shares equals Five Percent (5%) of the LICENSEE’s issued and outstanding Common
Stock calculated on a “Fully Diluted Basis.” 
For purposes of this Section 4.1(d), “Fully Diluted Basis” shall mean
that the total number of issued and outstanding shares of the LICENSEE’s Common
Stock shall be calculated to include conversion of all issued and outstanding
securities then convertible into common stock, the exercise of all then
outstanding options and warrants to purchase shares of common stock, whether or
not then exercisable, and shall assume the issuance or grant of all securities
reserved for issuance pursuant to any LICENSEE stock or stock option plan in
effect on the date of the calculation.

 

LICENSEE further represents
and warrants to M.I.T. that LICENSEE’s articles of incorporation, attached
hereto as Appendix H are the true and complete articles of incorporation on the
EFFECTIVE DATE, and that LICENSEE shall not change them in such a way as to
change the rights and privileges of the shares of stock issued to the M.I.T.
HOLDERS.

 

(ii)                                  Anti-Dilution
Protection.  LICENSEE
shall issue additional shares of Common Stock to M.I.T. and each M.I.T. Holder
pro rata, such that M.I.T.’s and each M.I.T. Holders’ ownership of outstanding
Common Stock shall not fall below Five Percent (5%) on a Fully Diluted Basis,
as calculated after giving effect to the anti-dilutive issuance.  Such issuances shall continue until and
including the date upon which a total of Two Million Five Hundred Thousand
Dollars ($2,500,000) in cash in exchange for LICENSEE’s capital stock (the
“Funding Threshold”) shall be received by LICENSEE.  Thereafter, no additional shares shall be due to M.I.T. or any
M.I.T. Holder pursuant to this section.

 

(iii)                               Participation
in Future Private Equity Offerings.  After the date of the Funding Threshold, the M.I.T. Holders shall
have the right to purchase additional shares of the LICENSEE’s Common Stock in
any private offering by the LICENSEE of its equity securities in exchange for
cash, to maintain its pro rata ownership as calculated immediately prior to
such offering on a Fully Diluted Basis, pursuant to the terms and conditions at
least as favorable as those granted to the other offerees.  All rights granted to M.I.T. pursuant to
this Section 4.1(e)(iii) shall terminate immediately prior to a firm commitment
underwritten public offering of the LICENSEE’s common stock resulting in gross
proceeds to the LICENSEE of at least $10 million.

 

11

 

4.2  All payments due hereunder shall be paid in
full, without deduction of taxes or other fees which may be imposed by any
government, except as otherwise provided in Paragraph 1.5(b).

 

4.3  Running Royalties under P. 4.1 (c) shall be
reduced by half (50%) for LICENSED PRODUCTS made in a country in which PATENT
RIGHTS are pending or issued and unexpired, but sold in a country in which there
are no pending or issued, unexpired PATENT RIGHTS.  No Running Royalties shall be due on LICENSED PRODUCTS which are
both made and sold in countries in which no pending, (but not in excess of
seven years), or issued and unexpired PATENT RIGHTS exist.

 

4.4  No multiple royalties shall be payable
because any LICENSED PRODUCT, its manufacture, use, lease or sale are shall be
covered by more than one PATENT RIGHTS patent application or PATENT RIGHTS
patent licensed under this Agreement. 
No royalty shall be payable under Paragraph 4.1(c)i and Paragraph
4.1(c)ii above with respect to the SALE of LICENSED PRODUCTS between or among
LICENSEE and AFFILIATES, provided that such LICENSED PRODUCTS are to be resold
to unrelated third parties, or with respect to any fees or other payments paid
between or among LICENSEE and AFFILIATES.

 

4.5  Royalty payments shall be paid in United
States dollars in Cambridge, Massachusetts, or at such other place as M.I.T.
may reasonably designate consistent with the laws and regulations controlling
in any foreign country.  If any currency
conversion shall be required in connection with the payment of royalties
hereunder, such conversion shall be made by using the exchange rate prevailing
at the Chase Manhattan Bank (N.A.) on the last business day of the calendar
quarterly reporting period to which such royalty payments relate.

 

4.6  LICENSEE shall have the right to deduct from
the royalties payable to M.I.T. under Section 4.1(c) the amount which LICENSEE,
AFFILIATES or a SUBLICENSEE of either LICENSEE or a AFFILIATE, as the case may
be, is paying to a third party for rights and license under a BLOCKING PATENT
to manufacture, use or sell such LICENSED PRODUCTS or practice of any method,
process or procedure within the PATENT RIGHTS. 
However, by reason of this Paragraph 4.6, the royalty payable to M.I.T.
under Paragraph 4.1(c) shall not be reduced to less than one percent (1%) of
NET SALES attributed to SALES of LICENSED PRODUCTS by LICENSEE and/or
AFFILIATES, and the royalty payable to M.I.T. under Paragraph 4.1(c)i and/or
Paragraph 4.1(c)ii shall not be reduced to less than one half of one percent
(0.5%) of NET SALES attributed to SALES of LICENSED PRODUCTS by SUBLICENSEES of
either LICENSEE or a AFFILIATE.

 

12

 

5 - REPORTS AND RECORDS

 

5.1  LICENSEE shall keep, and shall cause its
AFFILIATES and SUBLICENSEES to keep full, true and accurate books of account
containing all particulars that may be necessary for the purpose of showing the
amounts payable to M.I.T. hereunder. 
Said books of account shall be kept at LICENSEE’s principal place of
business or the principal place of business or the appropriate division or
AFFILIATE of LICENSEE to which this Agreement relates.  Said books and the supporting data shall be
open at all reasonable times for five (5) years following the end of the
calendar year to which they pertain, to the inspection of M.I.T. or its
accountants for the purpose of verifying LICENSEE’s royalty statement or
compliance in other respects with this Agreement.  Should such inspection lead to the discovery of a greater than
Ten Percent (10%) discrepancy in reporting to M.I.T.’s detriment.  LICENSEE agrees to pay the full cost of such
inspection.

 

5.2  LICENSEE shall deliver to M.I.T. true and
accurate reports, giving such particulars of the business conducted by
LICENSEE, its AFFILIATES and its SUBLICENSEES under this Agreement as shall be
pertinent to diligence under Article 3 and royalty accounting hereunder:

 

a.                                       before the
first commercial sale of a LICENSED PRODUCT or LICENSED PROCESS, annually, on
January 31 of each year; and

 

b.                                      after the first
commercial sale of a LICENSED PRODUCT or LICENSED PROCESS, quarterly, within
sixty (60) days after March 31, June 30, September 30 and December 31, of each
year.

