Document:

EXECUTION COPY

 

STOCK REPURCHASE AGREEMENT

 

THIS STOCK REPURCHASE
AGREEMENT (the “Agreement”) is entered into effective March 9, 2012 (the “Execution Date”), by and
between Barrett Business Services, Inc., a Maryland corporation (the “Company”), and Nancy B. Sherertz (“Seller”).

 

RECITALS:

 

A.     Seller is the owner of
800,776 shares of the Company’s issued and outstanding common stock (the “Common Stock”).

 

B.     Seller desires to sell
to the Company, and the Company desires to purchase from Seller, 500,000 shares of the Common Stock (the “Shares”)
under the terms and conditions set forth in this Agreement.

 

AGREEMENT:

 

In consideration of
the mutual covenants and provisions contained herein, the parties hereto agree as follows:

 

		1.	Sale of Common Stock.

 

1.1.     Delivery
of Shares. On the terms and subject to the conditions of this Agreement, Seller will, on the Closing Date (defined below),
sell, convey, transfer, and deliver to the Company all of her right, title, and interest in and to the Shares, free and clear of
all liens, security interests, claims, charges, or encumbrances of any nature whatsoever and deliver to the Company a certificate
or certificates representing the Shares, duly endorsed for transfer or accompanied by appropriate stock transfer powers duly executed
in blank, together with any other documents necessary or reasonably requested by the Company to transfer good and marketable title
to the Shares.

 

1.2.     Purchase
Price. The purchase price (“Purchase Price”) for the Shares shall be twenty dollars ($20.00) per share, representing
a total consideration of ten million dollars ($10,000,000.00). Four million, one hundred seventy-three thousand dollars ($4,173,000.00)
(the “Cash Purchase Price”) will be paid by electronic funds transfer at the Closing (defined below). The remainder
of the Purchase Price will take the form of 5,827 shares of Series A Nonconvertible, Non-Voting Redeemable Preferred Stock (the
“Preferred Shares”), which will be issued and delivered by the Company at the Closing and will have the preferences
and other rights as reflected in the form of Articles Supplementary attached as Exhibit A.

 

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		2.	Closing; Deliveries by Seller; Deliveries by the Company.

 

2.1.     Closing.
The closing of the transaction (the “Closing”) will take place by exchange of appropriate documentation between the
parties (via overnight delivery, facsimile, electronic transmission and other similar means for exchanging documentation) promptly
following the Execution Date, but no later than April 6, 2012 (the “Closing Date”).

 

2.2.     Deliveries
by Seller.

 

2.2.1.     Prior
to the Closing, Seller shall deliver, or cause to be delivered, to the Company:

 

		2.2.1.1.	Written wire transfer instructions for all payments to be made by the Company to Seller in the
Closing.

 

		2.2.1.2.	Sufficient evidence to demonstrate that the Shares will be delivered to the Company in the Closing.

 

2.2.2.     At or
prior to the Closing, Seller shall deliver, or cause to be delivered, to the Company:

 

		2.2.2.1.	All stock certificates for the Shares, together with duly executed irrevocable stock powers or
other instruments of transfer satisfactory to the Company.

 

		2.2.2.2.	All other documents, instruments and writings required, reasonably requested, or contemplated to
be delivered by Seller at or prior to the Closing pursuant to this Agreement or otherwise in connection with the transaction contemplated
by this Agreement.

 

2.3.     Deliveries by the Company.
At or prior to the Closing, the Company shall deliver, or cause to be delivered, to Seller:

 

2.3.1.     The Cash Purchase Price in
immediately available funds payable to Seller.

 

2.3.2.     Stock certificates representing
the Preferred Shares.

 

2.3.3.     A certified copy of the Articles
Supplementary as filed with and accepted for record by the State Department of Assessments and Taxation of Maryland.

 

2.3.4.     All other documents, instruments,
and writings required, reasonably requested, or contemplated to be delivered by the Company at or prior to the Closing pursuant
to this Agreement or otherwise in connection with the transaction contemplated by this Agreement.

 

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		3.	Representations and Warranties of Seller. Seller
represents and warrants to the Company as follows:

 

3.1.     Ownership of the Shares.
Seller is the sole owner of the Shares, Seller has no warrants, options, or other securities or agreements entitling her to acquire
additional shares of any class or series of stock of the Company other than the Preferred Shares, and the Shares will be conveyed
to the Company free and clear of any liens or encumbrances. Seller represents and warrants that she has not transferred or assigned
the Shares or any interest therein to any other person, and no other person has any right, title, or interest in or to the Shares
by operation of law or otherwise.

 

3.2.     Authorization
and Enforceability. Seller has all requisite power and authority to execute, deliver, and perform this Agreement and to consummate
the transaction contemplated hereby. The Agreement constitutes a valid and binding obligation of Seller fully enforceable in accordance
with its terms.

 

3.3.     Brokerage
Fees. Seller is not as of the date hereof, and will not become, a party to any agreement, arrangement or understanding with
any Person which could result in the Company having any obligation or liability for any brokerage fees, commissions, underwriting
discounts or other similar fees or expenses relating to the transaction contemplated by this Agreement. “Person” shall
mean any individual, corporation, company, association, partnership, limited liability company, joint venture, trust or unincorporated
organization, or a government or any agency, or political subdivision thereof.

 

3.4.     Restrictions
on Transferability of the Preferred Shares. Seller understands that the Preferred Shares are restricted securities within the
meaning of Rule 144 promulgated under the Securities Act of 1933; that there is no public trading market for the Preferred Shares
and the Company has no obligation or current intention to take action to facilitate the listing or quotation of the Preferred Shares
in any public trading market; and that the Preferred Shares have not been registered under the Securities Act of 1933 or the securities
laws of any state and the Company has no obligation or current intention to register the Preferred Shares, such that the Preferred
Shares must be held indefinitely unless they are subsequently registered or, in the opinion of counsel reasonably acceptable to
the Company, a sale or transfer may be made without registration under Federal and state securities laws. Seller agrees that any
certificate representing the Preferred Shares may bear a legend restricting the transfer of any of the Preferred Shares in a manner
generally consistent with the foregoing.

 

3.5.     Additional
Seller Representations. Seller makes the following representations and warranties to the Company:

 

3.5.1.     Investigation.
Seller, including her agents and advisors, has been given an opportunity to ask questions about the Company and the Preferred
Shares, has received all information that Seller, including her agents and advisors, feels is necessary to evaluate the merits
and risks of the transaction contemplated by this Agreement, including the Preferred Shares, and has been given access to any information
that the Company possesses or can acquire without unreasonable effort or expense that Seller, including her agents and advisors,
feels is necessary or appropriate to verify the accuracy of information furnished by the Company.

 

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3.5.2.     No
Warranty. Seller understands that no representation or warranty as to the value of the Company, the Company’s
business or financial condition, the Shares, or the Preferred Shares has been or is being made by or on behalf of the Company.

 

3.5.3.     Opportunity
to Consult. Seller acknowledges that she has had the opportunity to consult with attorneys, accountants, and other advisors
regarding the transaction contemplated by this Agreement. In reaching a determination to enter into this Agreement, Seller has
relied solely upon independent investigations by Seller, or by Seller’s agents and advisors. Seller has sought and received,
to the extent deemed necessary or appropriate, professional advice with respect to tax and investment aspects and merits and risks
of the transaction contemplated by this Agreement, including the tax effects and the appropriateness of the transaction contemplated
by this Agreement in light of Seller’s unique circumstances, and is not relying on the Company or its officers, directors,
or other agents and advisors for such advice and such advice has not been provided.

 

3.5.4.     Voluntary.
Seller is selling the Shares and entering into this Agreement voluntarily, based on Seller’s own judgment and evaluation,
and is not relying on any verbal or written representations of the Company or any agent of the same regarding the transaction contemplated
by this Agreement or the value of the Shares or the Preferred Shares except as set forth in this Agreement.

 

		4.	Representations and Warranties of the Company.
The Company represents and warrants to Seller as follows:

 

4.1.     Organization;
Good Standing; Power. The Company is a corporation duly organized, validly existing and in good standing under the laws of
the state of Maryland. The Company has all requisite corporate power and authority to execute, deliver, and perform this Agreement
and consummate the transaction contemplated by this Agreement.

 

4.2.     Authorization
of Agreement and Enforceability.  This Agreement has been duly and validly authorized, executed, and delivered on behalf of
the Company and constitutes a valid and binding obligation of the Company, fully enforceable in accordance with its terms.

 

4.3.     Valid Issuance.
The Preferred Shares, when issued, sold and delivered in accordance with the terms of this Agreement and for the consideration
set forth in this Agreement, will be duly and validly issued, fully paid and nonassessable, will be free of any liens, claims,
charges or encumbrances, will be free of any restrictions on transfer, other than restrictions on transfer under this Agreement
and under applicable state and federal securities laws and will have been issued in reliance upon an exemption from the registration
requirements of and will not result in a violation of the Securities Act of 1933.

 

4.4.     Brokerage
Fees. The Company is not as of the date hereof, and will not become, a party to any agreement, arrangement or understanding
with any Person which could result in Seller having any obligation or liability for any brokerage fees, commissions, underwriting
discounts or other similar fees or expenses relating to the transaction contemplated by this Agreement.

 

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4.5.     Effect of
Agreement. The execution, delivery, and performance of this Agreement by the Company and the consummation of the transaction
contemplated hereby will not, with or without the giving of notice or the lapse of time, or both:

 

4.5.1.     violate
any provision, law, statute, rule, or regulation to which the Company is subject;

 

4.5.2.     violate
any judgment, order, writ, or decree of any court, arbitrator, or governmental agency applicable to the Company;

 

4.5.3.     conflict
with the Company’s charter or bylaws in effect on the Closing Date; or

 

4.5.4.     require
the consent, authorization, or approval of any person, including, but not limited to, any governmental body, that has not been
received prior to the Closing.

 

4.6.     Information
Concerning the Company. The Company is a publicly-held company subject to reporting requirements under the Securities Exchange
Act of 1934 (the “1934 Act”) and has filed all reports required to be filed under the 1934 Act since January 1, 2011.

 

		5.	Conditions Precedent to Closing.

 

5.1.     Conditions
Precedent to the Company’s Obligations.  The obligation of the Company to consummate the transaction contemplated by
this Agreement shall be subject to the fulfillment of each of the following conditions, any one or portion of which may be waived
in writing by the Company:

 

5.1.1.     The
representations and warranties made in this Agreement by Seller shall be true and correct in all respects on the Closing Date as
fully as though such representations and warranties had been made on and as of the Closing Date.

 

5.1.2.     The
opinion the Company has received from the Company’s financial advisor that the transaction contemplated by this Agreement
is fair from a financial point of view to the Company shall not have been withdrawn on or prior to the Closing Date due to events
that are both unrelated to the transaction contemplated by this Agreement and outside of the control of the Company.

 

5.1.3.     No temporary
restraining order, preliminary or permanent injunction or other order issued by any court of competent jurisdiction or other legal
restraint or prohibition preventing the Company from consummating the transactions contemplated by the Agreement shall be in effect
and no action seeking such relief shall be pending, and no claim or demand shall have been made as to which Seller would be entitled
to indemnification under Section 7.2.1(ii) of this Agreement.

 

5.2.     Condition
Precedent to Seller’s Obligations. The obligation of Seller to consummate the transaction contemplated by this Agreement
shall be subject to the fulfillment of the following conditions, which may be waived in writing by Seller:

 

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5.2.1.     The
representations and warranties made in this Agreement by the Company shall be true and correct in all respects on the Closing Date
as fully as though such representations and warranties had been made on and as of the Closing Date.

 

5.2.2.     No temporary
restraining order, preliminary or permanent injunction or other order issued by any court of competent jurisdiction or other legal
restraint or prohibition preventing the consummation of the transactions contemplated by the Agreement shall be in effect and no
action seeking such relief shall be pending.

 

6.              Standstill. Beginning with the Closing Date and
ending on May 31, 2014 (the “Standstill Period”), except with the prior written consent of the Company, Seller shall
not (a) solicit proxies or the written consent of any of the Company’s stockholders; (b) make any public statement with
respect to nomination or election of any director, removal of any member of the Board of Directors, or any proposal in opposition
to the Board of Directors or management of the Company; (c) submit a request for a special meeting of the Company’s stockholders;
or (d) make a public announcement with respect to any tender offer or exchange offer, merger, or other business combination involving
the Company that has not been approved by the Board of Directors of the Company.

 

7.              Indemnification. 

 

7.1.     Indemnification
by Seller.

 

7.1.1.     Seller
shall indemnify and hold the Company harmless at all times after the date of this Agreement for, from and against any loss or damages
resulting from any breach of a covenant, obligation, representation, or warranty on the part of Seller under this Agreement or
from intentional misconduct, fraud, or criminal violation of law by Seller.

 

7.1.2.     Seller
shall reimburse the Company on demand for any payment made by the Company at any time after the Execution Date with respect to
any liability or claim to which the foregoing indemnity relates, subject to the Company’s compliance with Section 7.1.3 below.

 

7.1.3.     Seller’s
obligation to indemnify and hold the Company harmless shall be conditioned upon the Company giving Seller notice in writing of
the claimed breach and a reasonable opportunity to cure or mitigate said breach after receipt of said written notice.

 

7.2.     Indemnification
by the Company. 

 

7.2.1.     The
Company shall indemnify and hold Seller harmless at all times after the date of this Agreement for, from and against (i) any loss
or damages resulting from any breach of a covenant, representation, or warranty on the part of the Company under this Agreement,
and (ii) any and all claims, demands, losses, damages, suits, judgments and expenses of any nature arising under or related to
(A) this Agreement, other than claims or demands described in Section 7.1.1 above or (B) intentional misconduct, fraud, or criminal
violation of law by the Company.

