Document:

exv10w17

 

Exhibit 10.17

*** Text Omitted and Filed Separately

Confidential Treatment Requested

Under 17 C.F.R. §§ 200.80(b)(4)

and 230.406

NON-EXCLUSIVE LICENSE AGREEMENT

          This License Agreement (the “AGREEMENT”)is entered into and made effective this
20th day of December, 2002 (the “EFFECTIVE DATE”) between, Nanosphere, Inc., an Illinois
corporation, whose principal place of business is at 1818 Skokie Boulevard, Suite 200, Northbrook,
Illinois 60062 (hereinafter referred to as “NANOSPHERE”) and Abbott Laboratories, an
Illinois corporation, whose principal place of business is at 100 Abbott Park Road, Abbott Park,
Illinois 60064-3500 (hereinafter referred to as “ABBOTT”).

          For and in consideration of the mutual promises and covenants set forth below, NANOSPHERE and
ABBOTT agree as follows:

Article 1 — Definitions.

     1.1 “AFFILIATE” shall mean any corporation or other business entity controlled
by, controlling or under common control with the recited entity. For this purpose, “control” shall
mean direct or indirect beneficial ownership of more than fifty percent (>50%) of the voting
stock of, or more than fifty percent (>50%) interest in the income of such corporation or other
business entity and the ability to direct the conduct of its business affairs on a regular basis.

     1.2 “FIELD” shall mean research, genomics, proteomics, gene discovery, SNP detection,
genotyping, military, and human in vitro diagnostics.

     1.3 “LICENSED PATENT(S)” shall mean United States Patents Nos. 5,599,668 and 5,843,651
and any patents resulting from a reexamination or reissue from any of the foregoing patents, as
well as any patents claiming priority of an application underlying the foregoing patents whether a
continuation, continuation-in-part, division, or foreign equivalent. For clarity, LICENSED PATENTS
include, but may not be limited to, the patents and patent applications referred to in Appendix A.

     1.4 “PRODUCT(S)” shall mean any product, service, device, instrument, kit, or
component thereof, the making, using, importing, or selling of which would, in the absence of the
license granted hereunder, infringe, contribute to the infringement of, or induce the infringement
of any claim of a LICENSED PATENT. PRODUCT(S) shall not include the servicing or maintenance of an
instrument that is a PRODUCT.

     1.5 (a) “NET SALES” shall, unless otherwise specified in this Section 1.5, equal the
amount charged for the PRODUCT by NANOSPHERE or its AFFILIATES (and, if a sub-license is granted
pursuant to Section 2.3 hereof, the sublicensee) to a non-affiliated third party, less (i) rebates,
quantity, trade and cash discounts allowed to and taken by the non-affiliated third party, (ii)
amounts for transportation or shipping included in the amount charged to the non-affiliated third
party purchasers, (iii) amounts repaid, credited or rebated to the non-affiliated third party by
reason of a rejection or return of the PRODUCT, (iv) customs duties and other governmental charges,
as well as sales, use, excise, value added taxes and duties included in the amount charged to the
non-affiliated third party for PRODUCTS, and (v) charge back payments or

 

 

rebates granted to managed health care organizations or federal, state or local governments,
their agencies, purchasers or reimbursers (hereinafter “DEDUCTIONS”).

               (b) When a PRODUCT is sold by NANOSPHERE or one of its AFFILIATES to a purchaser with which
the seller does not deal at arms length, the NET SALES for a given quantity of that PRODUCT shall
equal an average of the NET SALES, as calculated by NANOSPHERE using 1.5(a) above, for the same
quantity of similar PRODUCTS sold, within the same QUARTER as the PRODUCT, to unaffiliated
purchasers in arms length transactions who are in the same geographic market and class of
purchasers as the non-arms length purchaser.

               (c) When a PRODUCT is not sold, and is not a free replacement or sample, but is OTHERWISE
DISPOSED OF (as defined in Paragraph 1.6 below), the NET SALES for a given quantity of that PRODUCT
shall equal an average of the NET SALES, as calculated by NANOSPHERE using 1.5(a) above, for the
same quantity of similar PRODUCTS sold, within the same QUARTER as the PRODUCT that is OTHERWISE
DISPOSED OF, to unaffiliated purchasers in arms length transactions who are in the same geographic
market in which the PRODUCT was OTHERWISE DISPOSED and the same class of purchasers to whom the
PRODUCT was OTHERWISE DISPOSED.

               (d) When packaged with other products, services, assays, devices, instruments, kits or
components thereof (“OTHER PRODUCTS”) which have commercial utility other than in
combination with the PRODUCT (a “PACKAGED PRODUCT”), and the PRODUCT is not separately
priced, the NET SALES of that PRODUCT shall equal an amount calculated by multiplying the amount
charged by NANOSPHERE or one of its AFFILIATES for the sale of the PACKAGED PRODUCT less the
applicable DEDUCTIONS times a fraction, the numerator of which shall be the average of the NET
SALES, as calculated by NANOSPHERE using 1.5(a) above, for a given quantity of similar PRODUCTS
sold, without such OTHER PRODUCTS, within the same QUARTER as the sale of the PACKAGED PRODUCT, to
unaffiliated third parties of the same class located in the same geographic market in which the
PACKAGED PRODUCT was sold, and the denominator of which shall be the average of the amounts charged
for the same quantity, within the same Quarter as the sale of the PACKAGED PRODUCT, to unaffiliated
third parties of the same class located in the same geographic market in which the PACKAGED PRODUCT
was sold less the applicable DEDUCTIONS. In the event that there is no established NET SALES for
the PRODUCT when sold without such OTHER PRODUCTS then the fraction shall be a number whose
numerator shall be the average of the fully burdened costs, as established by the cost accounting
records of NANOSPHERE, to manufacture all non-packaged PRODUCTS, similar to the PRODUCT that was
included in the PACKAGED PRODUCT, that were manufactured in the same QUARTER in which the PACKAGED
PRODUCT was sold and whose denominator shall be the average of the fully burdened costs to
manufacture all PACKAGED PRODUCTS similar to the PACKAGED PRODUCT that were manufactured in the
same QUARTER in which the PACKAGED PRODUCT was sold.