 

These reports shall include
at least the following:

 

a.                                       number of
LICENSED PRODUCTS manufactured, leased and sold by and/or for LICENSEE, its
AFFILIATES, and SUBLICENSEES;

 

b.                                      accounting for
all LICENSED PROCESSES used or sold by and/or for LICENSEE its AFFILIATES, and
SUBLICENSEES;

 

c.                                       accounting for
NET SALES, noting the deductions applicable as provided in Paragraph 1.5;

 

d.                                      Running
Royalties due under Paragraph 4.1(b);

 

e.                                       Payments on
SUBLICENSEE FEES due under paragraph 4.1(c);

 

f.                                         total royalties
due; and

 

g.                                      names and
addresses of all AFFILIATES and SUBLICENSEES of LICENSEE.

 

5.3  With each such report submitted, LICENSEE
shall pay to M.I.T. the royalties due and payable under this Agreement.  If no royalties shall be due, LICENSEE shall
so report.

 

13

 

5.4  On or before the ninetieth (90th) day
following the close of LICENSEE’s fiscal year, LICENSEE shall provide M.I.T.
with LICENSEE’s certified financial statements for the preceding fiscal year
including, at a minimum, a balance sheet and an income statement.

 

5.5  The amounts due under Articles 4 and 6
shall, if overdue, bear interest until payment at a per annum rate One Percent
(1%) above the prime rate in effect at the Chase Manhattan Bank (N.A.) on the
due date.  The payment of such interest
shall not foreclose M.I.T. from exercising any other rights it may have as a
consequence of the lateness of any payment.

 

6 - PATENT PROSECUTION

 

6.1  M.I.T. shall apply for, seek prompt issuance
of, and maintain the PATENT RIGHTS during the term of this Agreement.  Appendix B is a list of the foreign
countries in which patent applications corresponding to the United States
Patent applications listed in Appendix A shall be filed.  Appendix B may be amended by mutual
agreement of both parties.  The filing,
prosecution and maintenance of all PATENT RIGHTS applications and patents shall
be the primary responsibility of M.I.T.; provided, however, LICENSEE shall have
reasonable opportunities to advise M.I.T. and shall cooperate with M.I.T. in
such filing, prosecution and maintenance.

 

6.2  LICENSEE shall reimburse M.I.T. for all
patent costs for the PATENT RIGHTS prior to the EFFECTIVE DATE which were not
previously reimbursed by former licensees. 
LICENSEE shall pay such fees and costs to M.I.T. within thirty (30) days
of invoicing.

 

6.3  LICENSEE shall reimburse M.I.T. for all
patenting costs incurred in the filing prosecution and maintenance of the
PATENT RIGHTS incurred after the Effective Date.  Such reimbursement shall be within thirty (30) days of invoicing.

 

6.4  At any time during the term of this
Agreement, LICENSEE may elect to assume responsibility for prosecution of the
PATENT RIGHTS in M.I.T.’s name at LICENSEE’s expense by so notifying M.I.T. in
writing.  Such prosecution shall be
conducted in M.I.T.’s best interests, and LICENSEE shall not abandon any
substantive claim without prior written permission from M.I.T., such permission
not to be unreasonably withheld.

 

7 - INFRINGEMENT

 

7.1  Notification of Infringement.  Each party agrees to provide written notice
to the other party promptly after becoming aware of any infringement of the
PATENT RIGHTS.

7.2  Rights to Prosecute Infringements.

 

(a)           LICENSEE Right to Prosecute.  So long as LICENSEE remains the exclusive
licensee of the PATENT RIGHTS in the FIELD OF USE in the TERRITORY, 

 

14

 

LICENSEE, to the extent permitted by law,
shall have the right, under its own control and at its own expense, to
prosecute any third party infringement of the PATENT RIGHTS in the FIELD OF USE
in the TERRITORY, subject to Section 7.4. 
If required by law, M.I.T. shall permit any action under this Section to
be brought in its name, including being joined as a party-plaintiff, provided
that LICENSEE shall hold M.I.T. harmless from, and indemnify M.I.T. against,
any costs, expenses, or liability that M.I.T. incurs in connection with such
action.

 

Prior
to commencing any such action, LICENSEE shall consult with M.I.T. and shall
consider the views of M.I.T. regarding the advisability of the proposed action
and its effect on the public interest. 
LICENSEE shall not enter into any settlement, consent judgment, or other
voluntary final disposition of any infringement action under this Section
without the prior written consent of M.I.T.

(b)           M.I.T. Right to Prosecute.  In the event that LICENSEE is unsuccessful
in persuading the alleged infringer to desist or fails to have initiated an
infringement action within a reasonable time after LICENSEE first becomes aware
of the basis for such action, M.I.T. shall have the right, at its sole
discretion, to prosecute such infringement under its sole control and at its
sole expense, and any recovery obtained shall belong to M.I.T.

7.3  Declaratory Judgment Actions.  In the event that a declaratory judgment
action is brought against M.I.T. or LICENSEE by a third party alleging
invalidity, unenforceability, or non-infringement of the PATENT RIGHTS, M.I.T.,
at its option, shall have the right within twenty (20) days after commencement
of such action to take over the sole defense of the action at its own
expense.  If M.I.T. does not exercise
this right, LICENSEE may take over the sole defense of the action at LICENSEE’s
sole expense, subject to Section 7.4.

7.4  Recovery.  Any recovery obtained in an action brought by LICENSEE under
Sections 7.2 or 7.3 shall be distributed as follows:  (i) each party shall be reimbursed for any expenses incurred in
the action (including the amount of any royalty or other payments withheld from
M.I.T. as described below), (ii) as to ordinary damages, LICENSEE shall receive
an amount equal to its lost profits or a reasonable royalty on the infringing
sales, or whichever measure of damages the court shall have applied, and
LICENSEE shall pay to M.I.T. based upon such amount a reasonable approximation
of the royalties and other amounts that LICENSEE would have paid to M.I.T. if
LICENSEE had sold the infringing products, processes and services rather than the
infringer, and (iii) as to special or punitive damages, the parties shall share
equally in any award.  LICENSEE may
offset a total of fifty percent (50%) of any expenses incurred under Sections
7.2 and 7.3 

 

15

 

against any payments due to M.I.T. under
Article 4, provided that in no event shall the such payments under Article 4,
when aggregated with any other offsets and credits allowed under this
Agreement, be reduced by more than fifty percent (50%) in any reporting period.

 

7.5  Cooperation.  Each party agrees to cooperate in any action
under this Article which is controlled by the other party, provided that the
controlling party reimburses the cooperating party promptly for any costs and
expenses incurred by the cooperating party in connection with providing such
assistance.

 

7.6  Right to Sublicense.  So long as LICENSEE remains the exclusive
licensee of the PATENT RIGHTS in the FIELD OF USE in the TERRITORY, LICENSEE
and any AFFILIATE shall have the sole right to sublicense any alleged infringer
in the FIELD OF USE in the TERRITORY for future use of the PATENT RIGHTS in
accordance with the terms and conditions of this Agreement relating to
sublicenses.  Any upfront fees shall be
treated as set forth in Article 4.