 

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7.2.2.     The
Company shall reimburse Seller on demand for any payment made by Seller at any time after the Execution Date with respect to any
liability or claim to which the foregoing indemnity relates, subject to Seller’s compliance with Section 7.2.3 below.

 

7.2.3.     The
Company’s obligation to indemnify and hold Seller harmless shall be conditioned upon Seller’s giving the Company prompt
notice in writing of the facts and circumstances giving rise to a claim for indemnity and, if applicable, a reasonable opportunity
to cure or mitigate any breach after receipt of said written notice, and the Company's being permitted to control the response
to and any payment, settlement or defense of any third-party claim as to which indemnity is sought; provided that any such settlement
shall not impose any obligation on Seller without her prior written consent.

 

8.              Releases.

 

8.1.     By Seller.
Seller, on her own behalf, and on behalf of her affiliates, successors and assigns, does hereby remise, release, and forever discharge
the Company, and the Company’s agents, advisors, representatives, attorneys, successors, subsidiaries, affiliates, nominees,
directors, officers, employees, stockholders, independent contractors, and insurers (collectively, the “Seller’s Releasees”),
of and from any and all manner of actions and causes of action, suits, debts, claims, and demands whatsoever, in law or in equity,
whether known or unknown, which the Seller ever had, now has, or may in the future have, or which all or any of the heirs, executors,
administrators, successors, or assigns of Seller hereafter can, shall, or may have, against the Seller’s Releasees for or
by reason of any cause, matter, or thing whatsoever as it relates to or arises out of actions or events occurring prior to the
Closing Date. Nothing in the language of this Section 8.1 shall prevent any party to this Agreement from enforcing the terms
of this Agreement or any of the documents contemplated by Section 2, if there should be a breach or default of any such agreement.

 

8.2.     By the Company.
The Company, on its own behalf, and on behalf of its affiliates, successors and assigns, does hereby remise, release, and forever
discharge Seller and her agents, advisors, representatives, attorneys, successors, affiliates, heirs, nominees, employees, executors,
administrators, trustees, independent contractors, and insurers (collectively, the “Company’s Releasees”),
of and from any and all manner of actions and causes of action, suits, debts, claims, and demands whatsoever, in law or in equity,
whether known or unknown, which the Company ever had, now has, or may in the future have, or which all or any of the subsidiaries,
affiliates, directors, officers, employees, agents, representatives, successors, or assigns of the Company hereafter can, shall,
or may have, against the Company’s Releasees for or by reason of any cause, matter, or thing whatsoever as it relates to
or arises out of actions or events occurring prior to the Closing Date. Nothing in the language of this Section 8.2 shall
prevent any party to this Agreement from enforcing the terms of this Agreement or any of the documents contemplated by Section 2,
if there should be a breach or default of any such agreement.

 

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9.              Miscellaneous. 

 

9.1.     Further
Actions.  The parties will execute such further documents and take such further actions as may be reasonably requested by the
other in order to effect the transactions contemplated by this Agreement.

 

9.2.     Attorneys’
Fees. In the event it is necessary for any party hereto to institute suit in connection with this Agreement or breach thereof,
the prevailing party in such suit shall be entitled to reimbursement for its reasonable costs, expenses and attorneys’ fees
incurred.

 

9.3.     Survival
of Representations and Warranties. The representations, warranties, covenants, and agreements set forth in this Agreement,
and any other written representation and any ancillary document, are contingent on and shall survive the Closing.

 

9.4.     Assignment.
This Agreement shall not be assigned by any party hereto without prior written consent of the other party.

 

9.5.     Binding
on Successors and Permitted Assigns. This Agreement shall be binding upon and inure to the benefit of the Company and Seller
and their respective successors, heirs, devisees, transferees, and permitted assigns.

 

9.6.     Governing
Law; Venue; Injunctive Relief.  This Agreement shall be governed by and construed in accordance with the laws of the State
of Washington, regardless of the laws that might otherwise govern under applicable principles of conflicts of law. Any legal action
by or against Seller or the Company relating to this Agreement shall be instituted and determined exclusively in the federal courts
located in the State of Washington, to the jurisdiction of which each party hereby expressly and unconditionally and irrevocably
agrees to submit. The parties hereto shall be entitled to an injunction or injunctions to prevent breaches of this Agreement, and
to specifically enforce the terms hereof, in addition to any other remedy to which they are entitled at law or in equity.

 

9.7.     Severability.
Any provision of this Agreement which is prohibited or unenforceable in any jurisdiction shall as to such jurisdiction be ineffective
to the extent of such prohibition or unenforceability without invalidating the remaining provisions hereof or affecting the validity
or enforcement of any such provision in any other jurisdiction. To the extent permitted by applicable law, the parties waive any
provision of law which renders any provision hereof prohibited or unenforceable in any respect.

 

9.8.     Waiver.
No waiver of any provision of this Agreement shall be deemed, or shall constitute, a waiver of any other provision, whether or
not similar, nor shall any waiver constitute a continuing waiver. No waiver shall be binding unless executed in writing by the
party making the waiver.

 

9.9.     Entire Agreement;
Amendment. This Agreement comprises the entire agreement of the parties with respect to the matters addressed herein, and supersedes
all prior oral and written agreements of the parties and all discussions, correspondence or other communications with respect to
such matters. This Agreement may not be amended or modified, except by written agreement of the parties. No provision of this Agreement
may be waived, except in writing, and only in the specific instance and for the specific purposes for which given.

 

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9.10.     Headings.
The headings used in this Agreement are solely for convenience of reference, are not part of this Agreement, and are not to be
considered in construing or interpreting this Agreement.

 

9.11.     Costs.
The Company and Seller shall each bear their respective expenses and legal fees incurred with respect to this Agreement and
the transaction contemplated herein. 

 

9.12.     Signatures. 
This Agreement may be signed in counterparts.  A fax transmission of a signature page will be considered an original signature
page.  At the request of a party, the other party will confirm a fax-transmitted signature page by delivering an original
signature page to the requesting party.

 

[SIGNATURE
PAGE FOLLOWS.] 

 

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IN WITNESS WHEREOF, the parties hereto have
executed this Stock Repurchase Agreement effective on the day and year first herein written.

 

	SELLER:	 	COMPANY:
	 	 	 
	 	 	Barrett Business Services, Inc.
	 	 	 
	/s/ Nancy B. Sherertz by George C. Spencer,	 	 
	attorney-in fact under power of attorney	 	 
	Dated March 1, 2012	 	By:	/s/ Michael L. Elich
	Nancy B. Sherertz	 	Name:	Michael L. Elich
	 	 	Title:	President and Chief
	 	 	 	Executive Officer

  

    	 

    	 

    

  

EXHIBIT A

 

FORM OF ARTICLES SUPPLEMENTARY

SERIES A NONCONVERTIBLE, NON-VOTING REDEEMABLE
PREFERRED STOCK

 

Barrett Business Services, Inc., a Maryland
corporation (the “Corporation”), hereby certifies to the State Department of Assessments and Taxation of Maryland that:

 

FIRST: Under the authority contained
in Article III of the Charter of the Corporation (the “Charter”), the Board of Directors (the “Board”),
by duly adopted resolutions, classified and designated 50,000 shares of authorized but unissued Preferred Stock (as defined in
the Charter), $0.01 par value per share, of the Corporation as shares of Series A Nonconvertible, Non-Voting Redeemable Preferred
Stock (the “Series A Preferred Stock”), with the following preferences or other rights, voting powers, restrictions,
limitations as to dividends and other distributions, qualifications, and terms and conditions of redemption, which, upon any restatement
of the Charter, shall become part of Article III of the Charter, with any necessary and appropriate renumbering or relettering
of the sections or subsections hereof.

 

“Series A Nonconvertible, Non-Voting
Redeemable Preferred Stock

 

(1) Designation and Number. A series of Preferred
Stock, designated the “Series A Nonconvertible, Non-Voting Redeemable Preferred Stock” (the “Series A Preferred
Stock”), is hereby established. The number of shares of the Series A Preferred Stock shall be 50,000.

 

(2) Rank. The Series A Preferred Stock shall,
with respect to rights to the payment of dividends and the distributions of assets upon the liquidation, dissolution, or winding
up of the Corporation, rank (a) senior to all classes or series of Common Stock (as defined in the Charter) and any other class
or series of stock of the Corporation if the holders of the Series A Preferred Stock are entitled to receive dividends or amounts
distributable upon the liquidation, dissolution, or winding up of the Corporation or redemption in preference or priority to the
holders of shares of such class or series (the “Junior Stock”); (b) on a parity with any class or series of stock of
the Corporation if the holders of such class or series of stock and the Series A Preferred Stock are entitled to receive dividends
and amounts distributable upon the liquidation, dissolution, or winding up of the Corporation or redemption in proportion to their
respective amounts of accumulated, accrued, and unpaid dividends per share or liquidation preferences, without preference or priority
of one over the other (the “Parity Stock”); and (c) junior to any class or series of stock of the Corporation if holders
of such class or series are entitled to receive dividends and amounts distributable upon the liquidation, dissolution, or winding
up of the Corporation or redemption in preference or priority to the holders of the Series A Preferred Stock (the “Senior
Stock”).

 

(3) Dividends.

 

(a) Subject to the preferential rights
of holders of any class or series of Senior Stock, holders of the outstanding shares of Series A Preferred Stock shall be entitled
to receive, when and as authorized by the Board of Directors and declared by the Corporation, out of funds legally available for
the payment of dividends, if applicable, cumulative preferential dividends at the rate of 5% per annum based on the $1,000 liquidation
preference (as may be adjusted in accordance with Section 7) with such rate increasing by 2% on each April 1 beginning April 1,
2013, until all of the outstanding shares of Series A Preferred Stock are redeemed as provided in Section 5. Such dividends shall
accrue from the first date on which any Series A Preferred Stock is issued (the “Original Issue Date”) and shall be
payable semi-annually in arrears on or before March 31 and September 30 of each year (each a “Dividend Payment Date”);
provided, however, that if any Dividend Payment Date is not a Business Day (as defined below), then the dividend which would
otherwise have been payable on such Dividend Payment Date may be paid on the following Business Day with the same force and effect
as if paid on such Dividend Payment Date. Any dividend payable on the Series A Preferred Stock for any partial dividend period
will be computed on the basis of a 360-day year consisting of twelve 30-day months. A “dividend period” shall mean,
with respect to the first “dividend period,” the period from and including the Original Issue Date to and including
the first Dividend Payment Date, and with respect to each subsequent “dividend period,” the period from, but excluding,
a Dividend Payment Date to and including the next succeeding Dividend Payment Date or other date as of which accrued dividends
are to be calculated.

 

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(b) No dividends shall be declared or
paid or funds set apart for the payment of dividends by the Corporation or other distributions on any Common Stock or other Junior
Stock for any period (other than dividends or other distributions payable in shares of Common Stock or other Junior Stock or in
options, warrants or rights to subscribe for or purchase any shares of Common Stock or other Junior Stock and which options, warrants
or rights do not entitle the holder thereof to rights to dividends, amounts distributable upon the liquidation, dissolution, or
winding up of the Corporation or redemption on parity with or senior to the Series A Preferred Stock), and no shares of Common
Stock or other Junior Stock may be repurchased, redeemed or otherwise retired, nor may funds be set apart for such payment, repurchase,
redemption or retirement, unless all accrued and unpaid dividends in respect of the Series A Preferred Stock have been paid or
set apart for such payment on the Series A Preferred Stock for all prior dividend periods.

 

(c) Dividends shall be payable, at the
sole option of the Corporation, either (i) in cash, (ii) by issuance of additional shares of Series A Preferred Stock (including
fractional shares) having an aggregate Liquidation Preference equal to the amount of the dividend to be paid, or (iii) in any combination
thereof. All dividends paid with respect to shares of Series A Preferred Stock, whether in cash or shares of Series A Preferred
Stock, shall be made pro rata among the holders of Series A Preferred Stock based on the aggregate accrued but unpaid dividends
on the shares held by each such holder. If and when any shares are issued under this Section 3(c) for the payment of accrued dividends,
such shares shall be validly issued and outstanding and fully paid and nonassessable.

 

(d) No dividends on shares of Series A
Preferred Stock shall be declared by the Corporation or paid or set apart for payment by the Corporation at such time as the terms
and provisions of any existing written agreement between the Corporation and any other party, including any existing agreement
relating to its indebtedness, (i) prohibit or impose any penalty on such declaration, payment or setting apart for payment or (ii)
provide that such declaration, payment or setting apart for payment would constitute a breach thereof or a default thereunder,
or if such declaration or payment shall be restricted or prohibited by law.

 

(e) Notwithstanding the foregoing, dividends
on the Series A Preferred Stock shall accumulate, whether or not the terms and provisions set forth in Section 3(d) hereof at any
time prohibit the current payment of dividends, whether or not there are funds legally available for the payment of such dividends
and whether or not dividends are declared.

 

(f) Notwithstanding the foregoing, no
dividend will be declared or paid with respect to shares of the Series A Preferred Stock that are redeemed prior to the elapse
of six months from the Original Issue Date (for avoidance of doubt, such date being __________). 

 

(g) For purposes of these Articles Supplementary,
“Business Day” shall mean any day on which a bank doing business in the State of Washington is not permitted to be
closed.

 

(4) Liquidation Preference.

 

(a) Upon any voluntary or involuntary
liquidation, dissolution, or winding up of the Corporation, the holders of the Series A Preferred Stock then outstanding are entitled
to be paid, or have the Corporation declare and set apart for payment, out of the assets of the Corporation legally available for
distribution to its stockholders, before any distribution of assets is made to holders of any Junior Stock, a liquidation preference
per share of Series A Preferred Stock equal to the sum of (i) $1,000.00 (as may be adjusted in accordance with Section 7) and (ii)
all accrued and unpaid dividends (the “Liquidation Preference”).

