Document:

ex10-17.htm

    
      

    

    Exhibit 10.17

     

    
      

      LICENSE
AND DEVELOPMENT AGREEMENT

       

      
        	 	THIS AGREEMENT,
      effective this 14 day of July, 2008, between	 
	 	 	 
	 	
                HEALTH
      DISCOVERY CORPORATION, a corporation of the State of Georgia, with its
      principal place of business at 2 East Bryan Street, Suite 601, Savannah,
      Georgia 31401, hereinafter referred to as “HDC,”

              	 
	 	 	 
	 	
                and

              	 
	 	 	 
	 	
                DCL
      MEDICAL LABORATORIES, LLC,

                a
      limited liability company of the State of Delaware, with its principal
      place of business at 9550 Zionsville Road, Suite 200, Indianapolis,
      Indiana 46268, hereinafter referred to as “DCL”

              	 

      

       

      
      

      W I T N E S S E T H, That:

      

      WHEREAS,
HDC is the assignee, licensee, and owner of exclusive patent rights in
technology covering support vector machines and other learning machine methods
for analysis of data and signal processing, collectively the “SVM
Technology”;

       

      WHEREAS,
HDC also possesses technical expertise and know-how for the use and exploitation
of the SVM Technology and is willing to apply this expertise for development of
computer-assisted screening automat;

       

      WHEREAS,
DCL employs physicians with board certifications in anatomic pathology and
specialist certification in cytopathology and has access to cervical cytology
specimens and owns and operates laboratories to prepare and test cervical
cytology slides utilizing cytotechnologists trained in cytology screening
services;

       

      WHEREAS,
DCL desires to obtain the right to use such technical information and patent
rights on the terms set forth hereinbelow; and

      

      WHEREAS,
the parties desire to collaborate to develop and commercialize an automated
procedure for cervical cytology screening and cancer screening from solid
tissues in specific disease areas (the “Program”).

      

      NOW,
THEREFORE, in consideration of the promises and the mutual covenants herein
contained, and other good and valuable consideration, the receipt of which are
acknowledged by the parties, the parties agree as follows:

       

      
        
          
          

        

        
          
          

          
            

          

        

        
          
          

        

      

      
ARTICLE I –
DEFINITIONS

      

      As used in this Agreement the
following terms, whether singular or plural, shall have the following
meanings:

      

      A.           “Confidential
Information” shall mean technical information and know-how relating to the
Licensed Technology and its use in Screening Services, disclosed by one party
(the “Disclosing Party”) to the other party (the “Recipient”) prior to
termination of this Agreement and designated or confirmed in writing to be
confidential, except such information (1) that is or becomes known publicly
through no fault of  Recipient, (2) that is learned by Recipient from
a third party entitled to disclose it, or (3) that was already known to
Recipient at the time of disclosure by the Disclosing Party as shown by
Recipient’s prior written records.

      

      Information shall not be deemed to be
within the foregoing exceptions merely because it is embraced within broader or
general disclosures known to the public or the Recipient party, and any
combination of features shall not be deemed to be within the foregoing
exceptions merely because individual features are known to the public or to the
Recipient unless the whole combination of features and its principle of
operation are known.

      

      B.           “Effective
Date” shall mean the date indicated above as the effective date of this
Agreement.

      

      C.           “Field”
shall mean the discovery, research, development, manufacture and
commercialization of clinical laboratory testing services in the areas of
cervical cytology, ovarian cancer, and endometrial cancer
screening.

      

      D.           “License”
shall mean the license granted pursuant to Article II of this
Agreement.

      

      E.           “Licensed
Technology” shall mean the Licensed Patents and Confidential Information of
HDC.

      

      F.           “Licensed
Patents” shall mean those patents and patent applications in existence as of the
Effective Date and listed in Schedule A, and any divisions, continuations and
continuations-in-part or their equivalents, any patents issuing on these
applications including re-issues and reexaminations and the foreign equivalents
thereof, all of which will be automatically added to Schedule A and made a part
of this Agreement.

      

      G.           “Licensed
Territory” shall mean worldwide.

      

      
        ARTICLE II - GRANT OF
LICENSE

      

      

      A.           As
of the Effective Date of this Agreement, HDC hereby grants to DCL a nonexclusive
license under the Licensed Technology in the Field in the Licensed Territory;
and

       

      
        
          
          

        

        
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      B.           As
of the Effective  Date of this Agreement, HDC hereby grants to DCL a
Sole License (as defined below), without the right to grant sublicenses, to the
Applications (as hereinafter defined).  For purposes of this Agreement
a  Sole License means, if HDC owns (defined by equity ownership of
more than fifty (50) percent of the total issued equity in the company) and
operates a commercial CLIA certified one or more laboratories (each, an “HDC
Lab”), then, subject to the requirements of Article II,B,
hereunder,  such HDC Lab may utilize the Licensed Technology to
commercialize Services in the Licensed Territory.  For the avoidance
of doubt, HDC may not license the Applications to any third party during the
term of this Agreement.

       

      C.           For
any Rejected Application, as hereinafter defined, the Sole License granted under
Paragraph B above shall be converted to a nonexclusive license.

       

      ARTICLE III – ROLE OF THE
PARTIES

      

      A.           Role of
HDC

       

      (1)           HDC
will reimburse DCL commercially reasonable fees for services of the digital
scanning and imaging entities retained by DCL as specified in a trial protocol
to be completed and attached to this Agreement (the “Protocol”).  DCL
will be responsible for contracting with third parties for such
services.

       

      (2)           HDC
will use commercially reasonable efforts to develop new image analysis-based
systems for analysis of digital images (the “Images”) provided by DCL, utilizing
the SVM Technology (the “Applications”).

       

      (3)           Upon
completion of the testing of the Applications, HDC will promptly report the
sensitivity and specificity results to DCL.

       

      (4)           HDC
will provide to DCL the results of analysis of a second set of Images using the
Applications to allow DCL to compare the performance of the Applications between
the results of the first set of Images and the second set of Images for
validation of the Applications.

       

      (5)           If
the results of the validation testing do not indicate acceptable performance as
determined by DCL, HDC will refine the Applications as needed to improve the
performance. If any Application fails to achieve acceptable performance within a
commercially reasonable time period, but in no event longer than ninety (90)
days, DCL shall have the option to terminate the Application upon thirty (30)
days’ prior written notice to HDC.

       

      (6)           HDC
will be responsible for preparation and submission of all documents, filings and
associated fees related regulatory requirements for intellectual property rights
and commercial distribution of the test as required by the U.S. Food and Drug
Administration.

       

      
        
          
          

        

        
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      B.           Role of
DCL

       

      (1)           DCL
will provide up to 400 deidentified, remnant cervical cytology slides that were
prepared using Cytyc Thin Prep Pap Test system.  Such slides will be
processed in accordance with testing procedures required for scanning using an
Aperio ScanScope® or other similar cellular imaging system for conversion to
digital images.  Should Cytyc ThinPrep Pap Test slides not conform to
Aperio requirements, the parties will work together to identify a suitable
cytology processing method.

       

      (2)           DCL
will provide up to 200 each of deidentified, remnant ovarian cancer and
endometrial cancer slides that were prepared using standard medically acceptable
anatomic pathology stains.  Such slides will be utilized in accordance
with testing procedures required for scanning using an Aperio ScanScope® or
other similar cellular imaging system for conversion to digital
images.  Should these slides not conform to Aperio requirements, the
parties will work together to identify a suitable processing
methods.

       

      The deidentified remnant slides
(cervical cytology, ovarian and endometrial cancer) shall be referred to
collectively as the “Slides.”

      

      (3)           DCL
will cause the Slides to be independently screened by at least one certified
cytotechnologist and one cytopathologist in case of cervical cancer and anatomic
pathologist for ovarian and endometrial cancer.  Concordance of the
independent review will be used to determine an accurate diagnosis. If the
independent diagnoses do not agree on a Slide, the Slide will be discarded, or
accepted as indicated by the Protocol.

       

      (4)           DCL
will cause the pre-screened Slides to be scanned to generate
Images.  If scanning is not performed by DCL, the slides may be
submitted to a mutually-agreed third party, such as Aperio Digital Slide
Scanning Service.

       

      (5)           Within
sixty (60) days after the Effective Date, DCL will provide a first set of Images
to HDC along with deidentified clinical data associated with the Images
(“Clinical Data”) solely for use in the development of a new
Application.

       

      (6)           During
a ninety (90)-day period beginning with the date of execution of the parties’
Letter of Intent, DCL will make available a cytotechnologist, a cytopathologist
and anatomic pathologists to consult with HDC to provide detailed information
regarding characteristics of the Images and diagnoses associated with those
characteristics.  DCL shall provide up to a total of two hundred-forty
(240) hours of technologist and pathologist time in said ninety (90)-day period.
For avoidance of doubt, the two hundred-forty (240) hours is the combined time
of the cytotechnologist and cytopathologist.

