Document:

htgm-ex1023_1405.htm

Exhibit 10.23

 

***Text Omitted and Filed Separately with

the Securities and Exchange Commission.

Confidential Treatment Requested Under

17 C.F.R. Sections 200.80(b)(4) and 240.24b-2.

 

Master Assay Development, Commercialization 

and Manufacturing Agreement

This Master Assay Development, Commercialization and Manufacturing Agreement (“Agreement”), is entered into and effective as of November 16, 2016 (the “Effective Date”), by and between QIAGEN Manchester Limited, a UK corporation having offices at Skelton House, Lloyd Street North, Manchester, UK (“QIAGEN”), and HTG Molecular Diagnostics, Inc., a Delaware corporation having offices at 3430 E. Global Loop, Tucson, AZ, U.S.A.  85706 (“HTG”).  HTG and QIAGEN are herein referred to each as a “Party” and collectively as the “Parties.”  

RECITALS 

A.QIAGEN is a leading provider of sample to insight technologies, including, inter alia, sequencing equipment and bioinformatics analytics, and companion diagnostic assays to aid in the selection and use of pharmaceutical products for the treatment of disease; 

B.HTG is a leading provider of novel technologies based on targeted nuclease protection chemistry to facilitate the routine use of complex molecular profiling in a multiplexed panel format from low amounts of samples, which is useful inter alia for companion diagnostic assays;

C.QIAGEN and HTG desire to engage in a collaborative relationship, involving performing collaborative assay development and manufacturing activities involving each Party’s applicable technology, which is intended to support QIAGEN’s entering into companion diagnostic development programs with third party pharmaceutical companies, and, if applicable and agreed to by the Parties in each case, to facilitate QIAGEN’s or HTG’s existing, independent programs;

D.Each Party desires to engage in such collaborative development and commercial activities in accordance with the terms and conditions of this Agreement and individual Statements of Work (as defined below) entered into by the Parties. 

NOW, THEREFORE, in consideration of the foregoing recitals and the mutual obligations and responsibilities of the Parties as set forth herein, the receipt and total sufficiency of which is hereby acknowledged, the Parties agree as follows:

AGREEMENT

 

1.DEFINITIONS

1.1“Affiliate” means, with respect to a Party, any corporation, partnership or other business organization that, directly or indirectly, controls, is controlled by or is under common control with such Party. For the purpose of this definition “control” (with correlative meanings for the terms “controlled by” and “under common control with”) shall mean that the applicable business organization has the actual ability to direct and control the management and business decisions of the applicable Party, including by holding more than 50% (fifty percent) of the voting stock or other ownership interests of the applicable corporation or business entity. 

 

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1.2“AM Field” means the development and commercialization of companion diagnostic assays in the PDP Field for use in connection with autoimmune or microbiome therapeutics developed by Sponsors. 

1.3 “Applicable Law(s)” means all applicable provisions of all statutes, laws, rules, regulations, administrative codes, ordinances, decrees, orders, decisions, injunctions, awards, judgments, permits and licenses of or from Federal, State and local governmental authorities, including regulatory authorities, as the same may be amended from time to time, that are applicable to the particular obligation, task or undertaking under this Agreement. 

1.4“Change of Control” means, with respect to a Party, either (a) a sale of all or substantially all of such Party’s assets or business to which this Agreement relates; (b) a merger or consolidation of such Party in which the stockholders of such Party immediately prior thereto do not own, directly or indirectly, either (x) outstanding voting securities representing more than fifty percent (50%) of the combined outstanding voting power of the surviving entity in such merger or consolidation or (y) more than fifty percent (50%) of the combined outstanding voting power of the parent of the surviving entity in such merger or consolidation, in each case in substantially the same proportion as their ownership of the outstanding voting securities of such Party immediately prior to such transaction; or (c) a transaction or series of transactions that result in any Exchange Act Person becoming the owner, directly or indirectly, of securities of such Party representing more than fifty percent (50%) of the combined voting power of such Party’s then-outstanding securities (other than by virtue of a merger or consolidation and excluding any acquisition of securities of such Party directly from such Party). 

1.5Confidential Information” means, with respect to a Party, all proprietary and/or confidential information of such Party (the “Disclosing Party” as to such information) provided orally or in writing to the other Party (the “Receiving Party” as to such information), or as observed by such Receiving Party on visits to the Disclosing Party’s facilities, which may include any information that relates to the Disclosing Party’s new or existing products, services and/or business operations, product development plans, standard operating procedures, specifications, pricing information, business methods, trade secrets, business processes, business plans, inventions, techniques, and other information not readily available to the public, whether or not labeled as “Confidential” or “Proprietary” or otherwise reduced to writing, but provided that “Confidential Information” shall not include any information that meets any of the exclusions in Section 6.5.  For purposes of this Agreement, the Party disclosing its Confidential Information hereunder shall be referred to as “Disclosing Party” with respect to such information, while the Party receiving the Disclosing Party’s Confidential Information hereunder shall be referred to as the “Receiving Party” as to such information.  In addition, all HTG IP shall be deemed the Confidential Information of HTG, and all QIAGEN IP shall be deemed the Confidential Information of QIAGEN, subject in each case to information that meets any of the exclusions in Section 6.5.   

1.6“Cost of Goods” means, with respect to a particular HTG or QIAGEN instrument or tool or other product (excluding any PDP Assay) sold or transferred as contemplated in Section 5.2.3, all  costs and expenses actually incurred by HTG or QIAGEN (as applicable) with respect to such instrument or tool or other product that are appropriately characterized as “cost of goods sold” in accordance with U.S. GAAP (including any costs and expenses allocated to “cost of goods sold” in a manner consistent with HTG or QIAGEN’s (as applicable) past practices in preparation of its audited financial statements).  

 

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1.7“Intellectual Property Rights” means all rights of the following types, which may exist or be created under the laws of any jurisdiction in the world: (i) rights associated with works of authorship, including exclusive exploitation rights, copyrights, moral rights, and mask works; (ii) trademark and trade name rights and similar rights; (iii) trade secret rights; (iv) patent rights and industrial property rights; and (v) other proprietary rights in intellectual property of every kind and nature.

1.8“Exchange Act Person” means any natural person, entity or “group” (within the meaning of Section 13(d) or 14(d) of the Securities Exchange Act of 1934, as amended, and the rules and regulations promulgated thereunder), except that “Exchange Act Person” will not include an underwriter temporarily holding securities pursuant to a registered public offering of such securities.

1.9“Fields” means:

	
 
	
1.9.1
	
the Oncology Field, which shall be exclusive as between the Parties (including their Affiliates) as provided in Section 2.3.1;

	
 
	
1.9.2
	
the AM Field, which shall be non-exclusive as between the Parties as provided in Section 2.3.2; and

	
 
	
1.9.3
	
any other companion diagnostics field mutually agreed by the Parties to be included in this Agreement with respect to the Parties’ development and commercialization of companion diagnostic assays in the PDP Field for use applicable to such field(s) as provided in Section 2.3.2.

1.10“HTG IP” means all Inventions that: (a) were made, developed, perfected, devised, conceived of or first reduced to practice by or on behalf of HTG, its employees, agents or contractors, individually or jointly, or jointly with third parties, prior to the Effective Date, or (b) were made, developed, perfected, devised, conceived of or first reduced to practice by or on behalf of HTG, its employees, agents or contractors, individually or jointly during the Term (defined below) and independent of Development work performed under this Agreement, (c) are made, developed, perfected, devised, conceived of or first reduced to practice by or on behalf of HTG, its employees, agents or contractors, individually or jointly, during the Term in connection with the performance of Development work under this Agreement, and are not directly related to and specifically derived from any QIAGEN Property; or (d) were made, developed, perfected, devised, conceived of or first reduced to practice by or on behalf of QIAGEN or any of its Affiliates, or their respective employees, agents or contractors, individually or jointly, during the Term either (i) with reference to or use of HTG Property received by QIAGEN in connection with this Agreement, or (ii) in connection with the performance of Development work under this Agreement, in each case that directly relate to NPA Chemistry, which is defined as any practice, process, procedure, method, methodology, technique, technology, material or the like for targeted nuclease protection and subsequent detection, by whatsoever means, of nucleic acid molecules, including DNA or RNA in whatsoever form existing in nature or otherwise, that need not (but, optionally, may) be substantially purified prior to nuclease protection.  For the purposes of clarity, HTG IP shall not include any QIAGEN IP.  

1.11“HTG Property” means: (i) HTG IP and (ii) HTG’s Confidential Information.   

 

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1.12“Inventions” means all inventions, discoveries, know-how, trade secrets, devices, apparatus, practices, processes, procedures, methods, methodologies, techniques, products, trade secrets, notes, data, written materials, findings, records and documents, works of authorship, software and any other Intellectual Property Rights, including improvements, enhancements, or derivatives to or of any of the foregoing, whether or not patentable or otherwise protectable by intellectual property rights.   

1.13“Sponsor Project Agreement means an agreement entered into between QIAGEN and a Sponsor to conduct one or more Projects.   

1.14“Net Profits” means, as to a particular SOW, the following:  (a) all total amounts paid by the applicable Sponsor to QIAGEN under the relevant Sponsor Project Agreement with respect to the conduct of the Project covered by such SOW, less (b) the sum of QIAGEN Project Costs plus HTG Project Costs.  

1.15“Project” means a project covered by a particular Sponsor Project Agreement, under which QIAGEN, in partnership with HTG under this Agreement and an SOW, would develop a PDP Assay applicable to the Sponsor therapeutic covered by such Project, obtain needed regulatory approval of such PDP Assay, and would commercialize such PDP Assay throughout the Territory, after regulatory approval, as a companion diagnostic assay for use in connection with the prescribing of applicable Sponsor therapeutic(s) that are the subject of such Project.

1.16“Project Costs” means, with respect to a Party, the actual, direct costs incurred by the applicable Party to conduct its Development work under, and as mutually agreed in, a particular SOW.  [***...]

1.17“PDP Field” means use of diagnostic assays utilizing next generation sequencing (“NGS”) detection solely in connection with clinical applications of therapeutics, whether in connection with clinical trials of a therapeutic or in patient clinical settings (to determine if the clinical trial participant or the patient is an appropriate candidate for the applicable therapy), and whether as a companion diagnostic to a particular therapy or as a complementary diagnostic for the treatment pathway.  All other uses of NGS-based assays, [...***...] are expressly excluded from the PDP Field unless a particular Project [...***...] expressly contemplate a preliminary feasibility study, which would otherwise constitute an Excluded Use, as an intermediate step in the clinical development program for the applicable therapeutic.  [...***...].  For clarification, PDP Field expressly excludes PCR and other non-NGS assay technology platforms or any other project or business between QIAGEN and its customers for QIAGEN’s bioinformatics “software as a service” business. 

1.18““Oncology Field” means the development and commercialization of companion diagnostic assays in the PDP Field for use in connection with cancer therapeutics developed by Sponsors.  

 

***Confidential Treatment Requested 

 

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1.19“QIAGEN IP” means all Inventions that (a) were made, developed, perfected, devised, conceived of or first reduced to practice by or on behalf of QIAGEN, its employees, agents or contractors, individually or jointly, or jointly with third parties, prior to the Effective Date, or (b) were made, developed, perfected, devised, conceived of or first reduced to practice by or on behalf of QIAGEN, its employees, agents or contractors, individually or jointly, during the Term and independent of Development work performed under this Agreement; or (c) are made, developed, perfected, devised, conceived of or first reduced to practice by or on behalf of QIAGEN, it employees, agents or contractors, individually or jointly, in connection with the performance of Development work conducted under this Agreement, and are not directly related to and specifically derived from any HTG Property, or (d) were made, developed, perfected, devised, conceived of or first reduced to practice by or on behalf of HTG or its Affiliate, or their respective employees, agents or contractors, individually or jointly, during the Term in connection with the performance of Development work under this Agreement that directly relate to or is specifically derived from any QIAGEN Property.  For the purposes of clarity, QIAGEN IP shall not include any HTG IP 

1.20“PDP Assay” means an NGS-based companion diagnostic assay developed by the Parties pursuant to a particular SOW.  It is understood that, as provided in an applicable Statement of Work (and subject to any exceptions set forth therein, QIAGEN shall market and sell such assay under QIAGEN’s brand name and, if mutually agreed in the applicable Statement of Work, referencing a brand or technology of HTG if such HTG IP has been used.  

1.21“Protocol” means, with respect to a particular Project, the protocol agreed to by QIAGEN and the applicable Sponsor to cover the Sponsor’s activities to support such Project, including delivery of relevant clinical samples, and conduct of clinical trials on its applicable therapeutic, involving use of the applicable PDP Assay being developed hereunder pursuant to such Project.   

1.22“QIAGEN Property” means: (i) the QIAGEN IP; (ii) the QIAGEN Materials; and (iii) QIAGEN’s Confidential Information.  

1.23“QIAGEN Materials” means: (i) all test materials, controls, specimens or samples (“Samples”) identified in the applicable Statement of Work, collected from subjects in accordance with the Protocol (defined above) applicable to a particular Project under an Sponsor Project Agreement; and (ii) all reagents, data and information relating to the Samples or the use of the Samples provided by QIAGEN and/or the applicable Sponsor to HTG for purposes of performing its Development work pursuant to such Statement of Work.   

1.24“Statement of Work” or “SOW” means a statement of work, as provided in Section 3, which is executed by the Parties to cover the performance by each Party of its respective Development activities in support of development of the PDP Assay in connection with the related Project.  Each such SOW shall be subject to and governed by the terms of this Agreement.

1.25“Development” means the assay development activities undertaken by HTG and/or QIAGEN to develop a particular PDP Assay for a particular Project, as specified in detail in the applicable Statement of Work.

1.26“Sponsor” shall mean any pharmaceutical company or companies that is party to a particular Sponsor Project Agreement, and is identified in the relevant Statement of Work, for whom QIAGEN (in partnership with HTG under this Agreement) is engaged in a Project.    

1.27“Steering Committee” means the committee formed by the Parties under Section 2.4, to manage and oversee the negotiation of Sponsor Project Agreements, the conduct of Development work under the 

 

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agreed SOWs, the manufacture of PDP Assays, and the commercialization by QIAGEN of approved PDP Assays (and related QIAGEN equipment and tools).    

1.28“Territory” means worldwide.

1.29Other capitalized terms used in this Agreement shall have the meanings elsewhere defined in this Agreement. 

2.COMPANION DIAGNOSTICS PARTNERSHIP

2.1Overview of Collaboration.  This Agreement shall serve as the master agreement for the collaboration of the Parties to develop, pursuant to Projects initiated under Sponsor Project Agreements, and commercialize PDP Assays in the Fields for use solely in the PDP Field.  Under such collaboration, the Parties shall jointly seek and negotiate with potential Sponsors, to enter into Sponsor Project Agreements under which specific agreed Projects will be conducted to develop PDP Assays in the Fields, which shall be run on QIAGEN sequencing equipment (often in connection with QIAGEN bioinformatics analysis programs, and other QIAGEN proprietary tools, and/or with proprietary HTG tools and instruments as well), and which are to be used as companion diagnostics in the PDP Field to support the applicable Sponsor’s therapeutic development and commercialization.  The development of each PDP Assay, in connection with a Project under a particular Sponsor Project Agreement, shall be conducted by the Parties collaboratively under the applicable Statement of Work, as agreed to by the Parties as discussed in Section 3.2, in connection with QIAGEN agreeing to conduct such Project.  It is expected that:  (a) for each Project that relates to PDP Assays based primarily on HTG IP (such as, RNA-targeted assays, HTG shall conduct most of the preliminary Development work to create the a particular PDP Assay, (b) for each Project that relates to PDP Assays based primarily on QIAGEN IP (such as, certain DNA-targeted assays), QIAGEN likely will conduct most of the preliminary Development work to create the a particular PDP Assay, and (c) once such work Development work is completed, the clinical and regulatory work needed to obtain needed regulatory approvals of the PDP Assay shall be conducted by QIAGEN in collaboration with the applicable Sponsor.  It is also expected that HTG shall manufacture and supply to QIAGEN, for its use in clinical development and commercialization, the HTG-developed PDP Assays, pursuant to the manufacturing provisions of a Supply Agreement to be entered into by the Parties as contemplated in Section 8.3, and that QIAGEN shall have the responsibility for marketing, selling and otherwise commercializing the PDP Assays.  