               (e) In the event that a PRODUCT is incorporated into a total package in which said PRODUCT
contributes only a small proportion of the value of the total package, but the adjustment set forth
hereinabove in subparagraph 1.5(d) is impractical, the parties shall negotiate in good faith to
establish an equitable adjustment to the NET SALES for such PRODUCT to fairly reflect the
proportion of the value of the total package contributed by the PRODUCT. However, in no case will
the value be attributed to the PRODUCT which exceeds that obtained by using a factor, the numerator
of which shall be the number of results obtained

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from the PRODUCT and the denominator of which shall be the total number of results provided by
the total package.

               (f) In the instance in which PRODUCT is increased in price to include an amount to compensate
the seller for supplying an instrument system and/or other equipment and for supplying maintenance
for such system and/or equipment under a “reagent agreement plan”, “reagent rental plan”, or a
similar plan (collectively referred to herein as “RAP”), the NET SALES for such PRODUCT
sold under RAP shall be determined by reducing the total NET SALES of such PRODUCT (including the
total of sale of PRODUCT and instrument system RAP) by the amount of the price increase
attributable to RAP, in accordance with standard NANOSPHERE accounting procedures actually used by
NANOSPHERE in its usual course of business to assess the results of its operations concerning the
PRODUCT which procedures shall be in accordance with generally accepted accounting principles,
provided that the amount attributable to the NET SALES of the PRODUCT shall be no less than the
average of the NET SALES, as calculated by NANOSPHERE using 1.5(a) above, for similar PRODUCTS
sold, within the same QUARTER as the sale of the PRODUCT sold under the RAP, to unaffiliated
non-RAP customers of the same class located in the same geographic market in which the PRODUCT
under the RAP was sold.

     1.6 “OTHERWISE DISPOSED (OF)” shall mean and include:

               (a) the delivery of any amount of PRODUCT, other than free replacements or nominal quantities
of free samples, by NANOSPHERE or its AFFILIATES to unaffiliated third parties in any transaction
other than a sale, regardless of the basis of consideration, if any; or

               (b) the placing into use of any PRODUCT by NANOSPHERE or its AFFILIATES for any purpose, other
than its internal routine testing, provided that the scrapping or destruction of any PRODUCT or the
performance of a service for which no compensation is obtained (monetary or otherwise) shall not
fall within the definition of “OTHERWISE DISPOSED OF” and no value in respect thereof shall be
included in calculating the NET SALES of the PRODUCT. A PRODUCT shall be considered OTHERWISE
DISPOSED OF when used or shipped by, or on behalf of, NANOSPHERE or its AFFILIATES.

     1.7 “QUARTER” shall mean any period of three consecutive calendar months beginning
January 1, April 1, July 1, and October 1, occurring during the term of this AGREEMENT.

     1.8 “TERRITORY” shall mean worldwide.

Article 2 — License Grant and Release.

     2.1 Subject to the terms and conditions herein, ABBOTT hereby grants to NANOSPHERE and
its AFFILIATES, who accepts the same, a non-exclusive, non-transferable, right and license under
the LICENSED PATENTS to make, have made for NANOSPHERE and its AFFILIATES own use and sale, use,
offer to sell, sell and import PRODUCT within the FIELD and to practice the methods claimed in the
LICENSED PATENTS in connection with such PRODUCT, and to extend to its customers purchasing PRODUCT
the right to use and sell the PRODUCT purchased and to practice the methods claimed in the LICENSED
PATENTS in connection with such PRODUCT.

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     2.2 ABBOTT further hereby releases NANOSPHERE, its AFFILIATES, and their respective customers
from any liability for any infringement of the LICENSED PATENTS arising from activities which
occurred prior to the EFFECTIVE DATE.

     2.3 NANOSPHERE or its permitted successors may grant a single sub-license to a third party. A
purported sub-license granted by NANOSPHERE or its successors to a third party under this Section
2.3 shall not be effective, nor bind ABBOTT in any way, unless

               (a) Within thirty (30) days of the execution of the sub-license, NANOSPHERE shall pay to
ABBOTT the greater of: [...***...];

               (b) The sub-license shall require the sublicensee to pay ABBOTT (directly or through
NANOSPHERE) an annual minimum royalty at the rate of [...***...]. Such minimum royalty shall be in
addition to the minimum royalty due to ABBOTT pursuant to Section 4.l(b) hereof, the first such
payment whereof shall be pro-rated for any partial calendar year for which the sub-license is
effective, and succeeding minimum royalty payments shall be due at the same time NANOSPHERE’S
minimum royalty payment is due under section 4.1(c);

               (c) The sub-license shall obligate the sublicensee to pay royalties based on its NET SALES of
each PRODUCT sold or OTHERWISE DISPOSED OF on or subsequent to the effective date of the
sub-license. Such royalties shall be determined by the schedule in Section 4.1(c) of this
Agreement, including the last sentence of Section 4.1(c). The NET SALES by the sublicense shall be
added to the NET SALES of NANOSPHERE to determine the appropriate royalty under Section 4.1 (c);

               (d) Except for Sections 4.1(a), 4.1(b) and 4.1(c) as regards NET SALES by NANOSPHERE, the
sublicensee shall be bound by and shall obtain the benefit of all of the provisions of this
Agreement that apply to NANOSPHERE;

               (e) NANOSPHERE shall be responsible for and shall guaranty the performance of all obligations
of the sublicensee under this Agreement;

               (f) Any sublicense granted hereunder shall be in written form, and NANOSPHERE shall deliver to
ABBOTT a copy of the sublicense agreement to ABBOTT within forty-five (45) days after the effective
date of the sublicense;

               (g) NANOSPHERE shall pay to ABBOTT [...***...].