 

8 - PRODUCT LIABILITY

8.1  Indemnification.

 

(a)           Indemnity. 
LICENSEE shall indemnify, defend, and hold harmless M.I.T. and its
trustees, officers, faculty, students, employees, and agents and their
respective successors, heirs and assigns (the “Indemnitees”), against any
liability, damage, loss, or expense (including reasonable attorneys fees and
expenses) incurred by or imposed upon any of the Indemnitees in connection with
any claims, suits, actions, demands or judgments arising out of any theory of
liability (including without limitation actions in the form of tort, warranty,
or strict liability and regardless of whether such action has any factual
basis) concerning any product, process, or service that is made, used, sold, or
imported pursuant to any right or license granted under this Agreement.

 

(b)           Procedures. 
The Indemnitees agree to provide LICENSEE with prompt written notice of
any claim, suit, action, demand, or judgment for which indemnification is
sought under this Agreement.  LICENSEE
agrees, at its own expense, to provide attorneys reasonably acceptable to
M.I.T. to defend against any such claim. 
The Indemnitees shall cooperate fully with LICENSEE in such defense and
will permit LICENSEE to conduct and control such defense and the disposition of
such claim, suit, or action (including all decisions relative to litigation,
appeal, and settlement); provided, however, that any Indemnitee shall have the
right to retain its own 

 

16

 

counsel, at the expense of LICENSEE, if
representation of such Indemnitee by the counsel retained by LICENSEE would be
inappropriate because of actual or potential differences in the interests of
such Indemnitee and any other party represented by such counsel.  LICENSEE agrees to keep M.I.T. informed of
the progress in the defense and disposition of such claim and to consult with
M.I.T. with regard to any proposed settlement.

 

8.2  Insurance.  LICENSEE shall obtain and carry in full force and effect
commercial general liability insurance, including product liability and errors
and omissions insurance which shall protect LICENSEE and Indemnitees with
respect to events covered by Section 8.1(a) above.  Such insurance (i) shall be issued by an insurer licensed to practice
in the Commonwealth of Massachusetts or an insurer pre-approved by M.I.T., such
approval not to be unreasonably withheld, (ii) shall list M.I.T. as an
additional named insured thereunder, (iii) shall be endorsed to include product
liability coverage, and (iv) shall require thirty (30) days written notice to
be given to M.I.T. prior to any cancellation or material change thereof.  The limits of such insurance shall not be
less than One Million Dollars ($1,000,000) per occurrence with an aggregate of Three
Million Dollars ($3,000,000) for bodily injury including death; One Million
Dollars ($1,000,000) per occurrence with an aggregate of Three Million Dollars
($3,000,000) for property damage; and One Million Dollars ($1,000,000) per
occurrence with an aggregate of Three Million Dollars ($3,000,000) for errors
and omissions.  In the alternative,
LICENSEE may self-insure subject to prior approval of M.I.T. LICENSEE shall
provide M.I.T. with Certificates of Insurance evidencing compliance with this
Section.  LICENSEE shall continue to
maintain such insurance or self-insurance after the expiration or termination
of this Agreement during any period in which LICENSEE or any AFFILIATE or
SUBLICENSEE continues (i) to make, use, or sell a product that was a LICENSED
PRODUCT under this Agreement or (ii) to perform a service that was a LICENSED
PROCESS under this Agreement, and thereafter for a period of five (5) years.

 

9 - EXPORT CONTROLS

 

LICENSEE acknowledges that
it is subject to United States laws and regulations controlling the export of
technical data, computer software, laboratory prototypes and other commodities
(including the Arms Export Control Act, as amended and the United States
Department of Commerce Export Administration Regulations).  The transfer of such items may require a
license from the cognizant agency of the United States Government and/or
written assurances by LICENSEE that LICENSEE shall not export data or
commodities to certain foreign countries without prior approval of such agency.  M.I.T. neither represents that a license
shall not be required nor that, if required, it shall be issued.

 

17

 

10 - NON-USE OF NAMES

 

LICENSEE, its AFFILIATES and
SUBLICENSEES shall not use the names or trademarks of the Massachusetts
Institute of Technology or Lincoln Laboratory, nor any adaptation thereof, nor
the names of any of their employees, in any advertising, promotional or sales
literature without prior written consent obtained from M.I.T., or said employee,
in each case, except that LICENSEE may state that it is licensed by M.I.T.
under one or more of the patents and/or applications comprising the PATENT
RIGHTS.

 

11 - ASSIGNMENT

 

This LICENSE AGREEMENT may
not be assigned by LICENSEE without the prior written consent of M.I.T., which
consent shall not be unreasonably withheld, except to a party that succeeds to
all or substantially all of LICENSEE’s business or assets whether by sale,
merger, operation of law or otherwise; provided that such assignee or transferee
promptly agrees in writing to be bound by the terms and conditions of this
LICENSE AGREEMENT.

 

12 - DISPUTE RESOLUTION

 

12.1  Except for the right of either party to
apply to a court of competent jurisdiction for a temporary restraining order, a
preliminary injunction, or other equitable relief to preserve the status quo or
prevent irreparable harm, any and all claims, disputes or controversies arising
under, out of, or in connection with the Agreement, including any dispute
relating to patent validity or infringement, which the parties shall be unable
to resolve within ninety (90) days after notice by one party to the other in
writing of the nature of the dispute shall be mediated in good faith.  The party raising such dispute shall
promptly advise the other party of such claim, dispute or controversy in a
writing which describes in reasonable detail the nature of such dispute.  By not later than five (5) business days
after the recipient has received such notice of dispute, each party shall have
selected for itself a representative who shall have the authority to bind such
party, and shall additionally have advised the other party in writing of the
name and title of such representative. 
By not later than ten (10) business days after the date of such notice
of dispute, the party against whom the dispute shall be raised shall select a
mediation firm in the Boston area and such representatives shall schedule a
date with such firm for a mediation hearing. 
The parties shall enter into good faith mediation and shall share the
costs equally.  If the representatives
of the parties have not been able to resolve the dispute within fifteen (15)
business days after such mediation hearing, then any and all claims, disputes
or controversies arising under, out of, or in connection with this Agreement,
including any dispute relating to patent validity or infringement, shall be
resolved by final and binding arbitration in Boston, Massachusetts under the
rules of the 

 

18

 

American Arbitration Association, or the
Patent Arbitration Rules if applicable, then obtaining.  The arbitrators shall have no power to add
to, subtract from or modify any of the terms or conditions of this Agreement,
nor to award punitive damages.  Any
award rendered in such arbitration may be enforced by either party in either
the courts of the Commonwealth of Massachusetts or in the United States
District Court for the District of Massachusetts, to whose jurisdiction for
such purposes M.I.T. and LICENSEE each hereby irrevocably consents and submits.

 

12.2  Notwithstanding the foregoing, nothing in
this Article shall be construed to waive any rights or timely performance of
any obligations existing under this Agreement.

