Document:

Exhibit 4.1

 

CIM COMMERCIAL TRUST CORPORATION

 

Articles Supplementary 
 Series L Preferred Stock

 

CIM Commercial Trust Corporation, a Maryland corporation (the “Corporation”), hereby certifies to the State Department of Assessments and Taxation of Maryland that:

 

FIRST:  Under a power contained in Article VI of the charter of the Corporation (the “Charter”) and Section 2-105 of the Maryland General Corporation Law, the Board of Directors of the Corporation (the “Board of Directors”) by duly adopted resolutions reclassified [ ] shares of authorized but unissued preferred stock, $0.001 par value per share, of the Corporation as shares of Series L Preferred Stock, with the following preferences, 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 VI of the Charter, with any necessary or appropriate renumbering or relettering of the sections or subsections hereof.

 

Series L Preferred Stock

 

1.                                      Designation and Number.  A series of Preferred Stock, designated the “Series L Preferred Stock” (the “Series L Preferred Stock”), is hereby established.  The par value of the Series L Preferred Stock is $0.001 per share.  The number of shares of the Series L Preferred Stock shall be [ ].

 

2.                                      Definitions.  In addition to the capitalized terms elsewhere defined herein, the following terms, when used herein, shall have the meanings indicated:

 

(a)                                 “Aggregate VWAP” shall mean the amount equal to the quotient of (a) the sum of (i) the volume-weighted average per share price of the Common Stock based on all the transactions executed on the Applicable Dual-Listing Exchange for the twenty (20) days on which the Applicable Dual-Listing Exchange or the TASE is open for trading prior to the end of the quarter in which such redemption is effective, multiplied by the total number of shares of Common Stock traded on the Applicable Dual-Listing Exchange during such period, plus (ii) the volume-weighted average per share price of shares of Common Stock based on all the transactions executed on the TASE, using daily share prices as converted from ILS to USD at the then prevailing representative exchange rate published by the Bank of Israel on its website for the purpose of such day, for the twenty (20) days on which the Applicable Dual-Listing Exchange or the TASE is open for trading prior to the end of the quarter in which such redemption is effective, multiplied by the total number of shares traded on the TASE during such period, divided by (b) the total number of shares of Common Stock traded on the Applicable Dual-Listing Exchange and the TASE used for purposes of the above calculations.  If any such volume-weighted average per share price of Common Stock used for calculation of Aggregate VWAP is unavailable for one or more days during the period of calculation, the volume-weighted average price for such day will be deemed equal to the market value of one share of Common Stock on such trading day, as determined by the Corporation in a commercially reasonable manner, using a volume-weighted average price method.

 

(b)                                 “Aggregate Yearly Distribution Rate” is defined in Section 4(a).

 

(c)                                  “Applicable Dual-Listing Exchange” shall mean the non-Israeli securities exchange on which the Series L Preferred Stock is listed for trading at such time and which exchange is recognized as an eligible exchange under the “Dual-Listing Regime” of Chapter E3 of the Israeli Securities Law of 1968 and regulations promulgated under such law (as may be further amended or restated).

 

(d)                                 “Bank” shall mean one of the commercial banks (including their subsidiaries) or foreign bank branches as published from time to time by the Bank of Israel on its website that is selected by the Corporation for any given transaction.

 

(e)                                  “Common Stock” shall mean the Common Stock, $0.001 par value per share, of the Corporation.

 

(f)                                   “Corporation Redemption” shall mean a redemption at the option of the Corporation pursuant to Section 6.

 

(g)                                  “Corporation Redemption Date” is defined in Section 6(d).

 

 

(h)                                 “Corporation Redemption Notice Date” shall mean the date, which shall be no later than five days prior to the end of the quarter preceding the quarter in which the Corporation Redemption Date will occur, on which the Corporation provides notice of a Corporation Redemption in accordance with Section 6(g).

 

(i)                                     “Corporation Redemption Payment Date” shall mean the later of (i) the twelfth day following the Corporation Redemption Record Date (or, if such date is not a TASE Trading Day, the following TASE Trading Day) and (ii) the seventeenth day following the Corporation Redemption Notice Date.

 

(j)                                    “Corporation Redemption Price” is defined in Section 6(b).

 

(k)                                 “Corporation Redemption Record Date” shall mean with respect to a (i) Corporation Redemption for which a Corporation Redemption Notice Date occurs in the first three quarters of the year, the first TASE Trading Day following the Holder Redemption Payment Date occurring in the quarter following the Distribution Cutoff Date for such Corporation Redemption and (ii) Corporation Redemption for which a Corporation Redemption Notice Date occurs in the fourth quarter of the year, the first TASE Trading Day following the Series L Distribution Payment Date occurring in the following January or, if none, such other date in the following January announced by the Corporation.

 

(l)                                     “Current Exchange Rate” shall mean the exchange rate equal to the weighted average of the USD/ILS exchange rates of all the transactions (which shall be one or more) completed by the Bank(s) through which the payment is converted to ILS on the applicable date in accordance with the Prospectus.

 

(m)                             “Debt” shall mean with respect to the Corporation and its consolidated subsidiaries, determined in accordance with GAAP and to the extent listed as debt on the balance sheet of the Corporation, without duplication, the aggregate amount of all outstanding debt for borrowed money issued under bonds, notes, loan agreements or similar instruments, net of all cash and cash equivalents of the Corporation and its subsidiaries.  In no event (and for the avoidance of doubt) shall “Debt” include (i) issued and undrawn letters of credit, (ii) cash collateralized letters of credit, (iii) earn-out obligations and (iv) capital leases or operating leases.  In no event shall the allocable portion of “Debt” of any entity at which the “Debt” is incurred exceed the Corporation’s direct or indirect equity ownership percentage of such entity or, for the avoidance of doubt, include the “Debt” of any person the investment in which is accounted for under the equity method.  The Corporation’s good faith determination of the aggregate amount of “Debt” shall be binding absent manifest error. Notwithstanding the foregoing, the Corporation shall have no obligation to publish or otherwise disclose, and no holder of shares of Series L Preferred Stock shall have a right to request the publication or disclosure of, the financial information underlying the calculation of Debt.

 

(n)                                 “Distribution Cutoff Date” shall mean the last day of the quarter in which a Corporation Redemption Notice Date occurs.

 

(o)                                 “Holder Redemption Date” is defined in Section 7(d).

 

(p)                                 “Holder Redemption Notice” is defined in Section 7(e).

 

(q)                                 “Holder Redemption Payment Date” shall mean (i) with respect to each of the first three quarters of the year, the 18th day of the month following the end of such quarter (April 18, July 18, or October 18, as applicable) and (ii) with respect to the fourth quarter of the year, the Series L Distribution Payment Date occurring in the following January or, if no Series L Distribution Payment Date is set, such other date in the following January announced by the Corporation.

 

(r)                                    “Holder Redemption Price” is defined in Section 7(a)(i).

 

(s)                                   “ILS” shall mean Israeli new shekels.

 

(t)                                    “Initial Dividend” is defined in Section 4(c).

 

(u)                                 “Initial Exchange Rate” shall mean an exchange rate published by the Corporation in accordance with the Prospectus that is equal to the weighted average of the ILS/USD exchange rates of all the transactions as determined and completed by the Bank(s) through which the proceeds from the Offering that are not used to pay expenses denominated in ILS are converted to USD in accordance with the Prospectus.

 

(v)                                 “ISA” shall mean the Israel Securities Authority.

 

(w)                               “Leverage Ratio” shall mean the amount, expressed as a percentage, of Debt divided by Total Assets.

 

 

(x)                                 “Minimum Fixed Charge Coverage Ratio” is defined in Section 10(c).

 

(y)                                 “Offering” shall mean the offering and sale of the units consisting of shares of Series L Preferred Stock pursuant to the Prospectus.

 

(z)                                  “Person” shall mean an individual, partnership, corporation, limited liability company, business trust, joint stock company, trust, unincorporated association, permitted joint venture, governmental authority or other entity of whatever nature, whether public or private.

 

(aa)                          “Prospectus” shall mean the prospectus included in the effective registration statement filed by the Corporation with the U.S. Securities and Exchange Commission and with the ISA with respect to the Offering, as such prospectus may be amended or supplemented.

 

(bb)                          “Quarterly Redemption Window” shall mean the six-day period from and including the 15th day to and including the 20th day of the final month (March, June, September or December) of the fiscal quarter in which a holder seeks to exercise the holder’s optional redemption right provided by Section 7.

 

(cc)                            “Series A Preferred Stock” shall mean the Series A Preferred Stock, $0.001 par value per share, of the Corporation.

 

(dd)                          “Series L Distribution Conditions” is defined in Section 4(b).

 

(ee)                            “Series L Distribution Payment Date” is defined in Section 4(a).

 

(ff)                              “Series L Distribution Record Date” is defined in Section 4(a).

 

(gg)                            “Series L Stated Value” shall mean an amount per share equal to 100 ILS, subject to adjustment pursuant to Section 12.

 

(hh)                          “TASE” shall mean the Tel Aviv Stock Exchange.

 

(ii)                                  “TASE Trading Day” shall mean any day on which the TASE is open for trading.

 

(jj)                                “Total Assets” shall mean the fair value of the assets of the Corporation and its subsidiaries (on a consolidated basis) as determined by the Corporation consistent with the calculation of the Corporation’s net asset value as most recently published by the Corporation, as modified from time to time.  The Corporation’s good faith determination of the aggregate amount of “Total Assets” shall be binding absent manifest error.  Notwithstanding the foregoing, the Corporation shall have no obligation to publish or otherwise disclose, and no holder of shares of Series L Preferred Stock shall have a right to request the publication or disclosure of, the financial information underlying the calculation of Total Assets.

 

(kk)                          “USD” shall mean U.S. dollars.

 

3.                                      Rank.

 

(a)                                 The Series L Preferred Stock shall, with respect to rights to the payment of dividends and other distributions (not including the distribution of assets referenced in Section 3(b)), rank (i) senior to all classes or series of Common Stock, except with respect to and only to the extent of the Initial Dividend, and any other class or series of stock of the Corporation the terms of which specifically provide that the holders of the Series L Preferred Stock are entitled to receive dividends and other distributions in preference or priority to the holders of shares of such class or series (the “Junior Dividend Stock”); (ii) on a parity with any class or series of stock of the Corporation the terms of which specifically provide that the holders of such class or series of stock and the Series L Preferred Stock are entitled to receive dividends and other distributions on parity and without preference or priority of one over the other (the “Parity Dividend Stock”); and (iii) junior to the Series A Preferred Stock, the Common Stock, with respect to and only to the extent of the Initial Dividend, and any other class or series of stock of the Corporation the terms of which specifically provide that the holders of such class or series are entitled to receive dividends and other distributions in preference or priority to the holders of the Series L Preferred Stock (the “Senior Dividend Stock”).

 

(b)                                 The Series L Preferred Stock shall, with respect to the distribution of assets upon the liquidation, dissolution or winding up of the Corporation, rank (i) senior to the Common Stock both (1) to the extent of the Series L Stated Value and (2)  following payment of an amount equal to any unpaid Initial Dividend, to the extent of any accrued and unpaid distributions on the Series L Preferred Stock, senior to any other class or series of stock of the Corporation the terms

 

 

of which specifically provide that the holders of the Series L Preferred Stock are entitled to receive amounts distributable upon the liquidation, dissolution or winding up of the Corporation in preference or priority to the holders of shares of such class or series (the “Junior Liquidation Stock” and, together with Junior Dividend Stock, the “Junior Stock”); (ii) on a parity with the Series A Preferred Stock, to the extent of the Series L Stated Value, and any other class or series of stock of the Corporation the terms of which specifically provide that the holders of such class or series of stock and the Series L Preferred Stock are entitled to receive amounts distributable upon the liquidation, dissolution or winding up of the Corporation in proportion to their respective amounts of liquidation preferences, on parity and without preference or priority of one over the other (the “Parity Liquidation Stock” and, together with Parity Dividend Stock, the “Parity Stock”); and (iii) junior to the Series A Preferred Stock and the Common Stock, to the extent of the Initial Dividend, with respect to any accrued and unpaid distributions on Series L Preferred Stock, and any class or series of stock of the Corporation the terms of which specifically provide that the holders of such class or series are entitled to receive amounts distributable upon the liquidation, dissolution or winding up of the Corporation in preference or priority to the holders of the Series L Preferred Stock (the “Senior Liquidation Stock”).