       

      (7)           Within
thirty (30) days after HDC has reported the results of the testing of the new
Application using the first set of Images per Article III.B(3), DCL will provide
a second set of up to 200 Images to HDC to be used for validation of the
Applications.

       

      (8)           DCL
will compare the results of HDC’s analysis of the second set of Images to
outcomes data determined by a cytopathologist in case of cervical cancer and an
anatomic pathologist in case of ovarian and endometrial cancer and will report
the results of that comparison to HDC.

       

      
        
          
          

        

        
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      (9)           DCL
will provide HDC with all data generated under the validation, clinical trial
protocols, and commercial use of the Application to HDC as required for HDC to
prepare any required regulatory submissions for commercial
distribution.

      

      ARTICLE IV –
COMMERICALIZATION

      

      A.           Marketing and Profit
Sharing

       

      (1)           Upon
the validation of the new Application as determined by DCL, DCL will use
commercially reasonable efforts to initiate a commercial, laboratory-developed
screening service for analysis of Images of cervical cytology, and independently
for ovarian cancer and endometrial cancer slides (the “Services”), provided
that:  (i) such Services are within DCL’s scope of test offerings;
(ii) there is an existing market for Services; (iii) there is a billable CPT
code for Services; and (iv) such Services are in compliance with applicable
governmental laws, rules and regulations.

       

      (2)           DCL
will be responsible for the marketing of the Services.

       

      (3)           In
the event DCL decides not to commercialize Services within six (6) months
following the validation of a new Application or ceases to commercialize the
Services for any of the Applications for a period of at least six months
(“Rejected Applications”), then in addition to HDC’s limited rights under
Article II.A., HDC shall have the right to commercialize any such Rejected
Application subject to the requirements of this Article IV.

       

      (4)           DCL
will pay to HDC fifty percent (50%) of profits from providing the
Services.  The profits shall be based on total reimbursed amounts for
such Services by DCL, less direct costs of performing such Services to
include  reagent, instrument, imaging costs, billing, direct labor,
and shipping costs (if applicable).  Profits shall not be reduced by
non-employee corporate management and ownership expenses, , or marketing or
executive management bonus programs. Should the Service not have a billable CPT
code that generates revenue per test greater than reimbursement for a computer
assisted imaged cancer slide at the time of commercialization, DCL shall have no
obligation to commercialize the test, but shall use commercially reasonable
efforts to conduct a clinical utility study with specific commercial medical
practices to demonstrate the commercial utility of the Application and, where
possible, may prepare a manuscript for publication detailing the results of such
study.

       

      (5)    If HDC
commercializes an Application and offers Services as permitted in Article II,
B,_above, HDC will pay DCL twenty-five (25%) percent of profits from providing
the Services.  The profits shall be based on total reimbursed amounts
for such Services by DCL, less direct costs of performing such Services to
include  reagent, instrument, imaging costs, billing, direct labor,
and shipping costs (if applicable).  Profits shall not be reduced by
non-employee corporate management and ownership expenses, , or marketing or
executive management bonus programs.

       

      (6)           In
the event HDC sells or licenses a Rejected Application to a third
party,  HDC will pay to DCL twenty-five (25%) of HDC’s profits from
such a transaction. If such proceeds include a non-monetary component, such
component shall be appraised for its fair market value and paid at twenty-five
(25%) of the total cash equivalent.

       

      
        
          
          

        

        
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      B.           
Limitations on HDC’s
Liability

      

      While it is expected that the Licensed
Technology will enable DCL to develop and carry out Services on a commercial
scale, HDC does not warrant or guarantee that such results will be obtained, and
HDC shall not be liable to DCL because of any failure in the operations of
DCL.  Moreover, while it is believed that the ordinary and anticipated
use of Licensed Technology or Services based thereon, will not result in safety
or health hazards to workers or to purchasers of such Services, HDC does not
warrant or guarantee against health or safety hazards.

       

      HDC
further expressly excludes any and all implied representations, conditions and
warranties that:

       

      (i)           the
Licensed Patents are valid or enforceable;

      

      
        	
                 
      

              	
                (ii)

              	
                any
      manufacture, use, importation, sale, lease, or other disposal of Services
      will not infringe any patent or other intellectual property not owned by
      or licensed to HDC; and

              

      

      

      
        	
                 
      

              	
                (iii)

              	
                HDC
      has any obligation to bring or prosecute actions or suits against third
      parties  for infringement of the Licensed
    Patents.

              

      

      

      

      C.           Indemnity

      (1)           HDC
shall indemnify and hold DCL harmless from: (1) any claim of infringement of any
intellectual property right of a third party connected with the Licensed
Technology and the Services based thereon, developed, manufactured, used or sold
by DCL that includes in whole or in part any of the Licensed Technology; (2) any
claim for injury, damages, or any other harm alleged to be caused to any third
party (“Claim”) by Services provided by HDC or its licensees unless such Claim
results from the negligence or willful misconduct of DCL.  In
accordance with the foregoing, HDC shall be obligated to defend DCL in any cause
of action commenced against HDC, or in which HDC is named as a party, for a
Claim unless such Claim results from the negligence or willful misconduct of
HDC.

      

      (2)           DCL
shall indemnify and hold HDC harmless from any Claim
by  Services  provided by DCL unless such Claim results from
the negligence or willful misconduct of HDC.  In accordance with the
foregoing, DCL shall be obligated to defend HDC in any cause of action commenced
against HDC, or in which HDC is named as a party, for a Claim unless such Claim
results from the negligence or willful misconduct of DCL.

      

      (3)           In
either case, the indemnity shall include all penalties, settlements, awards, and
judgments; all court and arbitration costs; attorneys’ fees; and other
reasonable out-of-pocket expenses and costs incurred by DCL or HDC, as the case
may be, in connection with such claims or causes of action.  DCL or
HDC, as the case may be, shall have the right to control the defense of any such
litigation, and to settle or compromise all claims and lawsuits subject to its
indemnity, provided however, that DCL or HDC, as the case may be, may not settle
or compromise any such claim or lawsuit without the prior written consent of DCL
or HDC, as the case may be, which consent shall not be unreasonably withheld, if
any settlement or compromise (a) requires HDC or DCL, as the case may be, to
part with any right or to make any payment not indemnified, or (b) subjects HDC
or DCL, as the case may be, to any injunction.  Subject to the
foregoing, HDC or DCL shall have the right, at its option and expense, but not
the obligation, to retain advisory counsel to represent its interests in
defending any such claim or lawsuit.  The parties’ obligation to
indemnify and hold each other harmless shall survive the termination of this
Agreement for any reason.

       

      
        
          
          

        

        
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      D.           Confidentiality and Limited
Use Provisions

      

      (1)           DCL
shall have the right to use HDC’s Confidential Information only in connection
with performance under this Agreement, including without limitation the
development and commercialization of Services.  Except as specifically
provided herein, prior to the fifteenth (15th) anniversary of the Effective Date
of this Agreement, which period is anticipated to be the useful life of HDC’s
Confidential Information transmitted to DCL hereunder, DCL shall not disclose
any Confidential Information of HDC to any party or furnish to any party any
equipment embodying any such Confidential Information; provided, however, that
either party may disclose the portion of the Confidential Information relevant
in a given situation to any government agency concerned with public health or
safety provided that:

      

      (a)           the
agency agrees to treat the disclosed portion of Confidential Information as
proprietary and confidential or failure to make the disclosure would
substantially adversely affect the ability of DCL to market or continue to sell
Services, and

      

      
        (b)    HDC is
informed in advance of the proposed disclosure.

      

      

      (2)           HDC
shall use the Slides, Images, Clinical Data and DCL Confidential Information
only in connection with the performance under this Agreement and will not
disclose such Slides, Images, Clinical Data or DCL Confidential Information to
any third party without DCL’s prior written consent, not unreasonably withheld
or delayed.  Upon termination or expiration of the Agreement, HDC will
return to DCL or destroy any Slides, Images, Clinical Data or DCL Confidential
Information at the direction of DCL.

       

      (3)           If
DCL or HDC is compelled by law to disclose any portion of the Confidential
Information without a guarantee of confidentiality, the parties will notify each
other and consent to the other party’s in­tervention to the extent of
presenting arguments for the preservation of the confidentiality of the
Confidential Information.

      

      (4)   HDC agrees to comply with
all applicable laws, rules and regulations applicable to the use of the Slides
and Clinical Data including the Health Insurance Portability Act of 1996 as may
be amended from time to time (“HIPPA”).