 

13 - TERMINATION

 

13.1  Should LICENSEE fail to make any payment
whatsoever due and payable to M.I.T. hereunder, M.I.T. shall have the right to
terminate this Agreement effective on ninety (90) days’ notice, unless LICENSEE
shall make all such payments to M.I.T. within said ninety (90) day period.  Upon the expiration of the ninety (90) day
period, if LICENSEE shall not have made all such payments to MALT., the rights,
privileges and license granted hereunder shall automatically terminate.

 

13.2  Upon any material breach or default of this
Agreement by LICENSEE (including, but not limited to, breach or default under
Paragraph  3.3), other than those
occurrences set out in Paragraphs 13.1 and 13.2 hereinabove, which shall always
take precedence in that order over any material breach or default referred to
in this Paragraph 13.2, M.I.T. shall have the right to terminate this Agreement
and the rights, privileges and license granted hereunder effective on ninety
(90) days’ notice to LICENSEE.  Such termination
shall become automatically effective unless LICENSEE shall have cured any such
material breach or default prior to the expiration of the ninety (90) day
period.

 

13.3  LICENSEE shall have the right to terminate
this Agreement at any time on ninety (90) days’ notice to M.I.T., and upon payment
of all amounts due M.I.T. through the effective date of the termination.

 

13.4  Upon termination of this Agreement for any
reason, nothing herein shall be construed to release either party from any
obligation that matured prior to the effective date of such termination; and
Articles 1, 8, 9, 10, 12, 13.3, 13.4, 15, and 16 shall survive any such
termination.  LICENSEE, its AFFILIATES
and SUBLICENSEES may, however, after the effective date of such termination, sell
all LICENSED PRODUCTS, and complete LICENSED PRODUCTS in the process of
manufacture at the time of such termination and sell the same, 

 

19

 

provided that LICENSEE shall make the
payments to M.I.T. as required by Article 4 of this Agreement and shall submit
the reports required by Article 5 hereof.

 

14 - PAYMENTS,
NOTICES AND OTHER COMMUNICATIONS

 

Any payments, notice or
other communication pursuant to this Agreement shall be sufficiently made or
given on the date of mailing if sent to such party by certified first class
mail, return receipt requested, postage prepaid, addressed to it at its address
below or as it shall designate by written notice given to the other party:

 

	
  In the case of M.I.T.:

  	
   

  	
  In the case of LICENSEE:

  
	
   

  	
   

  	
   

  
	
  Director

  	
   

  	
  President & CEO

  
	
  Technology Licensing
  Office

  	
   

  	
  SONTRA MEDICAL, INC.

  
	
  Massachusetts Institute of
  Technology

  	
   

  	
  21 Erie Street, Suite 22

  
	
  77 Massachusetts Avenue,
  Room E32-300

  	
   

  	
  Cambridge, MA 02139

  
	
  Cambridge, Massachusetts
  02139

  	
   

  	
   

  

 

15 - MISCELLANEOUS PROVISIONS

 

15.1 All disputes arising
out of or related to this Agreement, or the performance, enforcement, breach or
termination hereof, and any remedies relating thereto, shall be construed,
governed, interpreted and applied in accordance with the laws of the
Commonwealth of Massachusetts, U.S.A., except that questions affecting the
construction and effect of any patent shall be determined by the law of the
country in which the patent shall have been granted.

 

15.2  The parties hereto acknowledge that this
Agreement sets forth the entire Agreement and understanding of the parties
hereto as to the subject matter hereof, and shall not be subject to any change
or modification except by the execution of a written instrument signed by the
parties.

 

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

 

15.4  LICENSEE agrees to mark the LICENSED
PRODUCTS sold in the United States with all applicable United States patent
numbers.  All LICENSED PRODUCTS shipped
to or sold in other countries shall be marked in such a manner as to conform
with the patent laws and practice of the country of manufacture or sale.

 

15.5  The failure of either party to assert a
right hereunder or to insist upon compliance with any term or condition of this
Agreement shall not constitute a waiver of that right or excuse a similar
subsequent failure to perform any such term or condition by the other party.

 

20

 

16 - CONFIDENTIAL
INFORMATION

 

The parties may, from time
to time, in connection with this LICENSE AGREEMENT disclose to each other
CONFIDENTIAL INFORMATION. “CONFIDENTIAL INFORMATION” shall mean any information
disclosed in writing by a party to either this LICENSE AGREEMENT to any of the
other parties to either this LICENSE AGREEMENT, and marked by the disclosing
party with the legend “CONFIDENTIAL” or other similar legend sufficient to
identify such information as confidential proprietary information of the
disclosing party.  In the case of disclosure
of CONFIDENTIAL INFORMATION by LICENSEE to M.I.T. under this Agreement.  LICENSEE agrees that these terms apply only
when such information is disclosed to the M.I.T. Technology Licensing Office
and not to any other entity at M.I.T. 
M.I.T., in turn, agrees that it will not disclose such information from
LICENSEE outside of the Technology Licensing Office.  Each party will use efforts similar to those used to protect its
own CONFIDENTIAL INFORMATION to prevent the disclosure of the other party’s
CONFIDENTIAL INFORMATION to third parties; provided that LICENSEE may disclose
M.I.T.’s CONFIDENTIAL INFORMATION to the extent reasonably necessary to exploit
the rights and license granted to LICENSEE hereunder; and provided further that
the recipient party’s obligations under this Section 16 shall not apply to
CONFIDENTIAL INFORMATION that:

 

a.                                       is disclosed
orally; provided, however, that the recipient party’s obligations under this
Article 16 shall apply to information disclosed orally if such information is
reduced to Writing and marked with the legend “CONFIDENTIAL” by the disclosing
party within thirty (30) days after disclosure thereof;

 

b.                                      is in the
recipient party’s possession at the time of disclosure thereof as demonstrated
by documentary evidence;

 

c.                                       is or later
becomes part of the public domain through no fault of the recipient party;

 

d.                                      is received
from a third party having no obligations of confidentiality to the disclosing
party;

 

e.                                       is developed
independently by the recipient party without access to the disclosing party’s
CONFIDENTIAL INFORMATION; or

 

f.                                         is required by
law or regulation to be disclosed; provided, however that the party subject to
such disclosure requirement has provided written notice to the other party
promptly to enable such other party to seek a protective order or otherwise
prevent disclosure of such CONFIDENTIAL INFORMATION

LICENSEE agrees that
LICENSEE shall not disclose to a third party CONFIDENTIAL INFORMATION of any of
the other party, unless such third party has executed a confidentiality
agreement with LICENSEE containing terms and conditions substantially similar
to this Article 16, 

 

21

 

or, with respect to governmental agencies or
other regulatory bodies, other usual and customary procedures in the medical
products industry are utilized to protect such CONFIDENTIAL INFORMATION.  The obligations of the parties pursuant to
this Article 16 with respect to CONFIDENTIAL INFORMATION of the other party
shall continue in full force and effect for a period of five (5) years after
expiration or termination of the later of this AGREEMENT.

 

IN WITNESS WHEREOF, the
parties have duly executed this Agreement the day and year set forth below.