 

4.                                      Distributions.

 

(a)                                 Subject to the preferential rights of holders of any class or series of Senior Dividend Stock and the Series L Distribution Conditions, holders of the Series L Preferred Stock shall be entitled to receive if, as and when authorized by the Board of Directors and declared by the Corporation, out of funds legally available for the payment of distributions, preferential cumulative cash distributions in ILS on each share of Series L Preferred Stock at the rate of 5.5% per annum (the “Aggregate Yearly Distribution Rate”), subject to increase as provided in Section 4(i), of the Series L Stated Value (as converted to USD at the Initial Exchange Rate).  The distributions on each share of Series L Preferred Stock shall be cumulative from (and including) the first date on which such share of Series L Preferred Stock is issued and shall be payable annually on the date selected by the Board of Directors (or its designee) (each, a “Series L Distribution Payment Date”), provided that a Series L Distribution Payment Date shall be no earlier than December 1 of the year for which such distribution is declared and no later than January 31 of the year following the year for which the distribution is declared.  Notwithstanding the foregoing, the first distribution on the Series L Preferred Stock shall not be payable until January 2019 and will represent accrual for more than a full year, covering the period from, and including, the date of original issuance to, and including, December 31, 2018.  Any distribution payable on the Series L Preferred Stock for any partial distribution period shall be computed ratably on the basis of a 360-day year consisting of twelve 30-day months.  Distributions shall be payable in arrears to holders of record as they appear in the stock records of the Corporation at the close of business on the applicable record date selected by the Board of Directors (or its designee) (the “Series L Distribution Record Date”), which shall be no earlier than five TASE Trading Days following the declaration of the distribution and no later than December 31 of the year for which the distribution is declared.  Any distribution on the Series L Preferred Stock that is authorized by Board of Directors shall be declared by the Corporation in USD no earlier than October 1 and no later than December 15 of the year for which the distribution is declared.  Notwithstanding the foregoing, the Board of Directors (or its designee), in its sole discretion, may at any time set a record date and/or a payment date for any part of or all of any distributions on the Series L Preferred Stock that are in arrears that differs from the Series L Distribution Record Date or the Series L Distribution Payment Date, respectively.  Authorized and declared distributions on the Series L Preferred Stock shall be paid in ILS on the Series L Distribution Payment Date by converting the declared distribution from USD to ILS at the Current Exchange Rate on the third TASE Trading Day preceding the applicable Series L Distribution Payment Date.

 

(b)                                 No distributions on the Series L Preferred Stock shall be paid with respect to a given fiscal year unless and until the following conditions (the “Series L Distribution Conditions”) are satisfied:

 

(i)                                     the Corporation has declared the entire Initial Dividend, if any, with respect to the Common Stock for such fiscal year;

 

(ii)                                  the Corporation has declared and paid (or declared and set apart for payment) full cumulative dividends equal to the full amount of all accrued and unpaid dividends on the Series A Preferred Stock for all past dividend periods; and

 

(iii)                               the Corporation has paid in such fiscal year dividends on the Common Stock in an amount equal to the product of (1) the Initial Dividend multiplied by (2) a fraction, the numerator of which is the number of quarters that have passed since the beginning of the fiscal year (including the current quarter) and the denominator of which is four.

 

 

(c)                                  Initial Dividend.

 

(i)                                     Subject to the other provisions of this Section 4(c), the “Initial Dividend” for a given fiscal year, if any, is a minimum annual amount, in USD, that is announced by the Corporation before the end of the prior fiscal year.

 

(ii)                                  Notwithstanding the provisions of Section 4(c)(i), the Initial Dividend for any fiscal year other than 2017 shall equal zero ($0) USD if any of the following is true: (1) the Board of Directors does not authorize or the Corporation does not announce such Initial Dividend before the end of the prior fiscal year, (2) full cumulative distributions equal to the full amount of all accrued and unpaid distributions on the Series L Preferred Stock have been not paid in full upon the Series L Preferred Stock for all past distribution periods (but not including the prior fiscal year) and such distributions have not been declared by the Corporation before the end of the prior fiscal year, (3) the Corporation has not declared in full the distributions that have accrued on the Series L Preferred Stock for the prior fiscal year before end of the prior fiscal year or (4) the Leverage Ratio as of November 30 of the preceding fiscal year exceeds 60%.

 

(d)                                 Subject to the modification of the Aggregate Yearly Distribution Rate pursuant to Section 4(i), holders of Series L Preferred Stock shall not be entitled to any distributions on the Series L Preferred Stock in excess of the distributions provided for in Section 4(a).

 

(e)                                  No interest, or sum of money in lieu of interest, shall be payable in respect of any distribution payment or payments on the Series L Preferred Stock that may be in arrears.

 

(f)                                   When distributions are not paid in full upon the Series L Preferred Stock or any other class or series of Parity Dividend Stock, or a sum sufficient for such payment is not set apart, all distributions declared upon the Series L Preferred Stock and any shares of Parity Dividend Stock shall be declared ratably in proportion to the respective amounts of distributions accrued and unpaid on the Series L Preferred Stock and accrued and unpaid on such Parity Dividend Stock (which shall not include any accumulation in respect of unpaid distributions for prior distribution periods if such Parity Dividend Stock does not have a cumulative distribution).

 

(g)                                  Except as set forth in Section 4(f) and Section 4(h), unless full cumulative distributions equal to the full amount of all accrued and unpaid distributions on the Series L Preferred Stock have been, or are concurrently therewith, declared and paid, or declared and set apart for payment, for all past annual periods,

 

(i)                                     no dividends or other distributions shall be declared and paid or declared and set apart for payment by the Corporation and no other distribution of cash or other property may be declared and made (other than dividends or other distributions paid in shares of Junior Dividend Stock or options, warrants or rights to subscribe for or purchase shares of Junior Dividend Stock or Junior Liquidation Stock), directly or indirectly, by the Corporation with respect to any shares of Common Stock (other than in amounts up to but not exceeding the Initial Dividend, if any) or any shares of Junior Dividend Stock or Parity Dividend Stock,

 

(ii)                                  nor shall any shares of Junior Dividend Stock or Parity Dividend Stock be redeemed, purchased or otherwise acquired (other than a redemption, purchase or other acquisition of Common Stock made for purposes of an equity incentive or benefit plan of the Corporation) for any consideration (or any monies be paid to or made available for a sinking fund for the redemption of any shares of any such stock), directly or indirectly, by the Corporation (except by conversion into or exchange for shares of Junior Dividend Stock or Junior Liquidation Stock, or options, warrants or rights to subscribe for or purchase shares of Junior Dividend Stock or Junior Liquidation Stock).

 

(h)                                 Notwithstanding the foregoing provisions of this Section 4, the Corporation shall not be prohibited from (i) declaring or paying or setting apart for payment any dividend or other distribution on any shares of Junior Stock or Parity Stock, or (ii) redeeming, purchasing or otherwise acquiring any Junior Stock or Parity Stock pursuant to the restrictions on ownership and transfer set forth in the Charter, in each case, if such declaration, payment, setting apart for payment, redemption, purchase or other acquisition is necessary in order to maintain the continued qualification of the Corporation as a real estate investment trust (REIT) under Section 856 of the Code (as defined in the Charter).

 

 

(i)                                     If the Corporation fails to declare the distributions that have accrued on the Series L Preferred Stock for a given year in full or fails to pay such distributions in full on the Series L Distribution Payment Date (provided that the first distribution on the Series L Preferred Stock shall not be payable until January 2019), the Aggregate Yearly Distribution Rate will increase by 1.0% effective January 1 of the year following the year for which such distributions were not paid in full, up to a maximum Aggregate Yearly Distribution Rate of 8.5% per annum.  Such increased Aggregate Yearly Distribution Rate will revert to 5.5% per annum as of January 1 of any year in which full cumulative distributions equal to the full amount of all accrued and unpaid distributions on the Series L Preferred Stock for all past yearly dividend periods have been paid in full as of January 31 of such year.

 

5.                                      Series L Liquidation Preference.

 

(a)                                 Upon any voluntary or involuntary liquidation, dissolution or winding up of the Corporation, after satisfaction of liabilities to creditors and subject to the preferential rights of holders of any class or series of Senior Liquidation Stock, before any payment or distribution by the Corporation shall be made to or set apart for the holders of any shares of Junior Liquidation Stock, the holders of shares of the Series L Preferred Stock shall be entitled to be paid out of the assets of the Corporation that are legally available for distribution to the stockholders, a liquidation preference equal to the Series L Stated Value (as converted to USD at the Initial Exchange Rate) (the “Series L Liquidation Preference”).  Until the holders of the Series L Preferred Stock have been paid the Series L Liquidation Preference in full, no payment will be made to any holder of Junior Liquidation Stock upon the liquidation, dissolution or winding up of the Corporation.  If upon the voluntary or involuntary liquidation, dissolution or winding up of the Corporation, the available assets of the Corporation, or proceeds thereof, distributable among the holders of the Series L Preferred Stock shall be insufficient to pay in full the Series L Liquidation Preference and the liquidating payments on any shares of any class or series of Parity Liquidation Stock (including any accrued and unpaid distributions that are required to be paid in accordance with the terms of such Parity Liquidation Stock) (the “Parity Liquidation Payments”), then such assets, or the proceeds thereof, shall be distributed among the holders of the Series L Preferred Stock and any such Parity Liquidation Stock ratably in the same proportion as the respective amounts that would be payable on such Series L Preferred Stock and any such Parity Liquidation Stock if all amounts payable thereon were paid in full.  After payment of the full amount of the Series L Liquidation Preference to which they are entitled, the holders of the Series L Preferred Stock shall have no right or claim to any of the remaining assets of the Corporation except as set forth in Section 5(c) below.

 

(b)                                 Upon any liquidation, dissolution or winding up of the Corporation, after payment shall have been made in full to the holders of the Series L Preferred Stock in an amount equal to the Series L Liquidation Preference and to the holders of any Parity Liquidation Stock in amount equal to the applicable Parity Liquidation Payment, the holders of Common Stock shall be entitled to receive an amount equal to any unpaid Initial Dividend.

 

(c)                                  Upon any liquidation, dissolution or winding up of the Corporation, after the payments set forth in (a) and (b) of this Section 5 shall have been made in full, the holders of the Series L Preferred Stock shall be entitled to receive an amount equal to all accrued and unpaid distributions (whether or not earned or declared) on such Series L Preferred Stock to the date of final distribution to such holders.  After payment of the full amount of the Series L Liquidation Preference and all accrued and unpaid distributions to which they are entitled, the holders of the Series L Preferred Stock shall have no right or claim to any of the remaining assets of the Corporation, or proceeds therefrom.

 

(d)                                 Upon any liquidation, dissolution or winding up of the Corporation, after the payments set forth in (a), (b) and (c) of this Section 5 shall have been made in full, the holders of any classes or series of Common Stock and any other class or series of Junior Liquidation Stock shall be entitled to receive any and all assets of the Corporation remaining to be paid or distributed in accordance with the terms of such classes or terms of Common Stock or other Junior Liquidation Stock, and the holders of the Series L Preferred Stock and any Parity Liquidation Stock shall not be entitled to share therein.

 

(e)                                  The consolidation, merger or conversion of the Corporation with or into any other corporation, trust or entity or of any other corporation, trust or entity with or into the Corporation, or the sale or transfer of all or substantially all of the assets or business of the Corporation or a statutory share exchange, shall not be deemed to constitute a voluntary or involuntary liquidation, dissolution or winding up of the Corporation.

 

(f)                                   All payments to holders of the Series L Preferred Stock pursuant to this Section 5 shall be paid by the Corporation in ILS, based on the Current Exchange Rate on the last TASE Trading Day immediately preceding the date of payment.

 

 

(g)                                  In determining whether a distribution (other than upon voluntary or involuntary liquidation), by dividend, redemption or other acquisition of shares of stock of the Corporation or otherwise, is permitted under the Maryland General Corporation Law, amounts that would be needed, if the Corporation were to be dissolved at the time of distribution, to satisfy the preferential rights upon dissolution of holders of shares of the Series L Preferred Stock shall not be added to the Corporation’s total liabilities.

 

6.                                      Redemption by the Corporation.

 

(a)                                 The Series L Preferred Stock is not redeemable at the option of the Corporation, pursuant to this Section 6, (i) prior to the fifth anniversary of the date of original issuance of any shares of Series L Preferred Stock or (ii) at any time if, as of the Corporation Redemption Date, (1) the Series L Distribution Conditions are not satisfied or (2) full cumulative distributions on all outstanding shares of Series L Preferred Stock have not been declared and paid or declared and set apart for payment for all past distribution periods.

 

(b)                                 Subject to the provisions of this Section 6, from and after the fifth anniversary of the date of original issuance of any shares of Series L Preferred Stock, the Corporation may, at its option, redeem such shares, in whole or, from time to time, in part, at a redemption price equal to 100% of the Series L Stated Value (as converted to USD at the Initial Exchange Rate), plus all accrued and unpaid distributions, if any, to and including the Distribution Cutoff Date (the “Corporation Redemption Price”).  Notwithstanding the foregoing, any declared distributions on the Series L Preferred Stock for which a Series L Distribution Record Date occurs prior to the Corporation Redemption Date shall not constitute a portion of the Corporation Redemption Price and will instead be paid on the applicable Series L Distribution Payment Date to the record holder or holders at the close of business on such Series L Distribution Record Date (notwithstanding if the redemption of such shares occurs on or prior to such Series L Distribution Payment Date). The Corporation shall make no payment or allowance for distributions that accrue after the Distribution Cutoff Date on Series L Preferred Stock for which a notice pursuant to Section 6(g) has been given.