 

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(b) In the event that, upon any such voluntary
or involuntary liquidation, dissolution or winding up, the available assets of the Corporation are insufficient to pay the full
amount of the Liquidation Preference on all outstanding shares of Series A Preferred Stock and all shares of Parity Stock, then
the holders of the Series A Preferred Stock and all holders of such Parity Stock shall share ratably in any such distribution of
assets in proportion to the full liquidation preference to which they would otherwise be respectively entitled.

 

(c) After payment of the full amount of
the Liquidation Preference to which they are entitled, the holders of Series A Preferred Stock will have no right or claim to any
of the remaining assets of the Corporation.

 

(d) Upon the Corporation’s provision
of written notice as to the effective date of any such liquidation, dissolution or winding up of the Corporation, accompanied by
a check in the amount of the full Liquidation Preference to which each record holder of the Series A Preferred Stock is entitled,
the Series A Preferred Stock shall no longer be deemed outstanding shares of stock of the Corporation and all rights of the holders
of such shares will terminate. Such notice shall be given by first class mail, postage pre-paid, to each record holder of the Series
A Preferred Stock at the respective mailing addresses of such holders as the same shall appear on the stock transfer records of
the Corporation.

 

(e) In determining whether a distribution
(other than upon voluntary or involuntary liquidation), by distribution, redemption or other acquisition of the Corporation’s
equity securities is permitted under Maryland law, no effect shall be given to amounts that would be needed, if the Corporation
were to be dissolved at the time of the distribution, to satisfy the preferential rights upon dissolution of stockholders whose
preferential rights on dissolution are superior to those receiving the distribution.

 

(f) The consolidation or merger of the
Corporation with or into any other business enterprise or of any other business enterprise with or into the Corporation, or the
sale, lease or conveyance of all or substantially all of the assets or business of the Corporation, shall not constitute a liquidation,
dissolution or winding up of the Corporation.

 

(5) Redemption.

 

(a) Mandatory Redemption. At the earlier
of (such earlier date, the “Mandatory Redemption Date”) (i) the fifth anniversary of the Original Issue Date, or (ii)
a Change of Control (as defined below), the Corporation, to the extent that it has funds legally available therefor shall redeem
all of the outstanding shares of the Series A Preferred Stock for cash at a redemption price per share of Series A Preferred Stock
(the “Redemption Price”) equal to $1,000.00 (as may be adjusted in accordance with Section 7) plus all accrued and
unpaid dividends thereon up to and including the Mandatory Redemption Date.

 

A “Change of Control” means,
after the Original Issue Date, in one or a series of related transactions:

 

(i) (A) the acquisition by any person, including
any syndicate or group deemed to be a “person” under Section 13(d)(3) of the Securities Exchange Act of 1934, as amended
(the “Exchange Act”), of “beneficial ownership” (as defined in Rules 13d-3 and 13d-5 under the Exchange
Act, except that a person or group shall be deemed to have beneficial ownership of all shares of voting stock that such person
or group has the right to acquire regardless of when such right is first exercisable), directly or indirectly, of stock of the
Corporation entitling that person to exercise more than 50% of the total voting power of all stock of the Corporation entitled
to vote generally in the election of the Corporation’s directors; and (B) following the closing of any transaction referred
to in (A), neither the Corporation nor the acquiring or surviving entity has a class of common securities (or American Depositary
Receipts representing such securities) listed on the New York Stock Exchange (the “NYSE”), the NYSE Amex Equities (the
“NYSE Amex”), or the NASDAQ Stock Market (“NASDAQ”), or listed or quoted on an exchange or quotation system
that is a successor to the NYSE, the NYSE Amex or NASDAQ; or

 

(ii) the sale, lease or conveyance of all
or substantially all of the assets or business of the Corporation.

 

    	A-3

    	 

    

 

(b) Optional Redemption. At any time before
the Mandatory Redemption Date, the Corporation, at its option, may redeem shares of the Series A Preferred Stock, in whole or in
part, for the Redemption Price. If less than all of the outstanding shares of Series A Preferred Stock are to be redeemed, the
shares of Series A Preferred Stock to be redeemed may be selected by any equitable method determined by the Board provided that
such method does not result in the creation of fractional shares.

 

(c) Procedure for Redemption.

 

(i) Upon the Corporation’s written
notice as to the effective date of the redemption, accompanied by payment in immediately available U.S. funds of the amount of
the full Redemption Price through such effective date to which each record holder of shares of Series A Preferred Stock to be redeemed
is entitled, shares of the Series A Preferred Stock shall be redeemed and shall no longer be outstanding shares of stock of the
Corporation and all rights of the holders of such shares will terminate. Such notice shall be given by first class mail, postage
pre-paid, to each record holder of the shares of Series A Preferred Stock to be redeemed at the respective mailing address of such
holder as the same shall appear on the stock transfer records of the Corporation. No failure to give such notice or any defect
therein or in the mailing thereof shall affect the validity of the proceedings for the redemption of any shares of Series A Preferred
Stock except as to the holder to whom notice was defective or not given.

 

(ii) In addition to any information required
by law or by the applicable rules of any exchange upon which Series A Preferred Stock may be listed or admitted to trading, such
notice shall state: (A) the redemption date; (B) the Redemption Price; (C) the place or places where the shares of Series A Preferred
Stock are to be surrendered (if so required in the notice) for payment of the Redemption Price in immediately available U.S. funds
(if not otherwise included with the notice); and (D) that dividends on the shares to be redeemed will cease to accrue on the redemption
date if payment accompanies the notice or, if not, on the date funds are set aside for payment. If less than all of the shares
of Series A Preferred Stock held by any holder are to be redeemed, the notice mailed to such holder shall also specify the number
of shares of Series A Preferred Stock held by such holder to be redeemed.

 

(iii) If notice of redemption of any shares
of Series A Preferred Stock has been given and if the funds necessary for such redemption have been set apart by the Corporation
for the benefit of the holders of any shares of Series A Preferred Stock so called for redemption, then, from and after the date
funds have been set apart for payment of the Redemption Price, dividends will cease to accrue on such shares of Series A Preferred
Stock, such shares of Series A Preferred Stock shall no longer be outstanding and all rights of the holders of such shares will
terminate, except the right to receive the Redemption Price therefor. If the Corporation shall so require and the notice of redemption
shall so state, holders of Series A Preferred Stock to be redeemed shall surrender the certificates representing such Series A
Preferred Stock, to the extent that such shares are certificated, at the place designated in such notice and, upon surrender in
accordance with said notice of the certificates representing shares of Series A Preferred Stock so redeemed (properly endorsed
or assigned for transfer, if the Corporation shall so require and the notice shall so state), such shares of Series A Preferred
Stock shall be redeemed by the Corporation at the Redemption Price. In case less than all of the shares of Series A Preferred Stock
represented by any such certificate are redeemed, a new certificate or certificates shall be issued representing the unredeemed
shares of Series A Preferred Stock without cost to the holder thereof. In the event that the shares of Series A Preferred Stock
to be redeemed are uncertificated, such shares shall be redeemed in accordance with the notice and no further action on the part
of the holders of such shares shall be required.

 

(iv) The deposit of funds with a bank
or trust company for the purpose of redeeming Series A Preferred Stock shall be irrevocable except that:

 

    	A-4

    	 

    

 

(A) the Corporation shall be entitled
to receive from such bank or trust company the interest or other earnings, if any, earned on any money so deposited in trust, and
the holders of any shares redeemed shall have no claim to such interest or other earnings; and

 

(B) any balance of monies so deposited
by the Corporation and unclaimed by the holders of the Series A Preferred Stock entitled thereto at the expiration of two years
from the applicable redemption date shall be repaid, together with any interest or other earnings thereon, to the Corporation,
and after any such repayment, the holders of the shares entitled to the funds so repaid to the Corporation shall look only to the
Corporation for payment of the Redemption Price without interest or other earnings.

 

(6) Voting Rights. Holders of the Series A
Preferred Stock will not have any voting rights, except that, so long as any shares of Series A Preferred Stock remain outstanding,
the Corporation shall not, without the affirmative vote of the holders of at least 85% of the Series A Preferred Stock outstanding
at the time voting as a separate class, (A) amend, alter or repeal the provisions of the Charter (by amendment, merger or otherwise)
in such a way that would materially and adversely affect the powers, special rights, preferences, or privileges of the Series A
Preferred Stock or the holders thereof, or (B) create or authorize the creation of (by amendment, merger, or otherwise) or issue
or incur any obligation to issue any Series A Preferred Stock (other than as provided in Section 3(c)) or any Senior Stock or Parity
Stock (or other securities, including notes, debentures or bonds, convertible into or exchangeable for Senior Stock or Parity Stock),
which by their terms shall be redeemable at any time when any shares of Series A Preferred Stock are issued and outstanding.

 

(7) Adjustment for Stock Splits and Reverse
Stock Splits. If outstanding shares of the Series A Preferred Stock shall be divided into a greater number of shares of Series
A Preferred Stock or into other securities of the Corporation convertible into or exchangeable for shares of Series A Preferred
Stock, then the Liquidation Price and Redemption Price, each as in effect immediately prior to such division, shall, simultaneously
with the effectiveness of such division, be proportionately reduced. Conversely, if outstanding shares of the Series A Preferred
Stock shall be combined into a smaller number of shares of Series A Preferred Stock or into other securities of the Corporation
convertible into or exchangeable for shares of Series A Preferred Stock, then the Liquidation Preference and Redemption Price,
each as in effect immediately prior to such combination, shall, simultaneously with the effectiveness of such combination be proportionately
increased. Any adjustment to the Liquidation Preference or Redemption Price under this Section 7 shall become effective
at the close of business on the date the subdivision or combination referred to herein becomes effective.

 

(8) Exclusion of Other Rights. The shares
of Series A Preferred Stock are not convertible into or exchangeable for any other property or securities of the Corporation. The
Series A Preferred Stock shall have no preemptive or subscription rights. The Series A Preferred Stock shall not have any preferences
or other rights other than those specifically set forth herein.”

 

SECOND: The Series A Preferred Stock
has been classified and designated by the Board under the authority contained in the Charter.

 

THIRD: These Articles Supplementary
have been approved by the Board in the manner and by the vote required by law. No stockholder of the Corporation has any voting
rights with respect to these Articles Supplementary.

 

FOURTH: The undersigned acknowledges
these Articles Supplementary to be the corporate act of the Corporation and, as to all matters or facts required to be verified
under oath, the undersigned acknowledges that, to the best of his knowledge, information and belief, these matters and facts are
true in all material respects and that this statement is made under the penalties of perjury.

 

    	A-5

    	 

    

 

IN WITNESS WHEREOF, the Corporation has caused
these Articles Supplementary to be signed in its name and on its behalf by its President and Chief Executive Officer and attested
to by its Secretary on this ___ day of ______, 2012. 

 

	ATTEST:	 	BARRETT BUSINESS SERVICES, INC.
	 	 	 
	By:	 	 	By:	 
	 	 	 	 	 
	 	Name:	 	 	Name:
	 	Title:	 	 	Title:

  

    	A-6CERTAIN PORTIONS OF THIS EXHIBIT HAVE
BEEN OMITTED PURSUANT TO A CONFIDENTIAL 

TREATMENT REQUEST. OMITTED INFORMATION
IS INDICATED BY AN ASTERIK MARKING (***) AND

HAS BEEN FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION 

 

 

 

 

 

 

 

 

EXCLUSIVE LICENSE AGREEMENT

 

dated October 5, 2005

 

between

 

Q Therapeutics, Inc.

 

and

 

UNIVERSITY OF UTAH RESEARCH FOUNDATION

 

 

 

    	 

    	 	

    

 

TABLE OF CONTENTS

 

	ARTICLE l.   DEFINITIONS	2
	ARTICLE 2.  LICENSE GRANT	3
	ARTICLE 3.  TERM AND SCOPE OF AGREEMENT	3
	ARTICLE 4.  SUBLICENSES	4
	ARTICLE 5.  LICENSE ISSUE FEES	6
	ARTICLE 6.  ROYALTIES	6
	ARTICLE 7.  DUE DILIGENCE	9
	ARTICLE 8.  CONFIDENTIALITY	10
	ARTICLE 9.  QUARTERLY & ANNUAL REPORTS	11
	ARTICLE 10.  PATENT PROSECUTION AND MAINTENANCE	12
	ARTICLE 11.  PATENT MARKING	12
	ARTICLE 12.  BOOKS AND RECORDS	12
	ARTICLE 13.  TERMINATION BY LICENSOR	13
	ARTICLE 14.  TERMINATION BY LICENSEE	13
	ARTICLE 15.  DISPOSITION OF LICENSED PRODUCTS ON HAND	14
	ARTICLE 16.  WARRANTY BY LICENSOR	14
	ARTICLE 17.  INFRINGEMENT	15
	ARTICLE 18.  WAIVER	15
	ARTICLE 19.  ASSIGNABILITY	15
	ARTICLE 20.  INDEMNIFICATION BY LICENSEE	16
	ARTICLE 21.  INDEMNIFICATION BY LICENSOR	16
	ARTICLE 22.  LATE PAYMENTS	16
	ARTICLE 23.  NOTICES	16
	ARTICLE 24.  REGULATORY COMPLIANCE	17
	ARTICLE 25.  GOVERNING LAW	17
	ARTICLE 26.  RELATIONSHIP OF PARTIES	18
	ARTICLE 27.  NON-USE OF NAMES	18
	ARTICLE 28.  DISPUTE RESOLUTION	18
	ARTICLE 29.  GENERAL PROVISIONS	19
	EXHIBIT “A” - PATENT RIGHTS	21
	EXHIBIT “B” - -LICENSE TO THE UNITED STATES GOVERNMENT	23
	EXHIBIT “C” - Quarterly Report	24
	EXHIBIT “D – Due Diligence	25

 

     

     

    

 

EXCLUSIVE LICENSE AGREEMENT

 

THIS EXCLUSIVE LICENSE
AGREEMENT (“agreement”) is entered into this 5TH day of October, 2005
by and between the UNIVERSITY OF UTAH RESEARCH FOUNDATION, a Utah nonprofit corporation, having its principal place of business
at 615 Arapeen Drive, Suite 310, Salt Lake City, UT 84108, hereinafter referred to as “LICENSOR,” and Q Therapeutics,
Inc., a Delaware corporation having its principal place of business at 615 Arapeen Drive, Suite 102, Salt Lake City, UT 84108,
hereinafter referred to as “LICENSEE.” This AGREEMENT replaces and consolidates a previous set of three license agreements
entered into the 9th day of August, 2002 by and between LICENSOR and LICENSEE (then formerly known as Cue Therapeutics),
identified by LICENSOR as Exclusive License #0837 for APCs, Exclusive License #0838 for GRPs, NCSCs and NEPs, and Non-Exclusive
License #0840 for NEPs.