Article 3 — Term.

     3.1 This AGREEMENT shall become effective as of the EFFECTIVE DATE hereof and shall
continue in effect until the last to expire of the LICENSED PATENTS.

*** Confidential Treatment Requested

Text Omitted and Filed Separately

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Article 4 — Payment.

     4.1 In consideration for the license and release granted hereunder, NANOSPHERE shall pay
or cause to be paid to ABBOTT:

               (a) A non-refundable, non-creditable fee of [...***...];

               (b) Annual minimum royalties due within thirty (30) days of January 1 of any calendar year
based on the following schedule

	 	 	 	 	 
	For year	 	Minimum annual royalty	 
	2003
	 	 	[...***...]	 
	2004
	 	 	[...***...]	 
	2005
	 	 	[...***...]	 
	2006
	 	 	[...***...]	 

and [...***...] annually thereafter for the lifetime of LICENSE; and

               (c) A royalty determined by the following schedule based on NET SALES of each PRODUCT sold or
OTHERWISE DISPOSED OF on or subsequent to the EFFECTIVE DATE:

	 	 	 	 	 
	For NET SALES occurring	 	Royalty rate applied to that	 
	in any calendar year of:	 	year’s NET SALES of:	 
	[...***...]
	 	 	[...***...]	 
	[...***...]
	 	 	[...***...]	 
	[...***...]
	 	 	[...***...]	 
	[...***...]
	 	 	[...***...]	 
	[...***...]
	 	 	[...***...]	 

The aggregate of minimum royalties paid pursuant to Sections 2.3(b) and 4.1(c) hereof in any
calendar year shall be credited against the total royalties payable for such calendar year under
this Section 4.1 (c) and Section 2.3(c). The following two examples illustrate the application of
the foregoing sentence:

          Example 1. [...***...]

          Example 2. [...***...]

     4.2 It is expressly understood that more than one (1) LICENSED PATENT may issue in a country.
The obligation to pay royalties to Abbott under Section 4.1 shall be imposed only once with respect
to the same unit of Licensed Product regardless of the number of patent claims covering such
PRODUCT or where such PRODUCT is made, used, or sold.

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     4.3 NANOSPHERE’s obligation to pay royalties under Section 4.1 on PRODUCT shall only
extend to PRODUCT whose manufacture, sale, importation, offer for sale use at the time of its
manufacture, sale, importation, offer for sale or use is subject to an enforceable claim of a
LICENSED PATENT. Thus, this obligation shall terminate with regard to activities undertaken by
NANOSPHERE and any other parties to whom the license is extended under Section 2.1 hereof in a
given country after the expiration or lapse of the LICENSED PATENTS with claims covering this
activity in that country. If all the claims of LICENSED PATENTS covering the activities of
NANOSPHERE and any other parties to whom the license is extended under Section 2.1 hereof in a
given country shall be held unenforceable or invalid by a decision by the competent authorities in
that country, which decision is not subject to appeal, then NANOSPHERE and any other parties to
whom the license is extended under Section 2.1 hereof shall have no obligation with regard to such
activities from the time such a decision becomes final and unappealable.

          Upon NANOSPHERE’S written request, ABBOTT shall promptly inform NANOSPHERE if any claim of a
LICENSED PATENT has expired, lapsed, or become subject to a final decision of invalidity or
unenforceability, or if any U.S. Patent or patent application covered by this AGREEMENT has become
involved in an interference proceeding as of the date of ABBOTT’S response.

     4.4 No royalty shall accrue or become due more than once for a PRODUCT.

     4.5 During the term of this AGREEMENT, NANOSPHERE shall provide quarterly written reports to
ABBOTT within sixty (60) days of the expiration of each QUARTER, which quarterly written reports
shall list and identify all royalty-bearing sales, transfers, and uses occurring, or shall verify
that no royalty-bearing sales, transfers, or uses have occurred. The quarterly written reports
shall also state, for each different type of PRODUCT sold, OTHERWISE DISPOSED OF, or given away as
free samples or replacements during the QUARTER: (i) the name of the PRODUCT, catalog number of
the Product, or other identifying-indicia assigned by NANOSPHERE to the PRODUCT sufficient to
uniquely identify the PRODUCT to ABBOTT, (ii) the number of PRODUCTS sold, (iii) the number of
PRODUCTS OTHERWISE DlSPOSED OF, (iv) the number of PRODUCTS given away as free samples or
replacements, and (v) the total of the NET SALES of PRODUCT sold or OTHERWISE DISPOSED.

     4.6 (a) Concurrently with the making of each report NANOSPHERE shall pay to ABBOTT all
royalties due, in the amount specified in Section 4.1(b), on the PRODUCTS included in the report.

               (b) Any late payment shall bear interest at the rate of one percent (1%) per month.

     4.7 All payments shall be made hereunder in United States Dollars; provided, however, that if
the proceeds of the sales upon which such royalty payments are based are received by NANOSPHERE in
a foreign currency or other form that is not convertible or exportable in Dollars, NANOSPHERE shall
pay such royalties in the currency of the country in which such sales were made by depositing such
royalties in ABBOTT’s name in a bank designated by ABBOTT in such country. Royalties in Dollars
shall be computed by converting the royalty in the currency of the country in which the sales were
made in accordance with the procedures ordinarily used by NANOSPHERE in converting foreign currency
sales in its normal business operations, which procedures shall be in accordance with generally
accepted accounting principles.