 

	
  MASSACHUSETTS INSTITUTE OF
  TECHNOLOGY

  	
   

  	
  SONTRA MEDICAL, INC.

  
	
   

  	
   

  	
   

  	
   

  
	
  By

  	
  /s/ J. David Litster

  	
   

  	
  By

  	
  /s/ Shawn E. Stovall

  	 

	
  Name

  	
  J. DAVID LITSTER

  	
   

  	
  Name

  	
  SHAWN E. STOVALL

  	 

	
  Title

  	
  VICE PRESIDENT FOR
  RESEARCH

  	
   

  	
  Title

  	
  GENERAL MANAGER

  	 

	
  Date

  	
  8-31-98

  	
   

  	
  Date

  	
  8-27-98

  	 

 

22

 

APPENDIX A

 

PATENT
RIGHTS on the EFFECTIVE DATE

 

UNITED STATES PATENT RIGHTS

 

M.I.T. Case 4126

Patent No. 4,767,402, Issued
August 30, 1988

“Ultrasound Enhancement of
Transdermal Drug Delivery”

By Joseph Kost, Robert S.
Langer and Drora Levy

 

M.I.T. Case 4266

Patent No. 4,780,212, Issued
October 25, 1988

“Ultrasound Enhancement of
Membrane Permeability”

By Joseph Kost and Robert S.
Langer

 

M.I.T. Case 4484

Patent No. 4,948,587, August
14, 1990

“Ultrasound Enhancement of
Transbuccal Drug Delivery”

By Joseph Kost and Robert S.
Langer

 

M.I.T. Case 6718

U.S.S.N. 08/507,060, Filed
July 25, 1995

“Transdermal Protein
Delivery Using Low-Frequency Sonophoresis”

U.S.S.N. 08/511,583, Filed
August 4, 1995

U.S.S.N. 08/545,236, Filed
October 19, 1995

“Transdermal Protein
Delivery or Measurement Using Low-Frequency Sonophoresis”

By Daniel Blankschtein,
Robert S. Langer and Samir Mitragotri

 

M.I.T. Case No. 6792

U.S.S.N. 08/626021, Filed
June 12, 1998

“Effect Of Electric Field
And Ultrasound For Transdermal Drug Delivery”

by Joseph Kost, Robert S.
Langer, Jr., Samir Mitagotri, Uwe Pliquett,

And James C. Weaver

 

M.I.T. Case 6822

“Enhanced Antimicrobial
Activity By Ultrasound for Dental Decay and

Periodontal Disease
Prevention and Treatment”

By Joseph Kost and Robert S.
Langer

 

M.I.T. Case 7222

U.S.S.N. 08/574377, Filed
December 18, 1995

“Chemical and Physical
Enhancers and Ultrasound for Transdermal Drug Deliver”

By Daniel Blankschtein, Mark
E. Johnson, Robert S. Langer, Jr., Samir S. Mitragotri,

And Michael Pishko

 

 

FOREIGN PATENT RIGHTS

 

M.I.T. Case 4126

Canada Patent No. 1,324,051,
Issued November 9, 1993

Japan Patent No. 2,710,281,
Issued October 24, 1997

“Ultrasound Enhancement of
Transdermal Drug Delivery”

By Joseph Kost, Robert S.
Langer and Drora Levy

 

M.I.T. Case 6718

PCT/US96/12244, Filed July
25, 1996

EPC Serial No. 96925491.1,
Filed July 25, 1996

AU Serial No. 65987/96,
Filed July 25, 1996

CAN Serial No. 2200984,
Filed July 25, 1996

JP Serial No. 9-507744,
Filed July 25, 1996

“Enhanced Transdermal
Transfer Using Ultrasound

By Daniel Blankschtein,
Robert S. Langer and Samir Mitragotri

 

M.I.T. Case 7222

PCT/US96/12244, Filed July
25, 1996

EPC Serial No. 96925491.1,
Filed July 25, 1996

AU Serial No. 65987/96,
Filed July 25, 1996

CA Serial No. 2200984, Filed
July 25, 1996

JP Serial No. 9-507744,
Filed July 25, 1996

“Enhanced Transdermal
Transfer Using Ultrasound”

By Daniel Blankschtein, Mark
E. Johnson, Robert S. Langer, Jr., Samir S. Mitragotri,

And Michael Pishko

 

 

APPENDIX B

 

DESIGNATED
FOREIGN COUNTRIES

 

Foreign countries in which
PATENT RIGHTS shall be filed, prosecuted and maintained in accordance with
Article 6:

 

Europe (EPO)

Japan

Canada

Australia

 

 

APPENDIX C1

 

 

CONFLICT AVOIDANCE STATEMENT

 

	
  Name:

  	
   

  	
  Robert S. Langer

  
	
   

  	
   

  	
   

  
	
  Dept. or Lab.:

  	
   

  	
  Chemical Engineering

  
	
   

  	
   

  	
   

  
	
  Company:

  	
   

  	
  SONTRA MEDICAL, INC.

  
	
   

  	
   

  	
   

  
	
  Address:

  	
   

  	
  21 Erie Street, Suite 22

  
	
   

  	
   

  	
  Cambridge, MA 02139

  

 

Licensed Technology:

 

M.I.T. Case 4126

Patent No. 4,767,402, Issued
August 30, 1988

“Ultrasound Enhancement of
Transdermal Drug Delivery”

By Joseph Kost, Robert S.
Langer and Drora Levy

 

M.I.T. Case 4266

Patent No. 4,780,212, Issued
October 25, 1988

“Ultrasound Enhancement of
Membrane Permeability”

By Joseph Kost and Robert S.
Langer

 

M.I.T. Case 4484

Patent No. 4,948,587, August
14, 1990

“Ultrasound Enhancement of
Transbuccal Drug Delivery”

By Joseph Kost and Robert S.
Langer

 

M.I.T. Case 6718

U.S.S.N. 08/507,060, Filed
July 25, 1995

“Transdermal Protein
Delivery Using Low-Frequency Sonophoresis”

U.S.S.N. 08/511,583, Filed
August 4, 1995

U.S.S.N. 08/545,236, Filed
October 19, 1995

“Transdermal Protein
Delivery or Measurement Using Low-Frequency Sonophoresis”

By Daniel Blankschtein,
Robert S. Langer and Samir Mitragotri

 

M.I.T. Case 6822

“Enhanced Antimicrobial
Activity By Ultrasound for Dental Decay and

Periodontal Disease
Prevention and Treatment”

By Joseph Kost and Robert S.
Langer

 

M.I.T. Case No 6792

“Transport Enhancement By
Simultaneous Application

Of Electric And Acoustic
Fields”

by Joseph Kost, Robert S.
Langer, Jr., Samir Mitagotri,

Uwe Pliquett, And James C.
Weaver

 

 

M.I.T. Case 7222

U.S.S.N. 08/574377, Filed
December 18, 1995

“Chemical and Physical
Enhancers and Ultrasound for Transdermal Drug Deliver”

By Daniel Blankschtein, Mark
E. Johnson, Robert S. Langer, Jr., Samir S. Mitragotri,

And Michael Pishko

 

 

Because
of the M.I.T. license granted to the above company and my equity* position and
continuing relationship with this company, I acknowledge the potential for a
possible conflict of interest between the performance of research at M.I.T. and
my contractual or other obligations to this company.  Therefore, I will not:

1)            use students at M.I.T. for
research and development projects for the company;

2)            restrict or delay access to
information from my M.I.T. research;

3)            take direct or indirect
research support from the company in order to support my activities at M.I.T.;
or

4)            employ students
at the company, except in accordance with Section 2.12.2, “Relations of Faculty
and Students,” in the Policies and Procedures Guide.