 

WITNESSETH

 

WHEREAS, certain inventions,
generally characterized as GENERATION, CHARACTERIZATION AND ISOLATION OF NEUROEPITHELIAL STEM CELLS (NEPs) AND LINEAGE RESTRICTED
INTERMEDIATE PRECURSOR; A COMMON NEURAL PROGENITOR FOR THE CENTRAL NERVOUS SYSTEM AND PERIPHERAL NERVOUS SYSTEM (Neural Crest Stem
Cells or NCSCs); LINEAGE RESTRICTED GLIAL PRECURSORS (GRPs) FROM THE CENTRAL NERVOUS SYSTEM; METHOD OF ISOLATING HUMAN NEUROEPITHELIAL
PRECURSOR CELLS FROM HUMAN FETAL TISSUE; AND PURE POPULATIONS OF ASTROCYTE RESTRICTED PRECURSOR CELLS (APCs); AND METHODS FOR ISOLATION
AND USES THEREOF and assigned University of Utah identification numbers U-2383, U-2536, U-3184, and U-3275 (which is equivalent
to work developed in continuation with research at the NIH and referred to by Public Health Service (PHS) identification number
E-187-02/0), hereinafter collectively referred to as “the INVENTION”, have been made in the course of research at the
University of Utah conducted by Drs. Mahendra Rao, Margot Mayer-Proschel, Tahmina Mujtaba, Patrick Tresco, Darrin Messina, Ying
Liu, Yuan Yuan Wu, and Mark Noble and are COVERED BY PATENT RIGHTS (as defined below);

 

WHEREAS, LICENSOR desires
that the PATENT RIGHTS be developed and utilized to the fullest extent so that their benefits can be enjoyed by the general public;

 

WHEREAS, LICENSEE wishes
to obtain from LICENSOR an exclusive license for the commercial development, production, manufacture, use and sale of the PATENT
RIGHTS, and LICENSOR is willing to grant such a license upon the terms and conditions hereinafter set forth;

 

CERTAIN
PORTIONS OF THIS EXHIBIT HAVE BEEN OMITTED PURSUANT TO A CONFIDENTIAL 

TREATMENT
REQUEST. OMITTED INFORMATION IS INDICATED BY AN ASTERIK MARKING (***) AND HAS 

BEEN FILED
SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION 

 

    	1

    	 

    
 

 

WHEREAS,
the PATENT RIGHTS were developed in the course of research sponsored in part by the U.S. Government, and as a consequence are
subject to overriding obligations of LICENSOR to the U.S. Government;

 

NOW
THEREFORE, for and in consideration of the covenants, conditions and undertakings hereinafter set forth, the parties hereby agree
as follows:

 

ARTICLE
l. DEFINITIONS

 

Section
1.1“PATENT RIGHTS” shall mean and include all of the following LICENSOR intellectual property:

 

The
United States patents and/or patent applications listed in Exhibit “A”; United States patents issued from the applications
listed in Exhibit “A” and from divisionals and continuations (other than continuations-in-part) of these applications
and any reissues of such United States patents; claims of continuation-in-part applications and patents directed to subject matter
specifically described in the applications listed in Exhibit “A”; and claims of all foreign applications and patents
which are directed to subject matter specifically described in the United States patents and/or patent applications listed in
Exhibit “A”.

 

Section
1.2“LICENSED PRODUCT” shall mean any product, apparatus, kit or component part thereof, or any other subject
matter the manufacture, use or sale of which is COVERED BY any claim or claims included within PATENT RIGHTS.

 

Section
1.3“LICENSED METHOD” shall mean any method, procedure, process or other subject matter, the manufacture, use
or sale of which is COVERED BY any claim or claims included within PATENT RIGHTS.

 

Section
1.4“...COVERED BY...” shall mean a product, apparatus, kit or component part thereof or other item
that when made, used, or sold, or a method, procedure, process or other item, that, when practiced, would constitute, but for
the license granted to LICENSEE pursuant to this AGREEMENT, an infringement of any claim or claims included within PATENT RIGHTS.

 

Section
1.5“NET SALES” shall mean sales and/or billings and/or transfer for any consideration, including revenue neutral
remuneration by LICENSEE, or in the case of a sublicense by SUBLICENSEE (as defined below), for (a) any LICENSED PRODUCT sold
or leased, and (b) services performed using any LICENSED PRODUCT or LICENSED METHOD, in all cases, net of the sum of the following
items (where applicable): (1) cash, trade or quantity discounts actually allowed; (2) sales, use, tariff, customs duties or other
excise taxes directly imposed upon particular sales; (3) outbound transportation charges prepaid or allowed; and (4) allowances
or credits to third parties for rejections or returns. A LICENSED PRODUCT and services performed using a LICENSED PRODUCT or LICENSED
METHOD shall be considered sold when billed out or invoiced or, if not invoiced, when delivered or performed. There shall be no
deductions from NET SALES for costs of commissions or collections. NET SALES shall not include billings for LICENSED PRODUCTS
sold or services performed by LICENSEE to any AFFILIATE unless such AFFILIATE is an end-user of any LICENSED PRODUCT or service
performed using any LICENSED PRODUCT or LICENSED METHOD.

 

CERTAIN
PORTIONS OF THIS EXHIBIT HAVE BEEN OMITTED PURSUANT TO A CONFIDENTIAL 

TREATMENT
REQUEST. OMITTED INFORMATION IS INDICATED BY AN ASTERIK MARKING (***) AND HAS 

BEEN FILED
SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION 

 

    	2

    	 

    
 

 

 

Section
1.6“AFFILIATE” means any person or entity that controls, is controlled by, or is under common control with
LICENSEE, directly or indirectly. For purposes of this definition, “control” and its various inflected forms means
the possession, directly or indirectly, of the power to direct or cause the direction of the management and policies of such person
or entity, whether through ownership of voting securities, by contract or otherwise.

 

Section
1.7“FIELD OF USE” shall mean (1) use of GRPs, NCSCs, APCs and NEPs for drug screening, drug discovery, diagnostics,
drug target discovery, genomics, and human therapeutics; and (2) the sale of GRPs, NCSCs, APCs and NEPs to third parties.

 

Section
1.8“TERRITORY” shall mean world wide.

 

Section
1.9“RESEARCH LICENSE” shall mean a nontransferable, nonexclusive license to make and use the PATENT RIGHTS
for purposes of research and not for purposes of commercial manufacture or distribution or in lieu of purchase.

 

ARTICLE
2. LICENSE GRANT

 

Section
2.1Subject to the terms and conditions set forth herein, LICENSOR hereby grants to LICENSEE an exclusive license to make,
have made, use and sell any LICENSED PRODUCT and to practice any LICENSED METHOD in the FIELD OF USE under LICENSOR’S PATENT
RIGHTS throughout the TERRITORY.

 

Section
2.2The license granted in Section 2.1 hereof is expressly made subject to LICENSOR’S reservation of the right to
practice under LICENSOR’S PATENT RIGHTS for academic purposes.

 

Section
2.3The license granted in Section 2.1 hereof is expressly made subject to a non-exclusive, irrevocable, royalty-free license
heretofore granted to the U.S. Government and in the general form as attached hereto as Exhibit “B” and incorporated
herein by reference.

 

CERTAIN
PORTIONS OF THIS EXHIBIT HAVE BEEN OMITTED PURSUANT TO A CONFIDENTIAL 

TREATMENT
REQUEST. OMITTED INFORMATION IS INDICATED BY AN ASTERIK MARKING (***) AND HAS 

BEEN FILED
SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION 

 

    	3

    	 

    
 

 

ARTICLE
3. TERM AND SCOPE OF AGREEMENT

 

Section
3.1This AGREEMENT shall be in full force and effect from the date of full payment of any License Issue Fee required by
Section 5 of this AGREEMENT, payment for patent costs required by Section 10 (and covered by invoices delivered by LICENSOR to
LICENSEE prior to the execution of this AGREEMENT), and any and all other fees and payments due hereunder upon the date of execution
of this AGREEMENT (hereinafter “EFFECTIVE DATE”). This AGREEMENT shall be in full force and effect from the EFFECTIVE
DATE until the end of the term of the last-to-expire of LICENSOR’S PATENT RIGHTS licensed under this AGREEMENT unless otherwise
terminated by operation of law or by acts of the parties pursuant to the terms of this AGREEMENT.

 

Section
3.2The license granted under Section 2.1 shall be exclusive (subject only to the reservations set forth in Sections 2.2
and 2.3 above and Section 4.5 below) and LICENSOR hereby agrees that it shall not grant any other license to make, have made,
use, or sell LICENSED PRODUCT or to practice LICENSED METHOD throughout the TERRITORY and in the FIELD OF USE during the term
of this AGREEMENT.

 

ARTICLE
4. SUBLICENSES

 

Section
4.1LICENSOR hereby grants to LICENSEE the right to enter into sublicensing agreements with third parties (hereinafter
referred to as “SUBLICENSEES”) to the extent of LICENSEE’S rights under the grant provided in Section 2.1 and
provided that LICENSEE has current exclusive license rights, pursuant to Section 3.2, to the PATENT RIGHTS to which the sublicense
applies, with respect to the portion of the Field of Use and TERRITORY to which the sublicense relates. Upon any termination of
this AGREEMENT, each SUBLICENSEE’s sublicensed rights with respect to PATENT RIGHTS shall also terminate, unless: (a) the
sublicense is subject to all of the terms and conditions of this AGREEMENT and incorporates all of the terms and conditions hereof
which are protective of and beneficial to LICENSOR, which incorporation can be made by reference, (b) LICENSOR has received a
copy of the sublicense and related information as provided under Section 4.4 below; (c) SUBLICENSEE is in good standing with all
the terms and conditions of the sublicense and LICENSEE is not in current breach of the sublicense; (d) all of the rights and
benefits due LICENSEE under the sublicense are directed to LICENSOR; (e) LICENSOR shall not be liable, financially or otherwise,
for any existing or potential breach or liability of LICENSEE under the sublicense; (f) LICENSOR shall assume no obligations or
liabilities of LICENSEE to SUBLICENSEE other than LICENSOR’S obligations to LICENSEE as defined by this Agreement; and (g)
the payments due to LICENSOR from SUBLICENSEE under the sublicense shall be no less than the payments LICENSEE is obligated under
this Agreement to pay to LICENSOR with respect to the sublicense. If each of these qualifications is met, and the SUBLICENSEE
desires for the sublicense to survive, the SUBLICENSEE and LICENSOR shall enter a letter of understanding, acknowledging the survival
of the sublicense and placing the LICENSOR and SUBLICENSEE in a direct contract relationship for the sublicense. In addition,
LICENSOR shall negotiate in good faith with any other SUBLICENSEE in good standing at the time of termination for a license.

 

CERTAIN
PORTIONS OF THIS EXHIBIT HAVE BEEN OMITTED PURSUANT TO A CONFIDENTIAL 

TREATMENT
REQUEST. OMITTED INFORMATION IS INDICATED BY AN ASTERIK MARKING (***) AND HAS 

BEEN FILED
SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION 

    	4

    	 

    
 

 

Section
4.2Any sublicense granted by LICENSEE to a SUBLICENSEE shall be subject to all of the terms and conditions of this AGREEMENT,
and shall include an express provision to this effect. LICENSEE shall use commercially reasonable efforts to collect all payments
due LICENSOR from SUBLICENSEES.

 

Section
4.3LICENSEE shall pay to LICENSOR *** 
of any lump-sum fee or advance payment received by LICENSEE from any SUBLICENSEE pursuant to a sublicense under this AGREEMENT,
regardless of how the LICENSEE and SUBLICENSEE characterize such payments, including but not limited to license fees, minimum
annual royalties, milestone payments, etc. (except for amounts paid to LICENSEE for the purpose of conducting research and development
activities). LICENSEE shall not receive from SUBLICENSEES anything of value in lieu of cash payments in consideration for any
sublicense under this AGREEMENT without the express prior written permission of LICENSOR. In addition, LICENSEE shall pay
to LICENSOR a royalty on NET SALES made under any sublicense which royalty shall be *** NET 
SALES of services. In the event a sublicense grant from LICENSEE also incorporates technology licensed in by LICENSEE from
one or more third parties, then LICENSEE shall make a good faith allocation of the lump-sum or advanced payments received by the
LICENSEE for the sublicense, as well as all royalties payable pursuant to such sublicense, as between the LICENSOR’S PATENT
RIGHTS and third party technology also included in the sublicense, based on the relative values of the licensed technologies to
the products or services generating the SUBLICENSEE’S NET SALES. The payments due LICENSOR under this Section 4.3 shall
only apply to that portion of the amounts received by LICENSEE attributable to the LICENSOR’S PATENT RIGHTS, in accordance
with LICENSEE’s good faith determination, so that the percentage of lump sums or advance payments due to LICENSOR will be
determined by multiplying the percentage payment obligation referenced above by the portion of such lump sums or advanced payments
attributable to the PATENT RIGHTS, and the royalty payable to LICENSOR with respect to royalties received by LICENSEE on NET SALES
by the SUBLICENSEE will be based on the portion of such NET SALES attributable to the PATENT RIGHTS. LICENSOR may contest whether
any determination by LICENSEE hereunder was made in good faith, pursuant to the dispute resolution procedure set forth in Article
28 of this Agreement.