6

 

     4.8 In the event that any taxes, withholding or otherwise, are levied by any taxing authority
in connection with accrual or payment of any royalties payable to ABBOTT under this AGREEMENT,
NANOSPHERE shall have the right to pay such taxes to the local tax authorities on behalf of ABBOTT
and the payment to ABBOTT of the net amount due, after reduction by the amount of such taxes, shall
fully satisfy NANOSPHERE’s royalty obligations under this AGREEMENT, provided that appropriate
documentation of such tax payment, including evidence of payment and receipt or any other
appropriate documentation, is provided to ABBOTT.

     4.9 All payments made hereunder shall be made to ABBOTT at the address set forth in Article 6
of this AGREEMENT or at such changed address as ABBOTT shall specify by written notice.

     4.10 NANOSPHERE shall keep records sufficient in accordance with generally accepted accounting
principles to permit verification of the reports and payments made to ABBOTT hereunder regarding
all PRODUCT sold or OTHERWISE DISPOSED OF. Records relating to the NET SALES of a PRODUCT sold or
OTHERWISE DISPOSED OF in any QUARTER after the EFFECTIVE DATE shall be available for inspection for
two (2) years after the close of that QUARTER. At ABBOTT’s expense and request and upon reasonable
notice, NANOSPHERE shall permit such records to be examined by independent public accountants
designated by ABBOTT and reasonably acceptable to NANOSPHERE. Such accountants shall report only
the amount by which royalties have been overpaid or underpaid and shall make such report
simultaneously to NANOSPHERE and ABBOTT. All information acquired in the course of such audits and
inspections, except the amount of royalties due ABBOTT, shall be deemed confidential information of
NANOSPHERE and shall not be disclosed to ABBOTT, and the accountants shall execute a written
undertaking with respect to such confidentiality prior to the commencement of any inspection. Such
examination shall take place not more than once each year.

     4.11 In the event that an examination by ABBOTT of NANOSPHERE’s records reveals an
underpayment to ABBOTT, NANOSPHERE shall pay ABBOTT the deficiency, plus interest at a rate of one
percent (1%) per month from the date the underpayment occurred, within sixty (60) days of receiving
the report of said accountants. In the event that such underpayment amounts to ten percent (10%)
or more of the total amount payable for the period examined, NANOSPHERE shall also reimburse ABBOTT
for all reasonable out-of-pocket expenses of the examination.

     4.12 During the term of this AGREEMENT, NANOSPHERE may notify ABBOTT and provide to ABBOTT
relevant facts upon becoming aware that a third party is infringing a LICENSED PATENT. NANOSPHERE
acknowledges that ABBOTT retains and shall have the sole and exclusive right to institute and
prosecute any and all suits and actions against third parties pertaining to the LICENSED PATENT.
NANOSPHERE shall reasonably cooperate with ABBOTT in all such suits and actions. ABBOTT shall pay
to NANOSPHERE [...***...] percent ([...***...]%) of any and all damages that may be received,
collected or recovered in any such suit or action, whether by judgment, settlement, or otherwise,
after reimbursement to ABBOTT of the costs of such suit or action.

*** Confidential Treatment Requested

Text Omitted and Filed Separately

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     4.13 During the term of this AGREEMENT, if NANOSPHERE (and, if a sub-license is granted
pursuant to Section 2.3 hereof, the sublicensee) notifies ABBOTT in writing and demonstrates that a
third party is infringing a LICENSED PATENT, and if ABBOTT does not, within ninety (90) calendar
days of receipt of such notice, (a) cause such actions to cease, (b) file and diligently pursue a
suit to enjoin such third party, or (c) execute a license to the third party under the LICENSED
PATENTS, then NANOSPHERE (or in the case of a sublicense, NANOSPHERE and the sublicensee) shall
have the right, upon written notice to ABBOTT, to reduce royalties on NET SALES of PRODUCT sold in
the country or countries in which such third party is infringing the Licensed Patents to
[...***...]. Such reduced royalties shall continue until the obligation to pay royalties expires,
or until ABBOTT has succeeded in abating the infringement. After the infringement has been abated,
NANOSPHERE (or in the case of a sublicense, NANOSPHERE and the sublicensee) shall resume paying
royalties to ABBOTT at the then-applicable rate for NET SALES of PRODUCT sold after that time, in
accordance with the term of royalty obligations as defined in Sections 4.1(b) and 4.1(c).
As with other disputes arising under this AGREEMENT, all disputes arising under this Section shall
be resolved exclusively in accordance with Article 18, which specifies the use of ADR to resolve
all disputes arising under this AGREEMENT.

     4.14 If ABBOTT shall grant a license in the Field to any third party under the Licensed
Patents in any country of the Territory on terms more favorable to such third party than those
contained herein, then ABBOTT shall notify NANOSPHERE and NANOSPHERE shall, at its option, have the
benefit of the more favorable terms, and shall also accept any less favorable terms, from the
effective date of such third party license.

Article 5 — Transferability of Rights and Obligations.

     5.1 This AGREEMENT and the license granted under it may not be assigned, transferred, or
sold, wholly or in part, by NANOSPHERE without the express written consent of ABBOTT; provided,
however, that NANOSPHERE may, without the consent of ABBOTT, transfer or assign this AGREEMENT and
the license granted hereunder in connection with the merger or consolidation of NANOSPHERE, the
sale of all the outstanding stock of NANOSPHERE, or the sale of NANOSPHERE’S entire line of
business related to this AGREEMENT.