2.2Sponsor Project Agreements; Projects.  The Parties shall seek to identify, and shall negotiate with, appropriate pharmaceutical companies regarding entering into Sponsor Project Agreements with QIAGEN, covering one or more Projects to develop PDP Assays for use in the PDP Field as companion diagnostic assays in connection with such company’s applicable therapeutics.  Each of the Parties commits to be fully cooperative with the other and to use good faith, diligent and commercially reasonable efforts, in all such activities seeking Sponsor Project Agreements.  [***...]  The Parties’ discussion and management of the Sponsor Project Agreement negotiation process shall be primarily through the Steering Committee.

 

***Confidential Treatment Requested 

 

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2.3Exclusivity, Non-exclusivity and Related Matters.  

	
 
	
2.3.1
	
The Parties agree that their relationship under this Agreement regarding the Oncology Field shall be exclusive, as provided herein, but subject to the exceptions below.  Each Party agrees that if it (or any of its Affiliates) becomes aware of any pharmaceutical company that likely is interested in, or that the Party believes would be a good candidate for, entering into an agreement or other relationship to develop a PDP Assay in the Oncology Field (whether in development or in commercialization), such Party shall, subject to the appropriate consent of the pharmaceutical company, notify the other Party of such company and all relevant information regarding its cancer therapeutic and possible interest in a companion diagnostic deal.  The Parties then shall promptly meet (most appropriately through the Steering Committee) and discuss such opportunity and determine whether (and if so, how) to approach such company to discuss a possible Sponsor Project Agreement, as contemplated under Section 2.2.  If, as to any such pharmaceutical company, either (a) the Parties are not able to agree on the Key Terms of the Sponsor Project Agreement with such company, or such company determines not to enter into a proposed Sponsor Project Agreement, or (b) the company indicates [***...] or (c) as to a particular proposed Project, the Parties cannot agree on the terms of an appropriate SOW to cover the Development work needed for such proposed Project, then, in case of scenario (a) or (b), the Parties (including their Affiliates) shall not independently work with such pharmaceutical company in the Oncology field, and, in case of scenario (c), the Parties (including their Affiliates) shall not independently work with such pharmaceutical company with respect to the Project (or any project that is substantially similar) in the Oncology Field; provided that, for clarification, with respect to scenario (c), QIAGEN and its Affiliates shall be unrestricted to work, in conformance with the terms and conditions of this Agreement, with such pharmaceutical company on a QIAGEN-developed, DNA-based PDP Assay.  In addition, for clarity, the above exclusivity commitments in the Oncology Field remain as to all other companies and possible projects in the Oncology Field.  

	
 
	
2.3.2
	
With respect to possible Projects in Fields other than the Oncology Field, the Parties acknowledge and agree that their relationship under this Agreement is non-exclusive.  Any collaborative program of the Parties hereunder to develop a PDP Assay for any Field other than the Oncology Field shall be undertaken only if the Parties agree, in their sole and absolute discretion, on the applicable Sponsor Project Agreement and SOW for such program, with neither Party having an obligation so to agree.  If either Party desires to engage in such a non-oncology program hereunder, it may request the other Party to consider the proposed program, and the Parties then will discuss reasonably and in good faith the proposed program, including the applicable pharmaceutical company of interest in the program, and the proposed Sponsor Project Agreement and SOW.  If the Parties can agree on such items, the program will proceed hereunder as a Project under the applicable agreed Sponsor Project Agreement and SOW.  Neither Party will have an obligation to agree to any such proposed program, or proposed Sponsor Project Agreement or SOW. 

 

***Confidential Treatment Requested 

 

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2.4Steering Committee.  Promptly after the Effective Date, the Parties shall form a committee (the “Steering Committee”), comprised of two representatives from each Party, appointed (and if applicable replaced) by each such Party.  The Steering Committee shall meet (either in person or by teleconference or videoconference, reasonably agreed by the Parties) at least once per calendar quarter, or more often as needed to address matters needing resolution in the collaboration hereunder between the Parties or arising under the SOWs or Development work.  All representatives on the Steering Committee shall work in good faith and reasonably to discuss and seek to find consensus on all matters raised at Steering Committee meetings and on all matters needed resolution or decision.  All decisions made and actions taken by Steering Committee shall require unanimous agreement by the representatives on the Steering Committee.  The Steering Committee shall have the responsibility to manage and oversee the Parties’ efforts to identify possible Sponsors and negotiate and enter into Sponsor Project Agreements, the performance and activities under the Sponsor Project Agreements, each Party’s conduct of the Development work under the SOWs, compliance with the timelines in the SOW, and the development and commercialization of PDP Assays, and such other appropriate matters arising under the Parties’ collaboration under this Agreement.  However, for clarity, the Steering Committee shall not have any authority to modify, amend, interpret or waive any terms or obligations under this Agreement.

3.CONDUCT & RESPONSIBILITIES REGARDING STATEMENTS OF WORK

3.1As this Agreement serves as the master agreement for the collaboration of the Parties for PDP Assay development in the Fields, the Parties agree that such Development efforts shall be conducted in accordance with SOWs agreed to by the Parties under this Article 3.  With respect to each particular Project that the Parties agree to undertake, pursuant to the applicable Sponsor Project Agreement, to develop a PDP Assay in partnership with or in support of the applicable Sponsor, the Parties must agree to the SOW covering such Development activities pursuant to the below terms, before such Project can be officially committed and undertaken under such Sponsor Project Agreement.   

3.2With respect to each Project, the parties shall (prior to QIAGEN committing to the Project under the applicable Sponsor Project Agreement) discuss and in good faith use commercially reasonable efforts to agree on the terms and conditions of, and enter into, an individual Statement of Work for such Project, and such SOW shall:  (a) identify the Sponsor and the nature of the Project, describe in all reasonable detail the agreed upon Development plan for Development of the PDP Assay under such Project, including setting forth for each Party the specific agreed upon Development work to be performed by such Party in developing such PDP Assay, include any corresponding research protocols to be followed by HTG and clinical development protocols to be followed by QIAGEN, the budget for conducting such work, and set forth the compensation to be paid by QIAGEN to HTG with respect to such HTG’s performance of such Development work and (if applicable) the amounts (out of payments by a Sponsor) to be retained by QIAGEN as compensation for its Development work.  A template Statement of Work is attached hereto as Exhibit A (with the understanding that the Parties may vary from such template, as needed for any particular SOW).  The Parties shall mutually discuss and in good faith use commercially reasonable efforts to agree in writing to each Statement of Work, and upon the execution of any such Statement of Work by the Parties, the Statement of Work shall be added to this Agreement as an exhibit, with each subsequent Statement of Work being numbered in sequential number (i.e. Exhibit A-1, A-2, A-3, etc.).  HTG shall have no obligation to perform any Development work on any particular proposed Project until the Parties mutually agree on the terms and conditions of and enter into one or more Statement of Work covering such work, and the particular terms (including compensation) covering such 

 

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work.  Each executed SOW shall be deemed incorporated into and made part of and governed by this Agreement.

3.3Upon the Parties entering into a particular Statement of Work, each of HTG and QIAGEN agrees to perform the Development work allocated to such Party under such SOW, in conformance with the terms and conditions of this Agreement, the corresponding Statement of Work, including without limitation, the applicable protocol(s) set forth in such SOW, and/or any other operating procedures and/or specifications set forth in a Statement of Work.  To the extent any terms or conditions of a Statement of Work conflict with the terms and conditions of this Agreement, the terms and conditions of this Agreement shall control unless otherwise specifically set forth in such Statement of Work.  Any term or condition included in any purchase order issued by QIAGEN in connection with a Statement of Work, or in any ‎acknowledgement, invoice, or similar document issued by either Party that conflicts with the terms ‎and conditions of this Agreement and/or the applicable Statement of Work will not apply to or govern the transaction resulting from the ‎Statement of Work, unless both Parties expressly agree in writing to the particular conflicting term or ‎condition, in which event the agreed term or condition will apply only with respect to that particular ‎Statement of Work.‎

3.4Each Party shall perform the Development work allocated to it in an SOW using its own independent professional judgment in accordance with the applicable provisions of the Statement of Work, including without limitation, the applicable protocol(s) and/or any other operating procedures and/or specifications set forth in the Statement of Work, in a timely and professional manner and in conformity with the highest applicable industry standards, Applicable Laws, regulations and guidelines for the conduct of clinical research and governing protections of human subjects (to the extent applicable to such work), including but not limited to, ICH GCP, 21 C.F.R. Part 50 and 21 C.F.R. Part 312.50, and such other standards of good clinical practice as are required by the U.S. Food and Drug Administration (“FDA”) and/or other regulatory authorities, and all applicable privacy and data protection laws, rules and regulations.  The Development work of a Party shall be performed under the direction and supervision of such Party’s employee identified in the corresponding Statement of Work (the “Project Lead”, as to such SOW and the related Project).

3.5Neither Party shall subcontract, delegate or otherwise assign (except as permitted in Section 15.4) the performance of any of its Development work or any other of its obligations and responsibilities under this Agreement without the prior written approval of the other Party, such approval not to be unreasonably withheld, refused or delayed, or except as expressly contemplated in the applicable SOW.  If a Party has such approval, such Party shall be solely responsible for ensuring that its agreements with its subcontractors are consistent with the terms of this Agreement, and such Party acknowledges and agrees that any such agreements with its subcontractors must permit the other Party to audit and assess such subcontractors and/or their respective facilities and personnel as provided for in this Agreement.  A Party’s approval of the use by the other Party of any subcontractor does not relieve the other Party of any of its obligations and responsibilities hereunder, and such other Party will at all times remain primarily liable for the performance of its obligations responsibilities under this Agreement and/or the corresponding Statement of Work.  Any breach or violation of this Agreement and/or a corresponding Statement of Work by the subcontractor of a Party shall automatically be deemed a breach or violation by such Party of this Agreement and/or the corresponding Statement of Work. 

3.6Any agreed upon change or modification to this Agreement and/or a Statement of Work shall be set forth in writing and signed by an authorized representative of the Parties (a “Change Order”).  No such 

 

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change or modification shall be effective unless and until a Change Order is signed by an authorized representative of the Parties.  

3.7Each Party’s Project Lead shall keep the other Party, and (if applicable) the relevant Sponsor, updated and consult with such other Party on a reasonably regular basis with respect to all the Development work being conducted by such Party, with respect to each corresponding Statement of Work.  In addition, within sixty (60) days after execution of a Statement of Work, the Parties will form a joint Project team (the “Joint Project Team” or “JPT”), which shall be responsible to facilitate the operational tasks and provide updates on the status and progress of the Development work being conducted under the Statement of Work.  In the event either party becomes aware that a delay in the Development work is likely to occur, that party shall promptly notify the other party so that the parties, through the JPT, can attempt to mitigate or prevent the delay.  Each such JPT shall meet via telephone or video conferences, on a regular basis, however, at least once per month, until the work conducted under the applicable SOW is completed.  Each JPT shall be composed of not more than three (3) representatives appointed by each Party, with such representatives having appropriate experience and responsibility for the work under the applicable SOW.  Each representative of a Party shall be appointed (and may be replaced at any time) by such Party upon prior written notice to the other Party. These representatives shall have appropriate experience, knowledge, and ongoing familiarity with the particular Project in their then current phases.  One (1) representative of HTG and one (1) representative of QIAGEN shall be designated as the co-chairs of the JPT (together the “JPT Chairs”).  All members designated by a Party shall have one (1) collective vote, to be cast by such Party’s JPT Chair, on all matters before, or decided by, the JPT.  Except as otherwise provided herein, all decisions of the JPT shall be made unanimously and the JPT members shall use reasonable, good faith efforts to reach agreement on all matters within its Statement of Work.  If the JPT is unable to agree on any matter after good faith attempts to resolve such disagreement, then the JPT Chairs shall, refer the disagreement to a meeting between the Vice President, Business Development of QIAGEN and the Chief Executive Officer of HTG (“Executive Meeting”), which meeting shall take place as soon as practicable, but in no event later than seven (7) days after the date of the relevant referral.

3.8Each Party shall generate, shall implement appropriate measures to generate, complete and accurate records of all Development work undertaken and all results and Inventions made while performing the Development work under each SOW (collectively, “Records”), and shall ensure that all Records are appropriately recorded in specific notebooks or electronic files and are archived appropriately, during the performance of the Development work and upon the expiration or termination of this Agreement.  Records that are archived to durable media shall be refreshed at appropriate intervals to mitigate risk of data loss due to media degradation.  Each Party shall disclose, on a regular basis, its Records to the other Party as needed for the other Party to conduct the respective Project.

3.9Delays in Meeting Deadlines.  In the event that: (i) HTG provides QIAGEN with notice of expected delay in performing the Development work under a Statement of Work and HTG fails to provide prompt, reasonable assurance that it can mitigate or cure such delay to QIAGEN’ s reasonable satisfaction; (ii) HTG gives QIAGEN reason to believe with substantial certainty that HTG will fail to meet an impending deadline and HTG fails to provide prompt, reasonable assurance upon request by QIAGEN; or (iii) HTG actually fails to meet a deadline expressly set forth in the Statement of Work, and the delay is likely to result in a failure to meet a deadline assigned by the Sponsor in the Sponsor Project 

 

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Agreement (each a “Project Delay”), then the Project Delay shall be immediately referred to the JPT and the Parties shall conduct informal resolution of the matter(s) as provided in Section 3.7.  [***...]  If the Parties are unable to resolve the Project Delay in a manner that would avoid a failure to meet a deadline assigned by the Sponsor, and Sponsor is unwilling to excuse the Project Delay, QIAGEN shall have the right, but not the obligation, to terminate the relevant Statement of Work.  The Parties understand and agree that in some cases, the Sponsor may demand alternative remedies in the event of a Project Delay that cannot be cured within a reasonable period of time.  Such remedies may include, by way of example, [***...] for completion of activities in a Project by Sponsor or its delegate.  Any such [...***...] shall be considered a “Key Term” requiring HTG’s consent prior to QIAGEN agreeing to such term in the Project Sponsor Agreement.  For clarification, any such delay shall be excused to the extent it has been directly caused by a QIAGEN Failure.  For purposes of this Agreement, a “QIAGEN Failure” means any failure or delay by QIAGEN to meet any deadlines or perform any obligations explicitly assigned to QIAGEN in a Statement of Work.

4.POSSIBLE TRANSFER OF MATERIALS

4.1Though it is not contemplated that PDP Assay development by HTG will require access to QIAGEN Materials, if a particular Project requires such access and the applicable SOW contemplates that QIAGEN will make such QIAGEN Materials available to HTG for such work, then QIAGEN shall use reasonable efforts to transfer applicable QIAGEN Materials to HTG solely for use in the performance of the Development work of HTG under such SOWs, in strict accordance with the terms and conditions of this Agreement and/or the corresponding Statement of Work.  Accordingly, QIAGEN hereby grants to HTG, during the Term and subject to the terms and conditions set forth herein, a limited, nonexclusive, non-sublicensable, nontransferable (except as may be otherwise agreed to by the Parties in writing), royalty-free license to use the QIAGEN Materials for the sole purpose of performing the Development work to be performed pursuant to the applicable Statement of Work. HTG shall: (i) use reasonable efforts to comply with all Applicable Laws relating to the QIAGEN Materials in performing its obligations and responsibilities under the applicable Statement of Work; (ii) use the QIAGEN Materials solely in connection with conducting the specific activities under the applicable Statement of Work and for no other purpose; and (iii) at all times retain possession of the QIAGEN Materials and not provide or transfer any part of the QIAGEN Materials to any third party without QIAGEN’s prior written consent.  HTG acknowledges that nothing in this Agreement grants HTG any rights to use the QIAGEN Materials for any purpose other than in connection with the performance of the Development work under an SOW.  

4.2Except as otherwise set forth in a Statement of Work, QIAGEN shall be solely responsible for shipping and/or transporting the QIAGEN Materials to HTG.  QIAGEN shall bear all risk of loss or damage to the QIAGEN Materials up to their delivery to HTG.  QIAGEN shall provide HTG all information in its possession regarding safety precautions for, and hazards of, any QIAGEN Materials transferred to HTG. 

4.3HTG shall, following their delivery by QIAGEN, use commercially reasonable efforts for the appropriate storage of the Materials in compliance with Applicable Laws.  In particular, HTG shall, following their delivery by QIAGEN, use commercially reasonable efforts to store and maintain the Materials, to the extent applicable, in accordance with Applicable Laws and current best practices with respect to the storage and maintenance of human samples.