 

CERTAIN
PORTIONS OF THIS EXHIBIT HAVE BEEN OMITTED PURSUANT TO A CONFIDENTIAL 

TREATMENT
REQUEST. OMITTED INFORMATION IS INDICATED BY AN ASTERIK MARKING (***) AND HAS 

BEEN FILED
SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION 

    	5

    	 

    
 

 

Section
4.4LICENSEE shall within thirty (30) days of: (a) execution, provide LICENSOR with a copy of each sublicense granted by
LICENSEE hereunder and any amendments thereto or terminations thereof; and (b) receipt, summarize and deliver copies of all reports
due to LICENSEE from SUBLICENSEES with respect to license rights granted hereunder or NET SALES by SUBLICENSEE or royalties payable
by SUBLICENSEE to LICENSEE.

 

Section
4.5In the event that LICENSOR receives a written request from Public Health Services to grant a RESEARCH LICENSE to a
third party non-profit entity to use the PATENT RIGHTS, LICENSOR shall so notify LICENSEE, and LICENSEE agrees to negotiate in
good faith to grant a RESEARCH LICENSE (in the form of a sublicense of the PATENT RIGHTS licensed by LICENSEE hereunder) to said
third party non-profit entity on reasonable terms. If such negotiation has not been successfully completed within six (6) months
from the date LICENSEE first receives such request, LICENSOR shall have the right to grant a RESEARCH LICENSE to the third party
non-profit entity.

 

Section
4.6The provisions of this AGREEMENT shall be construed so as to avoid any double counting on NET SALES (whether by LICENSEE
or SUBLICENSEES) and royalty payments; that is, any NET SALES shall not be subject to two different royalty payment obligations.
In furtherance of the foregoing, LICENSOR and LICENSEE agree that any NET SALES by SUBLICENSEE or attributed to or received by
LICENSEE that are subject to the royalty payment provisions of Section 4.3 shall not also be subject to the royalty payment provisions
of Section 6.1. In addition, to the extent that any lump sum fees or advanced payments received by LICENSEE from any SUBLICENSEE
(of which LICENSEE is obligated to ** *
LICENSOR pursuant to the first sentence of Section 4.3) represent an advance payment of, or are credited against, royalties
charged by LICENSEE on NET SALES by such SUBLICENSEE, then the maximum royalties on NET SALES payable pursuant to the third sentence
of Section 4.3 shall be calculated net of the amount paid to LICENSOR pursuant to the first sentence of Section 4.3. Similarly,
the provisions of Sections 6.1 and 6.5 of this Agreement regarding allocation of value between intellectual property subject to
this Agreement and intellectual property not covered by this Agreement, and the allocation of value between products, services
or components covered by this Agreement and products, services or components not covered by this Agreement, shall be construed
so as to avoid all improper doubling-up of reductions from payments otherwise payable by LICENSEE to LICENSOR pursuant to the
terms of this Agreement.

 

ARTICLE
5. LICENSE ISSUE FEES

 

In
consideration of full payment for the obligations of the previous set of three license agreements, which
shall be replaced by this AGREEMENT, LICENSEE shall pay to LICENSOR ** *.
Such consideration is already deemed earned and immediately payable.

 

CERTAIN
PORTIONS OF THIS EXHIBIT HAVE BEEN OMITTED PURSUANT TO A CONFIDENTIAL 

TREATMENT
REQUEST. OMITTED INFORMATION IS INDICATED BY AN ASTERIK MARKING (***) AND HAS 

BEEN FILED
SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION 

    	6

    	 

    
 

 

ARTICLE
6. ROYALTIES

 

Section
6.1As consideration for the license under this AGREEMENT, LICENSEE shall pay to
LICENSOR ** * of any services, including but not limited to drug screening,
drug discovery, drug target discovery, diagnostics, and genomics services. LICENSEE shall also pay to LICENSOR an earned
royalty on the LICENSEE’s NET SALES of human therapeutics ** *.

 

Earned
royalties shall accrue in each country with respect to NET SALES in that country for the duration of PATENT RIGHTS in that country.
LICENSEE shall pay all royalties accruing to LICENSOR in U.S. Dollars within forty-five (45) days following the calendar quarter
in which NET SALES occur.

 

The
parties recognize and agree that, in order to develop and commercialize LICENSED PRODUCTS and LICENSED METHODS, or services utilizing
LICENSED PRODUCTS or LICENSED METHODS in the FIELD OF USE, it may be necessary or desirable for LICENSEE and/or its LICENSEES
to make use of and/or incorporate multiple elements of intellectual property from multiple sources. LICENSEE and/or its SUBLICENSEES
shall determine, in their sole judgment, which elements of intellectual property are necessary and/or desirable for the development
and/or commercialization of the licensed PATENT RIGHTS. In the event that any LICENSED PRODUCTS or LICENSED METHODS, or services
provided utilizing LICENSED PRODUCTS or LICENSED METHODS, which are marketed by or through LICENSEE, incorporate or utilize technology
licensed from one or more third parties, then LICENSEE shall make a good faith determination of the relative values (as percentages
adding up to 100%) of the various licensed technologies to the resulting LICENSED PRODUCTS, LICENSED METHODS or services, as applicable,
and shall promptly notify LICENSOR of such determination. Upon such determination, the royalty payable to LICENSOR pursuant to
this Section 6.1 shall be based on the portion of LICENSEE’S NET SALES that corresponds to the percentage value assigned
to the LICENSOR’S PATENT RIGHTS, multiplied by the applicable royalty rate as set forth in this Section 6.1. For example,
if the applicable royalty rate for a specified period were ** *,
and LICENSEE achieved NET SALES of $1,000,000 with respect to such period, and LICENSEE had determined in good faith that
the relative value to the LICENSED PRODUCTS sold to generate such NET SALES of various technologies licensed by LICENSEE were
as follows:

 

(a)
value of PATENT RIGHTS licensed from LICENSOR: 60%

 

(b)
value of technologies licensed from other parties: 40%,

 

CERTAIN
PORTIONS OF THIS EXHIBIT HAVE BEEN OMITTED PURSUANT TO A CONFIDENTIAL 

TREATMENT
REQUEST. OMITTED INFORMATION IS INDICATED BY AN ASTERIK MARKING (***) AND HAS 

BEEN FILED
SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION  

 

    	7

    	 

    
 

 

then the royalty payable to LICENSOR pursuant to this Section
6.1 would be determined by multiplying the NET SALES for the period in question ($1,000,000) by the percentage value to the LICENSED
PRODUCT of the licensed PATENT RIGHTS (60%), and then multiplying the resulting product
by the applicable ** *. As a result, the royalty payable to LICENSOR
with respect to LICENSOR’S NET SALES with respect to such period would be: ($1,000,000
x .60) x *** = $*** . In the event that LICENSOR believes that LICENSEE’S
determination of the relative values of various licensed technologies to the LICENSED PRODUCTS or LICENSED METHODS in question
was not made in good faith, then it may dispute such determination, and such dispute will be resolved in accordance with the dispute
resolution procedure set forth in Article 28 below.

 

Section
6.2Commencing with the first calendar quarter to occur following the date of first occurrence of NET SALES pertaining
to NEPs, GRPs, NCSCs, or APCs (U-2383, U-2536, U-3184, or U-3275), LICENSEE shall pay to LICENSOR within forty-five (45) days
of the end of said quarter a minimum annual royalty 
***

 

LICENSEE
shall continue to pay such minimum annual royalty until the end of the term of the last to expire of LICENSOR’S PATENT RIGHTS.
LICENSOR shall fully credit each payment of minimum annual royalties against any earned royalties payable by LICENSEE with respect
to the year for which the minimum annual royalty is made (being the year commencing with the calendar quarter ending prior to
the calendar quarter in which the minimum annual royalty is payable).

 

Section
6.3If any patent or any claim thereof included within LICENSOR’S PATENT RIGHTS shall be found invalid by a court
of competent jurisdiction and last resort, from which decision no appeal may be taken, LICENSEE’S obligation to pay LICENSOR
royalties based on such patent or claim or any claim patentably indistinct there from shall cease as of the date of such decision.
LICENSEE shall not, however, be relieved from paying LICENSOR any royalties, fees, expenses, or other liabilities that accrued
prior to the date of such decision or that are based on any of LICENSOR’S PATENT RIGHTS not the subject of such decision.

 

Section
6.4By way of clarification, no royalties shall be payable with respect to, and the definitions of LICENSED PRODUCT and
LICENSED METHOD shall not apply to, products or methods that LICENSEE may manufacture, use, sell or practice, as applicable, in
any jurisdiction, without the grant of the license set forth in Article 2 above, and without constituting an illegal infringement
of any valid and enforceable Patent Rights. No royalty shall accrue with respect to any LICENSED PRODUCTS sold, or any services
with respect to LICENSED PRODUCTS or LICENSED METHODS provided, after they no longer fall within the definition of LICENSED PRODUCTS
or LICENSED METHODS, as applicable, as a result of expiration or termination of applicable PATENT RIGHTS.

 

CERTAIN
PORTIONS OF THIS EXHIBIT HAVE BEEN OMITTED PURSUANT TO A CONFIDENTIAL 

TREATMENT
REQUEST. OMITTED INFORMATION IS INDICATED BY AN ASTERIK MARKING (***) AND HAS 

BEEN FILED
SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION 

    	8

    	 

    
 

 

Section
6.5If a LICENSED PRODUCT or LICENSED METHOD is sold in combination by LICENSEE or applicable SUBLICENSEE, as a single
product, service, or in a kit, with another product, service or components for which no royalty would be due hereunder if sold
separately, NET SALES from such combination sales for purposes of calculating the amounts due under this Article 6 shall
be calculated by multiplying the NET SALES price of the combination by the fraction A/(A+B), where A is the NET SALES price, during
the royalty period in question, of the LICENSED PRODUCT or LICENSED METHOD sold separately, and B is the total market price, during
the royalty period in question, of the other products, services or components sold separately. If the LICENSED PRODUCT, LICENSED
METHOD, or other products, services or components are not sold separately by LICENSEE, or as applicable SUBLICENSEE, during that
royalty period, then the NET SALES price of the combination will be as reasonably allocated by LICENSEE between such LICENSED
PRODUCT or LICENSED METHOD on the one hand, and such other product, service or component on the other hand, based upon their relative
importance and proprietary protection. LICENSOR reserves the right to assert the dispute resolution
process if it disputes whether allocations set by LICENSEE and SUBLICENSEE as described above are commercially reasonable. The
allocation contemplated by this Section is to be made in a manner consistent with the allocation contemplated by Section 6.1 above.

 

ARTICLE
7. DUE DILIGENCE

 

Section
7.1Upon execution of this AGREEMENT, LICENSEE shall diligently proceed with the development, manufacture, sale and use
of LICENSED PRODUCTS and/or LICENSED METHODS in order to make them readily available to the general public as soon as possible
on commercially reasonable terms. LICENSEE shall continue active, diligent marketing efforts for one or more LICENSED PRODUCT(S)
and/or LICENSED METHOD(S) throughout the term of this AGREEMENT.

 

Section
7.2In addition, LICENSEE shall perform the following obligations as part of its due diligence activities hereunder;

 

		(a)	LICENSEE shall deliver to LICENSOR, within two months
of the EFFECTIVE DATE, a comprehensive executive summary including, but not limited to, a discussion of the technology, product,
funding proposals, market, competition, intellectual property, business model, and management team; and within twelve months of
the EFFECTIVE DATE, a more detailed, comprehensive business plan including, but not limited to, a discussion of the same topics.
Within six (6) months of the EFFECTIVE DATE, LICENSEE shall deliver to LICENSOR a specific research and commercialization plan
showing the amount of money, number and kind of personnel and time budgeted and planned for each phase of development of the initial
LICENSED PRODUCT(S) and/or LICENSED METHOD(S) targeted for development by LICENSEE;

 

CERTAIN
PORTIONS OF THIS EXHIBIT HAVE BEEN OMITTED PURSUANT TO A CONFIDENTIAL 

TREATMENT
REQUEST. OMITTED INFORMATION IS INDICATED BY AN ASTERIK MARKING (***) AND HAS 

BEEN FILED
SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION 

 

    	9

    	 

    
 

 

	 	 	 

		(b)	LICENSEE shall
pay LICENSOR a due diligence payment of ** *
until the first occurrence of NET SALES in this AGREEMENT;

		(c)	LICENSEE shall
spend at * ** on research, development and
commercialization of LICENSED PRODUCTS and/or LICENSED METHODS during the four year period ending on August 9, 2006;

		(d)	LICENSEE shall file an IND or BLA during the eight-year
period following the EFFECTIVE DATE. In the instance that LICENSEE does not meet this requirement within the specified time period,
at LICENSOR’s discretion, additional 18 month periods may be granted to LICENSEE upon
payment ** * providing that LICENSEE can
demonstrate commercially reasonable efforts to advancing LICENSED PRODUCTS and/or LICENSED METHODS to a marketable product.
Examples of such efforts may include but are not limited to, annual funding commitments comparable to Section 7.2 (c) above.