       

      
        
          
          

        

        
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      ARTICLE V – REPORTS,
REMITTANCES AND RECORDS

      

      A.           Reports and
Remittances

      

      (1)           DCL
shall report in writing to HDC within thirty (30) days after the end of each
calendar quarter the quantities of screening tests performed, associated
revenue,  applicable expenses and the calculation of the fees thereon
during said quarter.  With said report DCL shall pay to HDC the total
amount of the said fees.  Reports, notices and other communications to
HDC hereunder shall be sent to:

      

      Steve D.
Barnhill, M.D.

      2 East
Bryan Street, Suite 601

      Savannah,
GA 31401

      

      Each
payment to HDC hereunder shall be made by wire transfer of immediately available
funds:

      

      Bank of
America

      Attn:  Patrick
S. O’Neil

      200 Bull
Street

      Savannah,
GA 31401

      

      

      

      (2)           
In the event HDC:  (a) sells Services through a HDC Lab as permitted
hereunder; or (b) licenses a Rejected Application to a third party, HDC shall
report in writing to DCL within thirty (30) days after the end of each calendar
quarter the performed, associated revenue, applicable expenses and the
calculation of the fees payable thereon during said quarter.   of
..  With said report HDC shall pay to DCL the total amount of the said
fees.   Reports, notices and other communications to DCL shall be
sent to:  Michael Hanbury, Ph.D., President and CEO, 9550 Zionsville
Rd., Indianapolis, IN 46077.  Each payment to DCL hereunder shall be
made by check of immediately available funds to:

       

      
        
          
          

        

        
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      DCL
Medical Laboratories

      Attn: Jim
Bucher

      9550
Zionsville Road

      Indianapolis,
IN 46268

      

      B.            Taxes

      

      DCL shall pay all taxes and charges
imposed by any government or taxing authority (other than the United States or a
subdivision thereof) with respect to payments by DCL to HDC for transfer of the
Licensed Technology.  To the extent DCL is required to withhold such
taxes or charges, the amounts due from DCL to HDC shall be recalculated so as to
yield to HDC, after deduction for such taxes or charges, the amounts otherwise
due.

      

      C.           
Late Payment and Right
to Offset Nonpayments

      

      If any sum of money owed to either
party hereunder is not paid when due, the unpaid amount shall bear interest,
compounded annually, at an annual rate two (2) percentage points above the prime
rate quoted by the Bank of America on the day payment was due, until paid or
offset.

      

      D.           Records

      

      (1)           For
a period of three (3) years following the applicable reporting quarter, DCL
shall keep adequate records in sufficient detail to enable the fees due from DCL
hereunder to be determined, and permit said  records to be inspected
upon commercially reasonable notice to DCL (but in no event, more than once per
calendar year), during regular business hours by an independent auditor
appointed by HDC and approved by DCL solely for this purpose, who shall report
to HDC only the amount of the fees due hereunder. Any such audit will be at the
expense of HDC unless a discrepancy of 5% or more is found, in which case DCL
shall pay for the audit.

      

      (2)           
For a period of three (3) years following the applicable reporting quarter, HDC
shall keep, and require each sublicensee to keep, adequate records in sufficient
detail to enable the fees due from HDC hereunder to be determined, and permit
said  records to be inspected upon commercially reasonable notice to
HDC (but in no event, more than once per calendar year), during regular business
hours by an independent auditor appointed by DCL and approved by HDC solely for
this purpose, who shall report to DCL only the amount of the fees due
hereunder.  Any such audit will be at the expense of DCL unless a
discrepancy of 5% or more is found, in which case HDC shall pay for the
audit.

      

      ARTICLE VI – INTELLECTUAL
PROPERTY 

       

      A.           HDC
shall retain exclusive ownership rights in the intellectual property relating to
any methods, discoveries or products derived from development work initiated by
HDC prior to the Effective Date.

       

      B.           DCL
shall retain exclusive ownership rights in the Slides, Clinical Data, and DCL’s
intellectual property relating to any methods, discoveries or products derived
from development work initiated by DCL prior to the Effective Date. DCL owns the
Slides and Clinical Data as of the Effective Date.

       

      
        
          
          

        

        
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      C.           HDC
shall own and have the right to use the intellectual property relating to any
Application and new mathematical or other tools developed during the course this
License and Development Agreement, subject to the terms and conditions
hereunder.

       

      D.           To
the extent that the development, sale, manufacture, offer for sale, importation
or use of the Service infringes any existing intellectual property rights owned
or controlled by HDC, HDC hereby grants to DCL a royalty-free license to such
intellectual property for use in the development, manufacture, offer for sale,
sale, use and importation of Services.

       

      
        ARTICLE VII –
TERMINATION

      

      

      A.           Normal
Termination

      

      Unless terminated earlier as
hereinafter provided, and subject to the provisions of paragraph (B) of this
Article, this Agreement shall terminate on the fifteenth (15th) anniversary of
its Effective Date or
upon the expiration of the last of the patents licensed hereunder, whichever
date shall later occur.

      

      B.           
Surviving
Obligations

      

      (1)           The
termination of this Agreement shall not relieve either party of (a) any
obligation hereunder to keep records, (b) to make payment of any sum due under
this Agreement and (c) to furnish written reports as provided
herein.

      

      (2)           The
termination of this Agreement shall not relieve DCL of any liability hereunder
for damages to HDC resulting from the unauthorized disclosure or use of any
Confidential HDC Information by any engineering firm, equipment manufacturing
firm or other party or person; or

      

      (3)           The
termination of this Agreement shall not relieve HDC of any obligation hereunder
to maintain the confidentiality of DCL’s Confidential Information, including
without limitation, Slides, and Clinical Data, and of any liability hereunder
for damages to DCL resulting from the unauthorized disclosure or use of DCL
Confidential Information, including without limitation, Slides, and Clinical
Data, and to return or destroy such Slides, Images and Clinical Data as directed
by DCL.

      

      (4)           The
termination of this Agreement shall not terminate either party’s rights under
Article IV.

      

      C.           
Termination for
Breach

      

      In the event that any stipulation or
provision of this Agreement is breached by a party, the non-breaching party may
terminate this Agreement upon sixty (60) days’ written notice to the other
party.  However, if such breach is corrected within the sixty (60)-day
period, and there are no unreimbursed damages resulting from the breach, this
Agreement shall continue in force.

       

      
        
          
          

        

        
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      D.           
Insolvency

      

      Should a party (1) become insolvent or
unable to pay its debts as they mature, or (2) make an assignment for the
benefit of creditors, or (3) permit or procure the appointment of a receiver for
its assets, or (4) become the subject of any bankruptcy, insolvency or similar
proceeding, then the other party may at any time thereafter on written notice to
the first party, effective forthwith, cancel this Agreement.

      

      E.            
Effect of Early
Termination

      

      Should this Agreement be terminated
prior to the fifteenth (15th) anniversary of the Effective Date of this
Agreement, then neither party shall neither use or disclose any Confidential
Information of the other party or furnish to any party any equipment embodying
the same, until after said fifteenth (15th) anniversary.  Furthermore,
each party  shall return to the other party  all
Confidential Information provided pursuant to this Agreement, together with all
reproductions thereof, and all copies of notebooks, reports, manuals,
blueprints, drawings and the like embodying any Confidential Information in the
possession of the respective party .

      

      E.            
Termination by
DCL

      

      DCL may terminate an Application upon
thirty (30) days’ written notice to HDC in the event an Application is not
validated within twelve (12) months after the Effective Date.

       

      
        ARTICLE VIII -
ASSIGNABILITY

      

      

      Neither this Agreement nor the rights
or licenses granted hereunder shall be assignable or otherwise transferable by
either party; provided, however that (a) in the event of the acquisition of the
business and assets of DCL, payment of the fees under the Rejected Application
provisions in Article VI of this Agreement shall continue and inure to the
benefit of any successor of DCL in connection with a merger, consolidation, or
sale or transfer of all or substantially all of DCL’s assets or that portion of
its business pertaining to the subject matter of this Agreement without the
prior written consent of the other party and (b) in the event of the acquisition
of the business and assets of HDC, the assignee or successor shall retain all of
the rights HDC acquired under this Agreement. In either case,  the
acquiring party shall assume all of the obligations of the acquired party under
this Agreement. For the avoidance of doubt, license rights granted to DCL under
Article II of this Agreement shall not be assignable to any successor in
connection with a merger, consolidation, or sale or transfer of all or
substantially all of its assets or that portion of its business pertaining to
the subject matter of this Agreement without the express prior written consent
of HDC.