 

(c)                                  The Corporation Redemption Price shall be paid at the election of the Corporation, in its sole discretion, (i) in cash in ILS, based on the Current Exchange Rate on the third TASE Trading Day preceding the Corporation Redemption Payment Date, (ii) in shares of Common Stock, based on the lower of (1) the net asset value of the Corporation per share of Common Stock as most recently published by the Corporation as of the Corporation Redemption Date and (2) the Aggregate VWAP of the Common Stock, or (iii) in any combination of cash, in ILS, and Common Stock, based on the conversion mechanisms set forth in (i) and (ii) of this Section 6(c).

 

(d)                                 The “Corporation Redemption Date” shall be the effective date of any redemption made pursuant to this Section 6, which shall be the Corporation Redemption Record Date.

 

(e)                                  If full cumulative distributions on all outstanding shares of Series L Preferred Stock have not been declared and paid or declared and set apart for payment for all past distribution periods, except as provided by the restrictions on ownership and transfer set forth in the Charter, neither the Corporation nor any of its affiliates may purchase or otherwise acquire shares of the Series L Preferred Stock otherwise than pursuant to a purchase or exchange offer made on the same terms to all holders of the Series L Preferred Stock.

 

(f)                                   If fewer than all the outstanding shares of Series L Preferred Stock are to be redeemed pursuant to this Section 6, the Corporation shall select those shares to be redeemed pro rata.

 

(g)                                  The Corporation may exercise its redemption right pursuant to this Section 6, no later than five days prior to the end of the quarter preceding the quarter in which the Corporation Redemption Date will occur, by (i) if at the time of such Corporation Redemption Notice Date the Series L Preferred Stock is listed on the TASE, filing an Immediate Report with the ISA, and (ii) issuing a press release or publishing on the Corporation’s website a notice detailing the number of shares of Series L Preferred Stock to be redeemed and whether the Corporation Redemption Price will be paid in cash, Common Stock or a combination of cash and Common Stock.

 

(h)                                 Prior to or on the Corporation Redemption Payment Date, written or electronic notice as to the redemption of any shares of Series L Preferred Stock pursuant to this Section 6 shall be given to each such record holder of such shares of Series L Preferred Stock as of the close of business on the Corporation Redemption Record Date at the respective contact information of each 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 such shares of Series L Preferred Stock except as to a holder for whom both of the following are true: (i) notice to such holder was defective or not given and (ii) such holder does not receive the Corporation Redemption Price on the Corporation Redemption Payment Date.

 

 

(i)                                     In addition to any information required by law or by the applicable rules of any exchange upon which Series L Preferred Stock may then be listed or admitted to trading, such notice given pursuant to Section 6(h) shall state: (i) the Corporation Redemption Date; (ii) the Corporation Redemption Price payable on the Corporation Redemption Payment Date; (iii) whether the redemption price will be paid in cash, Common Stock or a combination of cash and Common Stock; and (iv) that distributions on the shares of Series L Preferred Stock to be redeemed will cease to accrue on the Distribution Cutoff Date.  If less than all the shares of Series L Preferred Stock held by any holder are to be redeemed, the notice mailed to such holder also shall specify the number of shares of Series L Preferred Stock held by such holder to be redeemed.

 

(j)                                    If notice of redemption of any shares of Series L Preferred Stock has been given in accordance with Section 6(g) 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 L Preferred Stock so called for redemption, then, (i) from and after the Distribution Cutoff Date, distributions will cease to accrue on such shares of Series L Preferred Stock, and (ii) from and after the Corporation Redemption Date, such shares of Series L Preferred Stock shall be redeemed in accordance with the notice and shall no longer be deemed outstanding and all rights of the holders of such shares will terminate, except the right to receive the Corporation Redemption Price without interest thereon.  The Corporation Redemption Price will be paid by the Corporation on the Corporation Redemption Payment Date, in accordance with the procedures described in the Prospectus. Except as provided in this Section 6, the Corporation shall make no payment or allowance for unpaid distributions, whether or not in arrears, on Series L Preferred Stock for which notice pursuant to Section 6(g) has been given.

 

(k)                                 Subject to applicable law and the limitations on purchases when distributions on the Series L Preferred Stock are in arrears, the Corporation may, at any time and from time to time, purchase or otherwise acquire any shares of Series L Preferred Stock in the open market, by tender or by private agreement.

 

7.                                      Redemption at the Option of a Holder.

 

(a)                                 Subject to the provisions in this Section 7:

 

(i)                                     From and after the fifth anniversary of the date of original issuance of the shares of Series L Preferred Stock, each holder of shares of Series L Preferred Stock will have the right to require the Corporation to redeem such shares at a redemption price equal to 100% of the Series L Stated Value (as converted to USD at the Initial Exchange Rate), plus, provided the Series L Distribution Conditions are satisfied as of the Holder Redemption Date (as defined below) and the Corporation is otherwise permitted to pay distributions on the Series L Preferred Stock, all accrued and unpaid distributions, if any, up to and including the Holder Redemption Date, subject to Section 7(a)(iv) below (the “Holder Redemption Price”).

 

(ii)                                  Notwithstanding Section 7(a)(i) above, a holder of shares of Series L Preferred Stock will have the right to require the Corporation to redeem such shares at the Holder Redemption Price at any time prior to the fifth anniversary of the date of original issuance of the shares of Series L Preferred Stock if (1) the Corporation does not declare and pay in full the distributions on the Series L Preferred Stock for any annual period prior to such fifth anniversary (provided that the first distribution on the Series L Preferred Stock shall not be payable until January 2019) and (2) the Corporation does not declare and pay all accrued and unpaid distributions on the Series L Preferred Stock for all past dividend periods prior to the Holder Redemption Date.

 

(iii)                               If, on any Holder Redemption Date, the Series L Distribution Conditions are not satisfied or the Corporation is otherwise not permitted to pay distributions on the Series L Preferred Stock, the Holder Redemption Price shall be equal to 100% of the Series L Stated Value (as converted to USD at the Initial Exchange Rate) and a redeeming holder shall forfeit any accrued and unpaid distributions on the Series L Preferred Stock on all shares redeemed on the Holder Redemption Date. The Corporation will provide notice prior to the Quarterly Redemption Window in accordance with the Prospectus if the Corporation will not be able to satisfy that Series L Distribution Conditions as of the Holder Redemption Date.

 

(iv)                              Any declared distributions on the Series L Preferred Stock for which a Series L Distribution Record Date occurs prior to the Holder Redemption Date shall not constitute a portion of the Holder Redemption Price and will instead be paid on the applicable Series L Distribution Payment Date to the record holder or holders at the close of business on such Series L Distribution Record Date (notwithstanding if the redemption of such shares occurs on or prior to such Series L Distribution Payment Date).

 

 

(b)                                 The Holder Redemption Price shall be paid at the election of the Corporation, in its sole discretion, (i) in cash in ILS, based on the Current Exchange Rate on the third TASE Trading Day preceding the first Series L Distribution Payment Date following the Holder Redemption Date, (ii) in shares of Common Stock, based on the lower of (1) the net asset value of the Corporation per share of Common Stock as most recently published by the Corporation as of the Holder Redemption Date and (2) the Aggregate VWAP of the Common Stock, or (iii) in any combination of cash, in ILS, and Common Stock, based on the conversion mechanisms set forth in (i) and (ii) of this Section 7(b).

 

(c)                                  The Corporation’s obligation to redeem any shares of Series L Preferred Stock is limited to the extent that, (i) the Corporation does not have sufficient funds available to fund any such redemption, in which case the Corporation will be required to redeem with shares of Common Stock, or (ii) the Corporation is restricted by applicable law, the Corporation’s charter or contractual obligations from making such redemption.

 

(d)                                 The “Holder Redemption Date” shall be the effective date of any redemption made pursuant to this Section 7, which shall be the last day of the fiscal quarter in which a Holder Redemption Notice is received during the Quarterly Redemption Window.

 

(e)                                  A holder may exercise its right of redemption under Section 7(a) by delivering written notice to either the Corporation or the respective TASE member, as applicable, in accordance with the procedures described in the Prospectus (“Holder Redemption Notice”) during the Quarterly Redemption Window.  The Holder Redemption Notice shall specify the number of shares of Series L Preferred Stock to be redeemed.  Any Holder Redemption Notice that is received outside the Quarterly Redemption Window for a fiscal quarter shall be null and void.

 

(f)                                   If a Holder Redemption Notice has been delivered in accordance with this Section 7 and if any funds necessary to pay the Holder Redemption Price have been set apart by the Corporation for the benefit of the holder delivering such Holder Redemption Notice, then, as of the Holder Redemption Date, distributions will cease to accrue on the shares of Series L Preferred Stock subject to redemption, such shares of Series L Preferred Stock shall be redeemed and shall no longer be deemed outstanding and all rights of the holders of such shares will terminate, except the right to receive the Holder Redemption Price in cash and/or Common Stock without interest thereon.  The Holder Redemption Price will be paid by the Corporation on the first Holder Redemption Payment Date after the Holder Redemption Date, in accordance with the procedures described in the Prospectus.  Except as provided in this Section 7, the Corporation shall make no payment or allowance for unpaid distributions, whether or not in arrears, on Series L Preferred Stock for which a Holder Redemption Notice has been given.

 

8.                                      No Fractional Shares.  The Corporation shall not issue fractional shares of Common Stock upon any redemption pursuant to Section 6 or Section 7, but in lieu of fractional shares, the Corporation shall round down to the nearest whole number of shares of Common Stock to be issued in the aggregate to a particular holder with respect to a quarter and shall pay cash, in ILS, in an amount equal to the fractional interest multiplied by the Aggregate VWAP or net asset value per share of our Common Stock, as applicable, used pursuant to Section 6(c) or Section 7(b) to determine the number of shares of Common Stock issuable upon redemption, as converted from USD (or the currently applicable to the Applicable Dual Listing Exchange) to ILS at the Current Exchange Rate on either (a) the first Series L Distribution Payment Date following the applicable Corporation Redemption Date or (b) the third TASE Trading Day preceding the first Series L Distribution Payment Date following the applicable Holder Redemption Date.

 

9.                                      Mechanics of Redemption.

 

(a)                                 The Corporation shall maintain or cause to be maintained a register in which, subject to such reasonable regulations as it may prescribe, the Corporation shall provide for the registration of shares of Series L Preferred Stock and of transfers of shares of Series L Preferred Stock for the purpose of registering shares of Series L Preferred Stock and of transfers of shares of Series L Preferred Stock as herein provided.  The initial registrar and transfer agent for the Series L Preferred Stock shall be Computershare Trust Company, N.A.  The Corporation may appoint one or more additional transfer agents as it shall determine.  The Corporation may change the transfer agent without prior notice to any holder.

 

(b)                                 If the Corporation elects to pay the redemption price in Common Stock, the Corporation shall cause the transfer agent for the Common Stock to, as soon as practicable, but not later than the first Series L Distribution Payment Date following the Holder Redemption Date (in the event of redemption by a holder) or the third TASE Trading Day following the Series L Distribution Payment Date (in the event of Corporation Redemption), as applicable, register the number of shares of Common Stock to which such holder shall be entitled as a result of such redemption.  The Person or Persons entitled to receive the shares of Common Stock issuable upon such redemption shall be treated for all purposes as the record holder or holders of such shares of Common Stock as of the Holder Redemption Date or Corporation Redemption Date, as applicable.

 

 

10.                               Fixed Charge Coverage Ratio.

 

(a)                                 Prior to the fifth anniversary of the date of original issuance the shares of the Series L Preferred Stock, the Corporation shall not issue shares of any new or existing series of preferred stock ranking senior to or on parity with the Series L Preferred Stock with respect to the payment of dividends, other distributions, liquidation and/or dissolution or winding up of the Corporation unless the Minimum Fixed Charge Coverage Ratio is equal to or greater than 1.25:1.00 as of the last day of the Calculation Period.

 

(b)                                 For purposes of the restriction set forth in subsection (a) of this Section 10, the Corporation’s good faith determination of an applicable Minimum Fixed Charge Coverage Ratio shall be binding absent manifest error. The Corporation shall have no obligation to publish or otherwise disclose, and no holder of shares of Series L Preferred Stock shall have a right to request the publication or disclosure of, the financial information of the Corporation or its Subsidiaries underlying the calculations of any Minimum Fixed Charge Coverage Ratio.