		(e)	LICENSEE shall
pay LICENSOR ** * for each IND or BLA filed for a cell based human therapeutic
developed using LICENSED PRODUCTS and/or LICENSED METHODS; and

		(f)	LICENSEE shall
pay LICENSOR ** * upon NDA approval of each IND or BLA referenced in
(e) above.

 

Section
7.3Commencing on January 1, 2006, and on each July 1 and January 1 thereafter, until the first occurrence of NET SALES
and annually thereafter each January 1, LICENSEE shall submit to LICENSOR a written report covering LICENSEE’S progress
in (a) development and testing of all LICENSED PRODUCTS and LICENSED METHODS; (b) achieving the due diligence milestones specified
herein; and (c) preparing, filing, and obtaining of any approvals necessary for marketing the LICENSED PRODUCTS and LICENSED METHODS.
Each report shall be in substantially similar form and contain at least the information required by Exhibit “D” attached
hereto and incorporated herein.

 

Section
7.4 Upon a written request made by LICENSOR with respect to attendance at any meeting of LICENSEE’s Board of Directors,
LICENSEE shall permit a representative of LICENSOR to attend such meeting (provided that LICENSEE shall not be required to permit
a LICENSOR representative to attend more than two meetings of LICENSEE’s Board of Directors meetings in any calendar year.
LICENSOR’S representative shall not be compensated and will have no voting rights and may be excluded from specific discussions
of a confidential nature as determined to be appropriate by a vote of the Board of Directors. LICENSEE shall provide LICENSOR
with at least 30 days notice of such meetings, and any information discussed in such meetings will be subject to Article 8 herein.

 

CERTAIN
PORTIONS OF THIS EXHIBIT HAVE BEEN OMITTED PURSUANT TO A CONFIDENTIAL 

TREATMENT
REQUEST. OMITTED INFORMATION IS INDICATED BY AN ASTERIK MARKING (***) AND HAS 

BEEN FILED
SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION 

    	10

    	 

    
 

 

ARTICLE
8. CONFIDENTIALITY

 

Section
8.1LICENSEE and LICENSOR acknowledge that either party may provide certain information to the other about the other party’s
business plans, technology, relationships, research, developments and proprietary information that is considered to be confidential.
LICENSEE and LICENSOR shall take reasonable precautions to protect such confidential information. Such precautions shall involve
at least the same degree of care and precaution that the recipient customarily uses to protect its own confidential information.

 

Section
8.2LICENSEE acknowledges that LICENSOR is subject to the Utah Governmental Records Access and Managemment Act (“GRAMA”),
as amended. LICENSOR shall keep confidential any information provided to LICENSOR by LICENSEE that LICENSEE considers confidential,
as well as information originated or maintained by or relating to the technology transferred or sponsored research record as referenced
therein, to the extent allowable under GRAMA and as provided in Section 53B-16-301 et seq., Utah Code Ann. In order
to be eligible for such protection under GRAMA, confidential information of LICENSEE disclosed to LICENSOR must be in written
or other tangible form, marked as proprietary, and accompanied by a written claim by LICENSEE stating the reasons that such information
must be kept confidential.

 

ARTICLE
9. QUARTERLY & ANNUAL REPORTS

 

Section
9.1Within forty-five (45) days after the calendar year in which NET SALES first occur, and within 45 days after each calendar
quarter thereafter, LICENSEE shall provide LICENSOR with a written report detailing all sales and uses, if any, made of LICENSED
PRODUCTS and LICENSED METHODS during the preceding calendar quarter, and detailing the amount of NET SALES made during such quarter
and calculating the royalties due pursuant to Sections 6.1 and 4.3 hereof. Each report shall include at least the following:

 

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

		b.	accounting for all LICENSED METHODS used or sold by and/or for LICENSEE and all SUBLICENSEES;

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

		d.	royalties due under Section 6.2;

		e.	running royalties due under Section 6.1;

 

    	11

    	 

    

 

	 	 	 

		f.	royalties due on other payments from SUBLICENSEES and assignees under Section 4.3;

		g.	total royalties due;

		h.	names and addresses of all SUBLICENSEES of LICENSEE;

		i.	the amount spent on development of LICENSED PRODUCTS or LICENSED METHODS; and

		j.	the number of full-time equivalent employees working on the LICENSED PRODUCTS and/or LICENSED METHODS.

 

Section
9.2Each report shall be in substantially similar form as Exhibit “C” attached hereto. Each such report shall
be signed by an officer of LICENSEE (or the officer’s designee). With each such report submitted, LICENSEE shall pay to
LICENSOR the royalties and fees due and payable under this AGREEMENT. If no royalties shall be due, LICENSEE shall so report.

 

Section
9.3In addition to the regular reports required by Section 9.1, LICENSEE shall provide a written report to LICENSOR of
the date of first occurrence of NET SALES in each country within sixty (60) days of its occurrence.

 

ARTICLE
10. PATENT PROSECUTION AND MAINTENANCE

 

Section
10.1LICENSOR, at its sole discretion, may diligently prosecute and maintain PATENT RIGHTS with legal counsel of its choice,
after consultation with LICENSEE. LICENSOR shall incorporate reasonable comments from LICENSEE in such prosecution and maintenance
of PATENT RIGHTS. LICENSOR shall provide LICENSEE with copies of all relevant documentation and keep LICENSEE informed and apprised
of the continuing prosecution. LICENSEE shall keep any such documentation and information confidential.

 

Section
10.2LICENSEE shall pay all costs and legal fees incurred by LICENSOR in the preparation, prosecution and maintenance of
PATENT RIGHTS, including without limitation, any taxes on such patent rights, within thirty (30) days of receipt of invoice by
LICENSEE.

 

Section
10.3LICENSOR may exclude by written notice any patent or patent application from this AGREEMENT if LICENSEE declines or
fails to pay the costs and legal fees for the preparation, prosecution and maintenance of said patent or application within the
time period provided for herein, or the thirty day cure period as referenced in Article 13 below.

 

Section
10.4LICENSEE may pursue the prosecution of a patent or patent claims or foreign applications, with legal counsel of its
choice, with respect to any intellectual property included within the PATENT RIGHTS if LICENSOR declines to do so, provided that
LICENSEE shall be responsible for all fees and costs related thereto.

 

CERTAIN
PORTIONS OF THIS EXHIBIT HAVE BEEN OMITTED PURSUANT TO A CONFIDENTIAL 

TREATMENT
REQUEST. OMITTED INFORMATION IS INDICATED BY AN ASTERIK MARKING (***) AND HAS 

BEEN FILED
SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION 

    	12

    	 

    

 

ARTICLE
11. PATENT MARKING

 

LICENSEE
shall mark all LICENSED PRODUCTS made, used or sold under the terms of this AGREEMENT, or their containers, in accordance with
all applicable patent-marking laws.

 

ARTICLE
12. BOOKS AND RECORDS

 

LICENSEE
shall keep complete, true and accurate books of account containing all particulars that may be necessary for the purpose of showing
the amounts payable to LICENSOR hereunder. Said books of account shall be kept at LICENSEE’S principal place of business
or the principal place of business of the appropriate division of LICENSEE to which this AGREEMENT relates. Said books and the
supporting data shall be open at all reasonable terms for five (5) years following the end of the calendar year to which they
pertain, to inspection by LICENSOR or its agents, upon notice to LICENSEE, for the purpose of verifying LICENSEE’S royalty
statement or compliance in other respects with this AGREEMENT. Should such inspection lead to the discovery of a greater than
five percent (5%) discrepancy in reporting to LICENSOR’S detriment, LICENSEE agrees to pay the full cost of such inspection.
LICENSEE shall permit an in-facilities inspection by LICENSOR on or before January 1, 2006, and thereafter permit in-facilities
inspections by LICENSOR at regular intervals with at least twelve (12) months between each such inspection.

 

ARTICLE
13. TERMINATION BY LICENSOR

 

Section
13.1If LICENSEE should: (a) fail to deliver to LICENSOR any statement or report required hereunder when due; (b) fail
to make any payment at the time that the same should be due; (c) violate or fail to perform any covenant, condition, or undertaking
of this AGREEMENT to be performed by it hereunder; (d) file a bankruptcy action, or have a bankruptcy action against it, or become
insolvent, enter into an agreement or be involved in a proceeding with creditors, or have a receiver appointed for it; or (e)
cease to carry on its business with respect to the rights granted in this Agreement; then LICENSOR may give written notice of
such default to LICENSEE. If LICENSEE should fail to cure such default within thirty (30) days of such notice, the rights, privileges,
and license granted hereunder shall automatically terminate.

 

Section
13.2No termination of this AGREEMENT by LICENSOR shall relieve LICENSEE of its obligation to pay any monetary obligation
due or owing at the time of such termination and shall not impair any accrued right of LICENSOR. LICENSEE shall pay all attorneys’
fees and costs incurred by LICENSOR in enforcing any obligation of LICENSEE or accrued right of LICENSOR. Articles
8, 12, 13.2, 15, 16.2, 16.3, 20, 22, 25, 27, 28 and 29.7 shall survive any termination of this AGREEMENT.

 

CERTAIN
PORTIONS OF THIS EXHIBIT HAVE BEEN OMITTED PURSUANT TO A CONFIDENTIAL 

TREATMENT
REQUEST. OMITTED INFORMATION IS INDICATED BY AN ASTERIK MARKING (***) AND HAS 

BEEN FILED
SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION 

    	13

    	 

    
 

 

ARTICLE
14. TERMINATION BY LICENSEE

 

Section
14.1LICENSEE may terminate this AGREEMENT, in whole or as to any specified PATENT RIGHTS, at any time and from time to
time without cause, by giving written notice thereof to LICENSOR. Such termination shall be effective ninety (90) days after such
notice and all LICENSEE’S rights associated therewith shall cease as of that date.

 

Section
14.2Any termination pursuant to Section 14.1 shall not relieve LICENSEE of any obligation or liability accrued hereunder
prior to such termination, or rescind or give rise to any right to rescind any payments made or other consideration given to LICENSOR
hereunder prior to the time such termination becomes effective. Such termination shall not affect in any manner any rights of
LICENSOR arising under this AGREEMENT prior to the date of such termination.

 

ARTICLE
15. DISPOSITION OF LICENSED PRODUCTS ON HAND

 

Upon
expiration or termination of this AGREEMENT by either party, LICENSEE shall provide LICENSOR with a written inventory of all LICENSED
PRODUCTS in process of manufacture, in use or in stock. LICENSEE may dispose of any such LICENSED PRODUCTS within the ninety (90)
day period following such expiration or termination, provided, however, that LICENSEE shall pay royalties and render reports to
LICENSOR thereon in the manner specified herein.

 

ARTICLE
16. WARRANTY BY LICENSOR

 

Section
16.1LICENSOR warrants that it has the lawful right to grant the license set forth in this AGREEMENT.

 

Section
16.2EXCEPT AS EXPRESSLY PROVIDED IN SECTION 16.1, THE PARTIES ACKNOWLEDGE AND AGREE THAT LICENSOR HAS MADE NO REPRESENTATIONS
OR WARRANTIES, EXPRESS OR IMPLIED, INCLUDING BUT NOT LIMITED TO, WARRANTIES OF MERCHANTABILITY OR FITNESS FOR A PARTICULAR PURPOSE.
IN NO EVENT SHALL LICENSOR BE HELD RESPONSIBLE FOR ANY SPECIAL, INDIRECT OR CONSEQUENTIAL DAMAGES ARISING OUT OF THE USE OF PATENT
RIGHTS, EVEN IF LICENSOR IS ADVISED IN ADVANCE OF THE POSSIBILITY OF SUCH DAMAGES.

 

Section
16.3Nothing in this AGREEMENT shall be construed as:

 

		a.	a warranty or representation by LICENSOR as to the validity of scope of any PATENT RIGHTS.

 

CERTAIN
PORTIONS OF THIS EXHIBIT HAVE BEEN OMITTED PURSUANT TO A CONFIDENTIAL 

TREATMENT
REQUEST. OMITTED INFORMATION IS INDICATED BY AN ASTERIK MARKING (***) AND HAS 

BEEN FILED
SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION 

    	14

    	 

    
 

 

	 	 	 

		b.	a warranty or representation by LICENSOR that anything made, used, sold or otherwise disposed of
pursuant to any license granted under this AGREEMENT is or will be free from infringement of intellectual property rights of third
parties.

		c.	an obligation by LICENSOR to bring or prosecute actions or suits against third parties for patent
infringement, except as expressly provided in Article 17 hereof.

		d.	conferring by implication, estoppel or otherwise any license or rights under any patents of LICENSOR
other than PATENT RIGHTS.

 

Section
16.4Any breach of the representations or warranties made in this Article 16 shall entitle LICENSEE to a refund of all
payments made to LICENSOR as consideration for the rights granted under this AGREEMENT, and said refund shall be the sole remedy
available to LICENSEE for breach or violation of any provisions contained in this Article 16.

 

ARTICLE
17. INFRINGEMENT

 

Section
17.1If either party learns of a claim of infringement of or by any of LICENSOR’S PATENT RIGHTS licensed under this
AGREEMENT, that party shall give written notice of such claim to the other party. LICENSOR shall then use reasonable efforts to
terminate such infringement. In the event LICENSOR fails to abate the infringing activity within ninety (90) days after such written
notice or to bring legal action against the third party, LICENSEE may bring suit for patent infringement, naming LICENSOR as nominal
party plaintiff. No settlement, consent judgment or other voluntary final disposition of the suit may be entered into without
the consent of LICENSOR, which consent shall not be unreasonably withheld.

 

Section
17.2Any such legal action shall be at the expense of the party by whom suit is filed, hereinafter referred to as the “Litigating
Party”. Any damages or costs recovered by the Litigating Party in connection with a legal action filed by it hereunder,
and remaining after the Litigating Party is reimbursed for its costs and expenses reasonably incurred in the lawsuit, and after
any royalties or other payments due to LICENSOR under Articles 4, 5 and 6 are paid, shall be equally divided between LICENSEE
and LICENSOR.