      

      
        
          
          

        

        
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        ARTICLE IX - APPLICABLE
LAW

      

      

      This Agreement is acknowledged to have
been made in and shall be construed in accordance with the laws of the State of
Delaware without regard to the principles thereof relating to the conflict of
laws, provided that all questions concerning the construction or effect of
patent applications and patents shall be decided in accordance with the laws of
the country in which the particular patent application or patent concerned has
been filed or granted, as the case may be.

      

      ARTICLE X - FORCE
MAJEURE

      

      Neither party shall be responsible to
the other for delay or failure in performance of any of the obligations imposed
by this Agreement, provided such delay or failure shall be occasioned by a cause
beyond the control of and without the fault or negligence of such
party,  including fire, flood, explosion, lightning, windstorm,
earthquake, subsidence of soil, failure of machinery or equipment or supply of
materials, discontinuity in the supply of power, court order or governmental
interference, civil commotion, riot, war, terrorism or terroristic threats,
strikes, labor disturbances, transportation difficulties or labor
shortage.  Notwithstanding the aforesaid, if either party fails to a
substantial extent for at least three (3) months to fulfill any of its
obligations under this Agreement, the other party may terminate the
Agreement.

      

      
        ARTICLE XI – DISPUTE
RESOLUTION

      

      

      In the event that a dispute arises
between the parties, the following procedures shall be followed:

      

      
        A.    Negotiations

      

      

      In the event that any dispute may
arise, the parties shall first seek to resolve any disputes by negotiation among
senior executives who have authority to settle the controversy, as
follows:

      

      (1)           Notification.  When
a party believes there is a dispute relating to the Agreement, the party will
give the other party written notice of the dispute.

      

      (2)           Meeting
Among Senior Executives.  The senior executives shall meet at a
mutually acceptable time and place within thirty (30) days after the date of the
notice to exchange relevant information and to attempt to resolve the
dispute.  

      

      (3)           Confidentiality.  All
negotiations are confidential and shall be treated as compromise and settlement
negotiations under the United States Federal Rules of Evidence.

      

      
        B.    Mediation

      

      

      If the
dispute has not been resolved within thirty (30) days after the date of the
notice of a dispute, or if the party receiving such notice fails or refuses to
meet within such time period, either party may initiate mediation of the dispute
by sending the other party a written request that the dispute be
mediated.  The party receiving such a written request will promptly
respond to the requesting party so that all parties can jointly select a neutral
and impartial mediator and schedule the mediation session.  The
parties shall mediate the dispute before a neutral, third-party mediator within
thirty (30) days after the date of the written request for
mediation.

       

      
        
          
          

        

        
          12

          
            

          

        

        
          
          

        

      

       

      
        C.    Arbitration

      

      `

      
        	
                 
      

              	
                Arbitration

              

      

      

      (1) Any controversy or claim arising
out of or relating to this Agreement, or the breach thereof, and not settled as
described in Article XII (A) or (B) that is not an “Excluded Claim”, shall be
settled by binding arbitration in accordance with the Commercial Arbitration
Rules and Supplementary Procedures for Large Complex Disputes of the American
Arbitration Association, and judgment on the arbitration award may be entered in
any Court having jurisdiction thereof.

      

      (2) The arbitration shall be conducted
by a panel of three (3) persons experienced in the clinical laboratory,
biotechnology or diagnostics business.  Within thirty (30) days after
initiation of arbitration, each party shall select one person to act as
arbitrator and the two party-selected arbitrators shall select a third
arbitrator within thirty (30) days of their appointment.  If the
arbitrators selected by the parties are unable or fail to agree upon the third
arbitrator, the third arbitrator shall be appointed by the AAA.  The
place of arbitration shall be New York, New York, and all proceedings and
communications shall be in English.

      

      (3) Either party may apply to the
arbitrators for interim injunctive relief until the arbitration award is
rendered or the controversy is otherwise resolved.  Either party also
may, without waiving any remedy under this Agreement, seek from any court having
jurisdiction any injunctive or provisional relief necessary to protect the
rights or property of that party pending the arbitration award.  The
arbitrators shall have no authority to award punitive or any other type of
damages not measured by a party’s compensatory damages.  Each party
shall bear its own costs and expenses and attorneys’ fees and an equal share of
the arbitrators’ and any administrative fees of arbitration.

      

      (4)  Except to the extent
necessary to confirm an award or as may be required by law, neither a party nor
an arbitrator may disclose the existence, content, or results of an arbitration
without the prior written consent of both parties.  In no event shall
arbitration be initiated after the date when commencement of a legal or
equitable proceeding based on the dispute, controversy or claim would be barred
by the applicable Delaware statute of limitations.

      

      (5)  As
used in this Article, the term “Excluded Claim” shall mean a dispute,
controversy or claim that concerns (a) the validity or infringement of a patent;
or (b) any antitrust, anti-monopoly or competition law or regulation, whether or
not statutory.

       

      
        
          
          

        

        
          13

          
            

          

        

        
          
          

        

      

      

      ARTICLE XII – MISCELLANEOUS
PROVISIONS

      

      A.           
HDC and DCL each has all necessary corporate power to enter into and perform its
obligations under this Agreement and has taken all necessary corporate action
pursuant to its certificate of incorporation and by-laws to authorize the
execution and consummation of this Agreement.

       

      B.           
The use and disclosure of technical information acquired pursuant to this
Agreement and the exercise of the rights granted by this Agreement shall be
subject to the export, assets and financial control regulations of the United
States of America and (country), including restrictions under regulations of the
United States that may be applicable to direct or indirect
reexportation.

       

      C.           
No license or right is granted by implication or otherwise with respect to any
patent application, patent, trademark or copyright except as specifically set
forth herein.  No right is granted by this Agreement to use any
registered or unregistered trademark or trade name of either party.

       

      D.           
The rights and remedies provided in this Agreement are cumulative and not
exclusive of any rights or remedies provided by law or in equity.

       

      E.           
Unless required by law or in accordance with any obligation to a governmental
authority, neither HDC nor DCL shall make any public statement or other
disclosure of the existence or terms of this Agreement or the License without
the express prior written consent of the other party as to the nature and
substance of such statement or other disclosure. However, it is the expectation
of the parties that they will issue a joint press release announcing this
Agreement and the License granted hereunder promptly after the Effective
Date.

       

      F.           
This Agreement embodies the entire understanding of the parties and shall
supersede all previous communications, representations, undertakings, letters of
intent or agreements, specifically the Letter of Intent executed by the parties
effective [_________]between them, either verbal or written, relating to the
subject matter hereof.  No modifications, extensions or waiver of any
provision hereof or release of any right hereunder will be valid unless the same
is in writing and consented to by both parties.  This Agreement may be
amended only by a written agreement signed by both parties.

       

      G.           
This Agreement shall be binding upon and inure to the benefit of the parties
hereto and upon their respective successors, and permitted
assignees.

       

      H.           
It is expressly agreed that HDC and DCL shall be independent contractors and
that the relationship between the two parties shall not constitute a
partnership, joint venture or agency.  Neither HDC nor DCL shall have
the authority to make any statements, representations or commitments of any
kind, or to take any action, which shall be binding on the other party, without
the prior written consent of the other party.

       

      
        
          
          

        

        
          14

          
            

          

        

        
          
          

        

      

       

      IN WITNESS WHEREOF, the parties have
executed this Agreement and have entered the effective date on the first page
hereof.

      

      
        	 
      	HEALTH
      DISCOVERY CORPORATION
	 
      	 
      	 
      	 
      
	 
      	
                By

              	/s/
      Stephen D. Barnhill, M.D.  	 
      
	 
      	 
      	 
      	 
      
	 
      	
                Name

              	
                Stephen D. Barnhill,
      M.D. 

              	 
      
	 
      	 
      	 
      	 
      
	 
      	
                Title

              	CEO	 
      
	 
      	 
      	 
      	 
      
	 
      	
                Date

              	7-14-08	 
      
	 
      	 
      	 
      	 
      
	 
      	 
      	 
      	 
      
	 
      	DCL
      MEDICAL LABORATORIES, LLC
	 
      	 
      	 
      	 
      
	 
      	
                By

              	/s/
      Michael Hanbury	 
      
	 
      	 
      	 
      	 
      
	 
      	
                Name

              	
                Michael
      Hanbury

              	 
      
	 
      	 
      	 
      	 
      
	 
      	
                Title

              	President	 
      
	 
      	 
      	 
      	 
      
	 
      	
                Date

              	7-14-08	 
      

      

       

      
        
          
          

        

        
          15

          
            

          

        

        
          
          

        

      

       

      SCHEDULE
A

      

      
        	 
      	 
      	
                Normal

              
	
                Country

              	
                Patent
      No.

              	
                Expiry
      Date

              
	 
      	
                (Patent Application
      No.)