     5.2 ABBOTT may freely assign this AGREEMENT in whole or in part and any or all of the rights
to LICENSED PATENTS.

     5.3 This AGREEMENT and each and every one of the terms and conditions thereof, shall inure to
the benefit of and be binding upon the permitted successors and assignees of both parties.

*** Confidential Treatment Requested

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Article 6 — Notice.

     6.1 Any notice, payment, report, or other correspondence (hereinafter collectively
referred to as “CORRESPONDENCE”) required or permitted to be given hereunder shall be
mailed by certified mail or delivery by hand or overnight courier to the party to whom such
correspondence is required or permitted to be given hereunder.

If mailed, any such notice shall be deemed to have been given when received by the party to whom
such CORRESPONDENCE is given, as evidenced by written and dated receipt of the receiving party.

     6.2 Alternatively, any CORRESPONDENCE provided for this AGREEMENT shall be deemed sufficiently
given by the party sending the CORRESPONDENCE when sent by facsimile to the party to whom the
CORRESPONDENCE is addressed, if a confirmation copy of the CORRESPONDENCE is also sent by Certified
or Registered Mail the same day. The date of the facsimile transmission will then constitute the
date of receipt of the CORRESPONDENCE if an acknowledgment of the receipt of the proper number of
pages is obtained from the receiving instrument.

All CORRESPONDENCE to ABBOTT shall be addressed as follows:

ABBOTT LABORATORIES

Director, Technology Acquisitions, Dept. 9RK, AP6C

Diagnostics Division

100 Abbott Park Road

Abbott Park, Illinois 60064-6094

Fax No.: (847) 937-6951

with a copy to:

ABBOTT LABORATORIES

Vice President, Domestic Legal, Dept. 322, AP6D

100 Abbott Park Road

Abbott Park, Illinois 60064-6049

Fax No.: (847) 938-1206

All correspondence to NANOSPHERE shall be addressed as follows:

NANOSPHERE, INC.

1818 Skokie Boulevard

Northbrook, IL 60062

Attention: Vice President, Business Development

Fax No.: (847) 562-8886

with a copy to:

Lael F. Johnson, Esq.

Schiff Hardin & Waite

6600 Sears Tower

Chicago, Illinois 60606

Fax No.: (312) 258-5700

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          Either party may change the address to which CORRESPONDENCE to it is to be addressed by
written notification as provided for herein.

Article 7 — Termination.

     7.1 ABBOTT shall have the right to terminate this AGREEMENT if NANOSPHERE has materially
defaulted in the performance of any of its royalty payment obligations herein contained, and such
default has not been cured within thirty (30) days after written notice from ABBOTT affirming its
intention to terminate. For clarification purposes, a breach of any representation or warranty
contained in Article 9 shall be considered a material breach for the purposes of this Section 7.1.

     7.2 In the event that NANOSPHERE shall be adjudicated bankrupt, go into liquidation,
receivership or trusteeship, make a composition with its creditors or enter into any similar
proceeding of the same nature, then ABBOTT shall have the right without liability therefor to
terminate this AGREEMENT forthwith by notice in writing to NANOSPHERE.

     7.3 NANOSPHERE shall have the right to terminate this AGREEMENT by giving thirty (30) days’
advance written notice. NANOSPHERE shall be obligated for royalty payments under Section 4.1 for
any PRODUCT sold or OTHERWISE DISPOSED OF during such thirty (30) day notice period.

     7.4 ABBOTT shall have the right to terminate this AGREEMENT, on a country-by-country basis, if
NANOSPHERE or its AFFILIATES, after the EFFECTIVE DATE, institutes a suit, nullity action,
opposition to grant, or other legal action seeking to invalidate the claims of a LICENSED PATENT in
that country, or actively participates (other than by legal compulsion) in any of the foregoing.

Article 8 — Governing Law.

          This AGREEMENT shall be governed by, interpreted in accordance with, and enforced under
the laws of the State of Illinois, U.S.A. (regardless of Illinois’ or any other jurisdiction’s
choice of law principles), or, as necessary, the laws of the United States of America or the laws
of the appropriate foreign country if the issue is the scope or validity of the patent rights
granted by that country.

Article 9 — Representations, Warranties and Limitations.

     9.1 Nothing in this AGREEMENT shall be construed as:

               (a) A warranty or representation by ABBOTT as to the validity or enforceability of any
LICENSED PATENTS;

               (b) A warranty or representation by ABBOTT that anything made, used, sold or OTHERWISE
DISPOSED OF under the license granted in this AGREEMENT, is or will be free from infringement of
patents or other rights of third parties;

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               (c) A requirement that ABBOTT shall file or prosecute any patent application, or secure or
maintain any patent;

               (d) An obligation of either party to bring or prosecute actions or suits against third parties
for infringement of any LICENSED PATENTS;

               (e) Conferring a right to use in advertising, publicity, or the like any name, tradename, or
trademark of NANOSPHERE or ABBOTT;

               (f) Granting by implication, estoppel or otherwise any licenses or rights under any patents
and patent applications other than under the LICENSED PATENTS; or

               (g) An obligation by ABBOTT to furnish know-how or any other technical information not
disclosed in the LICENSED PATENTS.

     9.2 ABBOTT represents and warrants to NANOSPHERE that ABBOTT owns all right, title and
interest in and to the Licensed Patents as of the EFFECTIVE DATE, and has the power and right to
grant the license hereunder. For clarity, Abbott may grant additional non-exclusive licenses to
the LICENSED PATENTS after the EFFECTIVE DATE.