 

In addition, in order to avoid the appearance
of a conflict, I will attempt to differentiate clearly between the intellectual
directions of my M.I.T. research and my contributions to the company.  To that end, I will expressly inform my
department head/laboratory director annually of the general nature of my
activities on behalf of the company.

 

	
   

  	
  Signed:

  	
  /s/ Robert S. Langer

  
	
   

  	
  Date:

  	
  6/25/98

  

 

	
  Approved by:

  	
  /s/ Robert C. Armstrong

  	
   

  
	
   

  	
   

  	
   

  
	
  Name (print):

  	
  Robert C. Armstrong

  	
   

  
	
  (Dept. Head or Lab Dir)

  	
   

  	
   

  
				

 

Conf
Avoid Stmnt 941017

 

* “Equity” includes stock, options, warrants
or other financial instruments convertible into Equity, which are directly or
indirectly controlled by the inventor.

 

 

APPENDIX C2

 

 

CONFLICT AVOIDANCE STATEMENT

 

	
  Name:

  	
   

  	
  James C. Weaver

  
	
   

  	
   

  	
   

  
	
  Dept. or Lab.:

  	
   

  	
  Harvard - M.I.T. Health
  Sciences

  
	
   

  	
   

  	
   

  
	
  Company:

  	
   

  	
  SONTRA MEDICAL, INC.

  
	
   

  	
   

  	
   

  
	
  Address:

  	
   

  	
  21 Erie Street, Suite 22

  
	
   

  	
   

  	
  Cambridge, MA 02139

  

 

Licensed
Technology:

 

M.I.T.
Case 4126

Patent
No. 4,767,402, Issued August 30, 1988

“Ultrasound
Enhancement of Transdermal Drug Delivery”

By
Joseph Kost, Robert S. Langer and Drora Levy

 

M.I.T. Case 4266

Patent
No. 4,780,212, Issued October 25, 1988

“Ultrasound
Enhancement of Membrane Permeability”

By
Joseph Kost and Robert S. Langer

 

M.I.T. Case 4484

Patent
No. 4,948,587, August 14, 1990

“Ultrasound
Enhancement of Transbuccal Drug Delivery”

By
Joseph Kost and Robert S. Langer

 

M.I.T. Case 6718

U.S.S.N.
08/507,060, Filed July 25, 1995

“Transdermal
Protein Delivery Using Low-Frequency Sonophoresis”

U.S.S.N.
08/511,583, Filed August 4, 1995

U.S.S.N.
08/545,236, Filed October 19, 1995

“Transdermal
Protein Delivery or Measurement Using Low-Frequency Sonophoresis”

By
Daniel Blankschtein, Robert S. Langer and Samir Mitragotri

 

M.I.T. Case 6822

“Enhanced
Antimicrobial Activity By Ultrasound for Dental Decay and

Periodontal
Disease Prevention and Treatment”

By
Joseph Kost and Robert S. Langer

 

M.I.T. Case No. 6792

“Transport
Enhancement By Simultaneous Application

Of
Electric And Acoustic Fields”

by
Joseph Kost, Robert S. Langer, Jr., Samir Mitagotri,

Uwe
Pliquett, And James C. Weaver

 

 

M.I.T. Case 7222

U.S.S.N.
08/574377, Filed December 18, 1995

“Chemical
and Physical Enhancers and Ultrasound for Transdermal Drug Deliver”

By
Daniel Blankschtein, Mark E. Johnson, Robert S. Langer, Jr., Samir S.
Mitragotri,

And
Michael Pishko

 

 

Because
of the M.I.T. license granted to the above company and my equity* position and
continuing relationship with this company, I acknowledge the potential for a
possible conflict of interest between the performance of research at M.I.T. and
my contractual or other obligations to this company.  Therefore, I will not:

1)            use students at M.I.T. for
research and development projects for the company;

2)            restrict or delay access to
information from my M.I.T. research;

3)            take direct or indirect
research support from the company in order to support my activities at M.I.T.;
or

4)            employ students at the
company, except in accordance with Section 2.12.2, “Relations of Faculty and
Students,” in the Policies and Procedures Guide.

 

In addition, in order to
avoid the appearance of a conflict, I will attempt to differentiate clearly
between the intellectual directions of my M.I.T. research and my contributions
to the company. To that end, I will expressly inform my department
head/laboratory director annually of the general nature of my activities on
behalf of the company.

 

	
   

  	
   

  	
   

  	
   

  	
   

  	
  Signed:

  	
  /s/ James C. Weaver

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
  Date:

  	
  08-27-98

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Approved by:

  	
  /s/ Martha L. Gray

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Name (print):

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  (Dept. Head or Lab Dir)

  	
   

  	
   

  	
   

  	
   

  
									

 

Conf
Avoid Stmnt 941017

 

* “Equity” includes stock, options, warrants
or other financial instruments convertible into Equity, which are directly or
indirectly controlled by the inventor.

 

 

APPENDIX D

WAIVER

 

For good and valuable
consideration, including the grant of a license to SONTRA MEDICAL, INC. (the
“LICENSEE”), the undersigned hereby releases all rights, title and interest
he/she, his/her heirs and assigns may have as an inventor/author under M.I.T.’s
Guide to the Ownership, Distribution and Commercial Development of M.I.T.
Technology, as that policy may be amended from time to time, to receive my
inventor’s share of M.I.T.’s institutional equity for the License for M.I.T.
Case 4126, Patent No. 4,767,402, Issued August 30, 1988, “Ultrasound
Enhancement of Transdermal Drug Delivery,” By Joseph Kost, Robert S. Langer and
Drora Levy; M.I.T. Case 4266, Patent No. 4,780,212, Issued October 25, 1988,
“Ultrasound Enhancement of Membrane Permeability,” By Joseph Kost and Robert S.
Langer; M.I.T. Case 4484, Patent No. 4,948,587, August 14, 1990, “Ultrasound
Enhancement of Transbuccal Drug Delivery,” By Joseph Kost and Robert S. Langer;
M.I.T. Case 6718, U.S.S.N. 08/507,060, Filed July 25, 1995, “Transdermal
Protein Delivery Using Low-Frequency Sonophoresis,” U.S.S.N. 08/511,583, Filed
August 4, 1995, “Transdermal Protein Delivery or Measurement Using
Low-Frequency Sonophoresis,” By Daniel Blankschtein, Robert S. Langer and Samir
Mitragotri; M.I.T. Case 6822, “Enhanced Antimicrobial Activity By Ultrasound
for Dental Decay and Periodontal Disease Prevention and Treatment,” By Joseph
Kost and Robert S. Langer; and M.I.T. Case 7222, U.S.S.N. 08/574377, Filed
December 18, 1995, “Chemical and Physical Enhancers and Ultrasound for
Transdermal Drug Deliver,” By Daniel Blankschtein, Mark E. Johnson, Robert S.
Langer, Jr., Samir S. Mitragotri, And Michael Pishko.