 

(c)                                  The “Minimum Fixed Charge Coverage Ratio” shall equal, for a given Calculation Period, the ratio of (i) EBITDA to (ii) Fixed Charges, in each case calculated after giving effect on a Pro Forma Basis to any Pro Forma Transaction.

 

(d)                                 The “Calculation Period” shall mean, with respect to a proposed issuance of shares of preferred stock by the Corporation, the trailing 12-month period ending on the last day of the quarter preceding the date of such issuance.

 

(e)                                  “Capitalized Lease” shall mean any lease that is not an operating lease in accordance with FASB ASC 840-10 or FASB ASC 842-10.

 

(f)                                   “Companies” shall mean the Corporation and its Subsidiaries, where a “Subsidiary” shall mean any corporation, partnership, joint venture, limited liability company or other business entity of which a majority of the shares of securities or other interests having ordinary voting power for the election of directors or other governing body (other than securities or interests having such power only by reason of the happening of a contingency) are at the time beneficially owned, or the management of which is otherwise controlled, directly, or indirectly through one or more intermediaries, by the Corporation.

 

(g)                                  “Consolidated Interest Expense” shall mean, with respect to a given period, without duplication, the sum of (1) total interest expense (including, for the avoidance of doubt, capitalized interest) of the Companies for such period determined on a consolidated basis in accordance with GAAP, plus (2) the Companies’ Ownership Share of total interest expense (including, for the avoidance of doubt, capitalized interest) of each Unconsolidated Affiliate for such period determined in accordance with GAAP; provided, however, that Consolidated Interest Expense shall be reduced by (i) any cash interest income received by the Companies during such period not otherwise included in the Consolidated Net Income for such period and (ii) the net amount of cash payments received by the Companies under interest rate swap agreements during such period. Notwithstanding the foregoing, Consolidated Interest Expense shall (A) be determined without regard to the effects thereon of (x) FASB ASC-860 with respect to non-cash portion of interest expense arising from transfer or servicing of financial assets and FASB ASC 470-20 with respect to the non-cash portion of interest expense attributable to convertible indebtedness and (y) non-cash charges including, but not limited to, the amortization of debt issue costs, premiums, discounts, intangible assets, or intangible liabilities, or any non-cash charges or write-offs related to the restructuring, modification or extinguishment of debt in accordance with FASB ASC 470-50 or FASB ASC 470-60, and (B) exclude onetime cash payments including, but not limited to, debt issue costs, pre-payment penalties, defeasance, yield maintenance, legal costs.

 

(h)                                 “Consolidated Net Income” shall mean, with respect to a given period, the sum of (1) the net income (or loss) of the Companies for such period determined on a consolidated basis in accordance with GAAP, excluding any extraordinary, unusual or non-recurring gain (or extraordinary, unusual or non-recurring loss) realized during such period by the Corporation, plus (2) the Companies’ Ownership Share of the net income (or loss) of each Unconsolidated Affiliate for such period determined in accordance with GAAP, excluding any extraordinary or non-recurring gain (or extraordinary or non-recurring loss) realized during such period by such Unconsolidated Affiliate.

 

(i)                                     “Consolidated Total Indebtedness” shall mean, as of any date of determination, the sum, without duplication, of (1) the aggregate amount of all Indebtedness of the Companies that would be reflected on a consolidated balance sheet of the Companies as of such date, plus (2) the Companies’ Ownership Share of the aggregate amount of all Indebtedness of each Unconsolidated Affiliate that would be reflected on a balance sheet of such Unconsolidated Affiliate.

 

 

(j)                                    “EBITDA” shall mean, for any Calculation Period, without duplication, an amount equal to the sum of:

 

(i)                                     Consolidated Net Income for such period (including the Companies’ Ownership Share of any items described below of each Unconsolidated Affiliate), plus

 

(ii)                                  to the extent deducted in calculating such Consolidated Net Income, (1) Consolidated Interest Expense (plus, to the extent not already included in such Consolidated Interest Expense, amortization of deferred financing costs), (2) the provision for federal, state, local and foreign income taxes of the Companies, (3) non-cash charges and expenses of the Companies reducing Consolidated Net Income for such period (excluding any non-cash charge or expense that results in an accrual of a reserve for a cash charge in any future period), (4) the Companies’ Ownership Share of non-cash charges and expenses of Unconsolidated Affiliates (excluding any non-cash charge or expense that results in an accrual of a reserve for a cash charge in any future period), (5) acquisition closing costs of the Companies that were capitalized prior to FAS 141-R reducing such Consolidated Net Income, (6) depreciation and amortization expense of the Companies and asset write downs and write offs (including in respect of goodwill and intangible assets), (7) one-time costs and expenses relating to the effectiveness of any credit arrangements and the transactions relating thereto and (8) proceeds of rent loss and business interruption insurance received by the Companies, less

 

(iii)                            non-cash items of the Companies increasing such Consolidated Net Income (other than the reversal of any accrual of a reserve referred to in the parenthetical in clause (ii)(3) above, except to the extent such reversal results from a cash payment).

 

(k)                                 “Equity Interests” shall mean, with respect to any Person, all of the shares of capital stock of (or other ownership or profit interests in) such Person, all of the warrants, options or other rights for the purchase or acquisition from such Person of shares of capital stock of (or other ownership or profit interests in) such Person, all of the securities convertible into or exchangeable for shares of capital stock of (or other ownership or profit interests in) such Person or warrants, rights or options for the purchase or acquisition from such Person of such shares (or such other interests), and all of the other ownership or profit interests in such Person (including partnership, member or trust interests therein), whether voting or nonvoting, and whether or not such shares, warrants, options, rights or other interests are outstanding on any date of determination.

 

(l)                                     “Fixed Charges” shall mean, for any Person for any period, the sum, without duplication, of (1) Consolidated Interest Expense, (2) scheduled payments of principal on Consolidated Total Indebtedness (as defined below) (excluding any balloon, bullet or similar payments payable on maturity of any such Consolidated Total Indebtedness), (3) the amount of cash dividends paid or required to be paid by any Company (other than to another Company or in connection with any prepayment, redemption or purchase offer) during such period in respect of its preferred equity interests and (4) the Companies’ Ownership Share of the amount of dividends or other distributions paid or required to be paid by any Unconsolidated Affiliate during such period in respect of its preferred equity interests (to Persons other than (i) the Corporation or (ii) an Unconsolidated Affiliate in which the percentage of equity interests of such Unconsolidated Affiliate owned by the Companies is greater than or equal to the percentage of equity interests owned by the Companies in the Unconsolidated Affiliate paying the dividend or other distribution).

 

(m)                             “GAAP” shall mean generally accepted accounting principles in the United States that are applicable to the circumstances as of the date of determination, consistently applied.

 

(n)

 

(i)                                     “Indebtedness” shall generally include (1) all obligations of such Person for borrowed money and all obligations of such Person evidenced by bonds, debentures, notes, loan agreements or other similar instruments; (2) all direct or contingent obligations of such Person arising under letters of credit (including standby and commercial), bankers’ acceptances, bank guaranties, surety bonds and similar instruments; (3) net obligations of such Person under any swap agreement; (4) all obligations of such Person to pay the deferred purchase price of property or services (other than trade accounts payable in the ordinary course of business and, in each case, either (i) not past due for more than 90 days or (ii) being contested in good faith by appropriate proceedings diligently conducted); (5) indebtedness (excluding prepaid interest thereon) secured by a lien on property owned by such Person (including indebtedness arising under conditional sales or other title retention agreements), whether or not such indebtedness shall have been assumed by such Person or is limited in recourse; (6) amount of any Capitalized Lease (as defined below) as of any date; (7) all obligations of such Person to purchase, redeem, retire, defease or

 

 

otherwise make any payment in respect of any Equity Interest in such Person or any other Person, valued, in the case of a redeemable preferred interest pursuant to a properly given notice, at the greater of its voluntary or involuntary liquidation preference plus accrued and unpaid dividends; and (8) all guarantees of such Person in respect of any of the foregoing

 

(ii)                                  Notwithstanding the foregoing, (1) Indebtedness of any Person shall include such Person’s Ownership Share of the foregoing items and components attributable to Indebtedness (as set forth in (1) through (7) of clause (i) above) of Unconsolidated Affiliates; (2) notwithstanding any of the foregoing, Indebtedness shall not include (A) current expenses and intercompany liabilities, (B) prepaid or deferred revenues arising in the ordinary course of business, including prepaid rent, (C) purchase price holdbacks arising in the ordinary course of business in respect of a portion of the purchase price of an asset to satisfy unperformed obligations of the seller of such asset, (D) earn-out obligations until such obligations become a liability on the balance sheet of such person in accordance with GAAP, (E) security deposits, (F) artificial financing obligations treated as liability under GAAP related to sales of real estate accounted for under FASB ASC 360-20 under financing or deposit method and (G) artificial financing obligations treated as liability under GAAP related to sale leaseback transactions that do not meet the requirements to account for the sale leaseback under FASB ASC 840-40; and (3) the amount of any net obligation under any swap agreement on any date shall be deemed to be the Swap Termination Value thereof as of such date. For the avoidance of doubt, the transferred portion of a loan under the Small Business Administration’s 7(a) Guaranteed Loan Program that is accounted for in accordance with GAAP as a secured borrowing rather than a sale shall not be Indebtedness.

 

(o)                                 The “Measuring Period” shall mean the four fiscal-quarter period ending as of the most recent fiscal quarter end preceding the date of a given Pro Forma Transaction.

 

(p)                                 “Ownership Share” shall mean, with respect to any Unconsolidated Affiliate of the Corporation as of a given date, the Corporation’s pro rata share of the liabilities or assets, as the case may be, of such Unconsolidated Affiliate determined in accordance with GAAP, which shall be calculated as the greater of (1) the Corporation’s direct or indirect nominal capital ownership interest in such Unconsolidated Affiliate as set forth in the organization documents of such Unconsolidated Affiliate, and (2) the Corporation’s direct or indirect economic ownership interest in such Unconsolidated Affiliate reflecting the Corporation’s current allocable share of income and expenses of such Unconsolidated Affiliate, in each case as of such date.

 

(q)                                 “Pro Forma Basis” shall mean, for purposes of calculating compliance with the Minimum Fixed Charge Coverage Ratio in respect of a proposed Pro Forma Transaction, such transaction shall be deemed to have occurred as of the first day of the Measuring Period.

 

(r)                                    “Pro Forma Transaction” means (1) any incurrence, assumption, retirement or repayment of Indebtedness, (2) any actual or contemplated issuance or redemption of preferred equity interests, (3) any direct or indirect disposition of any Person or property (including through a merger, dissolution, liquidation or consolidation thereof), or (4) the making of any investment in or any other acquisition of any Person (including by merger) or property (including any property for which a ground lease was entered into). In connection with any calculation relating to the Minimum Fixed Charge Coverage Ratio upon giving effect to a Pro Forma Transaction on a Pro Forma Basis for the applicable Measuring Period, in each case to the extent applicable:

 

(i)                                     any Indebtedness (A) that is to be incurred in connection with such Pro Forma Transaction, and the aggregate amount of all other Indebtedness incurred since the last day of such Measuring Period, shall be included and deemed to have been incurred as of the first day of the applicable period, and (B) that is to be retired or repaid in connection with such Pro Forma Transaction, and the aggregate amount of all other Indebtedness retired or repaid since the last day of such Measuring Period, shall be excluded and deemed to have been retired as of the first day of such Measuring Period;

 

(ii)                                  any preferred equity interest (A) that is to be issued in connection with such Pro Forma Transaction, and the aggregate amount of all other preferred equity interests issued since the last day of such Measuring Period, shall be included and deemed to have been incurred as of the first day of the applicable period, and (B) that is to be redeemed in connection with such Pro Forma Transaction, and the aggregate amount of all other preferred equity interests redeemed since the last day of such Measuring Period, shall be excluded and deemed to have been retired as of the first day of such Measuring Period; and

 

 

(iii)                               income statement items (whether positive or negative) attributable to (x) any Person or property being directly or indirectly disposed of or removed in connection with such Pro Forma Transaction, and all other Persons and properties directly or indirectly disposed of or removed since the last day of such Measuring Period, shall be excluded and (y) any Person or property being acquired in connection with such Pro Forma Transaction, and all other Persons and properties acquired since the last day of such Measuring Period, shall be included as of the first day of such Measuring Period.

 

(s)                                   “Swap Termination Value” shall mean, in respect of a swap agreement, after taking into account the effect of any legally enforceable netting agreement relating to such swap agreement, (1) for any date on or after the date such swap agreement has been closed out and termination value(s) determined in accordance therewith, such termination value(s), and (2) for any date prior to the date referenced in Section 10(s)(1), the amounts determined as the mark-to-market value(s) for such swap agreements, as determined based upon one or more mid-market or other readily available quotations provided by any recognized dealer in swap agreements.