 

***Confidential Treatment Requested 

 

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5.FINANCIAL TERMS

5.1QIAGEN shall pay HTG for the Development work performed by (or on behalf of) HTG under this Agreement in accordance with the fees, timelines, payment terms and budget included with each Statement of Work.  Potential compensation arrangements will depend on the development and/or commercialization activities of the Parties, and shall be commercially reasonable as agreed by the Parties in good faith, and may include:

	
 
	
5.1.1
	
Up-front payments as partial, advance payment for milestones;

	
 
	
5.1.2
	
Milestone payments upon the achievement of milestones within the applicable SOW; or

	
 
	
5.1.3
	
Any other arrangement mutually agreed by the Parties.

5.2The Parties further agree that, HTG shall be entitled to a share (according to the below schedule) of Net Profits resulting from the conduct of a particular SOW, as follows: 

	
 
	
5.2.1
	
For development of PDP Assays that are primarily based on HTG IP, HTG shall receive 50% of the Net Profits resulting from the SOW, taking into account and including all payments by the applicable Sponsor to QIAGEN in connection with the SOW; 

	
 
	
5.2.2
	
For development of PDP Assays that are primarily based on QIAGEN IP, HTG shall receive 20% of the Net Profits resulting from the SOW, taking into account and including all payments by the applicable Sponsor to QIAGEN in connection with the SOW;  

	
 
	
5.2.3
	
For sales or other commercial transfer of HTG or QIAGEN instruments, tools or other products (excluding any PDP Assay) to the Sponsor or its Affiliate or contractor, in connection with an SOW or Project, the Parties shall share equally (50/50) all net revenue received by either Party for such sales, with “net revenue” equal to:  (i) the net sales resulting from such sale or transfer (total amounts received, less typical, standard deductions actually incurred for such sale or transfer (such as for taxes, returns, etc), less (ii) the Cost of Goods for the product sold or transferred.    

	
 
	
5.2.4
	
On a calendar quarter basis, within 30 days after the end of each such quarter, the Parties shall meet and review all applicable books of account and determine, for such quarter ended, what are the to-date Net Profits and net revenues through the end of such quarter and shall, to the extent not previously shared between the Parties under the above provisions, allocate and share such amounts per the above sharing percentages.  For example, if a Development milestone is met, under a particular Project, and the Sponsor has paid in a particular quarter a milestone payment for having achieved such milestone, then per the above the Parties will determine what amount of such milestone payment is Net Profit, by deducting the Development payment amounts owed to each Party for its Development work conducted up to meeting the milestone, and then the remaining Net Profit shall be distributed (according to the above percentages) to each Party by QIAGEN, within 10 days of such determination.

5.3Compensation to HTG shall be invoiced and paid in U.S. Dollars (“USD”).

 

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5.4Financial Records and Audits.  Each Party shall keep full, true, and accurate books of account regarding the Development work conducted by (or on behalf of) such Party hereunder and of all revenues, costs and expenses received or incurred in relation to SOWs or the conduct thereof under each applicable Sponsor Project Agreement, as needed to calculate amounts reimbursable hereunder or the Net Profits or net revenues (as contemplated in Section 5.2) resulting from each SOW, for at least seven years after the creation of such records.  Such records shall include all particulars reasonably necessary for the purpose of supporting the charges for Development work provided under this Agreement and the calculation of Net Profit and net revenues.  At the expense of the Party, except as specified below, each Party has the right during the term to engage an independent public accountant to perform, on behalf of such Party, an audit, conducted in accordance with United States Generally Accepted Accounting Principles (US GAAP), of such books and records of the other Party reasonably necessary for the independent public accountant to support the charges for the audited Party’s Development work, or the amount of Net Profits or net revenues (as applicable).   Any such audit shall be conducted upon at least thirty (30) days’ prior written notice from the auditing Party to the other Party and shall be conducted during regular business hours in such a manner as to not unnecessarily interfere with the auditing Party’s normal business activities.  Such audit shall not be performed more frequently than once per calendar year nor more frequently than once with respect to records covering any specific period of time. All information, data, documents and abstracts herein referred to shall be used only for the purpose of verifying the specific amounts (cost of Development work, or Net Profits, as applicable) consistent with the terms of this Agreement and shall be treated as the Confidential Information of the audited Party and subject to the confidentiality obligations of this Agreement.  As a condition to such audit, such auditor shall have executed a confidentiality agreement reasonably acceptable to the audited Party regarding non-disclosure, non-use, and safeguarding of such information, data, documents and abstracts.  Audit results shall be shared by QIAGEN and HTG. If the audit reveals that the audited Party has not complied with the applicable financial provisions of this Agreement, the audited Party shall compensate the other Party, within thirty (30) days of the audit report, for any amounts needed to come into compliance, and if such compensation exceeds 5% of the amount actually owed, then the audited Party also will reimburse the other Party for the reasonable fees of the accountant that performed the audit.  

6.CONFIDENTIAL INFORMATION

6.1Each Receiving Party acknowledges and agrees that it may have access to and/or receive the Disclosing Party’s Confidential Information during the Term of this Agreement.  Each Receiving Party agrees to: (i) maintain the Disclosing Party’s Confidential Information in strict confidence; and (ii) not use the Disclosing Party’s Confidential Information or otherwise disclose such Confidential Information to any third party, except as authorized in this Agreement or as otherwise authorized by the Disclosing Party in writing.  For clarification, QIAGEN may disclose particular HTG Confidential Information relating directly to a Project in strict confidence to the Sponsor identified in a Statement of Work for that Project, solely for Sponsor’s internal business use in connection with its development of the Sponsor therapeutic that is the subject of such Project, and for no other use or purpose.  Each Sponsor shall be under appropriate confidentiality and limited use obligations, with respect to each Party’s Confidential Information, under terms of the applicable Sponsor Project Agreement.

6.2Each Receiving Party will store the Disclosing Party’s Confidential Information in a secure location, and will handle and protect the Disclosing Party’s Confidential Information with no less care than that with which it handles and protects its own highly confidential and proprietary information (but in no event less than a reasonable degree of care) to prevent the unauthorized use, publication or disclosure of the Disclosing Party’s Confidential Information.  

 

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6.3Each Receiving Party may only disclose the Disclosing Party’s Confidential Information: (i) with the prior written consent of the Disclosing Party; or (ii) to the Receiving Party’s employees, directors, agents, and/or professional advisors, and those of its Affiliates (“Representatives”) having a bona fide need to know the Disclosing Party’s Confidential Information for purposes of performing the Receiving Party’s obligations and responsibilities under this Agreement and/or a Statement of Work and who are likewise bound by written agreements with the Receiving Party including confidentiality and non-use terms no less onerous than those set forth herein.

6.4The confidentiality and non-use obligations set forth in this Section 6 shall survive for the earlier of: (i) ten (10) years from the expiration or termination of this Agreement (except to the extent such Confidential Information includes the Disclosing Party’s trade secrets, in which case the below Section 6.5 (ii) shall apply); or (ii) until the applicable portion of the Disclosing Party’s Confidential Information becomes public; provided, that such Confidential Information does not become public as a result of a breach of this Agreement.

6.5A Receiving Party’s obligations and responsibilities with respect to the Disclosing Party’s Confidential Information as set forth in this Section 6 do not apply to particular information:

	
 
	
6.5.1
	
That was known to the Receiving Party at the time it was obtained from the Disclosing Party, other than as a result of the Receiving Party’s breach of any contractual obligation as shown by written evidence;

	
 
	
6.5.2
	
That is acquired by the Receiving Party from a third party that is not under a contractual or other obligation not to disclose it; 

	
 
	
6.5.3
	
That is or becomes generally known or otherwise enters the public domain other than by the fault or omission of the Receiving Party; or

	
 
	
6.5.4
	
That is independently developed by or on behalf of the Receiving Party without any use of any Confidential Information of the Disclosing Party.  

6.6Notwithstanding the above obligations, a Receiving Party may disclose particular Confidential Information of Disclosing Party to the extent such disclosure is required by compulsory judicial or administrative process or by law or regulation, provided that the Receiving Party first provides prompt written notice of such disclosure to the Disclosing Party and, to the extent reasonably feasible under the circumstances, cooperates with the Disclosing Party’s reasonable and lawful actions to avoid and/or minimize the extent of such disclosure.

6.7Upon the expiration or termination of this Agreement, or at any time upon request of the Disclosing Party, the Receiving Party will promptly return or destroy (at the Receiving Party’s option) all items and materials, including any copies, in its possession, custody, or control that contain any of the Disclosing Party’s Confidential Information.  All notes or other work product containing the Disclosing Party’s Confidential Information will be destroyed or archived with Receiving Party’s other confidential records, and upon written request of the Disclosing Party, such destruction or archival will be certified in writing to the Disclosing Party by an authorized representative of the Receiving Party who supervised such destruction or archival.  Notwithstanding this Section 6.7, the Receiving Party shall be entitled to retain one (1) archive copy of the Disclosing Party’s Confidential Information solely for purposes of demonstrating its compliance with the terms and conditions of this Agreement.  The Receiving Party’s obligations of non-use and confidentiality set forth in this Section 6.7 shall continue to apply to any such retained Confidential Information for the period set forth in Section 6.4 above.  

 

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6.8The terms of this Agreement will be treated as the Confidential Information of the Parties pursuant to this Article 6, except that either Party may disclose the terms of this Agreement pursuant to litigation between the Parties to enforce, defend or interpret this Agreement.  Further, either Party may disclose such terms:  (a) as, and only to the extent, required by Applicable Laws as determined by competent legal counsel advising the Disclosing Party; (b) to its directors; (c) in confidence to bona fide potential acquirors or merger or strategic partners and their respective strategic professional advisors, all solely for diligence review in connection with a potential transaction with HTG and who are likewise bound by written agreements with or other professional duty to the Receiving Party including confidentiality and non-use terms no less onerous than those set forth herein.    

6.9Without limiting the generality of any other provision hereof, neither Party shall publish (including without limitation, publishing articles and making presentations of any kind whatsoever) any confidential information regarding the Development work and/or any Sponsor’s clinical study, directly or indirectly, without the prior written consent of the other Party and shall not assist any third party in the preparation of any such publishing without the prior written consent of the other Party.

7.OWNERSHIP; INTELLECTUAL PROPERTY 

7.1As between the Parties, the HTG Property is and shall at all times remain the sole and exclusive property of HTG.  As between the Parties, the QIAGEN Property is and shall at all times remain the sole and exclusive property of QIAGEN.  Except as expressly provided for in this Agreement, no right or license, either express or implied, is granted by either Party to the other under any Intellectual Property Right or by virtue of the disclosure of any QIAGEN Property and/or HTG Property (as applicable) to the other Party under this Agreement, or otherwise.  If HTG (or its Affiliates) invents, creates or develops any QIAGEN IP, HTG hereby assigns and agrees to assign to QIAGEN all its rights, title and interest in and to such QIAGEN IP.  IF QIAGEN (or its Affiliate) invents, creates or develops any HTG IP, QIAGEN hereby assigns and agrees to assign to HTG all its rights, title and interest in and to such HTG IP.   

7.2Each Party shall use reasonable efforts to indicate, in a summary manner in the relevant Statement of Work, any QIAGEN IP or HTG IP (as the case may be) that it believes in good faith is likely to be utilized in the conduct of the Development work for a particular Project.  The Statement of Work shall contain (a) any licenses to any needed IP that shall be granted for purposes of performing the Development work under such SOW relating to the applicable Project and for HTG’s performing of applicable manufacturing as contemplated in Section 8.3, and (b) a license to HTG IP as necessary for QIAGEN to complete any development, manufacture or commercialization of HTG-developed PDP Assays in the event of HTG’s bankruptcy or insolvency during the term of the SOW, subject to applicable law. 

7.3 Except for any improvements, modifications or enhancements related to the HTG IP or QIAGEN IP, the Parties shall jointly own any Intellectual Property Rights generated by either Party pursuant to a Statement of Work that are related directly and specifically to biomarker selection for the applicable PDP Assay.

7.4Upon request by a Party, the other Party will do all lawful acts, including, but not limited to, the execution of papers and lawful oaths and the giving of testimony, that may be necessary or desirable in the determination of the other Party to secure and/or perfect such Party’s Intellectual Property Rights as set forth in this Article 7.

8.REGULATORY, COMMERCIALIZATION AND BRANDING 

8.1As between the Parties, with respect to regulatory approval matters for each HTG-developed PDP Assay, HTG shall be considered, the contract manufacturer for QIAGEN, and QIAGEN shall be considered the Legal Manufacturer of the PDP Assay.  The Parties shall in good faith negotiate and use 

 

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commercially reasonable efforts to enter into a Quality Agreement with respect to the manufacture of a HTG-developed PDP Assay upon reasonable request by QIAGEN.  For the avoidance of doubt, such Quality Agreement shall include guidelines and terms acceptable for QIAGEN’s regulatory and quality departments including without limitation pre-meetings and regular update meetings to review and confirm product quality, documentation needs and timelines.  QIAGEN shall have the right to utilize any of its Affiliates in the performance of its manufacturing and commercialization obligations under this Agreement.

8.2QIAGEN shall have responsibility for obtaining any regulatory approvals that may be required or appropriate for the marketing and sale of each PDP Assay in all jurisdictions throughout the Territory, unless otherwise agreed in a Statement of Work

8.3QIAGEN shall have the sole rights and responsibility, using its commercially reasonable efforts, for the marketing, promotion, distribution and sale of each PDP Assay in all jurisdictions throughout the Territory, solely for use in the PDP Field.  For HTG-developed PDP Assays, QIAGEN shall purchase such HTG-developed PDP Assays, at the transfer price established in the applicable SOW, pursuant to a Supply Agreement containing typical and commercially reasonable supply provisions, to be negotiated in good faith and entered into by the Parties at the appropriate time (prior to commercialization of a HTG-developed PDP Assay). The transfer price shall be based on a “cost of goods sold plus mark-up” model, whereby the actual expectation of HTG for the mark-up is estimated to be [***...]%.  Subject to any limitations in such Supply Agreement, it shall include, without limitation: (i) an obligation by HTG to supply the HTG-developed PDP Assay for as long as QIAGEN wishes to purchase such HTG-developed PDP Assay from HTG, and (ii) an indemnification from HTG to QIAGEN for any third party claims for defective design or manufacture of such HTG-developed PDP Assay by HTG.  For QIAGEN-developed PDP Assays, QIAGEN shall pay a royalty on the sale of each such PDP Assay, at a rate established in good faith in the applicable SOW.

8.4Each PDP Assay shall be sold under the QIAGEN brand name; however, the Parties may also agree in a particular Statement of Work to acknowledge HTG’s technology or brand name in the marketing materials and product packaging for any particular PDP Assay.

9.INDEMNIFICATION

9.1HTG shall defend, indemnify and hold harmless QIAGEN, and its successors and assigns, and the officers, directors, employees, agents and representatives of the foregoing, (the “Qiagen Indemnitees”) from and against, any and all damages, losses, liabilities, claims, fines, penalties and expenses (including costs of investigation and defense and reasonable attorneys’ fees) (collectively, “Damages”) arising from any and all claims, proceedings, actions, arbitrations, hearings, investigations and suits (“Claims”) brought by any third party against a Qiagen Indemnitee to the extent such Claims result from or arise out of: (i) HTG’s material breach of this Agreement, including, with the exclusion of Section 10.1, a breach by HTG of its representations and warranties set forth in Section 10 below; (ii) the material failure on the part of HTG to comply with Applicable Laws; or (iii) the gross negligence or willful misconduct by HTG, its agents, employees or representatives, provided, however, that in no event shall HTG be obligated to indemnify, defend or hold harmless any Qiagen Indemnitees, for, from or against any Damages or Claims to the extent related to or arising from any subject matter or occurrence for which QIAGEN shall have the obligation to indemnify HTG under Section 9.2 below if such subject matter or occurrence were to give rise to a Claim against an HTG Indemnitee (as defined below). 