              	
                (Filing
      Date)

              

      

       

       

       

       

       

       

       

       

      16Employment agreement dated September 16, 2008

 Exhibit 10.1 
 Confidential                 
 AGREEMENT 
 AGREEMENT made and entered into in New
York, New York, by and between Antigenics Inc. (the “Company”), a Delaware corporation with a principal place of business at 162 Fifth Ave Suite 900 New York, NY, and Karen Higgins Valentine (the “Executive”), effective as of the
16th day of September, 2008 (the “Effective Date”) (the “Agreement”). Words or phrases which are initially capitalized or are
within quotation marks shall have the meanings provided in Section 14 below and as provided elsewhere herein. 
 WHEREAS, the operations
of the Company and its Affiliates are a complex matter requiring direction and leadership in a variety of arenas; 
 WHEREAS, the Executive
is possessed of certain experience and expertise that qualify him/her to provide the direction and leadership required by the Company; and 
 WHEREAS, subject to the terms and conditions hereinafter set forth, the Company therefore wishes to employ the Executive and the Executive wishes to accept such employment; 
 NOW, THEREFORE, in consideration of the foregoing premises and the mutual promises, terms, provisions and conditions set forth in this Agreement, the
parties hereby agree: 
 1. Employment. Subject to the terms and conditions set forth in this Agreement, the Company hereby offers and
the Executive hereby accepts employment. 
 2. Term. Subject to earlier termination as hereafter provided, this Agreement shall have
an original term of one year commencing on the Effective Date hereof and shall be automatically extended thereafter for successive terms of one year each, unless either party provides notice to the other at least ninety (90) days prior to the
expiration of the original or any extension term this Agreement is not to be extended. The term of this Agreement, as from time to time extended or renewed, is hereafter referred to as “Term”. 
 3. Capacity and Performance. 
 (a)
During the Term hereof, the Executive shall be employed by the Company on a full-time basis and shall perform such duties and responsibilities on behalf of the Company and its Affiliates as may be designated from time to time consistent with his/her
position. In addition, and without further compensation, the Executive shall serve as a director and/or officer of one or more of the Company’s Affiliates if so elected or appointed from time to time. 
 (b) During the Term hereof, the Executive shall devote his/her best efforts, business judgment, skill and knowledge to the advancement of the business
and interests of the Company and its Affiliates and to the discharge of his/her duties and responsibilities hereunder. The Executive shall not engage in any other business activity or serve in any industry, trade, professional, governmental or
academic position during the Term of this Agreement, except as may be approved by the Board of Directors of the Company (the “Board”) or its designee. 

 4. Compensation and Benefits. As compensation for all services performed by the Executive under
and during the Term hereof and subject to performance of the Executive’s duties and of the obligations of the Executive to the Company and its Affiliates, pursuant to this Agreement or otherwise: 
 (a) Base Salary. During the Term hereof, the Company shall pay the Executive a minimum base salary at the rate of $220,000 per annum, payable in
accordance with the payroll practices of the Company for its executives and subject to increase by the Board, in its sole discretion. Such base salary, as from time to time increased, is hereafter referred to as the “Base Salary”. The
Board shall review the Base Salary no less than annually. 
 (b) Incentive and Bonus Compensation. During the Term hereof, the
Executive shall be entitled to participate in the Company’s Executive Incentive Plan to the extent eligible and in accordance with the terms thereof, as such terms may be modified or amended by the Company from time to time; provided, however,
that nothing contained herein shall obligate the Company to continue such incentive compensation program. The Executive’s target incentive bonus under the Executive Incentive Plan is 30% of his/her Base Salary. Such target may be modified by
the Company from time to time, in its sole discretion. Any compensation paid to the Executive under the Executive Incentive Plan shall be in addition to the Base Salary. 
 (c) Stock Options. The Executive has been granted options to purchase shares of common stock of the Company. At the discretion of the Compensation Committee of the Board, the Executive may be granted
additional options to purchase shares of stock of the Company in the future. Any existing or future grants, shall be governed by the terms of the applicable Company stock option plan, as amended from time to time, and any stock option certificate,
stock option agreement, and other restrictions generally applicable to Company stock options. 
 (d) Vacations. During the Term
hereof, the Executive shall be entitled to four weeks of vacation per annum, to be taken at such times and intervals as shall be determined by the Executive, subject to the reasonable business needs of the Company. 
 (e) Other Benefits. During the Term hereof and subject to any contribution therefor generally required of employees (including executives) of the
Company, the Executive shall be entitled to participate in any and all employee benefit plans from time to time in effect for employees of the Company generally, except to the extent such plans are in a category of benefit otherwise provided to the
Executive. Such participation shall be subject to (i) the terms of the applicable plan documents, (ii) generally applicable Company policies and (iii) the discretion of the Board or any administrative or other committee provided for
in or contemplated by such plan. The Company may alter, modify, add to or delete its employee benefit plans at any time as it, in its sole judgment, determines to be appropriate, without recourse by the Executive. 
 (f) Business Expenses. The Company shall pay or reimburse the Executive for all reasonable, customary and necessary business expenses incurred or
paid by the Executive 

  

 -2- 

 
in the performance of his/her duties and responsibilities hereunder, subject to any maximum annual limit and other restrictions on such expenses as set forth
in the Company’s Travel Policy as may be amended from time to time, and to such reasonable substantiation and documentation as may be specified by the Company from time to time. 
 5. Termination of Employment and Severance Benefits. Notwithstanding the provisions of Section 2 hereof, but subject to Section 6
hereof, the Executive’s employment hereunder shall terminate prior to the expiration of the Term under the following circumstances: 
 (a) Death. In the event of the Executive’s death during the Term hereof, the Executive’s employment hereunder shall immediately and automatically terminate. In the event of the Executive’s death during the Term hereof,
the Company shall pay to the Executive’s designated beneficiary or, if no beneficiary has been designated by the Executive, to his/her estate, any earned and unpaid Base Salary and accrued but unused vacation through the date of his/her death.

 (b) Disability. 
 (i) The Company may terminate the Executive’s employment hereunder, upon notice to the Executive, in the event that the Executive becomes disabled during his/her employment hereunder through any illness, injury,
accident or condition of either a physical or psychological nature and, as a result, is unable to perform substantially all of his/her duties and responsibilities hereunder, with or without a reasonable accommodation, for ninety (90) days
during any period of three hundred and sixty-five (365) consecutive calendar days. 
 (ii) The Board may designate
another employee to act in the Executive’s place during any period of the Executive’s disability. Notwithstanding any such designation, the Executive shall continue to receive the Base Salary in accordance with Section 4(a) and
benefits in accordance with Section 4(e), to the extent permitted by the then-current terms of the applicable benefit plans, until the Executive becomes eligible for disability income benefits under the Company’s disability income plan or
until the termination of his/her employment, whichever shall first occur. 
 (iii) While receiving disability income payments
under the Company’s disability income plan, the Executive shall not be entitled to receive any Base Salary under Section 4(a) hereof, but shall continue to participate in Company benefit plans in accordance with Section 4(e) and the
terms of such plans, until the termination of his/her employment. 
 (iv) If any question shall arise as to whether during any
period the Executive is disabled through any illness, injury, accident or condition of either a physical or psychological nature so as to be unable to perform substantially all of his/her duties and responsibilities hereunder, the Executive may, and
at the request of the Company shall, submit to a medical examination by a physician selected by the Company to whom the Executive or his/her duly appointed guardian, if any, has no reasonable 

  

 -3- 

 
objection to determine whether the Executive is so disabled and such determination shall for the purposes of this Agreement be conclusive of the issue. If
such question shall arise and the Executive shall fail to submit to such medical examination, the Company’s determination of the issue shall be binding on the Executive. 
 (v) In the event the Company terminates the Executive’s employment hereunder due to disability, the Company shall pay to the
Executive any accrued and unpaid Base Salary and accrued but unused vacation through the date of termination. 
 (c) By the Company for
Cause. The Company may terminate the Executive’s employment hereunder for Cause at any time upon fourteen (14) day notice to the Executive setting forth in reasonable detail the nature of such Cause. The following, as determined by the
Company in its reasonable judgment, shall constitute Cause for termination: 
 (i) The Executive’s failure to perform
(other than by reason of disability), or negligence in the performance of, his/her duties and responsibilities to the Company or any of its Affiliates; or 
 (ii) Material breach by the Executive of any provision of this Agreement; or 
 (iii) Other
conduct by the Executive that is materially harmful to the business, interests or reputation of the Company or any of its Affiliates. 
 Upon
the giving of notice of termination of the Executive’s employment hereunder for Cause, the Company shall have no further obligation or liability to the Executive, other than for Base Salary earned and unpaid and accrued vacation earned but not
taken at the date of termination. 
 (d) By the Company Other than for Cause. The Company may terminate the Executive’s
employment with the Company other than for Cause at any time upon notice to the Executive. In the event of such termination, the Company shall either (i) pay the Executive the benefits payable under an executive severance plan, if such a plan
is in place on the date of termination and if the Executive is eligible for such benefits under such a plan or, if the present value to the Executive is greater, (ii) continue to pay the Executive his Base Salary, at the rate in effect on the
date of termination, until the conclusion of a period of twelve (12) months following the date of termination. In addition, the Company shall pay to the Executive in one lump sum an amount equal to the higher of (x) the Executive’s
target incentive bonus under the Executive Incentive Plan for the year in which the Executive’s employment is terminated or (y) the actual incentive bonus paid to the Executive, if any, under the Executive Incentive Plan for the last full
fiscal year preceding the year in which the Executive’s employment is terminated; and shall also, until the conclusion of a period of twelve (12) months following the date of termination, pay the full premium cost of the Executive’s
participation in the Company’s group medical and dental insurance plans, provided that the Executive is entitled to continue such participation under applicable law and plan terms. The Company will also provide the Executive with an
outplacement assistance benefit in the form of a lump-sum payment of $15,000 plus an 