 

Section
17.3LICENSEE and LICENSOR shall cooperate with each other in litigation proceedings instituted hereunder, provided that
such cooperation shall be at the expense of the Litigating Party, and such litigation shall be controlled by the Litigating Party.

 

CERTAIN
PORTIONS OF THIS EXHIBIT HAVE BEEN OMITTED PURSUANT TO A CONFIDENTIAL 

TREATMENT
REQUEST. OMITTED INFORMATION IS INDICATED BY AN ASTERIK MARKING (***) AND HAS 

BEEN FILED
SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION 

 

    	15

    	 

    

 

ARTICLE
18. WAIVER

 

No
waiver by either party hereto of any breach or default of any of the covenants or agreements herein set forth shall be deemed
a waiver as to any subsequent and/or similar breach or default.

 

ARTICLE
19. ASSIGNABILITY

 

Subject
to the limitations set forth below, this AGREEMENT is binding upon and shall inure to the benefit of the parties, their successors
and assigns. Subject to LICENSEE’s rights to sublicense, as set forth in Article 4 hereof, LICENSEE may assign this AGREEMENT
only with the written consent of LICENSOR, which consent shall not be reasonably withheld, provided that LICENSEE, without consent,
may assign this AGREEMENT in connection with the transfer or sale of all or substantially all of its assets, or in the event of
merger or consolidation, in either case to or with another company having assets and stockholder equity exceeding that of LICENSEE.

 

ARTICLE
20. INDEMNIFICATION BY LICENSEE

 

LICENSEE
shall indemnify, hold harmless and defend LICENSOR, the University of Utah, and their respective officers, employees and agents,
against any and all claims, suits, losses, damages, costs, liabilities, fees and expenses (including reasonable fees of attorneys)
resulting from or arising out of exercise of: (a) any license granted under this AGREEMENT; or (b) any act, error, or omission
of LICENSEE, its agents, employees or SUBLICENSEES, except where such claims, suits, losses, damages, costs, fees, or expenses
result solely from the negligent acts or omissions, or willful misconduct of the LICENSOR, its officers, employees or agents.
LICENSEE shall give LICENSOR timely notice of any claim or suit instituted of which LICENSEE has knowledge that in any way, directly
or indirectly, affects or might affect LICENSOR, and LICENSOR shall have the right at its own expense to participate in the defense
of the same.

 

ARTICLE
21. INDEMNIFICATION BY LICENSOR

 

The
LICENSOR is a governmental entity and is subject to the Utah Governmental Immunity Act, Section 63-30(d)-101 et seq.,
Utah Code Ann. (as amended) (the “Act”). The Act limits judgments for certain kinds of claims as specified. Subject
to the provisions of the Act, LICENSOR shall indemnify, defend and hold harmless LICENSEE, its officers, agents and employees
against any and all claims, suits, losses, damages, costs, liabilities, fees, and expenses (including reasonable fees of attorneys)
resulting solely from the negligent acts or omissions or willful misconduct of LICENSOR, its officers, agents or employees in
connection with this AGREEMENT. Nothing in this AGREEMENT shall be construed as a waiver of any rights or defenses applicable
to LICENSOR under the Act, including without limitation, the provisions of the Act regarding limitation of judgments. LICENSOR
shall give LICENSEE timely notice of any claim or suit instituted of which LICENSOR has knowledge that in any way, directly or
indirectly, affects or might affect LICENSEE, and LICENSEE shall have the right at its own expense to participate in the defense
of the same.

 

CERTAIN
PORTIONS OF THIS EXHIBIT HAVE BEEN OMITTED PURSUANT TO A CONFIDENTIAL 

TREATMENT
REQUEST. OMITTED INFORMATION IS INDICATED BY AN ASTERIK MARKING (***) AND HAS 

BEEN FILED
SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION 

    	16

    	 

    
 

 

ARTICLE
22. LATE PAYMENTS

 

In
the event royalty payments or other fees are not received by LICENSOR when due hereunder, LICENSEE shall pay to LICENSOR interest
charges at the rate of ten percent (10%) per annum on the amount of due but unpaid royalties, from the due date until paid.

 

ARTICLE
23. NOTICES

 

Any
payment, notice or other communication required or permitted to be given to either party hereto shall be in writing and shall
be deemed to have been properly given and effective: (a) on the date of delivery if delivered in person during recipient’s
normal business hours; or (b) on the date of attempted delivery if delivered by courier, express mail service or first-class mail,
registered or certified. Such notice shall be sent or delivered to the respective addresses given below, or to such other address
as either party shall designate by written notice given to the other party as follows:

 

In
the case of LICENSEE:

Q
THERAPEUTICS, INC.

615
Arapeen Drive, Suite 102

Salt
Lake City, UT 84108

Attn:
CEO

 

With
a copy to:

Snell
& Wilmer, LLP

15
West South Temple, Suite 1200

Salt
Lake City, Utah 84101

Attn:
Chris Anderson

 

In
the case of LICENSOR:

UNIVERSITY
OF UTAH RESEARCH FOUNDATION

Technology
Transfer Office

615
Arapeen Drive, Suite 310

Salt
Lake City, UT 84108

 

With
a copy to:

 

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OFFICE OF GENERAL COUNSEL

University of Utah

309 Park Building

Salt Lake City, Utah
84112

 

ARTICLE
24. REGULATORY COMPLIANCE

 

Section
24.1When required by local/national law, LICENSEE shall register this AGREEMENT, pay all costs and legal fees connected
therewith, and otherwise insure that the local/national laws affecting this AGREEMENT are fully satisfied.

 

Section
24.2LICENSEE shall comply with all applicable U.S. laws dealing with the export and/or management of technology or information.

 

Section
24.3LICENSEE agrees that products used or sold in the United States embodying LICENSED PRODUCTS or produced through use
of the LICENSED METHOD shall be manufactured in compliance with all applicable U.S. laws.

 

ARTICLE
25. GOVERNING LAW

 

This
AGREEMENT shall be interpreted and construed in accordance with the laws of the State of Utah, without application of any principles
of choice of laws.

 

ARTICLE
26. RELATIONSHIP OF PARTIES

 

In
assuming and performing the obligations of this AGREEMENT, LICENSEE and LICENSOR are each acting as independent parties and neither
shall be considered or represent itself as a joint venturer, partner, agent or employee of the other.

 

ARTICLE
27. NON-USE OF NAMES

 

LICENSEE
shall not use the names or trademarks of LICENSOR, the University of Utah, or its employees, nor any adaptation thereof, nor the
names of any of their employees, in any advertising, promotional or sales literature without prior written consent obtained from
LICENSOR, or said employee, in each case, except that LICENSEE may state that it is licensed by LICENSOR under one or more of
the patents and/or applications comprising the PATENT RIGHTS.

 

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ARTICLE
28. DISPUTE RESOLUTION

 

Except
for the right of either party to apply to a court of competent jurisdiction for a temporary restraining order, a preliminary injunction,
or other equitable relief to preserve the status quo or prevent irreparable harm, any and all claims, disputes or controversies
arising under, out of, or in connection with the AGREEMENT, including but not limited to any dispute relating to patent validity
or infringement or the existence of a breach or default hereunder, which the parties shall be unable to resolve within sixty (60)
days shall be mediated in good faith. The party raising such dispute shall promptly advise the other party of such dispute. By
not later than five (5) business days after the recipient has received such notice of dispute, each party shall have selected
for itself a representative who shall have the authority to bind such party, and shall additionally have advised the other party
in writing of the name and title of such representative. By not later than ten (10) days after the date of such notice of dispute,
the party against whom the dispute shall be raised shall select a mediator in the Salt Lake City area and such representatives
shall schedule a date with such mediator for a hearing. The parties shall enter into good faith mediation and shall share the
costs equally. If the representatives of the parties have not been able to resolve the dispute within fifteen (15) business days
after such mediation hearing, then any and all claims, disputes or controversies arising under, out of, or in connection with
this AGREEMENT, including any dispute relating to patent validity or infringement, shall be resolved through arbitration if the
parties mutually consent, or through any judicial proceeding either in the courts of the State of Utah or in the United States
District Court for the District of Utah, to whose jurisdiction for such purposes LICENSEE and LICENSOR each hereby irrevocably
consents and submits. All costs and expenses, including reasonable attorneys’ fees, of the prevailing party in connection
with resolution of a dispute by arbitration or litigation of such controversy or claim shall be borne by the other party.

 

ARTICLE
29. GENERAL PROVISIONS

 

Section
29.1The headings of the several sections are inserted for convenience of reference only and are not intended to be a part
of or to affect the meaning or interpretation of this AGREEMENT.

 

Section
29.2This AGREEMENT shall not be binding upon the parties until it has been signed herein below by or on behalf of each
party, and as of the EFFECTIVE DATE.

 

Section
29.3No amendment or modification of this AGREEMENT shall be valid or binding upon the parties unless made in writing and
signed by both parties.

 

Section
29.4This AGREEMENT embodies the entire understanding of the parties and supersedes all previous communications, representations
or understandings, either oral or written, between the parties relating to the subject matter hereof, including without limitation
the three license agreements referenced in the preamble of this AGREEMENT.

 

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Section
29.5The provisions of this AGREEMENT are severable, and in the event that any provision of this AGREEMENT shall be determined
to be invalid or unenforceable under any controlling body of the law, such invalidity or unenforceability shall not in any way
affect the validity or enforceability of the remaining provisions hereof.

 

Section
29.6This AGREEMENT may be signed in counterparts, each of which when taken together shall constitute one fully executed
document. Each individual executing this AGREEMENT on behalf of a legal entity does hereby represent and warrant to each other
person so signing that he or she has been duly authorized to execute this AGREEMENT on behalf of such entity.

 

Section
29.7In the event of any litigation, arbitration, judicial reference or other legal proceeding involving the parties to
this AGREEMENT to enforce any provision of this AGREEMENT, to enforce any remedy available upon default under this AGREEMENT,
or seeking a declaration of the rights of either party under this AGREEMENT, the prevailing party shall be entitled to recover
from the other such attorneys’ fees and costs as may be reasonably incurred, including the costs of reasonable investigation,
preparation and professional or expert consultation incurred by reason of such litigation, arbitration, judicial reference, or
other legal proceeding.

 

IN WITNESS WHEREOF,
LICENSOR and LICENSEE have executed this AGREEMENT by their respective officers hereunto duly authorized, on the day and year hereinafter
written.

 

 

	“LICENSEE”	 	“LICENSOR”
	Q THERAPEUTICS, INC.	 	
        UNIVERSITY OF UTAH RESEARCH FOUNDATION

         

	 	 	 	 	 
	 	 	 	 	 
	By	/s/ DEBORAH A. EPPSTEIN PhD	 	By	/s/ RAYMOND F. GESTELAND
	 	(Signature)	 	 	(Signature)
	 	 	 	 	 
	Name	Deborah A. Eppstein PhD.	 	Name	Raymond F. Gesteland
		(Please Print)	 	 	 
	 	 	 	 	 
	Title	Chief Executive Officer	 	Title	Vice President, Research
	 	 	 	 	 
	Date	10/05/2005 	 	Date	10/05/2005 

 

 

 

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FIRST AMENDMENT TO EXCLUSIVE LICENSE
AGREEMENT

BETWEEN

Q THERAPEUTICS, INC.

AND

UNIVERSITY OF UTAH RESEARCH FOUNDATION

 

 

This
First Amendment to Exclusive License Agreement (the “Amendment”) is made and entered into effective as of April 24,
2006, by and between Q Therapeutics, Inc., a Delaware corporation (“Licensee”) and the University of Utah Research
Foundation, a Utah nonprofit corporation (“Licensor”).

 

Recitals

 

A.Licensor
and Licensee are parties to an Exclusive License Agreement dated October 5, 2005 (the “Agreement”), pursuant to which
Licensor has granted certain rights and licenses to Licensee. For purposes of this Amendment, any capitalized terms used herein
but not otherwise defined will have the meanings given to them in the Agreement.

 

B.Licensor
and Licensee desire to amend and modify the terms of the Agreement in order to expand the definition of “Patent Rights”
to include certain intellectual property relating to neuronal restricted precursor cells, developed or acquired by Licensor (the
“Additional Intellectual Property”).

 

C.Licensor
and Licensee desire that Licensee have the right to utilize the Additional Intellectual Property on the same terms and subject
to the same restrictions and obligations as apply to the Patent Rights generally, as currently provided in the Agreement, subject
to the terms and conditions of this Amendment.

 

Agreement

 

NOW
THEREFORE, the parties hereto hereby agree as follows:

 

1.Modification
of Definition of Patent Rights. Section 1.1 of the Agreement is hereby amended to add the Additional Intellectual Property
to the definition of Patent Rights as currently set forth therein, so that the Patent Rights include, in addition to those items
previously referenced in the Agreement, all of the following Licensor intellectual property:

 

The
United States patent(s) and/or patent application(s) relating to neuronal restricted precursor cells (“NRPs”) which
are listed on Exhibit A attached hereto, and United States patents issued from such applications, and from divisionals and continuations
(other than continuations-in-part) of such applications and any reissuances of such United States patents; claims of continuation-in-part
applications and patents directed to subject matter specifically described in the application(s) referenced above; and claims
of all foreign applications and patents which are directed to subject matter specifically described in the United States patent(s)
and/or patent application(s) listed above.

 

    	 

    	 	

    
 

 

2.Expansion
of Field of Use. The definition of the term “Field of Use” as used in the Agreement is hereby expanded to include
(i) the use of NRPs for drug screening, drug discovery, diagnostics, drug target discovery, genomics and human therapeutics; and
(2) the sale of NRPs to third parties.