 

***Confidential Treatment Requested 

 

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9.2QIAGEN shall defend, indemnify and hold harmless HTG and its successors and assigns, and the officers, directors, employees, agents and representatives of the foregoing, (the “HTG Indemnitees”) from and against any and all Damages arising from any Claims against any HTG Indemnitee resulting from or arising out: (i) QIAGEN’s material breach of this Agreement, including without limitation, a breach by QIAGEN of its representations and warranties set forth in Section 10 below; (ii) the material failure on the part of QIAGEN to comply with Applicable Laws; (iii) the gross negligence or willful misconduct conduct by QIAGEN or its Affiliate or their respective agents, employees or representatives; or (iv) claims for personal injury and/or death resulting from a defective design or manufacture of the QIAGEN Property. 

9.3A Party (the “Indemnified Party”) that asserts that it (or its related party) is owed an indemnity hereunder by the other Party (the “Indemnifying Party”) shall promptly notify the Indemnifying Party of the Claim for which such indemnity is believed to be owed and shall provide with such notice all information about such Claim and its basis that Indemnified Party is aware, provided that, the failure of the Indemnified Party to promptly notify the Indemnifying Party of the Claim will not relieve the Indemnifying Party of its duties under this Article 9 except to the extent that the Indemnifying Party is materially prejudiced by the delay.  Provided that the Indemnifying Party undertakes and continues to prosecute in good faith the defense of such Claim, the Indemnified Party shall have no right to tender an appearance in the proceedings around such Claim.  Upon undertaking such defense, the Indemnifying Party shall have full control over all the proceedings and filings involved in the defense of the Claim, including selection of counsel to tender appearance for the Indemnifying Party and for the Indemnified Party.  The Indemnified Party and all applicable indemnitees thereof shall provide full cooperation in the defense against such Claim, including promptly signing any and all reasonably necessary documents relating to such defense, including for the selection of counsel, such as a joint defense agreement, and providing all other assistance and support including access to witnesses, documents and materials and appearing in hearings or defense meetings, and shall not unreasonably withhold its consent to conflict waivers.  The Indemnified Party’s attorney’s fees shall be limited to those necessary for complying with the Indemnifying Party’s requests for support that necessarily call for the use of the Indemnified Party’s counsel (e.g., preparing a witness for deposition).  The Party seeking indemnification hereunder (and its related indemnitee) shall not unreasonably withhold its approval of the settlement of any Claim covered by Section 9.1 or 9.2, as applicable, will cooperate with counsel of the Indemnifying Party, and reserves the right to engage its own counsel to assist in the defense at the expense of the indemnifying party. 

10.COVENANTS; REPRESENTATIONS AND WARRANTIES  

10.1HTG represents and warrants to QIAGEN that, as of the Effective Date, is has not entered into any contract or otherwise agreed to terms with a third party that would prohibit, conflict with or otherwise restrict HTG’s ability to enter into this Agreement on the terms and conditions herein.  

10.2With regard to debarment and related matters:

	
 
	
10.2.1
	
Each Party represents and warrants to the other Party that,  as of the Effective Date, the representing Party has not, nor to its knowledge, have any of its employees or agents who may perform Development work pursuant to this Agreement, ever been, currently, or are the subject of a proceeding that could lead to it/them becoming, as applicable, a Debarred Entity or Debarred Individual, an Excluded Entity or Excluded Individual or a Convicted 

 

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Entity or Convicted Individual, nor are they listed on the FDA’s Disqualified/Restricted List.  

	
 
	
10.2.2
	
Each Party agrees that if, during the Term of this Agreement, it becomes, or to its knowledge, any of its employees or agents working on its behalf, become or are the subject of a proceeding that could lead to that party becoming, as applicable, a Debarred Entity or Debarred Individual, an Excluded Entity or Excluded Individual or a Convicted Entity or Convicted Individual, or added to FDA’s Disqualified/Restricted List, the affected Party shall immediately notify the other Party, and the other Party shall have the right to immediately terminate any affected Statement of Work or, if all Statements of Work are affected, terminate this Agreement.  

	
 
	
10.2.3
	
For purposes of this section, the following definitions shall apply:

	
 
	
10.2.3.1 
	
A “Debarred Individual” is an individual who has been debarred pursuant to 21 U.S.C. § 335a (a) or (b).

	
 
	
10.2.3.2
	
“Debarred Entity” is a corporation, partnership or association that has been debarred pursuant to 21 U.S.C. § 335a (a) or (b).

	
 
	
10.2.3.3
	
An “Excluded Individual” or “Excluded Entity” is: (i) an individual or entity, as applicable, who has been excluded, debarred, suspended or is otherwise ineligible to participate in federal health care programs such as Medicare or Medicaid by the Office of the Inspector General (OIG/HHS) of the U.S. Department of Health and Human Services pursuant to section 1128 of the Social Security Act (42 U.S.C. § 1320a-7(b)); or (ii) is an individual or entity, as applicable, who has been excluded, debarred, suspended or is otherwise ineligible to participate in federal procurement and non-procurement programs, including those produced by the U.S. General Services Administration (GSA).

	
 
	
10.2.3.4
	
A “Convicted Individual” or “Convicted Entity” is an individual or entity, as applicable, who has been convicted of a criminal offense that falls within the ambit of 42 U.S.C. § 1320a – 7(a), but has not yet been excluded, debarred, suspended or otherwise declared ineligible.

	
 
	
10.2.3.5
	
“FDA’s Disqualified/Restricted List” is the list of clinical investigators restricted from receiving investigational drugs, biologics or devices pursuant to 21 C.F.R. Part 312.70.neither HTG nor any of its employees or agents 

10.3Each Party represents and warrants to the other that: (i) it is and will be at all times during the Term a valid legal entity existing under the law of its state of incorporation with the power to own all of its properties and assets and to carry on its business as it is currently being conducted; and (ii) the execution and delivery of this Agreement has been duly authorized and no further approval, corporate or otherwise, is required in order to execute this binding Agreement.  

 

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10.4QIAGEN represents and warrants to HTG that: (i) it owns the QIAGEN Materials or otherwise has all necessary rights to license and/or transfer the QIAGEN Materials, or any other specimens or samples to HTG for the purposes contemplated herein and to otherwise grant the rights granted to HTG hereunder; (ii) QIAGEN and/or Sponsor has, in obtaining and maintaining the QIAGEN Materials or any other specimens or samples, complied with all Applicable Laws; (iii) QIAGEN has, or the Sponsor has, obtained all necessary favourable opinions from the relevant research ethics committees and all authorizations, consents and documentation from the relevant regulatory authorities required to conduct the Study; and (iv) QIAGEN and/or the Sponsor shall be solely responsible for the authorization and conduct of each clinical trial or study conducted in connection with a Project or SOW, and will comply with ICH GCP, FDA regulations 21 C.F.R. 50 and 21 C.F.R. 312.50, or equivalent international standards, and such other standards of good clinical practice as are required by the FDA or such other regulatory authorities with jurisdiction where the Samples will be used in the Study, and all applicable privacy and data protection laws, rules and regulations. 

10.5In the performance of its obligations under any Statement of Work, each Party shall assign qualified personnel to perform the Development work in a professional and workmanlike manner in accordance with current industry standards.

10.6NEITHER PARTY MAKES ANY REPRESENTATION OR WARRANTY NOT EXPRESSLY SET FORTH ABOVE IN THIS SECTION 10, AND EACH PARTY HEREBY EXPRESSLY DISCLAIMS ALL OTHER REPRESENTATIONS AND WARRANTIES OF ANY KIND, WHETHER EXPRESS, IMPLIED, STATUTORY OR ARISING FROM COURSE OF TRADE, COURSE OF DEALING OR OTHERWISE, INCLUDING WITHOUT LIMITATION, THE IMPLIED WARRANTIES OF MERCHANTABILITY, FITNESS FOR A PARTICULAR PURPOSE, TITLE, USAGE, VALIDITY, AND/OR NON-INFRINGEMENT.  

11.LIMITATION OF LIABILITY AND INSURANCE

11.1EXCEPT FOR DAMAGES RESULTING FROM A BREACH OF THE CONFIDENTIALITY OBLIGATIONS SET FORTH IN ARTICLE 6 ABOVE, IN NO EVENT WILL EITHER PARTY BE LIABLE UNDER THIS AGREEMENT TO THE OTHER PARTY FOR ANY CONSEQUENTIAL, INCIDENTAL, INDIRECT, EXEMPLARY, SPECIAL OR PUNITIVE DAMAGES, INCLUDING ANY DAMAGES FOR BUSINESS INTERRUPTION, LOSS OF USE, DATA, REVENUE OR PROFIT, WHETHER ARISING OUT OF BREACH OF CONTRACT, TORT (INCLUDING NEGLIGENCE) OR OTHERWISE, REGARDLESS OF WHETHER SUCH DAMAGES WERE FORESEEABLE AND WHETHER OR NOT THE PARTY ALLEGED TO BE LIABLE WAS ADVISED OF THE POSSIBILITY OF SUCH DAMAGES.  FOR CLARITY, THIS SECTION 11.1 SHALL NOT LIMIT A PARTY’S INDEMNITY OBLIGATIONS UNDER ARTICLE 10.   

11.2Insurance.  During the term of this Agreement, each Party shall maintain the following insurance:

	
 
	
11.2.1
	
General Liability with limits of not less than USD $2,000,000 per occurrence or claim and in the aggregate including coverage for personal injury and property damage;

	
 
	
11.2.2
	
Workers Compensation as required by local statutory requirements;

 

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11.2.3
	
Auto Liability with limits of not less than USD $1,000,000 per occurrence or claim; and

	
 
	
11.2.4
	
Umbrella Liability insurance with limits of not less than USD $5,000,000.  Coverage shall be in excess of the above captioned general liability and auto liability insurance coverage.

12.AUDIT AND RECORD RETENTION

12.1During the Term, each Party, may upon good cause shown and on reasonable prior notice to the other Party, at a mutually agreeable time during the other Party’s normal business hours, but no more than once per calendar quarter, assess such other Party’s facilities and materials actually used in conducting its Development work hereunder, which may include applicable equipment, tools, processes, Project related output, and personnel, solely as necessary in order to assess the other Party’s performance of its Development work under this Agreement.  All information and materials of the audited Party shall be deemed, and treated by auditing Party as, the Confidential Information of audited Party.   

12.2Each Party will notify the other promptly (within five (5) business days) in the event of any actual or notified inspection by a regulatory or administrative authority of such Party’s facilities where Development work are being performed.  Each Party will promptly provide the other with copies of any correspondence from or to the regulatory authorities such as the FDA, related to any such inspection, including but not limited to any FDA 483s or warning letters, as well as any other correspondence with a governmental agency, in each case solely to the extent that is reasonably likely that such actions will affect the suitability of such Party to continue performing the applicable Development work.  In such event, the Party will consult with and allow the other Party and/or the applicable Sponsor (if permitted under the applicable Sponsor Project Agreement) to review and comment on any responses made by such Party to the regulatory and/or governmental authority relating to such inspection in advance of such responses being submitted.

12.3Each Party will ensure that its Project Lead and his or her personnel host and/or attend any such regulatory or governmental audit or inspection, and further assist in the preparation therefor and fully cooperate with the respective regulatory and/or administrative authority, the other Party, Sponsor (if applicable, and permitted by the applicable Sponsor Project Agreement) and/or its or their representatives.  All personnel time and resources necessary to complete such an audit shall be provided by the audited party on a time and materials basis, to be reimbursed by the other party unless the audit demonstrates that the audited party has materially breached its obligations under this Agreement with respect to its Development work obligations, in which case, the audited party shall bear all cost and expense for such audit.

12.4Each Party shall use commercially reasonable efforts to promptly remedy, at its own cost and expense, with competent proof, any audit findings made by any regulatory or administrative authority, the other Party, Sponsor (if applicable) and/or its or their representatives that relate to defects in such Party’s facilities where the Development work is being performed, the Party’s Development work, and/or such Party’s non-compliance with this Agreement and/or Applicable Laws.

 

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13.TERM AND TERMINATION; LOSS OF EXCLUSIVITY

13.1This Agreement shall commence as of the Effective Date and shall continue for a period of five (5) years thereafter, unless sooner terminated under this Article 13 (the “Term”).  

13.2QIAGEN shall have the right to suspend or terminate, as applicable, a Statement of Work if the relevant Project is suspended or terminated by the applicable Sponsor.  HTG shall cooperate with and support QIAGEN in the management of such suspension, including maintaining resources and materials for a reasonable period of time to enable a timely re-start.  The Parties may agree to specific terms for Project suspensions in the relevant Statement of Work.  

13.3Change of Control.

13.3.1In the event that either Party undergoes a Change of Control during the Term, it shall provide written notice of such Change of Control to the other Party at least seven (7) days prior to the expected closing of the Change of Control transaction. 

13.3.2Either Party shall have the right to terminate this Agreement and any or all Statements of Work in the event of a Change of Control of itself or the other Party.  

13.3.2.1     In the event a Party terminates this Agreement in the event of a Change of Control of itself, it shall provide notice to the other Party within thirty (30) days after the closing of the Change of Control transaction and make a payment of USD $2,000,000 to the other Party within such 30-day notice period.  

13.3.2.2     In the event a Party wishes to terminate this Agreement in the event of a Change of Control involving the other Party, it shall provide notice to the other Party within the later of (i) forty-five (45) days of its receipt of the notice described in Section 13.3.1 regarding the Change of Control and (ii) thirty (30) days after the closing of the Change of Control.   

13.4All Fields, including the Oncology Field, shall become non‐exclusive in the same manner as the Fields described in Section 2.3.2, 60 days following receipt of written notice by one Party to the other Party citing this section, in the event that: 

	
 
	
13.4.1
	
the Parties have not signed at least [***...] SOW pursuant to a Sponsor Project Agreement by the first anniversary of the Effective Date; or

	
 
	
13.4.2
	
the Parties have not signed, pursuant to a Sponsor Project Agreement, an aggregate of (i) at least [...***...] SOWs or Project Sponsor Agreements with gross proceeds of at least USD $[...***...] by the second anniversary of the Effective Date, or (ii) at least [...***...] SOWs or Project Sponsor Agreements with gross proceeds of at least USD $[...***...] or more by the third anniversary of the Effective Date.

13.5This Agreement and/or a Statement of Work may be terminated by either Party, as follows:

	
 
	
13.5.1
	
Either Party may terminate this Agreement in the event the other Party materially breaches the terms of this Agreement and, provided that the non-breaching Party shall have given the breaching Party written notice of such breach, setting forth the details of the breach, and the breaching Party shall have not cured such breach within thirty (30) days after receipt of such notice; or

 

***Confidential Treatment Requested 

 

Page 21 of 28

 

	
 
	
13.5.2
	
Either Party may terminate a Statement of Work in the event the other Party materially breaches the terms of such Statement of Work and, provided that the non-breaching Party shall have given the breaching Party written notice of such breach, setting forth the details of the breach, and the breaching Party shall have not cured such breach within thirty (30) days after receipt of such notice; or

	
 
	
13.5.3
	
Either Party may terminate the applicable Statement(s) of Work or, if all Statements of Work are affected, this Agreement, upon written notice to the other, in the event the performance of one or more Statements of Work by a Party is prevented or delayed by reason of (a) a force majeure event affecting a material obligation that persists for more than sixty (60) consecutive days, or (b) inability to obtain, in a reasonable time, appropriate needed regulatory approvals in a country material to the Sponsor, or (c) there are intellectual property infringement or violation issues that have enjoined the sale of the applicable PDP Assay, or QIAGEN sequencing equipment, and such issues cannot be overcome by commercially reasonable efforts to the satisfaction of either Party; or

	
 
	
13.5.4
	
A Party may terminate this Agreement, upon written notice to the other Party effective immediately, in the event the other Party enters bankruptcy proceedings, ceases to operate in the normal course of business, or generally fails to pay, or admits in writing its inability to pay its debts as they mature, or applies for, consents to, or acquiesces in the appointment of a trustee, receiver or other custodian for the other Party or for a substantial part of the property of the other Party, or makes a general assignment for the benefit of creditors, or in the absence of such application, consent or acquiescence, a trustee, receiver or other custodian is appointed for the other Party or for a substantial part of the property of the other Party, or any bankruptcy, reorganization, debt arrangement or other proceeding under any bankruptcy or insolvency law, or any dissolution or liquidation proceeding, is instituted by or against the other Party, or any warrant of attachment or similar legal process is issued against any substantial part of the property of the other Party.