 

(t)                                    “Unconsolidated Affiliate” shall mean any Person (1) in which the Corporation, directly or indirectly, holds an Equity Interest, which investment is accounted for in the consolidated financial statements of the Companies on an equity basis of accounting and (2) whose financial results are not consolidated with the financial results of the Companies under GAAP. Notwithstanding anything to the contrary contained herein, any Person in which the Corporation is the beneficial owner, directly or indirectly, of 50% or less of each class of Equity Interests of such Person shall be deemed to be an Unconsolidated Affiliate.

 

11.                               Status of Shares.

 

(a)                                 All shares of Common Stock that may be issued upon redemption of shares of Series L Preferred Stock shall be validly issued, fully paid and nonassessable.

 

(b)                                 Any shares of Series L Preferred Stock that shall at any time have been redeemed pursuant to Section 6 or Section 7 or otherwise acquired by the Corporation shall, after such redemption or acquisition, have the status of authorized but unissued Preferred Stock (as defined in the Charter), without designation as to class or series until such shares are once more classified and designated as part of a particular class or series by the Board of Directors.

 

12.                               Adjustments.  If the effective date of the redemption of any shares of Series L Preferred Stock pursuant to Section 6 or Section 7 occurs less than twenty (20) days on which the Applicable Dual-Listing Exchange or the TASE is open for trading after the Corporation: (i) declares a dividend or makes a distribution on the Common Stock payable in Common Stock, (ii) subdivides or splits the outstanding Common Stock, (iii) combines or reclassifies the outstanding Common Stock into a smaller number of shares or (iv) consolidates with, or merges with or into, any other Person, or engaging in any reorganization, reclassification or recapitalization that is effected in such a manner that the holders of Common Stock are entitled to receive stock, securities, cash or other assets with respect to or in exchange for Common Stock (other than as a cash dividend or distribution declared by the Corporation), the Series L Stated Value shall be adjusted so that the redemption of the Series L Preferred Stock with an effective date that is less than twenty (20) days on which the Applicable Dual-Listing Exchange or the TASE is open for trading after such event shall entitle the holder to receive the aggregate number of shares of Common Stock or cash which, if the Series L Preferred Stock had been redeemed immediately prior to such event, such holder would have owned upon such redemption and been entitled to receive by virtue of such dividend, distribution, subdivision, split, combination, consolidation, merger, reorganization, reclassification or recapitalization.

 

13.                               Voting Rights.  Holders of the Series L Preferred Stock shall not have any voting rights.

 

14.                               Conversion.  The Series L Preferred Stock is not convertible into or exchangeable for any other property or securities of the Corporation.

 

SECOND:  The shares of Series L Preferred Stock have been classified and designated by the Board of Directors under the authority contained in the Charter.

 

THIRD:  These Articles Supplementary have been approved by the Board of Directors in the manner and by the vote required by law.

 

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.

 

 

[Signatures on following page]

 

 

IN WITNESS WHEREOF, the Corporation has caused these Articles Supplementary to be signed in its name and on its behalf by its               and attested to by its                  on this      day of           , 2017.

 

	
ATTEST:
    	
 
    	
CIM   COMMERCIAL TRUST CORPORATION
    
	
 
    	
 
    	
 
    	
 
    	
 
    
	
By:
    	
 
    	
 
    	
By:
    	
 
    
	
 
    	
Name:
    	
 
    	
 
    	
Name:
    
	
 
    	
Title:
    	
 
    	
 
    	
Title:Exhibit 10.1 Clinical Study Agreement

 

CLINICAL STUDY AGREEMENT

 

This Clinical Study Agreement (the "Agreement") is entered into on July 17, 2017 (the "Effective Date") by and among the Regents of the University of Michigan with its principal office and place of business at 3003 South State Street, Ann Arbor, MI 48109-1274 (“Lead Institution”), and Volition America, Inc., a Delaware corporation, with its principal office and place of business at 100 Congress Avenue, Suite 2000, Austin TX 78701 (together "Laboratory") . 

 

BACKGROUND

 

Laboratory has expressed an interest in participating with the National Cancer Institute (“NCI”) Early Detection Research Network (“EDRN”) (the “Clinical Study”) Great Lakes New England Clinical Validation Center (“GLNE CVC”) clinical study as set forth in the grant proposal submitted by the Regents of the University of Michigan (“Lead Institution”) to the National Cancer Institute titled “the Great Lakes New England Clinical Validation Center,” which Lead Institution has established with those research institutions listed on Exhibit A attached hereto (each, a “Research Institution”) with funding provided by NCI. Together the Lead Institution and other Research Institutions are referred to as the “Institutions” under this Agreement. Each Research Institution has agreed to enroll patients in accordance with the protocol attached hereto as Exhibit A (as may be amended in accordance with this Agreement, the "Protocol"). The Institutions together will enroll approximately 9,000 adults age 60 or older who have not undergone a prior screening or diagnostic colonoscopy falling within the catchment areas defined by the Protocol (the “Study Subjects,” as more specifically defined in Section 1.5 below). Samples obtained from Study Subjects in accordance with the Protocol (the “Samples,” as more specifically defined in Section 4.1 below) will be tested for blood-based, cell-free circulating biomarkers on the Laboratory’s proprietary Nu.QTM platform (“Services” as more specifically defined in Section 2.1) at the laboratory facilities in Belgium and other places owned or contracted by Laboratory or its affiliates at no charge to the Lead Institution or the Research Institution, and Laboratory will provide a copy of all test results for the Clinical Study (the “Test Results”) to Lead Institution’s designated Data Management Coordinating Center (the “DMCC”) following the completion of the performance of the Services by the Laboratory on the Samples. The DMCC will collect and store all such Test Results, and shall share Test Results with the Institutions for collaborative analysis. 

 

RECITALS

 

Whereas, the Laboratory is engaged in the business of diagnostic testing, including without limitation for clinical trials, development of new kits and assays and reference laboratory services;

 

Whereas, the Lead Institution has the qualified personnel, experience, facilities and resources to undertake and competently manage the Clinical Study, and has engaged and subcontracted with the Research Institutions to participate in the Clinical Study; and

 

Whereas, Laboratory and Lead Institution wish to perform the activities described and in adherence to the Protocol (the “Activities”) as part of the Clinical Study, subject to the terms and conditions set forth herein.

 

NOW, THEREFORE, the parties hereto agree as follows:

 

1LEAD INSTITUTION RESPONSIBILITIES 

 

1.1Lead Investigator. Lead Institution’s principal investigator is named on the signature page hereto and shall be designated as the Lead Investigator under this Agreement, and Lead Institution, including the Lead Investigator, shall be responsible for administrative activities in the conduct of the Clinical Study, as specified in the Protocol, including without limitation engaging and subcontracting with the Research Institutions and the principal investigators assigned by each Research Institution to the Clinical Study (each, a “Principal Investigator”) and administering all payments to the Research Institutions from the consideration paid to Lead Institution in accordance with Section 3. 

 

1.2IRB Approval. The Lead Investigator shall obtain all requisite approvals from the Institutional Review Board ("IRB") of the Protocol, the Investigational Plan (as such term is defined in 21 C.F.R. Section 812.25), and the informed consent form to be used for Study Subjects ("Informed Consent"). Lead Institution will allow Laboratory to review and comment on the Informed Consent used in the conduct of the Clinical Study. The Lead Investigator shall provide Laboratory with written confirmation of the IRB approval prior to Laboratory performing Services on any Study Subject Samples (as defined below). If the IRB withdraws approval of the Clinical Study at any time, the Lead Investigator shall immediately notify Laboratory and the Research Institutions in writing and concurrently provide a written explanation of the circumstances leading to such withdrawal. In such event, Laboratory, in its absolute discretion, may terminate this Agreement by written notice to the Lead Institution effective immediately upon delivery. Lead Investigator shall be responsible for notifying all of the Research Institutions and Principal Investigators of such termination. 

1.3Protection of Human Subjects. To the extent required by Applicable Law, each party shall promptly notify the other party of information discovered through the course of performing the Clinical Study that could affect the safety or medical care of participants, affect the willingness of participants to continue participation, influence the conduct of the study, or alter the IRB approval to continue the study. Lead Institution shall take reasonable measures to ensure that all Research Institutions and Principal Investigators shall (a) comply with the ethical standards used in human research; and (b) comply with the Protocol, applicable law, and its ethical standards to protect Study Subjects. 

 

1.4Commencement and Completion. It is anticipated that the Clinical Study will commence on the Effective Date and that Study Subject enrollment will be completed approximately three (3) years from initiation of enrollment on the study, unless this Agreement is otherwise terminated pursuant to its terms (the “Enrollment Period”). The parties anticipate that the Clinical Study will be completed within twelve (12) months thereafter (together with the Enrollment Period, the “Study Term”). The parties agree that time is a critical element of this Clinical Study, and the Lead Institution, including the Lead Investigator, agrees to use diligent efforts to complete the Clinical Study by the expiration of the Study Term.  

 

1.5Study Subject Accrual. The Clinical Study will involve a total of approximately 9,000 new Study Subjects (within the Enrollment Period) (“New Study Subjects”) and 4677 previous Study Subjects (“Previous Study Subjects). New Study Subjects and Previous Study Subjects are collectively referred to as “Study Subjects”. New Study Subjects shall be enrolled by Institutions pursuant to Protocol eligibility criteria and before the expiration of the Enrollment Period. Samples from each New Study Subject shall be obtained and forwarded to GLNE CVC.  

 

1.6Study Subject Sample Access. Laboratory will perform Services on Samples obtained from New Study Subjects (the “New Study Subject Samples”) and from Previous Study Subjects (the “Previous Study Subject Samples”), which Lead Institution will coordinate with NCI to provide to Laboratory, as per the following schedule, in accordance with Section 4.2: 

 

(i)Subject to available NCI funding and EDRN approval, a serum aliquot from each of the 4,677 Previous Study Subject Samples will be delivered to Laboratory. The time table to delivery of these samples rests with NCI resources as these samples are under control of the NCI at their Frederick MD repository. The Lead Institution will make very effort to obtain release of these samples from the Previous Study Subject Samples within one hundred eighty (180) days of the first quarterly payment by Laboratory as per Section 3.1 below, however, the parties acknowledge and agree that such releases, including the time required to identify and pull these samples, are subject to NCI priorities and resources; and 

 

(ii)all New Study Subject Samples collected in a calendar quarter will be delivered on a schedule mutually agreed upon but at a maximum interval of ninety (90) days (quarterly) allowing at least ninety (90) days required to pull and ship the samples after completion of a given quarter; provided, that Laboratory will be supplied at least four hundred (400) New Study Subject Samples in each calendar quarter commencing January 1, 2018. 

 

Laboratory shall not be obligated to perform Services on all New Subject Study Samples and Previous Study Subject Samples.

 

1.7Use of Samples. To the extent permitted under applicable law and regulations and any relevant informed consent document, Laboratory shall have a perpetual, non-terminable and fully paid-up right to use all the Samples provided under this Agreement in connection with blood-based, cell-free circulating biomarkers on the Laboratory’s proprietary Nu.QTM platform including as part of the Services and for additional indications. 

 

1.8Key Personnel. The parties agree that the participation of the Principal Investigators are important to the successful performance and completion of the Clinical Study. If a Principal Investigator is unable to complete his or her responsibilities in connection with the Clinical Study for any reason, or withdraws from participation in the Clinical Study, the Lead Institution shall coordinate with the applicable Research Institution to appoint a successor, and the Lead Institution shall immediately notify Laboratory in writing of such successor. 

 

1.9Laboratory Visits. Lead Investigator shall ensure Laboratory’s representatives may conduct periodic visits of Lead Insitution, at mutually acceptable times during normal business hours, and at Laboratory's sole reasonable expense, as applicable, to review the progress of the Clinical Study. Lead Institution shall cooperate with Laboratory and use reasonable efforts to provide all information requested. 

1.10Changes to the Protocol. In the event that modifications to the Protocol as it pertains to Laboratory Services provided hereunder appear desirable or necessary, such changes may be made through prior written agreement between the Laboratory and the Lead Institution, provided, however, any requisite IRB approval of such changes is obtained prior to implementing such changes to the Protocol. If in the course of performing this Agreement, however, generally accepted standards of clinical study and medical practice relating to the safety of Study Subjects require a deviation from the Protocol, such standards will be followed. In such case, the party aware of the need for a deviation will promptly inform the other party in writing of the facts causing such deviation as soon as the facts are known to that party. Lead Institution shall be responsible for notifying all of the Research Institutions and Principal Investigators of any such changes as they may pertain to Research Institution activities. 

 

1.11Medical Records; HIPAA Privacy Rule; and Genetic Testing Laws. Lead Institution, including Lead Investigator, shall comply with all applicable Laws governing the privacy and security of Clinical Study participant information, including without limitation HIPAA, as well as applicable U.S. Federal and State genetic testing laws, and shall use reasonable measures to ensure that all Research Institutions and Principal Investigators do the same, including without limitation all applicable genetic testing laws of each Research Institution’s jurisdiction. 