  

 -4- 

 
additional lump-sum payment in an amount sufficient, after giving effect to all federal, state and other taxes with respect to such additional payment, to
make Executive whole for all taxes (including withholding taxes) on such outplacement assistance benefit. Furthermore, at the sole discretion of the Compensation Committee of the Board, any unvested options to purchase Company stock may be
accelerated. 
 (e) By the Executive for Reduction in Salary or Benefits. The Executive may terminate his/her employment hereunder
based on a material reduction in Base Salary or benefits due in accordance with the terms of this Agreement (“Compensation Reduction”), provided that Executive provides notice to the Company setting forth in reasonable detail the nature of
such Compensation Reduction, and provided further that the Company shall have thirty (30) days from such notice to cure such reduction. In the event of termination in accordance with this Section 5(e), the Company shall either (i) pay
the Executive the benefits payable under an executive severance plan, if such a plan is in place on the date of termination and if the Executive is eligible for such benefits under such a plan or, if the present value to the Executive is greater,
(ii) continue to pay the Executive his Base Salary, at the rate in effect on the date of termination, until the conclusion of a period of twelve (12) months following the date of termination. In addition, the Company shall pay to the
Executive in one lump sum an amount equal to the higher of (x) the Executive’s target incentive bonus under the Executive Incentive Plan for the year in which the Executive’s employment is terminated or (y) the actual incentive
bonus paid to the Executive, if any, under the Executive Incentive Plan for the last full fiscal year preceding the year in which the Executive’s employment is terminated; and shall also, until the conclusion of a period of twelve
(12) months following the date of termination, pay the full premium cost of the Executive’s participation in the Company’s group medical and dental insurance plans, provided that the Executive is entitled to continue such
participation under applicable law and plan terms. The Company will also provide the Executive with an outplacement assistance benefit in the form of a lump-sum payment of $15,000 plus an additional lump-sum payment in an amount sufficient, after
giving effect to all federal, state and other taxes with respect to such additional payment, to make Executive whole for all taxes (including withholding taxes) on such outplacement assistance benefit. In addition, at the sole discretion of the
Compensation Committee of the Board, any unvested options to purchase Company stock may be accelerated. 
 (f) By the Executive Other than
for a Compensation Reduction. The Executive may terminate his/her employment hereunder at any time upon sixty (60) days’ notice to the Company, unless such termination would violate any obligation of the Executive to the Company under
a separate severance agreement. In the event of termination of the Executive pursuant to this Section 5(f), the Board may elect to waive the period of notice, or any portion thereof, and, if the Board so elects, the Company will pay the
Executive his/her Base Salary for the notice period (or for any remaining portion of the period). 
 (g) Upon a Change of Control.

 (i) If a Change of Control occurs on the date of such Change in Control, fifty-percent (50%) of any stock options
previously granted to the Executive that 

  

 -5- 

 
are outstanding and unvested as of that date shall become vested and exercisable, provided that the Executive is employed by the Company on the date of such
Change in Control. 
 (ii) If a Change of Control occurs and within eighteen (18) months following such Change of
Control, the Company terminates the Executive’s employment other than for Cause, or the Executive terminates his/her employment as a result of a Compensation Reduction or for Good Reason (as defined herein), then, in lieu of any payments to or
on behalf of the Executive under Section 5(d) or 5(e) hereof, the Company shall pay to the Executive in one lump sum an amount equal to (A) eighteen (18) months Base Salary at the rate in effect on the date of termination, plus
(B) 150% of the higher of (x) the Executive’s target incentive bonus under the Executive Incentive Plan for the year in which the Executive’s employment is terminated or (y) the actual incentive bonus paid to the Executive,
if any, under the Executive Incentive Plan for the last full fiscal year preceding the year in which the Executive’s employment is terminated; and shall also, until the conclusion of a period of eighteen (18) months following the date of
termination, pay the full premium cost of the Executive’s participation in the Company’s group medical and dental insurance plans, provided that the Executive is entitled to continue such participation under applicable law and plan terms.
In addition, any outstanding unvested options granted to the Executive as of the date of the Change in Control shall become vested and shall be exercisable for ninety (90) days following termination of the Executive’s employment. The
Company will also provide the Executive with an outplacement assistance benefit in the form of a lump-sum payment of $15,000 plus an additional lump-sum payment in an amount sufficient, after giving effect to all federal, state and other taxes with
respect to such additional payment, to make Executive whole for all taxes (including withholding taxes) on such outplacement assistance benefit. 
 (iii) All payments required to be made by the Company hereunder to Executive or his/her dependents, beneficiaries, or estate will be subject to the withholding of such amounts relating to tax and/or other payroll
deductions as may be required by law. 
 In the event that it is determined that any payment or benefit provided by the
Company to or for the benefit of Executive, either under this Agreement or otherwise, will be subject to the excise tax imposed by Section 4999 of the Internal Revenue Code or any successor provision(s) (“Section 4999”), the Company
will, prior to the date on which any amount of the excise tax must be paid or withheld, make an additional lump-sum payment (the “Gross-up Payment”) to Executive in an amount sufficient, after giving effect to all federal, state and other
taxes and charges (including interest and penalties, if any) with respect to the gross-up payment, to make Executive whole for all taxes (including withholding taxes) and any associated interest and penalties, imposed under or as a result of
Section 4999. 
  

 -6- 

 Determinations under this Section 5(g)(iii) will be made by an accounting firm
engaged by the Company (the “Firm”). The determinations of the Firm will be binding upon the Company and Executive except as the determinations are established in resolution (including by settlement) of a controversy with the Internal
Revenue Service to have been incorrect. All fees and expenses of the Firm will be paid by the Company. 
 If the Internal
Revenue Service asserts a claim that, if successful, would require the Company to make a Gross-up Payment or an additional Gross-up Payment, the Company and Executive will cooperate fully in resolving the controversy with the Internal Revenue
Service. The Company will make or advance such Gross-up Payments as are necessary to prevent Executive from having to bear the cost of payments made to the Internal Revenue Service in the course of, or as a result of, the controversy. The Firm will
determine the amount of such Gross-up Payments or advances and will determine after final resolution of the controversy whether any advances must be returned by Executive to the Company. The Company will bear all expenses of the controversy and will
gross Executive up for any additional taxes that may be imposed upon Executive as a result of its payment of such expenses. 
 (iv) For the purpose of this Section 5(g), a “Change in Control” shall mean: (A) the acquisition by any Organization of beneficial ownership (within the meaning of Rule 13d-3 promulgated under the Exchange Act) of 50% or
more of the common stock of the Company; provided, however, that for purposes of this subsection (A), an acquisition shall not constitute a Change in Control if it is: (x) by a Benefit Plan sponsored or maintained by the Company or an entity
controlled by the Company or (y) by an entity pursuant to a transaction that complies with clauses (x), (y) and (z) of subsection (C) of this Section 5(g)(iv); or (B) individuals who, as of September 11, 2008,
constitute the Board (the “Incumbent Board”) cease for any reason to constitute at least a majority of the Board; provided, however, that any individual becoming a director subsequent to September 11, 2008 whose election, or
nomination for election by the Company’s stockholders, was approved by a vote of at least a majority of the directors then comprising the Incumbent Board (or a majority of the members of a nominating committee who are members of the Incumbent
Board) shall be treated as a member of the Incumbent Board unless he or she assumed office 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 an Organization other than the Board; or (C) consummation of a merger or consolidation involving the Company, or a sale or other disposition of all or substantially all of the assets of the Company, (a
“transaction”) in each case unless, immediately following such transaction, (x) the beneficial owners of the common stock of the Company outstanding immediately prior to such transaction beneficially own, directly or indirectly, more
than 50% of the combined voting power of the outstanding voting securities of the entity resulting from such transaction (including, without limitation, an entity which as a result of such transaction owns the Company or all or substantially all of
the Company’s assets either directly or through one or more subsidiaries), (y) no Organization (excluding any entity resulting from such transaction or any Benefit Plan of the Company or such entity 