     9.3 Each party represents and warrants that it has full authority to enter into and become
bound by the terms and conditions of this AGREEMENT and that its execution of this AGREEMENT will
not violate, contravene or be in conflict with any law, rule, bylaw, article of incorporation,
order, regulation or other agreement.

     9.4 NANOSPHERE represents and warrants that the cumulative total NET SALES of all PRODUCTS
prior to the EFFECTIVE DATE is less than or equal to one thousand dollars ($1,000.00).

Article 10 — Disclaimer and Hold Harmless Provision.

     10.1 It is understood and agreed by and between the parties hereto that nothing contained
in this AGREEMENT shall constitute or be construed to constitute any undertaking, representation,
suggestion, inducement, warranty, assurance or guarantee whatsoever by either party regarding the
safety, quality, yield, production, cost, profit, saleability, licenseability, demand, utility,
performance, availability of raw materials, or potential of accident or injury to person or
property of PRODUCTS or any assay, product, material, service, process or apparatus related to
PRODUCTS.

     10.2 NANOSPHERE expressly indemnifies and holds ABBOTT, its AFFILIATES, successors, and
assigns and their respective officers, directors and employees harmless from and against any and
all claims, liabilities, damages, costs, expenses, and/or actions of any kind whatsoever which
arise from or are connected with the manufacture, use, lease, sale, or other disposition of
PRODUCTS by NANOSPHERE or its AFFILIATES under the LICENSED PATENTS.

     10.3 NANOSPHERE expressly indemnifies and holds ABBOTT, its AFFILIATES, successors, and
assigns and their respective officers, directors and employees harmless from and against any and
all claims, liabilities, damages, costs, expenses, and/or actions of any kind whatsoever which
arise from breach of its representations and warranties in Section 9.3. Similarly, ABBOTT
expressly indemnifies and holds NANOSPHERE, its AFFILIATES, successors, and assigns and

11

 

their respective officers, directors and employees harmless from and against any and all
claims, liabilities, damages, costs, expenses, and/or actions of any kind whatsoever which arise
from breach of its representations and warranties in Sections 9.2 and 9.3.

     10.4 Neither of the parties hereto shall be liable in damages or have the right to cancel for
any delay or default in performing hereunder (other than delay or default in the payment of money)
if such delay or default is caused by conditions beyond its control, including but not limited to
Acts of God, governmental restrictions, continuing domestic or international problems such as war
or insurrections, strikes, fires, flood, work stoppages, embargoes and/or other casualty or cause;
provided, however, that any party hereto shall have the right to terminate this AGREEMENT upon
thirty (30) days prior written notice if the other party is unable to fulfill its obligations under
this AGREEMENT due to any of the above-mentioned causes and such inability continues for a period
of six (6) months.

Article 11 — Captions.

          The captions and headings of this AGREEMENT are solely for the convenience of reference
and shall not affect its interpretation.

Article 12 — Severability.

          Should any part or provision of this AGREEMENT be held unenforceable or in conflict with
the applicable laws or regulations of any jurisdiction, the invalid or unenforceable part or
provision shall be replaced with a provision which accomplishes, to the extent possible, the
original business purpose of such part or provision in a valid and enforceable manner, and the
remainder of this AGREEMENT shall remain binding upon the parties hereto.

Article 13 — Waiver.

          No failure or delay on the part of a party in exercising any right hereunder shall
operate as a waiver of, or impair, any such right. No single or partial exercise of any such right
shall preclude any other or further exercise thereof or the exercise of any other right. No waiver
of any such right shall be deemed a waiver of any other right hereunder.

Article 14 — Relationship of the Parties.

          The relationship of the parties under this AGREEMENT is that of independent contractors.
Nothing contained in this AGREEMENT is intended to, or is to be construed so as to, constitute the
parties as partners, joint venturers, or either party as an agent or employee of the other.
Neither party has any express or implied right under this AGREEMENT to assume or create any
obligation on behalf of or in the name of the other, or to bind the other party to any contract,
agreement, or undertaking with any third party, and no conduct of the parties shall be deemed to
imply such right.

12

 

Article 15 — Product Marking.

          NANOSPHERE agrees to properly mark all PRODUCTS and any advertising for PRODUCTS with
appropriate notice of patent coverage, which notice shall identify Abbott Laboratories as the owner
of the Licensed Patents and shall be mutually agreeable to the parties.

          In no event shall NANOSPHERE use ABBOTT’S name or any ABBOTT trademark except as specifically
stated in this AGREEMENT.

Article 16 — Survival.

     16.1 The provisions of Sections 4, 8, 9, 10 and 18 shall survive the termination or
expiration of this AGREEMENT and shall remain in full force and effect. Specifically, termination
or expiration shall not affect, inter alia;

               (a) NANOSPHERE’s obligation to pay royalties and supply reports for PRODUCT sold or OTHERWISE
DISPOSED OF up to such termination or expiration as specified in Article 4 of this AGREEMENT;

               (b) ABBOTT’s right to receive or recover and NANOSPHERE’s obligation to pay royalties accrued
or accruable for payment at the time of any termination;

               (c) NANOSPHERE’s obligation to maintain records pertaining to the NET SALES of PRODUCT sold or
OTHERWISE DISPOSED OF prior to such termination or expiration and ABBOTT’s right to conduct a final
examination of records in accordance with Paragraph 4.10 of this AGREEMENT within two (2) years of
such termination or expiration; and

               (d) Licenses and releases running in favor of customers or transferees of either party in
respect to PRODUCT sold or OTHERWISE DISPOSED OF prior to termination of this AGREEMENT.