 

	
  Witness:

  	
  /s/ Shawn E. Stovall

  	
   

  	
  Signed:

  	
  /s/ Robert S. Langer

  
	
   

  	
   

  	
  Name:

  	
  Robert S. Langer

  
	
   

  	
   

  	
  Date:

  	
  8-21-98

  

 

 

APPENDIX E

WAIVER

 

For good and valuable
consideration, including the grant of a license to SONTRA MEDICAL, INC. (the
“LICENSEE”), the undersigned hereby releases all rights, title and interest
he/she, his/her heirs and assigns may have as an inventor/author under M.I.T.’s
Guide to the Ownership, Distribution and Commercial Development of M.I.T.
Technology, as that policy may be amended from time to time, to receive my
inventor’s share of M.I.T.’s institutional equity for the License for M.I.T.
Case 4126, Patent No. 4,767,402, Issued August 30, 1988, “Ultrasound
Enhancement of Transdermal Drug Delivery,” By Joseph Kost, Robert S. Langer and
Drora Levy; M.I.T. Case 4266, Patent No. 4,780,212, Issued October 25, 1988,
“Ultrasound Enhancement of Membrane Permeability,” By Joseph Kost and Robert S.
Langer; M.I.T. Case 4484, Patent No. 4,948,587, August 14, 1990, “Ultrasound
Enhancement of Transbuccal Drug Delivery,” By Joseph Kost and Robert S. Langer;
M.I.T. Case 6718, U.S.S.N. 08/507,060, Filed July 25, 1995, “Transdermal
Protein Delivery Using Low-Frequency Sonophoresis,” U.S.S.N. 08/511,583, Filed
August 4, 1995, “Transdermal Protein Delivery or Measurement Using
Low-Frequency Sonophoresis,” By Daniel Blankschtein, Robert S. Langer and Samir
Mitragotri; M.I.T. Case 6822, “Enhanced Antimicrobial Activity By Ultrasound
for Dental Decay and Periodontal Disease Prevention and Treatment,” By Joseph
Kost and Robert S. Langer; and M.I.T. Case 7222, U.S.S.N. 08/574377, Filed
December 18, 1995, “Chemical and Physical Enhancers and Ultrasound for
Transdermal Drug Deliver,” By Daniel Blankschtein, Mark E. Johnson, Robert S.
Langer, Jr., Samir S. Mitragotri, And Michael Pishko.

 

	
  Witness:

  	
  /s/ Shawn E. Stovall

  	
   

  	
  Signed:

  	
  /s/ Joseph Kost

  
	
   

  	
   

  	
  Name:

  	
  JOSEPH KOST

  
	
   

  	
   

  	
  Date:

  	
  8/19/98

  

 

 

APPENDIX F

WAIVER

 

For good and valuable
consideration, including the grant of a license to SONTRA MEDICAL, INC. (the
“LICENSEE”), the undersigned hereby releases all rights, title and interest
he/she, his/her heirs and assigns may have as an inventor/author under M.I.T.’s
Guide to the Ownership, Distribution and Commercial Development of M.I.T. Technology,
as that policy may be amended from time to time, to receive my inventor’s share
of M.I.T.’s institutional equity for the License for M.I.T. Case 4126, Patent
No. 4,767,402, Issued August 30, 1988, “Ultrasound Enhancement of Transdermal
Drug Delivery,” By Joseph Kost, Robert S. Langer and Drora Levy; M.I.T. Case
4266, Patent No. 4,780,212, Issued October 25, 1988. “Ultrasound Enhancement of
Membrane Permeability,” By Joseph Kost and Robert S. Langer; M.I.T. Case 4484,
Patent No. 4,948,587, August 14, 1990, 
“Ultrasound Enhancement of Transbuccal Drug Delivery,” By Joseph Kost
and Robert S. Langer; M.I.T. Case 6718, U.S.S.N. 08/507,060, Filed July 25,
1995, “Transdermal Protein Delivery Using Low-Frequency Sonophoresis,” U.S.S.N.
08/511,583, Filed August 4, 1995, “Transdermal Protein Delivery or Measurement
Using Low-Frequency Sonophoresis,” By Daniel Blankschtein, Robert S. Langer and
Samir Mitragotri; M.I.T. Case 6822. 
“Enhanced Antimicrobial Activity By Ultrasound for Dental Decay and
Periodontal Disease Prevention and Treatment,” By Joseph Kost and Robert S.
Langer; and M.I.T. Case 7222, U.S.S.N. 08/574377, Filed December 18, 1995,
“Chemical and Physical Enhancers and Ultrasound for Transdermal Drug Deliver,”
By Daniel Blankschtein, Mark E. Johnson, Robert S. Langer, Jr., Samir S.
Mitragotri, And Michael Pishko.

 

	
  Witness:

  	
  /s/ Shawn E. Stovall

  	
   

  	
  Signed:

  	
  /s/ Samir Mitragotri

  
	
   

  	
   

  	
  Name:

  	
  Samir Mitragotri

  
	
   

  	
   

  	
  Date:

  	
  8/19/98

  

 

 

APPENDIX G

M.I.T.
HOLDERS

	
  Blankschtein

  	
   

  	
  5684
  Shares

  
	
  Johnson

  	
   

  	
  2132
  Shares

  
	
  Levy

  	
   

  	
  3552
  Shares

  
	
  M.I.T.

  	
   

  	
  245394
  Shares

  
	
  Pishko

  	
   

  	
  2132
  Shares

  
	
  Piquett

  	
   

  	
  2132
  Shares

  
	
  Weaver

  	
   

  	
  2132
  Shares

  

 

 

 

APPENDIX H

ARTICLES OF INCORPORATION

 

 

 

 

 

State of Delaware

 

Office of the Secretary of State

 

 

I, EDWARD J. FREEL,
SECRETARY OF STATE OF THE STATE OF DELAWARE, DO HEREBY CERTIFY THE ATTACHED IS
A TRUE AND CORRECT COPY OF THE RESTATED CERTIFICATE OF “NEWCORP MEDICAL, INC.”,
CHANGING ITS NAME FROM “NEWCORP MEDICAL, INC.” TO “SONTRA MEDICAL, INC.”, FILED
IN THIS OFFICE ON THE THIRTIETH DAY OF JUNE, A.D., 1998, AT 5 O’ CLOCK P.M.