 

1.12Advertising. In the event Lead Institution elects to advertise to recruit patients for enrollment in the Clinical Study and such advertisements include reference to Laboratory, Lead Institution will provide a copy of any such advertisement to Laboratory for prior written approval. The Lead Institution will be responsible for obtaining IRB approval of all advertisements prior to use. 

 

1.13Compliance with Law – Financial Disclosure. The Lead Institution shall provide Laboratory with sufficient and accurate financial information, including without limitation facilitation of the acquisition of such information from Research Institutions, to allow the Laboratory to prepare and submit complete and accurate certification or disclosure statements as required under 21 C.F.R. Part 54, as amended. The Lead Institution shall also promptly update this information if any relevant changes occur during the course of the Clinical Study and for one (1) year following the completion of the Clinical Study.  

 

2LABORATORY RESPONSIBILITIES 

 

2.1Laboratory Services. “Laboratory Services” shall mean any clinical testing activities that shall be performed by Laboratory in the performance of the Clinical Study as set forth in the Protocol. Laboratory agrees to perform the Laboratory Services at no charge to NCI, the Lead Institution, the Research Institutions or Principal Investigators. Laboratory shall use commercially reasonable efforts to perform the Laboratory Services in compliance with (i) the terms and conditions of this Agreement, including without limitation, and to the extent applicable, the terms, specifications and limitations in the Protocol and any amendments thereto; (ii) Laboratory’s standard operating procedures for the applicable tests to be provided; (iii) any applicable laws, regulations or rulings governing its performance, including without limitation all applicable health, medical privacy and safety laws and regulations, and all applicable laws and regulations with respect to the handling and disposal of infectious or hazardous waste.  

 

2.2Laboratory Limitations. Laboratory will not: (i) use Study Subject information except for the purposes of the Clinical Study and as authorized by the Study Subject in the Informed Consent Form; (ii) disclose Study Subject-identifying information or disclose Study Subject private information to any third party (other than as permitted by Research Institutions, NCI and Lead Institution or the Repository) unless required to do so by Applicable Law or government order or pursuant to a written request of the Study Subject; (iii) remove de-identified Study Subject information from Samples; or (iv) attempt to contact any Study Subject not previously known to Laboratory, as applicable, unless required to protect the Study Subject’s welfare. 

 

3.CONSIDERATION 

 

3.1In consideration of its participation in the Clinical Study on the terms and conditions of this Agreement, Laboratory shall provide direct and indirect funding in the amount of up to Three Million United State Dollars (US$3,000,000). Direct payments by the Laboratory for the Clinical Study will be as follows: 

 

Starting one (1) month from the date of Institutional Review Board approval from the Calgary, Canada Institution and 50% of participating United States Institutions, Laboratory will make up to twelve (12) quarterly installment payments to Lead Institution of Two Hundred Fifty Thousand United States Dollars (US$250,000) each not to exceed three million United States Dollars (US$3,000,000) in total payments under Section 3 during the term of this Agreement.

 

3.2The funding amounts detailed in Section 3.1 are the sole consideration for Laboratory’s participation in the Clinical Study, and are inclusive of all rights provided to Laboratory herein, including without limitation pursuant to Sections 1.5, 1.6, 1.7, 7 and 8. All of the funding amounts provided hereunder shall be used for costs and expenses of the Clinical Study. 

3.3The funding amounts detailed in Section 3.1 will be provided to the GLNE Operations Office at the University of Michigan pursuant to the issuance of an invoice to Laboratory by Lead Institution. 

 

4CLINICAL STUDY SAMPLES  

 

4.1Study Samples. The term “Samples” shall be understood to include biological materials derived from New Study Subjects enrolled in the Clinical Study, including but not limited to: blood plasma, serum, feces, DNA extracts and other biological materials as may be agreed between the Parties. The term “Samples” shall also include biological materials extracted prior to the Enrollment Period from Previous Study Subjects meeting the eligibility criteria set forth in the Protocol and banked for future use, solely to the extent any such Samples may be used for such purpose, in accordance with all the requirements of this Agreement, including without limitation Study Subject approvals and waivers, as necessary. Without limiting the foregoing, Laboratory will receive 4 ml of serum from each of the New Study Subject Samples and at least 2 ml of serum from each of the Previous Study Subject Samples. To the extent that more than 2 ml of serum from Previous Study Subject Samples is available, up to a maximum of 4 ml will be provided to Laboratory. 

 

4.2Transfer of Study Samples. The Samples will be stored by either GLNE CVC or NCI. Where Samples are stored by GLNE CVC, Lead Institution shall be solely responsible for the proper delivery and transport of the Samples to Laboratory under the terms of this Agreement in compliance with all applicable international, federal, state and local laws, regulations, and standards for the shipment and transportation of biological specimens from their point of origin to Laboratory’s facility located in Belgium. Lead Institution and Laboratory shall agree on the day and time for delivery of the Samples to Laboratory. All Samples are considered biohazardous and should be handled, stored, and transported according to appropriate laws, regulations, and government guidelines, including those issued by the Occupational Safety and Health Administration, the Centers for Disease Control and Prevention, and the Department of Transportation. Where Samples are stored by NCI, the Samples will be provided to Laboratory pursuant to the NCI Materials Transfer Agreement set forth in Exhibit B and executed by Latoratory and NCI. 

 

5.STUDY RECORDS, REPORTS AND DATA 

 

5.1Study Records. Lead Institution, including Lead Investigator, shall maintain, and Lead Institution shall cause all Research Institutions and Principal Investigators to maintain, complete, accurate and current Clinical Study records for its Study Subjects as set forth in the Protocol ("Study Records"). Lead Investigator shall retain the right to audit all Study Records, including, without limitation, source documents, signed Informed Consents, laboratory data and summaries of financial records. All Study Records shall be retained by each Institution for a period of two (2) years after the later of completion of the Clinical Study or termination of this Agreement, whichever is later, or such longer period as specified in the Protocol or as required by law. 

 

5.2Case Report Forms. Lead Institution shall obligate each Research Institution to promptly complete full clinical evaluations and original or electronic case report forms ("CRFs"), as appropriate, on each Study Subject in accordance with the Protocol. 

 

5.3Annual Reports. During the term of this Agreement, Lead Institution shall provide Laboratory with annual written reports, detailing the progress of the Clinical Study. Such reports shall include the number of Study Subjects, the number of Samples obtained, a summary of any adverse events, and a general description of the Clinical Study’s progress. Lead Institution shall provide such reports to the Laboratory within ninety (90) days after each anniversary of the Effective Date. Lead Institution shall also provide Laboratory with quarterly reports commencing the second quarter after the Effective Date. These quarterly reports are only required to provide the number of Study Subjects enrolled, on trial, completed trial, ineligible, eligible and numbers of endpoint events for analysis and will be provided together with the invoices issued by Lead Institution in respect of the quarterly payments detailed in Section 3.1(c). 

 

5.4Final Report. Within ninety (90) days after completion or termination of the Clinical Study, the Lead Institution shall provide to the Research Institutions, Laboratory, and to the IRB a final Clinical Study report similar in content to the annual report specified in Section 5.3.  

6CONFIDENTIALITY 

 

6.1Confidential Information. "Confidential Information" shall mean any information, data or material that is identified as confidential at the time of disclosure and is disclosed by a party (“Disclosing Party”) to the other party (“Receiving Party”) in connection with the Clinical Study or any other activities in connection with this Agreement and, if disclosed in non-tangible form, is confirmed as confidential in writing within twenty (20) working days of disclosure. Confidential Information shall not include information that: (i) was generally known and available in the public domain at the time it was disclosed, or becomes generally known and available in the public domain through no breach of this Agreement by the Receiving Party; (ii) was known by Receiving Party prior to disclosure, as demonstrated by written records; (iii) was developed by the Receiving Party independently of and without reference to the Confidential Information, or (iv) is received by Receiving Party from a third party having no obligation of confidentiality to the Disclosing Party. 

 

6.2Nondisclosure/Nonuse. Except as otherwise expressly provided herein, for the term of this Agreement and for a period of five (5) years thereafter, no Receiving Party shall disclose to any third party Confidential Information disclosed hereunder, and shall not use for any purpose other than as expressly provided herein any such Confidential Information, without the express written consent of the Disclosing Party. Without limiting the foregoing, Receiving Party shall disclose Confidential Information only to those employees or contractors of Receiving Party who require such Confidential Information for the purposes of this Agreement and who are bound by like obligations of confidentiality. Prior to disclosing Confidential Information to any employee or contractors, Receiving Party shall advise such employee or contractor of the confidential nature of the information, and shall require them to take all necessary and reasonable precautions to prevent the unauthorized disclosure thereof. In the event Receiving Party is required to disclose Confidential Information pursuant to law or the order or requirement of a court, administrative agency, or other governmental body, Receiving Party may disclose such Confidential Information to the minimum extent necessary provided that the Receiving Party provides the Disclosing Party with reasonable advance written notice thereof to enable Disclosing Party to seek a protective order or otherwise prevent such disclosure. 

 

6.3Protection. Each Receiving Party shall maintain reasonable procedures to prevent accidental or other loss or disclosure of any Confidential Information of Disclosing Party, and shall use at least the same procedures and degree of care that it uses to protect its own proprietary information, but in no case less than reasonable care. In the event of loss, disclosure or use of any Confidential Information in violation of this Agreement, the Receiving Party or other party aware of such breach of this Section 6 shall immediately notify Disclosing Party in writing, specifying all details of the circumstances. 

 

6.4Return of Confidential Information. Except as otherwise provided herein, upon termination, cancellation or expiration of this Agreement for any reason, all documents and other tangible items containing Confidential Information, together with all copies or summaries, abstracts or synopsis thereof shall be promptly returned to the applicable Disclosing Party, provided however, that one (1) copy of Confidential Information may be retained for archival purposes. If Disclosing Party requests, each Receiving Party shall provide written confirmation that they have returned all such materials to Disclosing Party. 

 

7PUBLICATION 

 

7.1The parties recognize the value of disseminating research results. It is understood that publication of results of the Clinical Study is expected. The Lead Investigator will collaborate with the Laboratory and the Research Institutions and Principal Investigators to publish the results of the Clinical Study, subject to the obligations of Section 6 above and this Section 7. Drafting of documents for publication and co-authorship shall follow the guidelines of the International Committee of Medical Journal Editors’ “Uniform Requirements for Manuscripts Submitted to Biomedical Journals: Writing and Editing for Biomedical Publication (updated October 2008). Lead Institution will register and update the Study listing on ClinicalTrials.gov. 

 

7.2The Lead Institution, including Lead Investigator shall furnish Laboratory with a written copy of any proposed publication or disclosure, including without limitation, disclosures at research seminars, lectures and professional meetings and the submission of papers for publication that include Laboratory submitted results at least sixty (60) days prior to submission for publication or disclosure so that Laboratory may have a reasonable opportunity to review the accuracy of the information related to the results generated by Laboratory under this Agreement and protect its proprietary rights to information, inventions, or products developed under the Clinical Study. Lead Institution, including Lead Investigator shall consider Laboratory’s comments in good faith. Further, if Laboratory indicates that such publication or disclosure contains Confidential Information provided by Laboratory, the Lead Institution, including the Lead Investigator, agrees to remove such Confidential Information from the proposed publication or disclosure. Lead Institution, including Lead Investigator, when applicable may release the draft document for publication or presentation after the aforementioned 60-day term has elapsed; provided that if, during the 60-day review period, Laboratory indicates that additional time is required to apply for patents to protect proprietary rights to inventions or products developed under the Clinical Study that are disclosed in the proposed publication, Lead Institution, including Lead Investigator, when applicable, will delay such publication for a period of up to ninety (90) days to enable such protection to be obtained. 

7.3Except as set forth in this Agreement or the Protocol, Laboratory will not use the Institutions’ name(s) in any advertising, marketing, or sales promotional material without the Institutions prior written approval, or in any material that implies or suggests endorsement of a product or service of Laboratory; provided, that, as soon as practicable following the date hereof, Laboratory may issue a press release approved by Lead Institution announcing the existence of this Agreement and Laboratory’s participation in the Clinical Study. Additionally, Laboratory may make public statements in response to questions by the press, analysts, investors or those attending industry conferences or financial analyst calls, or issue press releases, so long as any such public statement or press release is not inconsistent with prior public disclosures or public statements approved by Lead Institution pursuant to this Section 7.3 and which do not reveal non-public information about the Instituions. 