  

 -7- 

 
resulting from such transaction) beneficially owns, directly or indirectly, 50% or more of the combined voting power of the then outstanding voting
securities of such entity and (z) at least a majority of the members of the board of directors or similar board of the entity resulting from such transaction were members of the Incumbent Board at the time of the execution of the initial
agreement, or of the action of the Board, providing for such transaction; or (D) approval by the stockholders of the Company of a complete liquidation or dissolution of the Company. For purposes of the foregoing: “Benefit Plan” means
any employee benefit plan, including any related trust; “Board” means the Board of Directors of the Company; “Exchange Act” means the Securities Exchange Act of 1934, as amended; and “Organization” means any individual,
entity or group (within the meaning of Section 13(d)(3) or Section 14(d)(2) of the Exchange Act). 
 (h) Effect of Failure to
Renew by Company. In the event the Company chooses not to renew the Term hereof, such failure to renew shall be treated as a termination by the Company other than for “Cause” unless the Company gives notice that the failure to renew is
for “Cause” as defined in Section 5(c). 
 (i) To the extent any payment under Section 5 shall be required to be delayed
following separation from service to comply with the “specified employee” rules of Section 409A of the Internal Revenue Code, it shall be delayed (but not more than is required to comply with such rules). 
 6. Effect of Termination. The provisions of this Section 6 shall apply to termination due to the expiration of the Term hereof, termination
pursuant to Section 5 or otherwise. 
 (a) Payment(s) by the Company and contributions to the cost of the Executive’s continued
participation in the Company’s group health and dental plans that may be due to the Executive under Section 5 shall constitute the entire obligation of the Company to the Executive. In order to receive any payments or any other benefits
under Section 5(d) or 5(e) or 5(g) or 5(h), the Executive must first execute a General Release of Claims in a form acceptable to the Company. 
 (b) Except for medical and dental insurance coverage continued pursuant to Section 5(d) or 5(e) or 5(g) or 5(h) hereof, benefits shall terminate pursuant to the terms of the applicable benefit plans based on the date of termination of
the Executive’s employment without regard to any continuation of Base Salary or other payment to the Executive following such date of termination. 
 (c) Provisions of this Agreement shall survive any termination if so provided herein or if necessary or desirable fully to accomplish the purposes of such provision, including without limitation the obligations of the
Executive under Sections 7, 8 and 9 hereof. The obligation of the Company to make payments to or on behalf of the Executive under Section 5(d) or 5(e) or 5(g) or 5(h) hereof is expressly conditioned upon the Executive’s continued full
performance of obligations under Sections 7, 8 and 9 hereof. The Executive recognizes that, except as expressly provided in Section 5(d) or 5(e) or 5(g) or 5(h), no compensation is earned by, or in any way owing to, Executive after termination
of employment. 
  

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 (d) Any lump-sum payments to be made to the
Executive hereunder shall be made as soon as administratively practicable and in any event no later than 2 1/2 months after the
end of the year in which the Executive becomes entitled to such payment. 
 (e) To the extent any payment hereunder shall be required
to be delayed until six months following separation from service to comply with the “specified employee” rules of Section 409A of the Internal Revenue Code, it shall be delayed (but not more than is required) to comply with such
rules, and shall promptly after such delay be paid with interest at a reasonable market rate as determined by the Company 
 7.
Confidential Information. 
 (a) The Executive acknowledges that the Company and its Affiliates continually develop Confidential
Information, that the Executive may develop Confidential Information for the Company or its Affiliates and that the Executive may learn of Confidential Information during the course of employment. The Executive will comply with the policies and
procedures of the Company and its Affiliates for protecting Confidential Information and shall never disclose to any Person or to any governmental agency or political subdivision of any government (except as required by applicable law or for the
proper performance of his/her duties and responsibilities to the Company and its Affiliates), or use for his/her own benefit or gain, any Confidential Information obtained by the Executive incident to his/her employment or other association with the
Company or any of its Affiliates. The Executive understands that the restriction shall continue to apply after his/her employment terminates, regardless of the reason for such termination. 
 (b) All documents, records, tapes and other media of every kind and description relating to the business, present or otherwise, of the Company or its
Affiliates and any copies, in whole or in part, thereof (the “Documents”), whether or not prepared by the Executive, shall be the sole and exclusive property of the Company and its Affiliates. The Executive shall safeguard all Documents
and shall surrender to the Company at the time his/her employment terminates, or at such earlier time or times as the Board or its designee may specify, all Documents then in the Executive’s possession or control. 
 (c) The Executive acknowledges and agrees that all Confidential Information and proprietary materials that are provided by the Company to the Executive
under this Agreement are and shall remain the exclusive property of the Company or the third party entrusting such Confidential Information or proprietary materials to the Company. 
 8. Restricted Activities. The Executive agrees that some restrictions on his/her activities during and after his/her employment are necessary to
protect the goodwill, Confidential Information and other legitimate interests of the Company and its Affiliates: 
 (a) While the Executive is
employed by the Company and for the greater of (i) twelve (12) months after his/her employment terminates or (ii) the period during which the Executive is receiving payments under Section 5(d) or 5(e) or 5(g) or 5(h) (the
“Non-Competition Period”), the Executive shall not, directly or indirectly, whether as owner, partner, 

  

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investor, consultant, agent, employee, co-venturer or otherwise, compete with the Company or any of its Affiliates or undertake any planning for any business
competitive with the Company or any of its Affiliates. Specifically, but without limiting the foregoing, the Executive agrees not to engage in any manner in any activity that is directly or indirectly competitive with the business of the Company or
any of its Affiliates as conducted or under consideration at any time during the Executive’s employment. Restricted activity includes without limitation accepting employment or a consulting position with any Person who is, or at any time within
twelve (12) months prior to the termination of the Executive’s employment has been, a competitor or a customer of the Company or any of its Affiliates. For the purposes of this Section 8, the business of the Company and its Affiliates
shall include all Products and the Executive’s undertaking shall encompass all items, products and services that may be used in substitution for Products. The foregoing shall not prohibit the Executive’s passive ownership of two percent
(2%) or less of the equity securities of any publicly traded company. 
 (b) The Executive agrees that, during his/her employment with
the Company or any Affiliate of the Company, he/she will not undertake any outside activity, whether or not competitive with the business of the Company or its Affiliates, that could reasonably give rise to a conflict of interest or otherwise
interfere with his/her duties and obligations to the Company or any of its Affiliates. 
 (c) The Executive further agrees that while he/she
is employed by the Company or any Affiliate of the Company and thereafter during the Non-Competition Period, the Executive will not hire or attempt to hire any employee of the Company or any of its Affiliates, assist in such hiring by any Person,
encourage any such employee to terminate his/her or her relationship with the Company or any of its Affiliates or solicit or encourage any customer or vendor of the Company or any of its Affiliates to terminate its relationship with them, or, in the
case of a customer, to conduct with any Person any business or activity which such customer conducts or could conduct with the Company or any of its Affiliates. 
 9. Assignment of Rights to Intellectual Property. The Executive shall promptly and fully disclose, if he/she has not done so already, all Intellectual Property to the Company. The Executive shall maintain
adequate records (whether written, electronic, or otherwise) to document the Intellectual Property, including without limitation the conception and reduction to practice of all inventions, and shall make such records available to the Company upon
request. The Company shall have sole ownership of all Intellectual Property and all such records with respect thereto. The Executive hereby assigns, conveys, and grants to the Company (or as otherwise directed by the Company), and agrees to assign,
convey and grant to the Company (or as otherwise directed by the Company), all of his/her right, title, and interest in and to the Intellectual Property and any and all patents, patent applications, and copyrights relating to the Intellectual
Property. The Executive agrees to execute any and all applications for domestic and foreign patents, copyrights or other proprietary rights and to do such other acts (including without limitation the execution and delivery of instruments of further
assurance or confirmation) requested by the Company to assign the Intellectual Property to the Company and to permit the Company to enforce any patents, copyrights or other proprietary rights to the Intellectual Property. The Executive will not
charge the Company for time spent in complying with these obligations. All copyrightable works that the Executive creates shall be considered “work made for hire”. 
  