 

3.Grant
of Warrant in Lieu of Certain Reimbursements. In lieu of Licensee’s obligation to reimburse Licensor for $40,000 of
expenses incurred by Licensor in the preparation, prosecution and maintenance of Patent Rights with respect to the Additional
Intellectual Property (the “Patent Expense Amount”), the Patent Expense Amount shall be treated as an advancement
to Licensee pursuant to the terms of a Convertible Loan Agreement in the form attached hereto as Exhibit B (the “Loan Agreement”),
and upon Licensor’s execution of a counterpart of the Loan Agreement with respect to the Patent Expense Amount, Licensee
will issue to Licensor a Convertible Note (as defined in the Loan Agreement) in a principal amount equal to the Patent Expense
Amount, and will also undertake to issue to Licensor a Warrant (as defined in the Loan Agreement) in accordance with the terms
of the Loan Agreement.

 

4.Grant
of Additional Warrant. In consideration for Licensor’s agreement to modify the Agreement as provided in this Amendment,
and for other good and valuable consideration, the receipt and sufficiency of which are acknowledged by Licensee, Licensee will
grant to Licensor an additional Warrant, concurrently with the issuance of the Warrant referenced in Section 3 above, on substantially
the same terms, but providing for the purchase of an aggregate of 41,071 shares of Licensee’s Series B Preferred Stock,
at a price of $2.24 per share.

 

5.
Additional Information for Royalty Calculation. Paragraph 3 of Section 6.1 of the Agreement sets forth a mechanism
for determining royalties with respect to Licensed Products and Licensed Methods incorporating multiple elements for intellectual
property from multiple sources. In order to ensure that appropriate information is provided to Licensor in connection with each
such calculation, a new sentence is hereby added to such paragraph 3, to follow the fourth sentence currently set forth n such
paragraph, and to read as follows:

 

“For
any payment affected by such a determination Licensee shall specifically identify and justify to Licensor in writing: how Licensee
weighted the relative values of the technologies and the formula used to arrive at a final good faith determination of value,
which shall be included and detailed in the quarterly reports required under Section 9.2 of the Agreement, to be in the form referenced
in Exhibit C to the Agreement.”

 

 

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6.Modification
of Due Diligence Obligations. Section 7.2(b) of the Agreement, which currently sets forth various due diligence obligations
of the Licensee, is hereby amended to replace such obligations with a new payment obligation, and to read in its entirety as follows:

 

Licensee
shall pay Licensor a due diligence payment of ** *
on or before October 5, 2008, and on each anniversary of such date, provided that such payment obligations shall cease
upon the first occurrence of Net Sales, as defined in this Agreement.

  

7.
Patent Prosecution. Article 10 of the Agreement, relating to patent prosecution and maintenance, is hereby amended
to add the following new Section 10.5 to the end of such Article:

 

“10.5
Alternatively, Licensee may select the patent attorney who will prosecute the patent applications for said Patent Rights,
so long as Licensor consents to the selected attorney, which consent will not be unreasonably withheld. Licensee will pay all
costs and fees for said selected patent attorney. If there are any transition costs or fees incurred from transferring responsibilities
from the patent attorney who was used previously by Licensor to the selected patent attorney, Licensee will pay said costs and
fees. All such patent applications and patents shall be in the name of Licensor, and owned by Licensor, and included as part of
the Patent Rights licensed pursuant to this Agreement. If Licensee notifies Licensor that it does not intend to pay the cost of
an application, or if Licensee does not respond or make an effort to agree with Licensor on the disposition of rights in the subject
application, then Licensor may file an application at its own expense and Licensee will have no rights to the invention. If Licensee
selects a patent attorney as provided above, Licensee will require such attorney to agree to keep both Licensee and Licensor,
as co-clients, equally informed and involved as to all material information, material communications with governmental patent
offices, material issues and decisions, and related matters applicable to prosecuting the patent applications for the Patent Rights
and for maintaining the Patent Rights in good standing. Decisions for prosecuting the patent applications will be made so as to
obtain as broad of patent protection as is reasonable and practical under the circumstances. Licensor will request that copies
of all documents prepared by the selected patent attorney be provided to Licensee for review and comment prior to filing to the
extent practicable under the circumstances. Licensee will be billed and will pay all documented costs and fees and other charges
incident to the preparation, prosecution, and maintenance of the Licensed Patents within thirty (30) days of receipt of invoice
from the selected patent attorney. Licensee will promptly notify Licensor of its plans to file, revise or drop any patent application
or claim which may adversely affect the Patent Rights or the rights or royalties of Licensor in the Licensed Product(s) under
this Agreement. Licensee and the selected patent attorney shall not change any inventorship designations and shall not drop or
reduce any claim in a pending patent application which may adversely affect the Patent Rights or royalties of Licensor in the
Licensed Product(s).

 

8.Continuation
of Agreement. Except as otherwise specifically modified by this Amendment, the Agreement shall continue in full force and
effect.

 

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IN WITNESS WHEREOF, the parties hereto have
executed this Amendment effective as of the date first above written.

 

 

	 	LICENSEE:
	 	 	 
	 	Q Therapeutics, Inc.
	 	 	 
	 	/s/ DEBORAH A. EPPSTEIN PHD
	 	By:	 Deborah A. Eppstein PhD
	 	 	Chief Executive Officer
	 	 	 
	 	 	 
	 	LICENSOR:
	 	 	 
	 	University of Utah Research Foundation
	 	 	 
	 	/s/ RAYMOND F. GESTLAND
	 	 	 
	 	By:	 
	 	 	Raymond F. Gestland, Vice President, Research

   

 

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EXHIBIT B

  

LOAN AGREEMENT

 

 

[TO BE ATTACHED]

 

 

 

[FORM OF LOAN AGREEMENT

NOT YET DETERMINED BY PARTIES]

 

 

 

 

 

 

 

 

 

 

 

 

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SECOND AMENDMENT TO LICENSE AGREEMENT

BETWEEN

Q THERAPEUTICS, INC.

AND

THE UNIVERSITY OF UTAH RESEARCH FOUNDATION

 

This
Amendment is made and entered into effective as of October 13, 2011, by and between Q Therapeutics, Inc., a Delaware corporation,
having offices at 615 Arapeen Drive, Suite 102, Salt Lake City, UT 84108 (“Licensee”), and the University of Utah
Research Foundation, having offices at the Technology Commercialization Office, 615 Arapeen Drive, Suite 310, Salt Lake City,
UT 84108 (“Licensor”). For purposes of this Amendment, capitalized terms used herein but not otherwise defined will
have the meanings given to them in the Agreement (defined below). Licensor and Licensee may be referred to herein separately as
“Party” and jointly as “Parties”.

 

RECITAL

 

WHEREAS,
Licensor and Licensee are parties to an Exclusive License Agreement dated October 5, 2005 (the “Agreement”), pursuant
to which Licensor has granted certain rights and licenses to Licensee; and

 

WHEREAS,
Licensor and Licensee desire to amend and modify the terms of the Agreement excepting from the rights granted to Licensee certain
rights previously granted to ***., under a ***  Agreement
(as defined below), and consistent with that certain Settlement Agreement entered into by the Parties dated October 13,
2011.

 

NOW
THEREFORE, for and in consideration of the covenants, conditions and undertakings hereinafter set forth, the Parties hereby agree
as follows:

 

AMENDMENT

 

		1.	License Grant. Section 2.1 of the Agreement is
hereby deleted and replaced in its entirety with the following:

 

Section
2.1 LICENSEE hereby takes and accepts the rights granted to it under this AGREEMENT
subject to that certain ***  Agreement
entered into by and between LICENSOR and ***., dated on or about ***  (the
“*** Agreement”). LICENSEE’s grant under this AGREEMENT is therefore co-exclusive with those
rights granted under the ***  Agreement.

 

 

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			Subject to the *** 
Agreement, and subject to the terms and conditions set forth herein, LICENSOR hereby grants to LICENSEE an otherwise exclusive
license to make, have made, use and sell any LICENSED PRODUCT(S) and to practice any LICENSED METHOD(S) in the FIELD OF USE under
LICENSOR’S PATENT RIGHTS throughout the TERRITORY.

 

		2.	Ratification of Agreement. Except as provided
herein or as may be required to effectuate the intent of the Parties with respect to the amendments described in paragraph 1 hereof,
the Parties hereby reaffirm and ratify the terms of the Agreement in their entirety.

 

		3.	Further Assurances. Each of Licensee and Licensor
hereby agrees to execute, deliver, verify, acknowledge, and file any and all documents, instruments, or agreements as shall be
necessary or appropriate to reflect the intent of the Parties with respect to the amendments of the Agreement described herein.

 

		4.	Entire Understanding. This Amendment constitutes
the entire understanding between the Parties hereto with respect to the subject matter hereof, and any modification of this Amendment
shall be in writing and shall be signed by a duly authorized representative of each Party.

 

		5.	Counterparts.This Amendment may be executed
in counterparts, each of which will be deemed an original and together constitute the same Amendment.

 

 

IN WITNESS WHEREOF,
Licensor and Licensee have executed this Agreement by their respective duly authorized officers, on the day and year written above.

 

 

	“LICENSEE”	 	“LICENSOR”
	Q THERAPEUTICS, INC.	 	
        UNIVERSITY OF UTAH RESEARCH FOUNDATION

         

	 	 	 	 	 
	 	 	 	 	 
	By	/s/ DEBORAH A. EPPSTEIN PHD	 	By	/s/ THOMAS N. PARKS
	 	(Signature)	 	 	(Signature)
	 	 	 	 	 
	Name	Deborah A. Eppstein PhD		Name	Thomas N. Parks
		(Please Print)	 	 	(Please Print) 
	 	 	 	 	 
	Title	Chief Executive Officer	 	Title	President
	 	 	 	 	 

  

 

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THIRD AMENDMENT TO LICENSE AGREEMENT

BETWEEN

Q THERAPEUTICS, INC.

AND

THE UNIVERSITY OF UTAH RESEARCH FOUNDATION

 

This Amendment is made
and entered into effective as of October 22, 2011, by and between Q Therapeutics, Inc., a Delaware corporation, having offices
at 615 Arapeen Drive, Suite 102, Salt Lake City, UT 84108 (“Licensee”), and the University of Utah Research Foundation,
having offices at the Technology Commercialization Office, 615 Arapeen Drive, Suite 310, Salt Lake City, UT 84108 (“Licensor”).
For purposes of this Amendment, capitalized terms used herein but not otherwise defined will have the meanings given to them in
the Agreement (defined below). Licensor and Licensee may be referred to herein separately as “Party” and jointly as
“Parties”.

 

RECITAL

 

WHEREAS, Licensor and
Licensee are parties to an Exclusive License Agreement dated October 5, 2005 (the “Agreement”), pursuant to which Licensor
has granted certain rights and licenses to Licensee; and

 

WHEREAS, Licensor and
Licensee desire to amend and modify the terms of the Agreement regarding minimum annual royalty payments;

 

NOW THEREFORE, for
and in consideration of the covenants, conditions and undertakings hereinafter set forth, the Parties hereby agree as follows:

 

AMENDMENT

 

		1.	Royalties. Section 6.2 of the Agreement is hereby
deleted and replaced in its entirety with the following:

 

Section 6.2Commencing with
the first calendar quarter to occur following the date of first occurrence of NET SALES pertaining to NEPs, GRPs, NCSCs, or APCs
(U-2383, U-2536, U-3184, or U-3275) for human therapeutic use, LICENSEE shall pay to LICENSOR within forty-five (45) days of the
end of said quarter a minimum annual royalty as provided below:

 

	YEAR 1	$ ***
	YEAR 2	$ ***
	YEAR 3	$ ***
	YEAR 4	$ ***
	 (and Beyond)

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LICENSEE shall
continue to pay such minimum annual royalty until the end of the term of the last to expire of LICENSOR’S PATENT RIGHTS.
LICENSOR shall fully credit each payment of minimum annual royalties against any earned royalties payable by LICENSEE with respect
to the year for which the minimum annual royalty is made (being the year commencing with the calendar quarter ending prior to the
calendar quarter in which the minimum annual royalty is payable).

 

2. Ratification
of Agreement. Except as provided herein or as may be required to effectuate the intent of the Parties with respect to the amendments
described in paragraph 1 hereof, the Parties hereby reaffirm and ratify the terms of the Agreement in their entirety.

 

3. Further
Assurances. Each of Licensee and Licensor hereby agrees to execute, deliver, verify, acknowledge, and file any and all documents,
instruments, or agreements as shall be necessary or appropriate to reflect the intent of the Parties with respect to the amendments
of the Agreement described herein.

 

4. Entire
Understanding. This Amendment constitutes the entire understanding between the Parties hereto with respect to the subject matter
hereof, and any modification of this Amendment shall be in writing and shall be signed by a duly authorized representative of each
Party.

 

5. Counterparts. This Amendment
may be executed in counterparts, each of which will be deemed an original and together constitute the same Amendment.

 

IN WITNESS WHEREOF,
Licensor and Licensee have executed this Agreement by their respective duly authorized officers, on the day and year written above.

 

 

	“LICENSEE”	 	“LICENSOR”
	Q THERAPEUTICS, INC.	 	
        UNIVERSITY OF UTAH RESEARCH FOUNDATION

         

	 	 	 	 	 
	 	 	 	 	 
	By	/s/ DEBORAH A. EPPSTEIN PhD	 	By	/s/ THOMAS N. PARKS
	 	(Signature)	 	 	(Signature)
	 	 	 	 	 
	Name	Deborah A. Eppstein PhD		Name	Thomas N. Parks
		(Please Print)	 	 	(Please Print) 
	 	 	 	 	 
	Title	Chief Executive Officer	 	Title	President
	 	 	 	 	 

  

 

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SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION 

 

    	2

Source: [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00201-of-00352.parquet"}, [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00201-of-00352.parquet"}]]