     16.2 The provisions of this AGREEMENT which do not survive termination or expiration hereof
(as the case may be) shall, nonetheless, be controlling on, and shall be used in construing and
interpreting, the rights and obligations of the parties hereto with regard to any dispute,
controversy or claim which may arise under, out of, in connection with, or relating to this
AGREEMENT.

Article 17 — Entire Agreement.

          This AGREEMENT constitutes the entire agreement between the parties hereto respecting the
subject matter hereof, and supersedes and terminates all prior agreements respecting the subject
matter hereof, whether written or oral, and may be amended only by an instrument in writing
executed by both parties hereto.

Article 18 — Alternative Dispute Resolution.

          The parties recognize that bona fide disputes as to certain matters may arise from time
to time during the term of this AGREEMENT which relate to either party’s rights and/or obligations
under this Agreement, and agree to have such a dispute(s) resolved exclusively by this

13

 

Alternative Dispute Resolution (“ADR”) provision. A party desiring resolution of a dispute
must first send written notice of the dispute to the other party for attempted resolution by good
faith negotiations between their respective presidents (or their designees) of the affected
subsidiaries, divisions, or business units within twenty-eight (28) days after such notice is
received (all references to “days” in this ADR provision are to calendar days). If the matter has
not been resolved within twenty-eight (28) days of the notice of dispute, or if the parties fail to
meet within such twenty-eight (28) days, either party may initiate an ADR proceeding as provided
herein. The parties shall have the right to be represented by counsel in such a proceeding.

     18.1 To begin an ADR proceeding, a party shall provide written notice to the other party of
the issues to be resolved by ADR. Within fourteen (14) days after its receipt of such notice, the
other party may, by written notice to the party initiating the ADR, add additional issues to be
resolved within the same ADR.

     18.2 Within twenty-one (21) days following receipt of the original ADR notice, the parties
shall select a mutually acceptable neutral to preside in the resolution of any disputes in this ADR
proceeding. If the parties are unable to agree on a mutually acceptable neutral within such
period, either party may request the President of the CPR Institute for Dispute Resolution
(“CPR”), 366 Madison Avenue, 14th Floor, New York, New York 10017, to select a neutral
pursuant to the following procedures:

               (a) The CPR shall submit to the parties a list of not less than five (5) candidates within
fourteen (14) days after receipt of the request, along with a Curriculum Vitae for each candidate.
No candidate shall be an employee, director, or shareholder of either or any of their subsidiaries
or affiliates.

               (b) Such list shall include a statement of disclosure by each candidate of any circumstances
likely to affect his or her impartiality.

               (c) Each party shall number the candidates in order of preference (with the number one (1)
signifying the greatest preference) and shall deliver the list to the CPR within seven (7) days
following receipt of the list of candidates. If a party believes a conflict of interest exists
regarding any of the candidates, that party shall provide a written explanation of the conflict to
the CPR along with its list showing its order of preference for the candidates. Any party failing
to return a list of preferences on time shall be deemed to have no order of preference.

               (d) If the parties collectively have identified fewer than three (3) candidates deemed to have
conflicts, the CPR immediately shall designate as the neutral the candidate for whom the parties
collectively have indicated the greatest preference. If a tie should result between two
candidates, the CPR may designate either candidate. If the parties collectively have identified
three (3) or more candidates deemed to have conflicts, the CPR shall review the explanations
regarding conflicts and, in its sole discretion, may either (i) immediately designate as the
neutral the candidate for whom the parties collectively have indicated the greatest preference, or
(ii) issue a new list of not less than five (5) candidates, in which case the procedures set forth
in subparagraphs 2(a) — 2(d) shall be repeated.

     18.3 No earlier than twenty-eight (28) days or later than fifty-six (56) days after selection,
the neutral shall hold a hearing to resolve each of the issues identified by the parties. The ADR
proceeding shall take place at a location agreed upon by the parties. If the parties cannot

14

 

agree, the neutral shall designate a location other than the principal place of business of
either party or any of their subsidiaries or affiliates.

     18.4 At least seven (7) days prior to the hearing, each party shall submit the following to
the other party and the neutral:

               (a) a copy of all exhibits on which such party intends to rely in any oral or written
presentation to the neutral;

               (b) a list of any witnesses such party intends to call at the hearing, and a short summary of
the anticipated testimony of each witness;

               (c) a proposed ruling on each issue to be resolved, together with a request for a specific
damage award or other remedy for each issue. The proposed rulings and remedies shall not contain
any recitation of the facts or any legal arguments and shall not exceed one (1) page per issue.

               (d) a brief in support of such party’s proposed rulings and remedies, provided that the brief
shall not exceed twenty (20) pages. This page limitation shall apply regardless of the number of
issues raised in the ADR proceeding.

          Except as expressly set forth in subparagraphs 4(a) — 4(d), no discovery shall be required or
permitted by any means, including depositions, interrogatories, requests for admissions, or
production of documents; provided however, that the neutral may order up to two
depositions not to exceed three (3) hours in duration under exceptional circumstances. Any
deposition ordered by the neutral shall be limited in scope and further limited in duration, if
possible, so as to address only the exceptional circumstances that make the deposition necessary.

     18.5 The hearing shall be conducted on two (2) consecutive days and shall be governed by the
following rules:

               (a) Each party shall be entitled to five (5) hours of hearing time to present its case. The
neutral shall determine whether each party has had the five (5) hours to which it is entitled.

               (b) Each party shall be entitled, but not required, to make an opening statement, to present
regular and rebuttal testimony, documents or other evidence, to cross-examine witnesses, and to
make a closing argument. Cross-examination of witnesses shall occur immediately after their direct
testimony, and cross-examination time shall be charged against the party conducting the
cross-examination.