 

8.OWNERSHIP RIGHTS 

 

8.1Data. Each Institution shall retain ownership of Study Records, which shall be the Confidential Information of the applicable Institution. Subject to the publication rights set forth in Section 7.2 above, any Test Results or other data resulting from the Laboratory Services performed on samples from the Study Subjects and provided by Laboratory (“Results”), shall be jointly owned by Laboratory and the applicable Institution enrolling such Study Subjects. Lead Institution acknowledges that (i) Laboratory, in accordance with such joint ownership shall have the royalty-free right to use the Results for any purpose, including, without limitation, incorporating some or all of the Results in its own patient database and forwarding such Results to the DMCC as requested by Lead Investigator, and (ii) the Institution enrolling Study Subjects, in accordance with such joint ownership shall have the royalty-free right to use the Results solely for research purposes and not commercialization. 

 

8.2 Inventions. Inventorship of patentable inventions shall be determined by U.S. Patent Law and ownership shall follow inventorship.  

 

8.3 Rights of U.S. Government. All rights granted herein are subject to the applicable rights and regulations of the U.S. Government. 

 

9REPRESENTATIONS AND WARRANTIES  

 

9.1Lead Institution. Lead Institution represents and warrants that: (i) it has the legal authority and right to enter into this Agreement; (ii) it has no obligation to any other party which materially impairs its ability to fulfill its obligations under this Agreement; (iii) it will conduct its activities in connection with the Clinical Study in accordance with the Protocol and in full compliance with all applicable local, state and federal laws and regulations for the protection of the rights, safety and welfare of human subjects in clinical trials, and the conditions of the IRB; and (iv) the Clinical Study was approved by the IRB. Lead Institution represents that it is not aware of any circumstance, including but not limited to any restrictions placed on the use of the Study Samples by the IRB that would prevent it from freely transferring the Study Samples to Laboratory for the purposes described in this Agreement. 

 

Lead Institution represents to Laboratory that it will use reasonable measures to assure that: 

 

(a)at each Research Institution, the Clinical Study will be conducted under the supervision of the applicable Principal Investigator, and Lead Institution shall provide Laboratory with the curriculum vitae of any Principal Investigator upon request. 

 

(b)each Research Institution and Principal Investigator shall perform the Clinical Study as set forth in the Protocol in compliance with: (a) generally accepted standards of good clinical practice, (b) the Protocol, (c) written instructions provided by the Lead Investigator, and (d) all applicable local, state and federal laws and regulations governing the performance of clinical investigations including but not limited to (i) the Investigational Device Exemptions regulations (21 C.F.R. Section 812, Subpart E, et seq.); (ii) those relating to the rights, safety and welfare of human subjects in clinical trials; (iii) those relating to kickbacks and physician, referrals including, without limitation, 42 U.S.C. Sec. 1320a-7b(b) et. Seq. and 42 U.S.C. Sec. 1395nn; and (iv) the Health Insurance Portability and Accountability Act (“HIPAA”), as set forth below (“Applicable Law”). 

 

(c)it will obligate the Research Institutions to not deviate from the Protocol without the prior written consent of Lead Investigator, except as necessary to ensure Clinical Study participant safety, in which case the applicable Principal Investigator will immediately notify the Lead Investigator of such deviation in writing.  

 

(d)each Research Institution shall provide adequate personnel to conduct the Clinical Study, and all such personnel shall have the necessary education, training, licensure and experience to perform their respective Clinical Study responsibilities, including without limitation, appropriate training on the enrollment of eligible Study Subjects, the Protocol and all other relevant activities requested by Lead Investigator or Laboratory in performance thereof. 

(e)each Principal Investigator shall obtain a written authorization, Informed Consent and IRB waiver for all Study Subjects enrolled through the applicable Research Institution prior to performance of any procedures in connection with the Clinical Study, which authorization, consent and waivers shall include the right for Lead Institution to disclose their information in connection with the Clinical Study, including genetic testing information if applicable, to the Repository and the Laboratory for their use in connection with the Clinical Study to the extent necessary to perform the activities contemplated by the Protocol and to comply with Applicable Laws relating to the Clinical Study. 

 

9.2Laboratory. The Laboratory represents and warrants that: (i) it has the legal authority and right to enter into this Agreement; (ii) it has no obligation to any other party that is in conflict with its obligations under this Agreement and (iii) the person executing this Agreement on its behalf has been authorized to do so. 

 

9.3No Impairment; No Conflict. During the term of this Agreement, Lead Institution represents that it will not enter into any agreement to provide services that would in any way materially impair its ability to complete the Clinical Study in accordance with the Protocol and the terms of this Agreement. 

 

9.4No Action by FDA. Lead Institution represents that it has not received any warnings or other adverse communications from the FDA relating to the conduct of a human clinical trial that would affect its participation in the Clinical Study or compliance with the terms of this Agreement with respect to itself, or any Research Institution or Principal Investigator. 

 

9.5No Pending Litigation. Lead Institution represents that it is not currently involved in, nor is it aware of, any pending claim, litigation or proceedings relating to its role in the conduct of a human clinical trial. Lead Institution represents that it is not aware of any such claim, litigation or proceeding with respect to Research Institutions or Principal Investigators. 

 

9.6Full Disclosure. Lead Institution has provided written notice to Laboratory of any (i) clinical study or trial in which the Lead Investigator or, to the best of its knowledge, any Principal Investigator was involved that was terminated for any reason prior to completion, (ii) receipt of Form 483 Notices of Observation from the FDA, Notice of Adverse Findings or any regulatory warning letter by Lead Institution or any Research Institution, and (iii) disqualifications of such Lead Investigator or any Principal Investigator from receiving investigational drugs or medical devices by the FDA or any comparable foreign regulatory entity.  

 

9.7No Debarment. Lead Institution, including Lead Investigator, hereby certifies that, to the best of its knowledge, all of the Research Institutions and their respective Principal Investigators, have not been debarred under the provisions of 21 U.S.C. §335a(a) or (b), as amended. In the event that the Lead Institution: (i) becomes debarred or learns that Lead Investigator, a Research Institution or Principal Investigator is debarred; or (ii) receives notice of action or threat of action with respect to such debarment, during the term of this Agreement, Lead Institution agrees to notify Laboratory in writing immediately. In the event that Lead Institution receives notice that a Research Institution or Principal Investigator becomes debarred as set forth in clause (i) above, the Lead Institution shall immediately terminate its participation in this Agreement without any further action or notice by any party hereto. In the event that Lead Institution notifies Laboratory of action or threat of action as set forth in clause (ii) above, the Laboratory will have the right to terminate or suspend (in its sole discretion) provision of Laboratory Services immediately. 

 

9.8No Services of Debarred Persons. Each party hereby certifies that they have not and will not use in any capacity the services of any individual, corporation, partnership or association in connection with the Clinical Study which has been debarred under 21 U.S.C. §335a(a) or (b), as amended. In the event that a party becomes aware of the debarment or threatened debarment of any individual, corporation, partnership or association providing services to such party which directly or indirectly relates to such party’s activities under this Agreement, such party will notify the other parties in writing immediately, and such party may immediately terminate its participation in this Agreement without any further action or notice by any party hereto.  

 

9.9No Other Warranties. EXCEPT FOR THE LIMITED WARRANTIES GIVEN IN THIS SECTION 9, THE PARTIES HERETO MAKE AND RECEIVE NO WARRANTIES, EXPRESS, IMPLIED, STATUTORY OR OTHERWISE WITH RESPECT TO THE SUBJECT MATTER CONTAINED HEREIN, AND EACH EXPRESSLY DISCLAIMS ANY IMPLIED WARRANTIES OF MERCHANTABILITY, NONINFRINGEMENT, OR FITNESS FOR A PARTICULAR PURPOSE. 

9.10Healthcare Compliance Laws. Each party agrees to comply with all applicable laws and regulations. Neither Laboratory nor Lead Institution shall engage in any activity prohibited by anti-kickback, anti self-referral, or any other federal, state or local law or regulation which relate to health care and/or the performance of services under this Agreement, as those regulations now exist or as subsequently amended, renumbered, revised or promulgated. Lead Institution shall use reasonable measures to ensure that all Research Institutions shall comply with all applicable laws. It is not the intent of either Laboratory or Lead Institution, including Lead Investigator, that any payments, gift, donation or other consideration made under this Agreement be in return for the referral of ongoing business, if any, or in return for the purchasing, leasing, or ordering of any services other than the specific services described in this Agreement. All payments or transfers of value specified in this Agreement are consistent with fair market value in an arms-length transaction for the goods or services provided.  

 

10INDEMNIFICATION AND INSURANCE  

 

10.1Laboratory Indemnification. Laboratory shall hold harmless and indemnify Lead Institution, its trustees, officers, medical and professional staff (including its Lead Investigator), employees, agents, successors or assigns from and against third party claims for personal injury (including death) to any person or damage to property arising out of or in connection with Laboratory’s or its employees’ acts or omissions, except to the extent such claims arise from Lead Institution’s breach of this Agreement including without limitation failure to follow the Protocol, negligence or willful misconduct.  

 

10.2Institution Indemnification. To the extent permitted by law, Lead Institution shall hold harmless and indemnify the Laboratory and its directors, officers, employees, agents, successors or assigns from and against third party claims for personal injury (including death) to any person or damage to property resulting from the acts or omissions of the Lead Investigator or Lead Institution including failure of such Lead Investigator to adhere to the Protocol, Laboratory's written instructions with respect to the Clinical Study, or applicable FDA or other governmental requirements except when such actions are necessary for patient safety, clinical care and treatment purposes in the reasonable medical judgment of the Lead Investigator.  

 

10.3Procedure. Any party entitled to indemnification under this Section 10 shall give the indemnifying party prompt notice of any covered claim, shall provide the indemnifying party with the opportunity to defend against the claim, and shall reasonably cooperate in such defense at the indemnifying party’s expense; provided, however, failure of any party to do so shall not relieve the other party of its obligation(s) to indemnify, except to the extent that the indemnifying party can demonstrate it was actually prejudiced by such failure. Notwithstanding anything to the contrary in this Agreement, neither party shall enter into any settlement, consent judgment, or other voluntary final disposition of any claim that has a material adverse effect on the rights of the other party or admits any wrongdoing or fault by the other party or imposes on the other party any payment or other liability, without the prior written consent of the other party. 

 

10.4Insurance. Each party shall, at its own expense, maintain a policy or program of insurance or self-insurance at levels sufficient to support the indemnification obligations assumed herein. During the term of this Agreement and upon one party's request, the other party shall provide such party with a certificate of insurance (or the self-insured equivalent) and shall provide to such party thirty (30) days’ prior written notice of cancellation of such insurance. 

 

11TERM AND TERMINATION 

 

11.1Term. This Agreement shall begin on the Effective Date and remain in full force and effect for the Study Term or until the completion of the Clinical Study and submission of the final report pursuant to Section 5.4 above, unless earlier terminated in accordance with this Section 11. 

 

11.2Termination at Will. Either party may terminate this Agreement upon sixty (60) days prior written notice to the other party. 

 

11.3Partial Termination by Lead Investigator and/or Laboratory. In the event that a Principal Investigator becomes unavailable or withdraws from the Clinical Study, and the Research Institution is unable to appoint a successor within thirty (30) days after Lead Investigator is so notified in writing, Laboratory may request that Lead Investigator terminate such Research Institution’s participation in the Clinical Study. 

 

11.4Termination for Breach. Any party to this Agreement may terminate participation in this Agreement upon thirty (30) days' prior written notice to the other party of such party's material breach of this Agreement if such breach is not cured within such thirty (30) day period. 

11.5Effect of Termination. In the event of termination of this Agreement, for any reason (including, without limitation, completion of the Clinical Study), the Lead Investigator shall cease providing Study Samples to Laboratory; provided, that, to the extent permitted by applicable law and regulations and any relevant informed consent document, Laboratory shall have the continued right to use the Study Samples in its possession in connection with blood-based, cell-free circulating biomarkers on the Laboratory’s proprietary Nu.QTM platform including for additional indications. Within one hundred eighty (180) days from the effective date of any termination (including, without limitation, completion of the Clinical Study), the Lead Investigator and Lead Institution shall obtain from the Research Institutions and Principal Investigators all available unblinded patient data collected in connection with the Clinical Study including without limitation Annual Reports and the final written report described in Section 5.4 above, and except as otherwise provided herein, any materials and Confidential Information provided by Laboratory or Lead Institution for the conduct of the Clinical Study; provided, however that one (1) copy of Confidential Information may be retained for archival purposes. If Lead Institution or Laboratory terminates this Agreement for any reason, Lead Institution will provide, and Laboratory will have the perpetual right to use, all available unblinded patient data for the Study Samples already paid for and received by Laboratory on the completion of the Clinical Study. If the Clinical Study is terminated for any reason, Lead Institution will provide, and Laboratory will have the perpetual right to use, all available unblinded patient data for the Study Samples already provided to Laboratory immediately upon termination and completion of the analysis by relevant EDRN components (e.g. Data Management and Coordinating Center) of the Clinical Study. For avoidance of doubt, the patient data included in the Case Report Forms to the Protocol shall be made available to Laboratory under this Section 11.5, which shall include, without limitation, (a) patient conditions (i.e. colorectal cancer, high risk adenoma), (b) age, (c) sex, (d) any other history, and (e) any other diseases. In addition, Lead Institution agrees to, and will ensure that all Research Institutions, hold unblinded patient data for at least three (3) months after the completion of the Clinical Study. 