13.6Consequences of Termination.  Upon the termination or expiration of this Agreement, the Parties shall have the following rights, obligations and responsibilities:

	
 
	
13.6.1
	
The termination or expiration of this Agreement shall not automatically result in the termination of any then-active Statement of Work.  In the event of the expiration of this Agreement and/or the termination by either Party of this Agreement pursuant to Section 13.5 above, any then-active Statement of Work shall continue in effect, unless earlier terminated, as permitted pursuant to this Section 13, for the duration of such Statement of Work and the terms of this Agreement shall survive only to the extent necessary to govern such Statement of Work until its completion or termination.

	
 
	
13.6.2
	
Following HTG’s receipt or giving of a termination notice or otherwise upon the expiration or termination a Statement of Work or this Agreement, HTG shall, within sixty (60) days thereof, invoice QIAGEN for all amounts owed for the Development work performed prior to the effective date of termination or expiration under this Agreement and/or the terminated Statement of Work, as applicable, for which HTG has not yet been paid.  HTG shall additionally avoid, to the extent reasonably practicable, incurring 

 

Page 22 of 28

 

	
 
		
additional costs and expenses on Development work for the terminated SOW during the closeout or winding down period.  

	
 
	
13.6.3
	
Upon the termination or expiration of this Agreement and/or a Statement of Work, and except as otherwise set forth in Section 13.6.3, all rights and obligations of the Parties under this Agreement and/or the terminated or expired Statement of Work shall immediately and automatically cease.  Upon the termination or expiration of this Agreement and/or a Statement of Work, each Party shall immediately deliver to the other, at the other Party’s expense, all of the other Party’s Confidential Information, and (if applicable) any remaining QIAGEN Materials in HTG’s possession, that have not yet been delivered to such other Party as of the date of such expiration or termination.  Within sixty (60) days after the expiration or earlier termination of a Statement of Work for any reason, HTG will further provide to QIAGEN a final report detailing all results obtained pursuant to its Development work under such Statement of Work.

	
 
	
13.6.4
	
The expiration or termination of this Agreement and/or a Statement of Work for any reason or no reason will not release any Party from any obligation that matured prior to the effective date of such expiration or termination.  Sections of this Agreement that by their nature prescribe continuing rights and obligations will survive until their purposes are fulfilled, including Section 6 (Confidential Information), Section 7 (Ownership; Intellectual Property), Section 9 (Indemnification), Section 11 (Limitation of Liability) Section 13.6 (Consequences of Termination), Section 14 (Non-Solicitation), and Section 15 (General Provisions). 

14.NON-SOLICITATION

14.1During the Term, and for a period of two (2) years thereafter (provided that, in the event of a breach by either Party of any covenant set forth in this Section 14.1, the term of such restriction will be extended by the period of the duration of such breach) neither Party shall, on its own behalf or on behalf of any third party, directly solicit for employment any person who was an employee or independent contractor of the other Party during the Term of this Agreement, without the prior written consent of the other Party.  For clarification, the foregoing shall not prohibit a party from employing any such person who (i) contacts the party on his or her own initiative without any direct solicitation by or encouragement from the party, (ii) ceases to be employed by the other party prior to any direct solicitation by or encouragement or (iii) responds to a general employment advertisement or other general solicitation or recruitment effort not specifically aimed at employees of the other party.

 

Page 23 of 28

 

15.GENERAL PROVISIONS

15.1Notices.  All notices or other communications given hereunder shall be in writing, shall be signed by an officer of the Party sending such notice or other communication, and shall be delivered by hand, by overnight courier, by electronic mail or by facsimile (provided that the sending Party does not have reason to know that the electronic mail or facsimile was not received by the other Party), all delivery charges prepaid and addressed to the Parties as follows:

 

	
To HTG:
	
 

	
 
	
HTG Molecular Diagnostics, Inc..

	
 
	
Attn: Chief Executive Officer

	
 
	
3430 E. Global Loop

	
 
	
Tucson, AZ 85706

	
 
	
 

	
To QIAGEN:
	
QIAGEN Legal Department

	
 
	
19300 Germantown Road

	
 
	
Germantown, MD 20874

 

All such notices and communications will be effective on the date delivered, if in person, on the date of the postmark of that notice or communication if by courier.  Either Party may change its address by giving notice of that change to the other Party.

15.2Waivers.  Neither Party will be deemed to have waived any of its rights under this Agreement until it has signed a written waiver of those rights, or except as provided by Applicable Law.  Without limiting the preceding, no failure or delay by either Party in exercising any rights, powers or remedies under this Agreement will operate as a waiver of any such right, power or remedy, except as provided by Applicable Law, and no waiver will constitute a waiver of any other provision, breach, right or remedy, nor will any waiver constitute a continuing waiver or be effective except for the specific instance and for the specific purpose given.

15.3Amendments.  If either Party wishes to modify this Agreement or a Statement of Work, the Parties will confer in good faith to determine the desirability of such modification.  No modification, change or amendment to this Agreement or an SOW will be effective until a written amendment is signed by both Parties. 

15.4Assignment.  Neither Party shall have the right or ability to assign or transfer any interest in or delegate its obligations under this Agreement and/or a Statement of Work without the prior written approval of the other Party, which shall not be unreasonably withheld, except that each Party shall have the right, solely with notice to the non-assigning Party, to assign this Agreement to a successor in interest in connection with a merger or acquisition or sale of all or substantially all of the assigning Party’s assets, subject to Section 13.3.  This Agreement will be binding on and inure to a Party’s permitted successors and assigns. 

15.5Severability.  The terms and conditions of this Agreement are severable.  If any term or condition of this Agreement is rendered invalid or unenforceable by any law or regulation, or declared null and void 

 

Page 24 of 28

 

by any court of competent jurisdiction, that part will be reformed, if possible, to conform to the law, and if reformation is not possible, that part will be deleted in such jurisdiction only and the remainder of the terms and conditions of this Agreement as well as the invalid or unenforceable term or condition in all jurisdictions where valid and enforceable will remain in full force and effect, unless enforcement of this Agreement without the invalid or unenforceable term or condition would be grossly inequitable under the circumstances or would frustrate the primary purpose of this Agreement.

15.6Remedies.  The Parties acknowledge and agree that a material breach of this Agreement by the other Party may result in immediate, irreparable and continuing damage to the non-breaching Party for which there will be no adequate remedy at law; and agree that in the event of any such material breach or violation or any threatened or intended breach or violation of this Agreement, the non-breaching Party, its successors and assigns, will be entitled to seek temporary, preliminary and permanent injunctive relief and/or restraining orders enjoining and restraining such breach or violation or such threatened or intended breach or violation and/or other equitable relief in addition to such other and further relief as provided for at law and in equity. 

15.7Agreement to Arbitrate Disputes

	
 
	
15.7.1
	
Prior to arbitration, the Parties agree to and shall seek to conduct informal resolution of any issues or disputes that arise under this Agreement (a “Dispute”).  Such informal process may be initiated with written notice of one Party to the other, describing the Dispute with reasonable particularity, and the other Party shall follow with a written response within ten (10) calendar days of receipt of such notice.  Each Party shall promptly designate an executive with requisite authority to resolve the noticed Dispute.  The informal procedure shall commence within 10 calendar days of the date of response.  If the Dispute is not resolved within 30 business days of the date of commencement of the procedure, either Party may proceed to arbitration as set forth below to resolve the Dispute.  

	
 
	
15.7.2
	
The Parties agree that any Dispute between the Parties, and including any claim by either Party against any agent, employee, successor, or assign of the other Party, related to or arising under this Agreement, including any dispute or issue as to performance of a Party’s obligations or breach of this Agreement or as to the validity or applicability of this arbitration clause, shall be resolved by binding arbitration administered by the American Arbitration Association under its Commercial Arbitration Rules, except as where those rules are intentionally varied by the Parties herein or pursuant to mutual written agreement.  The parties expressly agree that the arbitration shall be conducted in Denver, CO, in the English language, and shall be governed by Delaware law.  For good or equitable cause shown, the prevailing party shall be entitled to reimbursement of its reasonable attorney fees and arbitration costs by the other Party, according to the relative success on the merits, as assessed by the arbitrator(s) in such arbitration.  The arbitration award shall be final, absent manifest error or fraud.

	
 
	
15.7.3
	
The Parties are entering into this arbitration agreement in connection with a transaction involving interstate commerce. Accordingly, this arbitration agreement, and any proceedings 

 

Page 25 of 28

 

	
 
		
thereunder, shall be governed by the Federal Arbitration Act (“FAA”) 9 USC 1-16.  Any award by the arbitrator may be entered as a judgment in any court having jurisdiction.

	
 
	
15.7.4
	
The foregoing agreement to arbitrate shall not restrict either Party’s remedies or ability at any time to seek equitable relief for a breach or threatened breach of: (i) either Party’s confidentiality obligations; or (ii) the misuse, misappropriation or infringement of either Party’s Intellectual Property Rights.  

15.8Independent Contractor; No Agency.  Neither Party will be deemed to be the employee, representative, agent, joint venturer or partner of the other Party for any purpose.  Neither Party has the authority to obligate or bind the other, or to incur any liability on behalf of the other, nor to direct the employees of the other.

15.9Interpretation.  Both Parties have had the opportunity to have this Agreement reviewed by their attorneys.  Therefore, no rule of construction or interpretation that favors or disfavors either Party will apply to the interpretation of this Agreement.  Instead, this Agreement will be interpreted according to the fair meaning of its terms.  The captions or headings of this Agreement are for convenience of reference only.  They will not limit or otherwise affect the meaning or interpretation of any provision of this Agreement.   The words “includes” and “including” are not limiting in any way and mean “includes without limitation” or “including without limitation.”  The word “person” includes individuals, corporations, partnerships, limited liability companies, co-operatives, associations and other natural and legal persons.  The term “and/or” means each and all of the persons, words, provisions or items connected by that term; i.e., it has a joint and several meaning. The word “will” is a synonym for the word “shall”.  All attachments to this Agreement are a part of and are incorporated in this Agreement.

15.10Counterparts.  This Agreement may be executed in two or more counterparts, each of which shall be deemed an original and all of which will together be deemed to constitute one agreement.  The Parties agree that the execution of this Agreement by exchanging pdf signatures, and/or by industry standard electronic signature software, shall have the same legal force and effect as the exchange of original signatures.  In any proceeding arising under or relating to this Agreement, each Party hereby waives any right to raise any defense or waiver based upon execution of this Agreement by means of such electronic signatures or maintenance of the executed agreement electronically.

15.11Force Majeure.  Except for in connection with QIAGEN’s obligation to make payments to HTG under Section 4 above, no Party will be liable for, or will be considered to be in breach of or in default under this Agreement on account of, any delay or failure to perform any obligation under this Agreement to the extent such delay or failure is due to causes or conditions that are beyond such Party’s reasonable control and that such Party is unable to overcome through the exercise of commercially-reasonable efforts.  If any force majeure event occurs, the affected Party will give prompt written notice to the other Party and will use commercially-reasonable efforts to minimize the impact of the event.

15.12Entire Agreement.  With respect to the subject matter hereof, this Agreement, including any Statement(s) of Work and Exhibits, is the entire agreement between the Parties and supersedes all prior discussions, representations, warranties and agreements, both written and oral between the Parties.

15.13Integration.  This Agreement sets forth the entire understanding of the Parties with respect to the subject matter hereof, supersedes all existing agreements between them concerning such subject matter.    

[Signature Page Follows]  

 

Page 26 of 28

 

IN WITNESS WHEREOF, the Parties hereto have caused this Agreement to be executed as of the date set forth herein by their duly authorized representatives.

 

	
HTG MOLECULAR DIAGNOSTICS, INC. “HTG”
	
 
	
QIAGEN MANCHESTER LIMITED “QIAGEN”

	
 
	
 
	
 

	
By: /s/ Timothy B. Johnson
	
 
	
By:
	
/s/ Douglas Liu

	
 
	
 
	
 

	
Timothy B. Johnson
	
 
	
Douglas Liu

	
President and Chief Executive Officer
	
 
	
Print Name

	
 
	
 
	
SVP Global Operations

	
 
	
 
	
Title

	
 
	
 
	
 

	
 November 16, 2016
	
 
	
 November 16, 2016

	
Date
	
 
	
Date

 

 

 

Page 27 of 28

CONFIDENTIAL

 

EXHIBIT A

 

Statement of Work Template

 

THIS STATEMENT OF WORK (this “SOW”) is made and entered into as of _________, 20___ (the “SOW Effective Date”) by and between HTG Molecular Diagnostics, Inc. (“HTG”) and QIAGEN Manchester Limited (“QIAGEN”).  This SOW is made a part of, and shall be governed by, the terms and conditions of the Master Assay Development, Commercialization and Manufacturing Agreement (the “MSA”) executed between the Parties dated as of November ___, 2016.  In the event of a conflict between the terms and conditions of this SOW and those of the MSA, the MSA shall govern unless otherwise expressly provided herein.

 

	
 
	
1.
	
Term

	
 
	
2.
	
Description of Project 

	
 
	
3.
	
Definitions

	
 
	
4.
	
Specific Details of Development Work 

	
 
	
5.
	
Milestones and Deadlines

	
 
	
6.
	
Compensation Provisions (including Transfer Price calculation)

	
 
	
7.
	
Clinical Supply Manufacturing Provisions 

	
 
	
8.
	
Intellectual Property and Licenses

	
 
	
9.
	
Project Suspension and Termination

IN WITNESS WHEREOF, HTG and QIAGEN have executed this SOW by their respective officers hereunto duly authorized on the day and year written below.

 

					
	
HTG MOLECULAR DIAGNOSTICS
	
 
	
QIAGEN Manchester Limited

	
 
	
 
	
 
	
 
	
 

	
By:
	
[template – not for signature]
	
 
	
By:
	
[template – not for signature]

	
 
	
 
	
 
	
 
	
 

	
Name:
	
 
	
 
	
Name:
	
 

	
 
	
 
	
 
	
 
	
 

	
Title:
	
 
	
 
	
Title:
	
 

	
 
	
 
	
 
	
 
	
 

	
Date:
	
 
	
 
	
Date:htgm-ex1024_1404.htm

Exhibit 10.24

 

Execution Copy

STOCK PURCHASE AGREEMENT

This Stock Purchase Agreement (this “Agreement”) is made as of November 16, 2016 (the “Effective Date”), by and between HTG Molecular Diagnostics, Inc., a Delaware corporation (the “Company”), and QIAGEN North American Holdings, Inc., a California corporation (the “Purchaser”).

Whereas, the Company wishes to sell to the Purchaser, and the Purchaser wishes to purchase from the Company, shares of the Company’s common stock, par value $0.001 per share (“Common Stock”), on the terms and subject to the conditions set forth in this Agreement.

Agreement

In consideration of the mutual covenants contained in this Agreement, and for other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the Company and the Purchaser hereby agree as follows:

	
1.
	
Definitions

Capitalized terms used and not otherwise defined herein shall have the respective meanings set forth below:

1.1“Action” has the meaning set forth in Section 3.12.

1.2“Affiliate” means, with respect to any Person, another Person that controls, is controlled by or is under common control with such Person.  A Person shall be deemed to control another Person if such Person possesses, directly or indirectly, the power to direct or cause the direction of the management and policies of such Person, whether through the ownership of voting securities, by contract or otherwise.  Without limiting the generality of the foregoing, a Person shall be deemed to control another Person if any of the following conditions is met:  (i) in the case of corporate entities, direct or indirect ownership of more than 50% of the stock or shares having the right to vote for the election of directors, and (ii) in the case of non-corporate entities, direct or indirect ownership of more than 50% of the equity interest with the power to direct the management and policies of such non-corporate entities.  For the purposes of this Agreement, in no event will the Purchaser or any of its Affiliates be deemed Affiliates of the Company or any of its Affiliates, nor will the Company or any of its Affiliates be deemed Affiliates of the Purchaser or any of its Affiliates.

1.3“Board Approval” means, with respect to a specified matter or action, the approval of such matter or action by at least a majority of the members of the Company’s Board of Directors at a duly authorized meeting of the Company’s Board of Directors or pursuant to an action taken by unanimous written consent of the Company’s Board of Directors.