A FILED COPY OF THIS CERTIFICATE HAS BEEN FORWARDED TO THE NEW CASTLE
COUNTY RECORDER OF DEEDS.

	
   

  	
   

  	
  /s/ Edward J. Freel

  
	
   

  	
  Edward
  J. Freel, Secretary of State

  
	
   

  	
   

  	
   

  	
   

  
	
  2878224  8100

  	
   

  	
  AUTHENTICATION:

  	
  9176901

  
	
  981257808

  	
   

  	
  DATE:

  	
  07-02-98

  

 

 

AMENDED
AND RESTATED

CERTIFICATE
OF INCORPORATION

OF
NEWCORP MEDICAL, INC.

 

The undersigned, being the
Secretary of NEWCORP MEDICAL, INC., a corporation organized and existing under
and by virtue of the General Corporation Law of the State of Delaware (the
“Corporation”) originally incorporated March 31, 1998;

 

DOES HEREBY CERTIFY:

 

FIRST:  That the Board of Directors of the
Corporation, by the unanimous written consent of its members, dated as of June
12, 1998, adopted a resolution proposing and declaring advisable that the
Corporation’s Certificate of Incorporation be amended and restated as set forth
in Exhibit A hereto:

 

SECOND:  That in lieu of a meeting and vote of the
Stockholders of the Corporation, such Stockholders have given Majority Written
Consent to said amendment and restatement of the Corporation’s Certificate of
Incorporation in accordance with the provisions of Section 228 of the General
Corporation Law of the State of Delaware.

 

THIRD:  That the aforesaid amendment was duly
adopted in accordance with Sections 242 & 245 of the General Corporation
Law of the State of Delaware.

	
   

  	
  NEWCORP MEDICAL, INC.

  
	
   

  	
   

  
	
   

  	
  /s/ Shawn Stovall

  
	
   

  	
  Name:

  	
  Shawn Stovall

  
	
   

  	
  Title:

  	
  Secretary

  

 

 

 

FIRST
AMENDED AND RESTATED

CERTIFICATE
OF INCORPORATION

 

OF

 

NEWCORP MEDICAL, INC.

ARTICLE
I

 

The name of the corporation
is Sontra Medical, Inc.

 

ARTICLE
II

 

The address of the
Corporation’s registered office in the State of Delaware is c/o The Corporation
Trust Company, 1209 Orange Street, Wilmington; Delaware 19801, County of New
Castle.  The name of its registered
agent at such address is The Corporation Trust Company.

 

ARTICLE
III

 

The purpose of the
Corporation is to engage in any lawful act or activity for which corporations
may be organized under the General Corporation Law of Delaware.

 

ARTICLE
IV

 

The aggregate number of
shares of capital stock which the Corporation shall have the authority to issue
is 15,000,000 shares of common stock (“Common Stock”), par value $.01 per
share.  Shares of Common Stock of the
Corporation may be issued for such consideration and for such corporate
purposes as the Board of Directors of the Corporation may from time to time
determine.  By resolution of its Board
of Directors, the Corporation shall have the authority to issue a class of
preferred stock and multiple series thereof and a second class of common stock,
the preferences and relative rights of all of which shall be 

 

 

 

designated by the Board of Directors in its
resolution authorizing the creation and issuance thereof.

 

In the event of voluntary or
involuntary liquidation, distribution or sale of assets, dissolution or
winding-up of the Corporation, the holders of the Common Stock shall be
entitled to receive all the assets of the Corporation, tangible and intangible,
of whatever kind available for distribution to stockholders, ratably in
proportion to the number of shares of Common Stock held by each.

 

Each holder of Common Stock
shall have one vote in respect of each share of Common Stock held by such
holder on each matter voted upon by the stockholders.

 

ARTICLE V

 

The name and mailing address
of the incorporator is as follows:

 

	
  Name

  	
   

  	
  Mailing
  Address

  
	
   

  	
   

  	
   

  
	
  James R. McNab, Jr.

  	
   

  	
  Reprogenesis, Inc.

  
	
   

  	
   

  	
  10 Sylvan Drive, Suite 27

  
	
   

  	
   

  	
  St. Simons Island, GA
  31522

  

 

ARTICLE VI

 

The powers of the
incorporator shall terminate upon the filing of this Certificate of
Incorporation and the names and mailing addresses of the persons who are to
serve as directors until the first annual meeting of stockholders or until
their successors are elected and qualify are:

 

	
  Name of
  Director

  	
   

  	
  Mailing
  Address

  
	
   

  	
   

  	
   

  
	
  Robert Langer

  	
   

  	
  77 Lombard Street

  
	
   

  	
   

  	
  Newton, MA 02158

  
	
   

  	
   

  	
   

  
	
  Joseph Kost

  	
   

  	
  26 Searle Avenue

  
	
   

  	
   

  	
  Brookline, MA 02146

  
	
   

  	
   

  	
   

  
	
  James R. McNab, Jr.

  	
   

  	
  Reprogenesis, Inc.

  
	
   

  	
   

  	
  10 Sylvan Drive, Suite 27

  
	
   

  	
   

  	
  St. Simons Island, GA
  31522

  

 

 

2

 

ARTICLE VII

 

In furtherance and not in
limitation of the powers conferred by law, the Board of Directors shall have
the power, and is expressly authorized, to adopt, amend or repeal the Bylaws of
the Corporation.

 

ARTICLE VIII

 

To the fullest extent
permitted by the Delaware General Corporate Law as the same exists or may
hereafter be amended, a director of the Corporation shall not be personally
liable to the Corporation or its stockholders for monetary damages for breach
of duty as a director.  Without limiting
the foregoing in any respect, a director of the Corporation shall not be
personally liable to the Corporation or its stockholders for monetary damages
for breach of duty as a director, except for liability (a) for any breach of
the director’s duty of loyalty to the Corporation or its stockholders, (b) for
acts or omissions not in good faith or which involve intentional misconduct or
a knowing violation of law, (c) under Section 174 of the General Corporation
Law of the State of Delaware, as the same exists or hereafter may be amended,
or (d) for any transaction from which the director derived an improper personal
benefit.  If the General Corporation Law
of the State of Delaware is amended after the date of filing of this
Certificate of Incorporation to authorize corporate action further eliminating
or limiting the personal liability of directors, then the liability of a
director of the Corporation, in addition to the limitation on personal
liability provided herein, shall be eliminated or limited to the fullest extent
permitted by the amended General Corporation Law of the State of Delaware.  The indemnities provided and granted herein
shall not be exclusive of any other rights or protections afforded an
individual under any bylaw, contract or vote of shareholders or disinterested
directors or otherwise.  Any repeal or
modification of this Article VIII by the stockholders of the Corporation shall
be prospective only, and shall not adversely affect any limitation on the
personal liability of a director of the Corporation existing at the time of
such repeal or modification.

 

3

Source: [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00038-of-00352.parquet"}, [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00038-of-00352.parquet"}]]