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 The Executive represents that the attached Exhibit A contains a complete list of all inventions, copyrightable
works, tangible materials, and other intellectual property that the Executive (either alone or jointly with others) conceived, developed, discovered, created, or reduced to practice prior to the Effective Date (the “Prior IP”). The Prior
IP is not assigned to the Company under this Agreement, except to the extent that the Executive expressly assigns such Prior IP to the Company under the terms of a separate written instrument. If no Prior IP is listed on Exhibit A, the
Executive represents that no Prior IP exists. The Executive recognizes that the protection of the Intellectual Property of the Company against unauthorized disclosure and use is of critical importance to the Company, and therefore, the Executive
agrees to use his/her best efforts and exercise utmost diligence to protect and safeguard the Intellectual Property of the Company and its Affiliates, if any, and, except as may be expressly required by the Company in connection with the
Executive’s performance of his/her obligations to the Company under this Agreement, the Executive shall not, either during the Term of this Agreement or thereafter, directly or indirectly, use for his/her own benefit or for the benefit of
another, or disclose to another, any of such Intellectual Property. 
 10. Notification Requirement. Until the conclusion of the
Non-Competition Period the Executive shall give notice to the Company of each new business activity he/she plans to undertake, at least twenty-one (21) days prior to beginning any such activity. Such notice shall state the name and address of
the Person for whom such activity is undertaken and the nature of the Executive’s business relationship(s) and position(s) with such Person. The Executive shall provide the Company with such other pertinent information concerning such business
activity as the Company may reasonably request in order to determine the Executive’s continued compliance with his/her obligations under Sections 7, 8 and 9 hereof. 
 11. Enforcement of Covenants. The Executive acknowledges that he/she has carefully read and considered all the terms and conditions of this Agreement, including the restraints imposed upon him/her pursuant to
Sections 7 and 8 hereof. The Executive agrees that said restraints are necessary for the reasonable and proper protection of the Company and its Affiliates and that each and every one of the restraints is reasonable in respect to subject matter,
length of time and geographic area. The Executive further acknowledges that, were he/she to breach any of the covenants contained in Sections 7 or 8 hereof, the damage to the Company would be irreparable. The Executive therefore agrees that the
Company, in addition to any other remedies available to it, shall be entitled to preliminary and permanent injunctive relief against any breach or threatened breach by the Executive of any of said covenants, without having to post bond. The parties
further agree that, in the event that any provision of Section 7 or 8 hereof shall be determined by any court of competent jurisdiction to be unenforceable by reason of its being extended over too great a time, too large a geographic area or
too great a range of activities, such provision shall be deemed to be modified to permit its enforcement to the maximum extent permitted by law. 
 12. Conflicting Agreements. The Executive hereby represents and warrants that the 

  

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execution of this Agreement and the performance of his/her obligations hereunder will not breach or be in conflict with any other agreement to which the
Executive is a party or is bound and that the Executive is not now subject to any covenants against competition or similar covenants that would affect the performance of his/her obligations hereunder. The Executive will not disclose to or use on
behalf of the Company any proprietary information of a third party without such party’s consent. 
 13. Indemnification. The
Company shall indemnify the Executive to the extent provided in its then current Articles or By-Laws. The Executive agrees to promptly notify the Company of any actual or threatened claim arising out of or as a result of his/her employment with the
Company. 
 14. Definitions. For purposes of this Agreement, the following definitions apply: 
 (a) “Affiliates” means all persons and entities directly or indirectly controlling, controlled by or under common control with the Company,
where control may be by either management authority or equity interest. 
 (b) “Confidential Information” means any and all
information of the Company and its Affiliates that is not generally known by others. Confidential Information includes without limitation such information relating to (i) the development, research, testing, manufacturing, marketing and
financial activities of the Company and its Affiliates, (ii) the Products, (iii) the costs, sources of supply, financial performance and strategic plans of the Company and its Affiliates, (iv) the identity and special needs of the
customers of the Company and its Affiliates and (v) the people and organizations with whom the Company and its Affiliates have business relationships and those relationships. Confidential Information also includes comparable information that
the Company or any of its Affiliates have received belonging to others or which was received by the Company or any of its Affiliates with any understanding that it would not be disclosed. 
 (c) “Good Reason” means: (i) the relocation of the Executive’s principal office, without his/her prior consent, to a location more
than thirty (30) miles from its location on the day prior to the Change in Control; (ii) failure of the Company to continue the Executive in the position held immediately prior to the Change of Control; or (iii) material and
substantial diminution in the nature or scope of the Executive’s responsibilities, duties or authority; however, the Company’s failure to continue the Executive’s appointment or election as a director or officer of any of its
Affiliates and any diminution of the business of the Company or any of its Affiliates, including without limitation the sale or transfer of any or all of the assets of the Company or any of its Affiliates, shall not constitute “Good
Reason”. 
 (d) “Intellectual Property” means inventions, discoveries, developments, methods, processes, compositions, works,
concepts and ideas (whether or not patentable or copyrightable or constituting trade secrets) conceived, made, created, developed or reduced to practice by the Executive (whether alone or with others, whether or not during normal business hours or
on or off Company premises) during the Executive’s employment and during the period of twelve (12) months immediately following termination of his/her employment that relate to either the Products or any prospective activity of the Company
or any of its Affiliates. 
  

 -12- 

 (e) “Person” means an individual, a corporation, an association, a partnership, an estate, a
trust and any other entity or organization, other than the Company or any of its Affiliates. 
 (f) “Products” mean all products
planned, researched, developed, under development, tested, manufactured, sold, licensed, leased or otherwise distributed or put into use by the Company or any of its Affiliates, together with all services provided or planned by the Company or any of
its Affiliates, during the Executive’s employment. 
 15. Withholding. All payments made by the Company under this Agreement
shall be reduced by any tax or other amounts required to be withheld by the Company under applicable law. 
 16. Assignment. Neither
the Company nor the Executive may make any assignment of this Agreement or any interest herein, by operation of law or otherwise, without the prior written consent of the other; provided, however, that the Company may assign its rights and
obligations under this Agreement without the consent of the Executive in the event that the Company shall hereafter affect a reorganization, consolidate with, or merge into, any other Person or transfer all or substantially all of its properties or
assets to any other Person. This Agreement shall inure to the benefit of and be binding upon the Company and the Executive, their respective successors, executors, administrators, heirs and permitted assigns. 
 17. Severability. If any portion or provision of this Agreement shall to any extent be declared illegal or unenforceable by a court of competent
jurisdiction, then the remainder of this Agreement, or the application of such portion or provision in circumstances other than those as to which it is so declared illegal or unenforceable, shall not be affected thereby, and each portion and
provision of this Agreement shall be valid and enforceable to the fullest extent permitted by law. 
 18. Waiver. No waiver of any
provision hereof shall be effective unless made in writing and signed by the waiving party. The failure of either party to require the performance of any term or obligation of this Agreement, or the waiver by either party of any breach of this
Agreement, shall not prevent any subsequent enforcement of such term or obligation or be deemed a waiver of any subsequent breach. 
 19.
Notices. Any and all notices, requests, demands and other communications provided for by this Agreement shall be in writing and shall be effective when delivered in person or deposited in the United States mail, postage prepaid, registered or
certified, and addressed to the Executive at his/her last known personal address on the books of the Company or, in the case of the Company, at its principal place of business, attention of Senior Attorney, or to such other address as either party
may specify by notice to the other actually received. 
 20. Entire Agreement. This Agreement constitutes the entire agreement between
the parties and supersedes all prior communications, agreements and understandings, written or oral, with respect to the terms and conditions of the Executive’s employment, excluding any obligations with respect to the securities of the Company
or the grant of any stock options. 
  

 -13- 

 21. Amendment. This Agreement may be amended or modified only by a written instrument signed by
the Executive and by an expressly authorized representative of the Company. 
 22. Headings. The headings and captions in this
Agreement are for convenience only and in no way define or describe the scope or content of any provision of this Agreement. 
 23.
Counterparts. This Agreement may be executed in two or more counterparts, each of which shall be an original and all of which together shall constitute one and the same instrument. 
 24. Governing Law. This is a contract and shall be construed and enforced under and be governed in all respects by the laws of the Commonwealth of
Massachusetts, without regard to the conflict of laws principles thereof. 
 [SIGNATURE PAGE FOLLOWS] 
  

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 IN WITNESS WHEREOF, this Agreement has been executed as a sealed instrument by the Company, by its duly
authorized representative, and by the Executive, as of the date first above written. 
  

							
	THE EXECUTIVE:	 		 	ANTIGENICS INC., a Delaware corporation
				
	 /s/ Karen Higgins Valentine
	 		 	By:	 	 /s/ Garo H. Armen

	Karen Higgins Valentine	 		 	Name:	 	Garo H. Armen
		 		 	Title:	 	Chairman & CEO

  

 -15- 

 EXHIBIT A 
 LIST OF PRIOR IP 
  

 -16-

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