1.4“Change of Control” will occur if: (a) any Third Party acquires directly or indirectly the beneficial ownership of any voting security of the Company, or if the percentage ownership of such person or entity in the voting securities of the Company is increased through stock redemption, cancellation or other recapitalization, and immediately after such acquisition 

 

 

or increase such Third Party is, directly or indirectly, the beneficial owner of voting securities representing more than 50% of the total voting power of all of the then outstanding voting securities of the Company; (b) a merger, consolidation, recapitalization, or reorganization of the Company is consummated, other than any such transaction which would result in stockholders or equity holders of the Company immediately prior to such transaction owning at least 50% of the outstanding securities of the surviving entity (or its parent entity) immediately following such transaction; (c) the stockholders or equity holders of the Company approve a plan of complete liquidation of the Company, or an agreement for the sale or disposition by the Company of all or substantially all of the Company’s assets, other than any such sale or disposition to an Affiliate of the Company or to an entity of which more than 50% of the combined voting power of its voting securities are beneficially owned by stockholders of the Company in substantially the same proportions as their beneficial ownership of the outstanding voting securities of the Company immediately prior to such sale or disposition; or (d) individuals who, as of the date hereof, constitute the Board of Directors of the Company (the “Incumbent Board”) cease for any reason to constitute at least a majority of the Board of Directors of the Company (provided, however, that any individual becoming a director subsequent to the date hereof whose election or appointment, or nomination for election by the Company’s stockholders, was approved or recommended by a vote of at least a majority of the directors then comprising the Incumbent Board shall be considered as though such individual were a member of the Incumbent Board, but excluding, for this purpose, any such individual whose initial assumption of office occurs as a result of an actual or threatened election contest with respect to the election or removal of directors or other actual or threatened solicitation of proxies or consents by or on behalf of any person other than the Board of Directors of the Company).

1.5“Closing” means the First Tranche Closing or the Second Tranche Closing, as applicable.

1.6“Closing Date” means the First Tranche Closing Date or the Second Tranche Closing Date, as applicable.

1.7“Common Stock Equivalents” means any options, warrants or other securities or rights convertible into or exercisable or exchangeable for, whether directly or following conversion into or exercise or exchange for other options, warrants or other securities or rights, shares of Common Stock (collectively, “Convertible Securities”), or any swap, hedge or similar agreement or arrangement that transfers in whole or in part, the economic risk of ownership of, or voting or other rights of, shares of Common Stock.

1.8“Disposition” or “Dispose of” means any (i) pledge, sale, contract to sell, sale of any option or contract to purchase, purchase of any option or contract to sell, grant of any option, right or warrant for the sale of, or other disposition of or transfer of any shares of Common Stock, or any Common Stock Equivalents, including, without limitation, any “short sale” or similar arrangement, or (ii) swap or any other agreement or any transaction that transfers, in whole or in part, directly or indirectly, the economic consequence of ownership of shares of Common Stock, whether any such swap or transaction is to be settled by delivery of securities, in cash or otherwise.

1.9“Evaluation Date” has the meaning set forth in Section 3.8.

2.

 

1.10“Exchange Act” means the United States Securities Exchange Act of 1934, as amended, and the rules and regulations promulgated thereunder.

1.11“FDA” has the meaning set forth in Section 3.17(a).

1.12“FDA Law and Regulations” has the meaning set forth in Section 3.17(a).

1.13“First Tranche Closing” means the closing of the sale and purchase of the First Tranche Shares.

1.14“First Tranche Closing Date” means the Effective Date or such other date or time as the Company and the Purchaser may mutually agree.

1.15“First Tranche Purchase Price” means the product of (x) the number of shares of Common Stock to be purchased under this Agreement at the First Tranche Closing, as determined in accordance with the definition of “First Tranche Shares” set forth below, multiplied by (y) the Share Price. 

1.16“First Tranche Shares” means the number of shares of Common Stock to be purchased under this Agreement at the First Tranche Closing, which shall be equal to (i) $2,000,000 divided by (ii) the Share Price, rounded down to the nearest whole number; provided that in no event shall such number of shares exceed 19.9% of the issued and outstanding shares of Common Stock of the Company as of immediately after the First Tranche Closing.

1.17“Governmental Authority” means any court, agency, authority, department, regulatory body or other instrumentality of any government or country or of any national, federal, state, provincial, regional, county, city or other political subdivision of any such government or country or any supranational organization of which any such country is a member.

1.18“HTG Qualified Financing” means the first financing consummated by the Company after the Effective Date in which the Company sells shares of Common Stock and/or shares of Preferred Stock for an aggregate purchase price of at least $12,000,000, before deduction of any underwriting or similar commissions, compensation or concessions paid or allowed by the Company in connection with such transaction and without deduction of any expenses payable by the Company, and including, for the avoidance of doubt, any such sale to an Affiliate of the Company that is done on an arm’s length basis.

1.19“Intellectual Property Rights” has the meaning set forth in Section 3.14.

1.20“Liens” means a lien, charge, pledge, security interest, encumbrance, right of first refusal, preemptive right or other restriction. 

1.21“Lock-Up Term” has the meaning set forth in Section 8.2.

1.22“Material Adverse Effect” means a material adverse effect upon the business, assets, properties, operations, condition (financial or otherwise) or results of operations of the 

3.

 

Company and its Subsidiaries, taken as a whole, or in the Company’s ability to perform its obligations under this Agreement. 

1.23“Permitted Transferee” means (i) an Affiliate of the Purchaser that is wholly owned, directly or indirectly, by the Purchaser, or (ii) an Affiliate of the Purchaser that wholly owns, directly or indirectly, the Purchaser.

1.24“Person” means any individual, limited liability company, partnership, firm, corporation, association, trust, unincorporated organization, government or any department or agency thereof or other entity, as well as any syndicate or group that would be deemed to be a Person under Section 13(d)(3) of the Exchange Act.

1.25“Qualified Financing Purchase Price” means (i) with respect to any sale of shares of Common Stock in the HTG Qualified Financing, the price per share at which shares of Common Stock are sold, (ii) with respect to any sale of shares of Preferred Stock in the Qualified Financing, the price per share determined by dividing (a) the aggregate purchase price paid for such shares of Preferred Stock by (b) the aggregate number of shares of Common Stock issuable upon conversion of such shares of Preferred Stock (determined as of the closing of the HTG Qualified Financing without regard to any limitations on conversion that relate to Nasdaq Listing Rule 5635 or a holder’s beneficial ownership of Common Stock), reduced to reflect the reasonable value of preferential rights of such shares of Preferred Stock over the Common Stock, and (iii) with respect to any sale of shares of both Common Stock and Preferred Stock in the HTG Qualified Financing, the weighted average of the Qualified Financing Purchase Price determined in accordance with the foregoing clauses (i) and (ii), respectively, based on aggregate purchase price for shares of Common Stock and Preferred Stock sold in such HTG Qualified Financing.

1.26“SEC” means the United States Securities and Exchange Commission.

1.27“SEC Filings” means all reports, forms, statements and other documents filed by the Company with the SEC since May 5, 2015 pursuant to the requirements of the Exchange Act, including material filed pursuant to Section 13(a) or 15(c) of the Exchange Act, in each case, together with all exhibits, supplements, amendments and schedules thereto, and all documents incorporated by reference therein.

1.28“Second Tranche Closing” means the closing of the sale and purchase of the Second Tranche Shares.

1.29“Second Tranche Closing Date” has the meaning set forth in Section 2.4.

1.30“Second Tranche Purchase Price” means the product of (i) the number of Second Tranche Shares, as determined in accordance with the definition set forth below, multiplied by (ii) the Qualified Financing Purchase Price.

1.31“Second Tranche Shares” means the number of shares of Common Stock to be purchased under this Agreement at the Second Tranche Closing, which shall be equal to (i) $2,000,000 divided by (ii) the Qualified Financing Purchase Price, rounded down to the nearest whole number; provided that in no event shall such number of shares, collectively with the 

4.

 

number of First Tranche Shares, exceed (A) if and only if the weighted-average price per share of Common Stock purchased at the First Tranche Closing and to be purchased at the Second Tranche Closing would be less than the greater of (x) the most recently reported consolidated closing bid price of the Common Stock (as reported on the Nasdaq Stock Market) prior to the execution of this Agreement and (y) the Company’s most recently reported net tangible book value per share prior to the date of this Agreement (the “Nasdaq 20% Limitation”), 19.9% of the issued and outstanding shares of Common Stock of the Company as of immediately prior to the execution of this Agreement and (B) 19.9% of the issued and outstanding shares of Common Stock of the Company as of immediately after the issuance of the Second Tranche Shares (the “Nasdaq Change of Control Limitation” and together with the Nasdaq 20% Limitation, the “Nasdaq Limitations”).  In the event either the Nasdaq 20% Limitation or Nasdaq Change of Control Limitation applies, the number of shares of Common Stock that shall constitute the Second Tranche Shares shall be appropriately reduced to the maximum number of shares of Common Stock that may be issued under this Agreement in the Second Tranche Closing without violating either of the Nasdaq Limitations. 

1.32“Securities Act” means the United States Securities Act of 1933, as amended, and the rules and regulations promulgated thereunder. 

1.33“Shares” means the number of shares of Common Stock to be purchased under this Agreement, which shall include the First Tranche Shares and the Second Tranche Shares, as applicable.

1.34“Shares of Then Outstanding Common Stock” means, at the time of determination, the then issued and outstanding shares of Common Stock, as well as all capital stock that, as a result of any stock split, stock dividend or reclassification of Common Stock, is distributable (without any further action by the Company’s Board of Directors or stockholders) on a pro rata basis to all holders of Common Stock.

1.35“Share Price” means $2.40.

1.36“Standstill Term” has the meaning set forth in Section 7.2.

1.37“Subsidiary” means any subsidiary of the Company and shall, where applicable, also include any direct or indirect subsidiary of the Company formed or acquired after the date hereof.

1.38“Third Party” means any Person (other than a Governmental Authority) other than the Purchaser, the Company or any of their respective Affiliates.

	
2.
	
Agreement to Sell and Purchase.

2.1Authorization of Shares.  The Company has authorized the sale and issuance to the Purchaser of the Shares under the terms and conditions of this Agreement.

2.2Sale and Issuance of Common Stock.  On the basis of the representations and warranties herein, and upon the terms and subject to the conditions hereof, the Purchaser agrees to purchase from the Company, and the Company agrees to issue and sell to the Purchaser, (i) at 

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the First Tranche Closing, the First Tranche Shares at a price per share equal to the Share Price, and (ii) at the Second Tranche Closing, the Second Tranche Shares at a price per share equal to the Qualified Financing Purchase Price.

2.3First Tranche Closing.  Subject to the satisfaction or waiver of the conditions set forth herein, the First Tranche Closing shall take place on the First Tranche Closing Date at the offices of Cooley llp, 4401 Eastgate Mall, San Diego, California 92121 or at such other place as the Company and the Purchaser may agree in writing.  At the First Tranche Closing, the Company shall instruct its transfer agent to credit the First Tranche Shares in book entry form for the benefit of, and in the name of, the Purchaser against the Purchaser’s payment to the Company of the First Tranche Purchase Price by wire transfer of immediately available funds in accordance with wire instructions provided by the Company to the Purchaser prior to the First Tranche Closing.  

2.4Second Tranche Closing.  Subject to the satisfaction or waiver of the conditions set forth herein, the Second Tranche Closing shall take place at the offices of Cooley llp, 4401 Eastgate Mall, San Diego, California 92121, or at such other place as the Company and the Purchaser may agree in writing, on the date on which the HTG Qualified Financing closes (the date on which the Second Tranche Closing actually occurs being referred to herein as the “Second Tranche Closing Date”), but in no event later than six months following the First Tranche Closing Date.  At the Second Tranche Closing, the Company shall instruct its transfer agent to credit the Second Tranche Shares in book entry form for the benefit of, and in the name of, the Purchaser against the Purchaser’s payment to the Company of the Second Tranche Purchase Price by wire transfer of immediately available funds in accordance with wire instructions provided by the Company to the Purchaser prior to the Second Tranche Closing.  

	
3.
	
Representations, Warranties and Covenants of the Company.

The Company hereby represents and warrants to the Purchaser as of each applicable Closing Date as follows:

3.1Organization, Good Standing and Qualification.  The Company is a corporation duly organized, validly existing and in good standing under the laws of the State of Delaware and has all requisite corporate power and authority to carry on its business.  The Company is duly qualified to transact business as a corporation and is in good standing in each jurisdiction in which the failure so to qualify would have a Material Adverse Effect upon the Company’s ability to perform its obligations under this Agreement.  Neither the Company nor any Subsidiary is in violation nor default of any of the provisions of its respective certificate or articles of incorporation, bylaws or other organizational or charter documents.

3.2Authorization; Due Execution.  The Company has the requisite corporate power and authority to enter into this Agreement and to perform its obligations under the terms of this Agreement.  All corporate action on the part of the Company, its officers, directors and, if applicable, stockholders, necessary for the authorization, execution and delivery of this Agreement has been taken.  This Agreement has been duly authorized, executed and delivered by the Company and, upon due execution and delivery by the Purchaser, this Agreement will be a valid and binding obligation of the Company, enforceable against the Company in accordance 

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with its terms, except as enforceability may be limited by bankruptcy, insolvency, reorganization, moratorium or similar laws affecting creditors’ rights generally or by equitable principles.

3.3Subsidiaries. All of the direct and indirect subsidiaries of the Company are set forth on Schedule 3.3.  The Company owns, directly or indirectly, all of the capital stock or other equity interests of each Subsidiary free and clear of any Liens, and all of the issued and outstanding shares of capital stock of each Subsidiary are validly issued and are fully paid, non-assessable and free of preemptive and similar rights to subscribe for or purchase securities.  If the Company has no subsidiaries, all other references to the Subsidiaries in this Agreement shall be disregarded.

3.4Capitalization. Except as may be set forth in the SEC Filings, the Company has not issued any capital stock since its most recently filed periodic report under the Exchange Act, other than pursuant to the exercise of employee stock options under the Company’s stock option plans, the issuance of shares of Common Stock to employees pursuant to the Company’s employee stock purchase plans and pursuant to the conversion and/or exercise of Common Stock Equivalents outstanding as of the date of the most recently filed periodic report under the Exchange Act.  Except as may be set forth in the SEC Filings, no Person has any right of first refusal, preemptive right, right of participation, or any similar right to participate in the transactions contemplated by this Agreement.  Except as may be set forth in the SEC Filings, there are no outstanding options, warrants, scrip rights to subscribe to, calls or commitments of any character whatsoever relating to, or securities, rights or obligations convertible into or exercisable or exchangeable for, or giving any Person any right to subscribe for or acquire any shares of Common Stock, or contracts, commitments, understandings or arrangements by which the Company or any Subsidiary is or may become bound to issue additional shares of Common Stock or Common Stock Equivalents. The issuance and sale of the Shares will not obligate the Company to issue shares of Common Stock or other securities to any Person (other than the Purchaser) and will not result in a right of any holder of Company securities to adjust the exercise, conversion, exchange or reset price under any of such securities. All of the outstanding shares of capital stock of the Company are duly authorized, validly issued, fully paid and nonassessable, have been issued in compliance with all applicable federal and state securities laws, and none of such outstanding shares was issued in violation of any preemptive rights or similar rights to subscribe for or purchase securities.  Assuming the accuracy of the Purchaser’s representations and warranties set forth in Sections 4.3 and 4.4 hereof, no further approval or authorization of any stockholder, the board of directors of the Company or others is required for the issuance and sale of the Shares.  Except as may be set forth in the SEC Filings, there are no stockholders agreements, voting agreements or other similar agreements with respect to the Company’s capital stock to which the Company is a party or, to the knowledge of the Company, between or among any of the Company’s stockholders.

3.5Valid Issuance of Stock.  The Shares, when issued, sold and delivered in accordance with the terms of Section 2 hereof for the consideration and on the terms and conditions set forth herein, will be duly and validly authorized and issued, fully paid and nonassessable, free and clear of all Liens (other than any Liens that may be created by or imposed upon the Purchaser or its Affiliates), and, based in part upon the representations of the 

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Purchaser in this Agreement, will be issued in compliance with all applicable United States federal and state securities laws.  

3.6No Defaults.  There exists no default under the provisions of any instrument or agreement evidencing, governing or otherwise relating to any material indebtedness of the Company, or with respect to any other agreement, a default under which would have a material adverse effect upon the Company’s ability to perform its obligations under this Agreement.