 

11.6Survival. Termination of this Agreement by any party shall not affect the rights and obligations of the parties accrued prior to the effective date of such termination. The rights and duties under Sections 1.3, 6, 7, 8, 9, 10.1, 10.2, 10.3, 10.4, 12.1, 12.2, and 12.7, and the last sentence of Section 5.1 shall survive the expiration or termination of this Agreement for any reason. 

 

12MISCELLANEOUS 

 

12.1Use of Names. Except as permitted in Section 7 above, no party to this Agreement shall use the name or other identifying marks of any other party in any advertising, promotional or sales literature or in any news release or other media publicity without the prior written consent of the party whose name or mark is to be used. Notwithstanding the foregoing, no party shall unreasonably withhold its consent to any use of its name, which accurately and appropriately describes the scope and nature of the parties' participation in the Clinical Study, and which does not imply directly or indirectly any endorsement of the other party or its products by the party whose name is to be used. 

 

12.2Assignment. The parties agree that their rights and obligations under this Agreement may not be delegated, transferred or assigned to a third party without prior written consent of the other parties hereto. Notwithstanding the foregoing, Laboratory may transfer or assign its rights and obligations under this Agreement to a successor to all or substantially all of its business or assets pertaining to the subject matter of this Agreement whether by sale, merger, operation of law or otherwise.  

 

12.3Force Majeure. No party hereto will be held liable or responsible to the other parties, nor be deemed to have defaulted under or breached this Agreement, for failure or delay in fulfilling or performing any term of this Agreement when such failure or delay is caused by or results from causes beyond the reasonable control of the affected party, including, without limitation, fire, floods, earthquakes, natural disasters, embargoes, war, acts of war (whether war be declared or not), insurrections, riots, civil commotions, strikes, lockouts or other labor disturbances, acts of God, or acts, omissions or delays in acting by any governmental authority or other party hereto. 

12.4Notices. Any notice required or permitted hereunder shall be in writing and shall be deemed to have been delivered (i) when delivered by hand; or (ii) when shipped by private express carrier (such as DHL), shipping charges prepaid, to the party to whom delivery shall be made at the respective addresses as set forth below, or such other address as the party may substitute by written notice; or (iii) when faxed to the number set forth below with confirming letter mailed thereafter under the conditions described in (ii). 

 

If to Laboratory:Volition American, Inc. 

Suite 2000

100 Congress Avenue

Austin, TX 78701

Attn: Jason Terrell

 

 

If to Lead Institution:Regents of the University of Michigan 

c/o Dean E. Brenner, Lead Investigator 

2150 Cancer Center 

1500 E Medical Center Drive 

Ann Arbor, MI 48109-5930 

 

Lead Investigator: Dean E. Brenner, M.D. 

2150 Cancer Center 

1500 E Medical Center Drive 

Ann Arbor, MI 48109-5930 

 

12.5Governing Law. This Agreement shall be governed and construed by the laws of Michigan, without reference to its conflict of laws principles.  

 

12.6Limitation of Liability. IN NO EVENT SHALL ANY PARTY BE LIABLE TO ANY OTHER PARTY FOR ANY SPECIAL, INCIDENTAL OR CONSEQUENTIAL DAMAGES ARISING OUT OF OR RELATING TO THIS AGREEMENT, OR THE SUBJECT MATTER HEREOF, HOWEVER CAUSED AND WHETHER SUCH CLAIM IS BASED IN CONTRACT, TORT (INCLUDING NEGLIGENCE) OR OTHERWISE, EVEN IF AN AUTHORIZED REPRESENTATIVE OF SUCH PARTY IS ADVISED OF THE POSSIBILITY OF SUCH DAMAGES. THIS LIMITATION OF LIABILITY SHALL BE RESTRICTED TO THIS CLINICAL STUDY ONLY AND SHALL NOT EXTEND TO ANY OTHER CURRENT OR FUTURE STUDY CONTRACT AGREEMENTS BETWEEN ANY OF THE PARTIES. 

 

12.7Modification; Waiver. This Agreement may not be altered, amended or modified in any way except in writing signed by the parties. The failure of a party to enforce any provision of this Agreement shall not be construed to be a waiver of the right of such party to thereafter enforce that provision or any other provision or right. 

 

12.8Severability. In the event that any provision of this Agreement is determined to be illegal, invalid or unenforceable by a court of competent jurisdiction, the remainder of this Agreement shall remain in full force and effect without said provision. The parties shall negotiate in good faith a substitute clause for any provision declared illegal, invalid or unenforceable, which shall most nearly approximate the original intent of the parties in entering this Agreement. 

 

12.9Independent Contractors. The parties agree that the relationship between the Laboratory, the Lead Institution and Lead Investigator created by this Agreement is that of independent contractors and that neither the Lead Investigator nor the Lead Institution may create or assume any obligations on behalf of the Laboratory. 

 

12.10Entire Agreement. This Agreement and the Exhibits attached hereto represent the entire understanding of the parties with respect to the subject matter of this Agreement, and supersede all prior discussions, agreements and writings in respect to such subject matter. In the event of any inconsistency between this Agreement and the Exhibits, the terms of this Agreement shall govern. 

 

12.11Counterparts. This Agreement may be executed in counterparts and delivered by fax, each of which shall be deemed an original, and all of which, together, shall constitute one and the same instrument. 

 

12.12Headings. Headings are provided solely for the benefit of the Parties and shall not be used to interpret or construe its provisions. 

IN WITNESS WHEREOF, the parties hereto have caused their duly authorized representatives to execute this Agreement.

 

LABORATORYLEAD INSTITUTION 

 

VOLITION AMERICA, INC.THE REGENTS OF THE UNIVERSITY OF MICHIGAN 

 

By: /s/ Jason Terrell                                            By: /s/ Kevin P. Hegarty                                                      

Name: Jason Terrell MDName: Kevin P. Hegarty  

Title:   Execitive Executive OfficerTitle: Execitive Vice President & Chief Financial Officer 

  Volition America, Inc 

 

Date: 7.17.2017Date: 7.12.2017 

 

 

LEAD INVESTIGATOR 

 

By: /s/ Dean E. Brenner                                                       

Name: Dean E. Brenner 

Title: Professor of Internal Medicine 

 

EXHIBIT A

 

STUDY PROTOCOL

 

GLNE 010, Version 5.0 March 6, 2017

 

[EDRN to insert]

EXHIBIT B

 

NCI MATERIAL TRANSFER AGREEMENT for

 

4.0 mLs of frozen human plasma from Study Subjects conforming to sample collection as described in the Early Detection Research Network (“EDRN”) Study Protocol and at least 2 mLs but upto 4 mLs, if available, of previously banked frozen human serum samples from the same Study Subjects collected as described in GLNE 010. These Samples are transferred under the terms of the EDRN Clinical Study Agreement executed between the Regents of the University of Michigan and Volition America, Inc. (the “Clinical Study Agreement”)

 

RECIPIENT: ____________________________  

RECIPIENT SCIENTIST: _________________________

 

1. The NCI agrees to transfer to the RECIPIENT the following MATERIAL, which is the property of the original provider of the MATERIAL to the NCI: _______________

_______________________________________________(hereinafter referred to as “MATERIAL”) and any clinical data, results and raw data relating to the MATERIAL that neither contains nor is associated with identifiable private information (“DATA”). 

 

2. THIS MATERIAL MAY NOT BE USED IN HUMAN SUBJECTS. The MATERIAL will not be used for commercial purposes such as screening, production or sale, for which a commercialization license may be required. The RECIPIENT agrees to use the MATERIAL and DATA in compliance with all applicable statutes and regulations. The MATERIAL is to be used solely for the research specified in Exhibit A attached to the Clinical Study Agreement and only by the RECIPIENT SCIENTIST and those persons under his or her direct supervision. All requests for use for other persons should be forwarded to the EDRN Executive Committee.

 

3. The MATERIAL and DATA have been collected from human subjects in accordance with all applicable federal regulations for the protection of human subjects, including, as applicable, 45 CFR Part 46, “Protection of Human Subjects,” and the Standards for Privacy of Individually Identifiable Health Information set forth in 45 C.F.R. Part 164, and appropriate Assurances and IRB approved protocols, which include all necessary informed consents and authorizations. NCI provides the MATERIAL pursuant to an exemption from IRB approval (NIH Office of Human Subjects Research Protections Exemption #____). The DATA provided by NCI neither contains nor is associated with identifiable private information. RECIPIENT agrees to use the MATERIAL in compliance with all applicable laws, regulations, and policies of the National Institutes of Health relating to human subjects and human biospecimens. The RECIPIENT agrees not to attempt to obtain identifying information on, or otherwise seek to re-identify or contact the human subjects associated with the MATERIAL or DATA provided under this Agreement.

 

4. Any MATERIAL delivered pursuant to this Agreement is understood to be experimental in nature and may have hazardous properties. THE NCI MAKES NO REPRESENTATIONS AND EXTENDS NO WARRANTIES OF ANY KIND, EITHER EXPRESSED OR IMPLIED. THERE ARE NO EXPRESS OR IMPLIED WARRANTIES OF MERCHANTABILITY OR FITNESS FOR A PARTICULAR PURPOSE, OR THAT THE USE OF THE MATERIAL OR DATA WILL NOT INFRINGE ANY PATENT, COPYRIGHT, TRADEMARK, OR OTHER PROPRIETARY RIGHTS. No indemnification for any loss, claim, damage, or liability is intended or provided by any party under this agreement. Each party shall be liable for any loss, claim, damage, or liability that said party incurs as a result of its activities under this Agreement, except that the NCI, as an agency of the United States Government, assumes liability only to the extent as provided under the Federal Tort Claims Act, 28 USC, chapter 171. 

 

5. The MATERIAL is provided at no cost.

 

6. Inventorship of any inventions arising from the RECIPIENT’s use of the MATERIAL shall be governed by U.S. patent law. Ownership of such inventions shall follow the laws and RECIPIENT’s institutional rules governing assignment obligations of the inventors. No right, title or interest in any such invention is transferred by virtue of this Agreement.

 

7. The RECIPIENT agrees to acknowledge the contributions of the NCI’s EDRN program in all publications resulting from the use of this MATERIAL. It is recommended that the following statement be included in the methods or acknowledgement section of such publications: "Tissue samples were provided by the National Cancer Institute on behalf of the Early Detection Research Network (EDRN).” By entering into this Agreement, the NCI does not directly or indirectly endorse any product or service that is or will be provided, whether directly or indirectly related to this Agreement. 

 

8. The NCI shall have the right to terminate this Agreement if the RECIPIENT materially breaches any of its obligations or responsibilities under this Agreement, and such material breach is not cured within thirty (30) days of receipt of written notice from the NCI. Upon termination, the RECIPIENT will, at the NCI’s discretion, either return or destroy any remaining MATERIAL and DATA in accordance with applicable laws and regulations.

9. The RECIPIENT and RECIPIENT SCIENTIST agree to deposit all primary data and processed data obtained using the MATERIAL with the EDRN Data Management and Coordinating Center (DMCC) within four (4) months after processing the MATERIAL in accordance with the Clinical Study Agreement. The DMCC will conduct the data analysis and results will be provided to the RECIPIENT SCIENTIST. The results will be posted on a secure domain of the EDRN website (eCAS) three (3) months after the results have been provided to the RECIPIENT SCIENTIST. The NCI EDRN reserves the right to post the results to its public website upon completion of the study.

 

10. This Agreement may be executed in one or more counterparts, each of which together shall be deemed original but all of which together shall constitute one and the same document. A facsimile or Portable Document Format (PDF) of the original signature of the representative of a party shall have the same validity as an original signature for the purpose of this Agreement.

 

The RECIPIENT and the NCI must both sign this agreement and then the NCI will send the MATERIAL. 

 

FOR THE RECIPIENT:

 

RECIPIENT Scientist:_________________________________________________

RECIPIENT Organization:_____________________________________________

___________________________________________________________________

___________________________________________________________________

 

Name of Authorized Official: ___________________________________________

Title of Authorized Official:____________________________________________

Address:____________________________________________________________

___________________________________________________________________

 

Signature of Authorized Official ________________________________________

Date: _______________________

  

 

FOR THE NCI:

 

  

Name of Authorized Official: Lisa D. Finkelstein, Ph.D. 

Title of Authorized Official:Technology Transfer Specialist 

Technology Transfer Center

National Cancer Institute 

9609 Medical Center Drive, Rm 1E530 

Rockville, MD 20852 

 

Signature of Authorized Official:_____________________ 

Date:_____________________

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