3.7SEC Filings; Financial Statements.  The Company has timely filed with the SEC all SEC Filings.  The SEC Filings were prepared in accordance with and, as of the date on which each such SEC Filing was filed with the SEC, complied in all material respects with the applicable requirements of the Exchange Act.  None of such SEC Filings, at the time filed, contained an untrue statement of a material fact, or omitted to state a material fact required to be stated therein or necessary in order to make the statements therein, in light of the circumstances under which they were made, not misleading.  The financial statements of the Company included in the SEC Filings comply in all material respects with applicable accounting requirements and the rules and regulations of the SEC with respect thereto as in effect at the time of filing.  Such financial statements have been prepared in accordance with United States generally accepted accounting principles applied on a consistent basis during the periods involved (“GAAP”), except as may be otherwise specified in such financial statements or the notes thereto and except that unaudited financial statements may not contain all footnotes required by GAAP, and fairly present in all material respects the financial position of the Company and its consolidated Subsidiaries as of and for the dates thereof and the results of operations and cash flows for the periods then ended, subject, in the case of unaudited statements, to normal year-end audit adjustments (which are not expected to be material either individually or in the aggregate).

3.8Sarbanes-Oxley; Internal Accounting Controls. The Company and the Subsidiaries are in compliance with any and all applicable requirements of the Sarbanes-Oxley Act of 2002 that are effective and applicable to the Company as of the date hereof, and any and all applicable rules and regulations promulgated by the SEC thereunder that are effective as of the date hereof and as of the applicable Closing Date.  The Company and its Subsidiaries maintain a system of internal accounting controls sufficient to provide reasonable assurance that: (i) transactions are executed in accordance with management’s general or specific authorizations, (ii) transactions are recorded as necessary to permit preparation of financial statements in conformity with GAAP and to maintain asset accountability, (iii) access to assets is permitted only in accordance with management’s general or specific authorization, and (iv) the recorded accountability for assets is compared with the existing assets at reasonable intervals and appropriate action is taken with respect to any differences. The Company and its Subsidiaries have established disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) for the Company and its Subsidiaries and designed such disclosure controls and procedures to ensure that information required to be disclosed by the Company in the reports it files or submits under the Exchange Act is recorded, processed, summarized and reported, within the time periods specified in the SEC’s rules and forms.  The Company’s certifying officers have evaluated the effectiveness of the disclosure controls and procedures of the Company and its Subsidiaries as of the end of the period covered by the most recently filed periodic report under the Exchange Act (such date, the “Evaluation Date”).  The Company presented in its most recently filed periodic report under the Exchange Act the conclusions of the certifying officers 

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about the effectiveness of the disclosure controls and procedures based on their evaluations as of the Evaluation Date.  Since the Evaluation Date, there have been no changes in the internal control over financial reporting (as such term is defined in the Exchange Act) of the Company and its Subsidiaries that have materially affected, or is reasonably likely to materially affect, the  internal control over financial reporting of the Company and its Subsidiaries.

3.9Governmental Consents.  No consent, approval, order or authorization of, or registration, qualification, designation, declaration or filing with any Governmental Authority on the part of the Company is required in connection with the consummation of the transactions contemplated by this Agreement, except for such notices required or permitted to be filed with certain United States state and federal securities commissions after the Effective Date, which notices (if required) will be filed on a timely basis.

3.10No Conflict.  The Company’s execution, delivery and performance of this Agreement does not violate (i) any provision of the Company’s Amended and Restated Certificate of Incorporation or Amended and Restated Bylaws, each as amended as of the date hereof (copies of which have been filed with the SEC), (ii) any provision of any order, writ, judgment, injunction, decree, determination or award to which the Company is a party or by which it is bound, or (iii) to the Company’s knowledge, any law, rule or regulation currently in effect having applicability to the Company.

3.11Material Changes; Undisclosed Events, Liabilities or Developments.  Since the date of the latest audited financial statements included within the SEC Filings, except as specifically disclosed in a subsequent SEC Filing filed prior to the date hereof: (i) there has been no event, occurrence or development that has had or that would reasonably be expected to result in a Material Adverse Effect, (ii) the Company has not incurred any liabilities (contingent or otherwise) other than (A) trade payables and accrued expenses incurred in the ordinary course of business consistent with past practice and (B) liabilities not required to be reflected in the Company’s financial statements pursuant to GAAP or disclosed in filings made with the SEC, (iii) the Company has not altered its method of accounting, (iv) the Company has not declared or made any dividend or distribution of cash or other property to its stockholders or purchased, redeemed or made any agreements to purchase or redeem any shares of its capital stock and (v) the Company has not issued any equity securities to any officer, director or Affiliate, except pursuant to existing Company stock option plans timely reported pursuant to Section 16 of the Exchange Act at least one (1) trading day prior to the date that this representation is made.  Other than with respect to that certain Master Assay Development, Commercialization and Manufacturing Agreement, in negotiation between the parties or executed on or about the date hereof, by and between QIAGEN Manchester Limited and the Company (the “Development Agreement”), the Company does not have pending before the SEC any request for confidential treatment of information.  Except for the issuance of the Shares contemplated by this Agreement and the entry into the Development Agreement, no event, liability, fact, circumstance, occurrence or development has occurred or exists or is reasonably expected to occur or exist with respect to the Company or its Subsidiaries or their respective businesses, properties, operations, assets or financial condition, that would be required to be disclosed by the Company under applicable securities laws at the time this representation is made or deemed made that has not been publicly disclosed at least one (1) trading day prior to the date that this representation is made.

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3.12Litigation. Except as may be set forth in the SEC Filings, there is no action, suit, inquiry, notice of violation, proceeding or investigation pending or, to the knowledge of the Company, threatened against or affecting the Company, any Subsidiary or any of their respective properties before or by any court, arbitrator, governmental or administrative agency or regulatory authority (federal, state, county, local or foreign) (collectively, an “Action”) which (i) adversely affects or challenges the legality, validity or enforceability of any of the transactions contemplated by this Agreement or the Shares or (ii) would, if there were an unfavorable decision, have or reasonably be expected to result in a Material Adverse Effect.  Neither the Company nor any Subsidiary, nor any director or officer thereof, is or has been the subject of any Action involving a claim of violation of or liability under federal or state securities laws or a claim of breach of fiduciary duty.  There has not been, and to the knowledge of the Company, there is not pending or contemplated, any investigation by the SEC involving the Company or any current director or officer of the Company.  The SEC has not issued any stop order or other order suspending the effectiveness of any registration statement filed by the Company or any Subsidiary under the Exchange Act or the Securities Act.

3.13Tax Status. The Company and its Subsidiaries each (i) has made or filed all United States federal, state and local income and all foreign income and franchise tax returns, reports and declarations required by any jurisdiction to which it is subject, (ii) has paid all taxes and other governmental assessments and charges that are material in amount, shown or determined to be due on such returns, reports and declarations and (iii) has set aside on its books provision reasonably adequate for the payment of all material taxes for periods subsequent to the periods to which such returns, reports or declarations apply.  There are no unpaid taxes in any material amount claimed to be due by the taxing authority of any jurisdiction, and the officers of the Company or of any Subsidiary know of no basis for any such claim.

3.14Intellectual Property. The Company and its Subsidiaries have, or have rights to use, all patents, patent applications, trademarks, trademark applications, service marks, trade names, trade secrets, inventions, copyrights, licenses and other intellectual property rights and similar rights as described in the SEC Filings as necessary or required for use in connection with their respective businesses (collectively, the “Intellectual Property Rights”).  Except as would not reasonably be expected to have a Material Adverse Effect, neither the Company nor any of its Subsidiaries has received a notice (written or otherwise) that any of, the Intellectual Property Rights has expired, terminated or been abandoned, or is expected to expire or terminate or be abandoned, within three (3) years from the date of this Agreement.  Except as disclosed in the SEC Filings or with respect to a matter occurring after the date hereof which has been promptly disclosed in writing to the Purchaser prior to the Second Tranche Closing, neither the Company nor any of its Subsidiaries has received, since the date of the latest audited financial statements included within the SEC Filings, a written notice of a claim or otherwise has any knowledge that the Intellectual Property Rights violate or infringe upon the rights of any Person, and to the knowledge of the Company, all such Intellectual Property Rights are enforceable and there is no existing infringement by another Person of any of the Intellectual Property Rights.  The Company and its Subsidiaries have taken reasonable security measures to protect the secrecy, confidentiality and value of all of their intellectual properties, except where failure to do so would not, individually or in the aggregate, reasonably be expected to have a Material Adverse Effect.

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3.15Compliance. Except as may be set forth in the SEC Filings, neither the Company nor any Subsidiary: (i) is in default under or in violation of (and no event has occurred that has not been waived that, with notice or lapse of time or both, would result in a default by the Company or any Subsidiary under), nor has the Company or any Subsidiary received notice of a claim that it is in default under or that it is in violation of, any indenture, loan or credit agreement or any other agreement or instrument to which it is a party or by which it or any of its properties is bound (whether or not such default or violation has been waived), (ii) is in violation of any judgment, decree or order of any court, arbitrator or other governmental authority or (iii) is or has been in violation of any statute, rule, ordinance or regulation of any governmental authority, including without limitation all foreign, federal, state and local laws relating to taxes, environmental protection, occupational health and safety, product quality and safety and employment and labor matters, except in each case as would not have or reasonably be expected to result in a Material Adverse Effect.

3.16Regulation M Compliance. The Company has not, and to its knowledge no one acting on its behalf has, (i) taken, directly or indirectly, any action designed to cause or to result in the stabilization or manipulation of the price of any security of the Company to facilitate the sale or resale of any of the Shares, (ii) sold, bid for, purchased, or paid any compensation for soliciting purchases of, any of the Shares, or (iii) paid or agreed to pay to any Person any compensation for soliciting another to purchase any other securities of the Company in violation of Regulation M of the Exchange Act.

3.17FDA; FDCA.

(a)The Company and its Subsidiaries are conducting and have conducted their business and operations in material compliance with the Federal Food, Drug, and Cosmetic Act, 21 U.S.C. §301 et. seq., and all applicable regulations promulgated by the United States Food and Drug Administration (“FDA”) (collectively, the “FDA Law and Regulations”) and comparable foreign regulatory or governmental authorities.

(b)Except as set forth on Schedule 3.17(b) or as may be set forth in an applicable SEC Filing, neither the Company nor its Subsidiaries has received any notice or communication from the FDA alleging noncompliance with any applicable FDA Law and Regulation.  The Company and its Subsidiaries are not subject to any enforcement, regulatory or administrative proceedings by the FDA or any comparable foreign regulatory or governmental authority and, to the knowledge of the Company, no such proceedings have been threatened.  There is no civil, criminal or administrative action, suit, demand, claim, complaint, hearing, investigation, demand letter, warning letter, proceeding or request for information pending against Company or its Subsidiaries, and, to the knowledge of the Company, the Company and its Subsidiaries have no liability (whether actual or contingent) for failure to comply with any FDA Law and Regulation or any law or regulation of a comparable foreign regulatory or governmental authority.  There is no act, omission, event, or circumstance of which the Company or its Subsidiaries have knowledge that would reasonably be expected to give rise to or lead to any such action, suit, demand, claim, complaint, hearing, investigation, notice, demand letter, warning letter, proceeding or request for information or any such liability.  There has not been any violation of any FDA Law and Regulation or any law or regulation of a comparable foreign regulatory or governmental authority by the Company or its Subsidiaries in 

11.

 

their product development efforts, submissions, record keeping and reports to FDA or a comparable governmental authority that would reasonably be expected to require or lead to investigation, corrective action or enforcement, regulatory or administrative action that would result in a Material Adverse Effect. To the knowledge of  Company, there are no civil or criminal proceedings relating to the Company or its Subsidiaries or any Company or Subsidiary employee which involve a matter within or related to the FDA’s jurisdiction or the jurisdiction of any comparable governmental authority.

3.18Regulatory Permits. Except as set forth in the SEC Filings, the Company and the Subsidiaries possess all certificates, authorizations and permits issued by the appropriate federal, state, local or foreign regulatory authorities necessary to conduct their respective businesses as described in the SEC Filings, except where the failure to possess such permits would not reasonably be expected to result in a Material Adverse Effect, and neither the Company nor any Subsidiary has received any notice of proceedings relating to the revocation or modification of any such permit.

3.19Foreign Corrupt Practices; Office of Foreign Assets Control. Neither the Company nor any Subsidiary, nor to the knowledge of the Company or any Subsidiary, any agent or other person acting on behalf of the Company or any Subsidiary, has: (i) directly or indirectly, used any funds for unlawful contributions, gifts, entertainment or other unlawful expenses related to foreign or domestic political activity, (ii) made any unlawful payment to foreign or domestic government officials or employees or to any foreign or domestic political parties or campaigns from corporate funds, (iii) failed to disclose fully any contribution made by the Company or any Subsidiary (or made by any person acting on its behalf of which the Company is aware) which is  in violation of law or (iv) violated in any material respect any provision of the Foreign Corrupt Practices Act of 1977, as amended. Neither the Company nor any Subsidiary nor, to the Company's knowledge, any director, officer, agent, employee or Affiliate of the Company or any Subsidiary is currently subject to any U.S. sanctions administered by the Office of Foreign Assets Control of the U.S. Treasury Department.

3.20Accountants.  The Company’s independent registered accounting firm is identified in the SEC Filings.  To the knowledge of the Company, such accounting firm: (i) is a registered public accounting firm as required by the Exchange Act and (ii) will express its opinion with respect to the financial statements to be included in the Company’s Annual Report for the fiscal year ending December 31, 2016.

3.21Insurance. The Company and the Subsidiaries are insured by insurers of recognized financial responsibility against such losses and risks and in such amounts as are prudent and customary in the businesses in which the Company and the Subsidiaries are engaged.  Neither the Company nor any Subsidiary has been notified that it will not be able to renew its existing insurance coverage as and when such coverage expires or to obtain similar coverage from similar insurers as may be necessary to continue its business without a significant increase in cost.

3.22Investment Company. The Company is not, and is not an Affiliate of, and immediately after receipt of payment for the Shares, will not be or be an Affiliate of, an “investment company” within the meaning of the Investment Company Act of 1940, as 

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amended.  The Company shall conduct its business in a manner so that it will not become an “investment company” subject to registration under the Investment Company Act of 1940, as amended.

3.23Disclosure. Except with respect to the material terms and conditions of the transactions contemplated by this Agreement and of the transactions contemplated by the Development Agreement, neither the Company nor any other Person acting on its behalf has provided the Purchaser or its agents or counsel with any information that it believes constitutes or might constitute material, non-public information. All of the disclosure furnished by or on behalf of the Company to the Purchaser regarding the Company and its Subsidiaries, their respective businesses and the transactions contemplated hereby is true and correct and does not contain any untrue statement of a material fact or omit to state any material fact necessary in order to make the statements made therein, in light of the circumstances under which they were made, not misleading. The Company acknowledges and agrees that the Purchaser does not make or has made any representations or warranties with respect to the transactions contemplated hereby other than those specifically set forth in Section 4 hereof.

	
4.
	
Representations, Warranties and Covenants of the Purchaser.

The Purchaser hereby represents and warrants to the Company as of each Closing Date as follows:

4.1Organization and Good Standing.  The Purchaser is an entity duly organized, validly existing and in good standing under the laws of its jurisdiction of incorporation or organization, and has all requisite corporate power and authority to carry on its business. 

4.2Authorization; Due Execution.  The Purchaser has the requisite corporate power and authority to enter into this Agreement and to perform its obligations under the terms of this Agreement.  All corporate action on the part of the Purchaser, its officers, directors and shareholders necessary for the authorization, execution and delivery of this Agreement have been taken.  This Agreement has been duly authorized, executed and delivered by the Purchaser, and, upon due execution and delivery by the Company, this Agreement will be a valid and binding obligation of the Purchaser, enforceable against the Purchaser in accordance with its terms, except as enforceability may be limited by bankruptcy, insolvency, reorganization, moratorium or similar laws affecting creditors’ rights generally or by equitable principles.

4.3No Current Ownership in the Company.  Other than the Shares acquired or to be acquired under this Agreement, the Purchaser does not own any shares of Common Stock or any Common Stock Equivalents as of immediately prior to the applicable Closing.

4.4Purchase Entirely for Own Account.  The Shares to be purchased by the Purchaser at the applicable Closing are being acquired for investment for the Purchaser’s own account, not as a nominee or agent, and not with a view to the resale or distribution of any part thereof, and that the Purchaser has no present intention of selling, granting any participation in, or otherwise distributing the same.  The Purchaser does not have any contract, undertaking, agreement or arrangement with any person to sell, transfer or grant participation to such person or to any third party, with respect to the Shares, if issued.

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4.5Disclosure of Information.  The Purchaser has received all the information that it has requested and that it considers necessary or appropriate for deciding whether to enter into this Agreement and to acquire the Shares.  The Purchaser further represents that it has had an opportunity to ask questions and receive answers from the Company regarding the terms and conditions of the offering of the Shares.

4.6Investment Experience.  The Purchaser acknowledges that it can bear the economic risk of its investment and has such knowledge and experience in financial or business matters that it is capable of evaluating the merits and risks of the investment in the Shares.  The Purchaser has not been organized solely for the purpose of acquiring the Shares.

4.7Accredited Investor.  The Purchaser is an “accredited investor” as such term is defined in Rule 501 of the General Rules and Regulations promulgated by the SEC pursuant to the Securities Act.

4.8Restricted Securities.  The Purchaser understands that: 

(a)the Shares will not be registered under the Securities Act by reason of a specific exemption therefrom, and that the Purchaser must, therefore, bear the economic risk of such investment, unless and until a subsequent disposition thereof is registered under the Securities Act or is exempt from such registration, such as under Rule 144 of the Securities Act (“Rule 144”);

(b)the Shares, whether represented by a physical stock certificate or in book entry form, will be endorsed, stamped or otherwise notated with the following legends (in addition to any legend required by applicable state securities laws):

(i)THE SECURITIES REPRESENTED HEREBY HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933 (THE “ACT”) AND MAY NOT BE OFFERED, SOLD OR OTHERWISE TRANSFERRED, ASSIGNED, PLEDGED OR HYPOTHECATED UNLESS AND UNTIL REGISTERED UNDER THE ACT OR UNLESS THE COMPANY HAS RECEIVED AN OPINION OF COUNSEL SATISFACTORY TO THE COMPANY AND ITS COUNSEL THAT SUCH REGISTRATION IS NOT REQUIRED. 

(ii)THE SECURITIES REPRESENTED HEREBY ARE SUBJECT TO, AND TRANSFERABLE ONLY IN ACCORDANCE WITH, THE TERMS AND CONDITIONS OF A CERTAIN STOCK PURCHASE AGREEMENT BY AND BETWEEN THE STOCKHOLDER AND THE COMPANY.  COPIES OF SUCH AGREEMENT MAY BE OBTAINED UPON WRITTEN REQUEST TO THE SECRETARY OF THE COMPANY.

(c)The Company will instruct its transfer agent not to register the transfer of any Shares unless (1) the conditions specified in the legend contained in Section 4.8(b)(i) are satisfied and (2) (A) such Shares are transferred to a Person that is not bound or required to be bound by the restrictions contained in Sections 7 and 8 hereof or (B) the Standstill Term and the Lock-Up Term have expired or terminated, provided that any transfer described in the foregoing clause (A) or (B) also shall have been in compliance with all applicable provisions of this Agreement. 

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4.9No Short Sales.  The Purchaser has not engaged, and will not engage, in any short sales of the Common Stock within the three month period prior to the applicable Closing Date.

4.10No Legal, Tax or Investment Advice.  The Purchaser understands that nothing in the SEC Filings, this Agreement or any other materials presented to the Purchaser in connection with the purchase and sale of the Shares constitutes legal, tax or investment advice and that independent legal counsel has reviewed these documents and materials on the Purchaser’s behalf.  The Purchaser has consulted such legal, tax and investment advisors as it, in its sole discretion, has deemed necessary or appropriate in connection with its purchase of the Shares.

	
5.
	
Conditions to the Company’s Obligations at Closing. 

The Company’s obligation to sell, issue and deliver the Shares to the Purchaser at each Closing shall be subject to the following conditions, to the extent not waived by the Company:

5.1Representations and Warranties. The representations and warranties made by the Purchaser in Section 4 hereof shall be true and correct in all material respects on the applicable Closing Date.  

5.2Obligations. The Purchaser shall have performed and complied with all obligations and conditions required to be performed and complied with by the Purchaser under this Agreement on or prior to the applicable Closing Date.

	
6.
	
Conditions to the Purchaser’s Obligations At Closing.  

The Purchaser’s obligation to tender payment of the First Tranche Purchase Price and the Second Tranche Purchase Price, as applicable, and accept delivery of the Shares at the applicable Closing shall be subject to the following conditions, to the extent not waived by the Purchaser:

6.1Representations and Warranties.  The representations and warranties made by the Company in Section 3 hereof shall be true and correct in all material respects on the applicable Closing Date.  

6.2Obligations. The Company shall have performed and complied with all obligations and conditions to be performed and complied with by the Company under this Agreement on or prior to the applicable Closing Date.

	
7.
	
Restrictions on Beneficial Ownership. 

7.1Standstill. During the Standstill Term, neither the Purchaser nor any of its Affiliates (collectively, the “Standstill Parties”) will (and the Purchaser shall cause its Affiliates not to), except to the extent expressly authorized in advance by Board Approval:

(a)directly or indirectly acquire beneficial ownership of any Shares of Then Outstanding Common Stock, and/or any Common Stock Equivalents, or make a tender, exchange or other offer to acquire Shares of Then Outstanding Common Stock and/or Common 

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Stock Equivalents; provided, however, that an acquisition of shares of Common Stock pursuant to a stock split, a stock dividend or a recapitalization of the Company shall not be deemed to violate the provisions of this Section 7;

(b)directly or indirectly seek to have called any meeting of the stockholders of the Company, propose or nominate any person for election to the Company’s Board of Directors or cause to be voted any Shares of Then Outstanding Common Stock in favor of any person for election to the Company’s Board of Directors whose nomination has not been approved in advance by Board Approval;

(c)directly or indirectly, solicit proxies or consents, or become a “participant” in a “solicitation” (as such terms are defined in Regulation 14A under the Exchange Act), without prior Board Approval, or in opposition to the recommendation of the Company’s Board of Directors, with respect to any matter, or seek to advise or influence any Person, in each case with respect to voting of any Shares of Then Outstanding Common Stock of the Company;

(d)deposit any Shares of Then Outstanding Common Stock in a voting trust or subject any Shares of Then Outstanding Common Stock to any arrangement or agreement with respect to the voting of such Shares of Then Outstanding Common Stock (other than as expressly contemplated by this Agreement);

(e)propose (i) any merger, consolidation, business combination, tender or exchange offer, purchase of the Company’s assets or businesses, or similar transaction involving the Company or (ii) any recapitalization, restructuring, liquidation or other extraordinary transaction with respect to the Company;

(f)act in concert with any Third Party to take any action in clauses (a) through (e) above, or form, join or in any way participate in a “partnership, limited partnership, syndicate, or other group” within the meaning of Section 13(d)(3) of the Exchange Act; or

(g)enter into discussions, negotiations, arrangements or agreements with any Third Party relating to the foregoing actions referred to in (a) through (f) above; provided, however, that nothing contained in this Section 7.1 prohibits the Purchaser or its Affiliates from acquiring a company or business that owns Shares of Then Outstanding Common Stock and/or Common Stock Equivalents provided that any such securities of the Company so acquired will be subject to the provisions of this Section 7.

7.2Standstill Term.  As used in this Agreement, the “Standstill Term” means the period commencing on the date of this Agreement and continuing until the occurrence of the earliest to occur of:

(a)the date that is six (6) months after the First Tranche Closing Date; provided, however, that if the Second Tranche Closing occurs during such six (6) month period, then the Standstill Term shall extend to the date that is nine (9) months after the Second Tranche Closing Date;

16.

 

(b)provided that none of the Standstill Parties has materially violated Section 7.1, the date on which a Third Party publicly announces a tender, exchange or other offer  for the Common Stock or proposal that, if consummated, would result in a Change of Control;

(c)the date that the Company publicly announces that it has entered into a letter of intent relating to a Change of Control, publicly announces its intent to do so or publicly announces that it is pursuing a transaction that would reasonably be expected to result in a Change of Control;

(d)the date on which the Common Stock ceases to be registered pursuant to Section 12 of the Exchange Act; and

(e)a liquidation or dissolution of the Company.

	
8.
	
Restrictions on Dispositions.

8.1Lock-Up.  During the Lock-Up Term, except to the extent expressly authorized by prior Board Approval, the Purchaser shall not, and shall cause its Affiliates not to, Dispose of (x) any of the Shares, together with any shares of Common Stock issued in respect thereof as a result of any stock split, share exchange, merger, consolidation or similar recapitalization, and (y) any Common Stock issued as (or issuable upon the exercise of any warrant, right or other security that is issued as) a dividend or other distribution with respect to, or in exchange or in replacement of, the shares of Common Stock described in clause (x) of this sentence (collectively, the “Lock-Up Securities”); provided, however, that the foregoing shall not prohibit the Purchaser from (A) transferring Lock-Up Securities to a Permitted Transferee, provided that any Lock-Up Securities so transferred remain subject to the provisions of this Section 8, or (B) Disposing of any Lock-Up Securities in order to reduce the beneficial ownership of the Standstill Parties to 19.9%, or such lesser percentage as advised in good faith and in writing by the Purchaser’s certified public accountants that would be necessary pursuant to applicable accounting rules and guidelines so as to not require the Purchaser to include in its financial statements its portion of the Company’s financial results, of the Shares of Then Outstanding Common Stock.

8.2Lock-Up Termination.  As used in this Agreement, the “Lock-Up Term” means, with respect to a Lock-Up Security, the period commencing on the date of this Agreement and continuing until the occurrence of the earliest to occur of:

(a)the date that is twelve (12) months after the applicable Closing Date at which such Lock-Up Security is purchased;

(b)immediately prior to the consummation of a Change of Control;

(c)a liquidation or dissolution of the Company; and

(d)the date on which the Common Stock ceases to be registered pursuant to Section 12 of the Exchange Act.

17.

 

8.3Certain Tender Offers.  Notwithstanding any other provision of this Section 8, this Section 8 shall not prohibit or restrict any Disposition of Shares of Then Outstanding Common Stock and/or Common Stock Equivalents by the Standstill Parties into (a) a tender offer by a Third Party which is not opposed by the Company’s Board of Directors (but only after the Company’s filing of a Schedule 14D-9, or any amendment thereto, with the SEC disclosing the recommendation of the Company’s Board of Directors with respect to such tender offer) or (b) an issuer tender offer by the Company.

	
9.
	
Miscellaneous.

9.1Survival. The representations and warranties contained herein shall survive each Closing and the delivery of the Shares thereat.

9.2Waivers and Amendments.  Any term of this Agreement may be amended and the observance of any term of this Agreement may be waived (either generally or in a particular instance and either retroactively or prospectively), only with the written consent of both the Company and the Purchaser.

9.3Severability.  If one or more provisions of this Agreement are held to be unenforceable under applicable law, such provision(s) shall be excluded from this Agreement and the balance of this Agreement shall be interpreted as if such provision(s) were so excluded and shall be enforceable in accordance with its terms.

9.4Governing Law.  This Agreement shall be governed by and construed in accordance with the laws of the State of New York, without regard to conflicts of law principles that would result in the application of the laws of another jurisdiction.

9.5Counterparts.  This Agreement may be executed in counterparts, each of which shall be deemed an original document, and all of which, together with this writing, shall be deemed one instrument.  Facsimile and electronic (PDF) signatures shall be as effective as original signatures.

9.6Successors and Assigns.  Neither this Agreement nor any rights or obligations hereunder may be assigned or otherwise transferred by either party without the prior written consent of the other party.  Subject to the preceding sentence, the rights and obligations of the parties under this Agreement shall be binding upon and inure to the benefit of the successors and permitted assigns of the parties.  Any assignment not in accordance with this Agreement shall be void.

9.7Entire Agreement.  This Agreement constitutes the entire understanding and agreement between the parties with respect to the subject matter hereof and neither party will be liable or bound to the other party in any manner by any oral or written warranties, representations, or covenants except as specifically set forth herein.

9.8Payment of Fees and Expenses.  Each of the Company and the Purchaser shall bear its own expenses and legal fees incurred on its behalf with respect to this Agreement and the transactions contemplated hereby.  If any action at law or in equity is necessary to enforce or interpret the terms of this Agreement, the prevailing party shall be entitled to reasonable 

18.

 

attorneys’ fees, costs and necessary disbursements in addition to any other relief to which such party may be entitled. The Company shall pay all transfer agent fees (including, without limitation, any fees required for same-day processing of any instruction letter delivered by the Company), stamp taxes and other taxes and duties levied in connection with the delivery of any Shares to the Purchaser.

9.9Broker’s Fee.  Each of the Company and the Purchaser hereby represents that there are no brokers or finders entitled to compensation in connection with the sale of the Shares, and each party shall indemnify the other party for any such fees for which such party is responsible.

9.10Notices.  All notices required or permitted hereunder shall be in writing and shall be deemed effectively given: (i) upon personal delivery to the party to be notified; (ii) upon transmission when sent by confirmed facsimile if sent during normal business hours of the recipient, and if sent at a time other than the normal business hours of the recipient, then on the day on which normal business hours of the recipient next commence; (iii) seven calendar days after having been sent by registered or certified mail, return receipt requested, postage prepaid; or (iv) two business days after deposit with an internationally recognized overnight courier with written verification of receipt.  All communications shall be sent to the other party hereto at the mailing address or facsimile number set forth below, or at such other mailing address or facsimile number as such party may designate by 10 days’ advance written notice to the other party hereto.

(a)If to the Company, notices shall be addressed to:

HTG Molecular Diagnostics, Inc.

3430 E. Global Loop

Tucson, AZ 85706

Attn:  Chief Executive Officer

Facsimile:  (520) 547-2837

With a copy to:

 

Cooley LLP

4401 Eastgate Mall

San Diego, CA 92121

Attention: Steven M. Przesmicki, Esq.

Facsimile: (858) 550-6420

19.

 

(b)If to the Purchaser, notices shall be addressed to:

QIAGEN NORTH AMERICAN HOLDINGS, INC.

19300 Germantown Road

Germantown, MD  20874

Attention:  General Counsel

 

With copies to:

Dr. Philipp von Hugo

QIAGEN GmbH

QIAGEN Strasse 1

40724 Hilden

Germany

Facsimile:  011 49 2103 29 21844

 

With a copy to:

 

Mintz, Levin, Cohn, Ferris, Glovsky & Popeo, P.C.

One Financial Center

Boston, MA 02111

Attention:  Daniel Follansbee

Facsimile: 617-542-2241

9.11Headings.  The headings of the various sections of this Agreement have been inserted for convenience of reference only and shall not be deemed to be part of this Agreement.

9.12Disclaimer.  EXCEPT AS EXPRESSLY SET FORTH IN THIS AGREEMENT, NEITHER PARTY MAKES ANY REPRESENTATION OR WARRANTY TO THE OTHER PARTY OF ANY NATURE, EXPRESS OR IMPLIED, WITH RESPECT TO THE SUBJECT MATTER OF THIS AGREEMENT.

9.13Limitation of Liability.  NEITHER PARTY SHALL BE ENTITLED TO RECOVER FROM THE OTHER PARTY ANY SPECIAL, INCIDENTAL, CONSEQUENTIAL OR PUNITIVE DAMAGES IN CONNECTION WITH THIS AGREEMENT.

9.14WAIVER OF JURY TRIAL.  IN ANY ACTION, SUIT, OR PROCEEDING IN ANY JURISDICTION BROUGHT BY ANY PARTY AGAINST ANY OTHER PARTY, THE PARTIES EACH KNOWINGLY AND INTENTIONALLY, TO THE GREATEST EXTENT PERMITTED BY APPLICABLE LAW, HEREBY ABSOLUTELY, UNCONDITIONALLY, IRREVOCABLY AND EXPRESSLY WAIVES FOREVER TRIAL BY JURY.

[Signature Page Follows]

 

 

20.

 

In Witness Whereof, the parties hereto have caused this Stock Purchase Agreement to be executed by their duly authorized representatives as of the day and year first above written.

		
	
HTG Molecular Diagnostics, Inc.

	
 

	
By:
	
/s/ Timothy B. Johnson

	
 
	
Timothy B. Johnson

	
 
	
President and Chief Executive Officer

 

		
	
QIAGEN North American Holdings, Inc.

	
 

	
By:
	
/s/ Roland Sackers

	
 
	
Roland Sackers

	
 
	
Chief Financial Officer QIAGEN

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