               (c) The party initiating the ADR shall begin the hearing and, if it chooses to make an opening
statement, shall address not only issues it raised but also any issues raised by the responding
party. The responding party, if it chooses to make an opening statement, also shall address all
issues raised in the ADR. Thereafter, the presentation of regular and rebuttal testimony and
documents, other evidence, and closing arguments shall proceed in the same sequence.

               (d) Except when testifying, witnesses shall be excluded from the hearing until closing
arguments.

15

 

               (e) Settlement negotiations, including any statements made therein, shall not be admissible
under any circumstances. Affidavits prepared for purposes of the ADR hearing also shall not be
admissible. As to all other matters including the conduct of hearing, discovery matters and
admissibility of evidence, the neutral shall have sole discretion and his or her rulings shall be
binding, non-reviewable and non-appealable.

     18.6 Within seven (7) days following completion of the hearing, each party may submit to the
other party and the neutral a post-hearing brief in support of its proposed rulings and remedies,
provided that such brief shall not contain or discuss any new evidence and shall not exceed ten
(10) pages. This page limitation shall apply regardless of the number of issues raised in the ADR
proceeding.

     18.7 The neutral shall rule on each disputed issue within fourteen (14) days following
completion of the hearing. Such ruling shall adopt in its entirety the proposed ruling and remedy
of one of the parties on each disputed issue but may adopt one party’s proposed rulings and
remedies on some issues and the other party’s proposed rulings and remedies on other issues. The
neutral shall not issue any written opinion or otherwise explain the basis of the ruling.

     18.8 The neutral shall be paid a reasonable fee plus expenses. These fees and expenses, along
with the reasonable legal fees and expenses of the prevailing party (including all expert witness
fees and expenses), the fees and expenses of a court reporter, and any expenses for a hearing room,
shall be paid as follows:

               (a) If the neutral rules in favor of one party on all disputed issues in the ADR, the losing
party shall pay 100% of such fees and expenses.

               (b) If the neutral rules in favor of one party on some issues and the other party on other
issues, the neutral shall issue with the rulings a written determination as to how such fees and
expenses shall be allocated between the parties. The neutral shall allocate fees and expenses in a
way that bears a reasonable relationship to the outcome of the ADR, with the party prevailing on
more issues, or on issues of greater value or gravity, recovering a relatively larger share of its
legal fees and expenses.

     18.9 The rulings of the neutral and the allocation of fees and expenses shall be binding,
non-reviewable, and non-appealable, and may be entered as a final judgment in any court having
jurisdiction.

     18.10 Except as provided in paragraph 9 or as required by law, the existence of the dispute,
any settlement negotiations, the ADR hearing, any submissions (including exhibits, testimony,
proposed rulings, and briefs), and the rulings shall be deemed Confidential Information. The
neutral shall have the authority to impose sanctions for unauthorized disclosure of Confidential
Information.

     18.11 All disputes referred to ADR, the statute of limitations, and the remedies for any wrong
that may be found, shall be governed by the laws of the State of Illinois.

     18.12 The neutral may not award punitive damages. The parties hereby waive the right to
punitive damages.

     18.13 The hearings shall be conducted in the English language.

16

 

     18.14 Notwithstanding any of the above, this article shall not apply to, and no ADR proceeding
shall deal with, disputes relating to the issues of the validity and/or enforceability of any of
the LICENSED PATENTS.

Article 19 — Confidentiality.

     19.1 The terms of this AGREEMENT, and any information provided by a party hereto pursuant
to this AGREEMENT, shall be kept in confidence by the parties hereto, except that the parties
hereto may disclose the terms of the AGREEMENT as required by law, to prospective purchasers of the
entire business or line of business relating to PRODUCTS, and to each party’s lawyers, accountants,
consultants to the extent necessary to receive their professional services; provided
that any such persons to whom disclosure is permitted have agreed to keep such terms
confidential. Except as provided above, no party hereto shall provide this AGREEMENT or any of its
terms to any person or entity not a party hereto. Notwithstanding any of the above, the parties
hereto may disclose publicly that ABBOTT has granted and NANOSPHERE has accepted a non-exclusive
right and license under the LICENSED PATENTS.

     19.2 Notwithstanding Paragraph 19.1, if either of the parties hereto is required (by
deposition, questions, interrogatories, requests for information or documents as required by or in
any legal proceedings, subpoenas, civil investigative demands, or any other similar compulsory
Processes) to disclose any of the terms of this AGREEMENT, each party so required shall provide the
other party with prompt written notice of any such request or requirement so that such other party
may seek a protective order or other appropriate remedy.

     19.3 Notwithstanding the foregoing, neither of the parties shall be prohibited from disclosing
the terms of this AGREEMENT in a Quarterly Report on Form 10-Q or Annual Report on Form 10-K, if
upon the advice of legal counsel, such disclosure is required by the rules and regulations of the
Securities and Exchange Commission, including but not limited to Regulations S-K and S-X.

17

 

          IN WITNESS WHEREOF, the parties hereto have caused this AGREEMENT to be executed by their
respective officers thereunto duly authorized to be effective as of the EFFECTIVE DATE.

NANOSPHERE, INC.

By: /s/ Bill Athenson 

Printed Name: Bill Athenson

Title: V.P. Business Development

Date: 12-20-02

ABBOTT LABORATORIES

By: /s/ Edward L. Michael 

Printed Name: Edward L. Michael

Title: Corporate Vice President

          Immunoassay/Clinical Chemistry

Date: 12/19/02

18

 

APPENDIX A

U.S. Patent No 5,599,668 (issued February 4, 1997) and

U.S. Patent No. 5,843,651 (Issued December 10, 1998)

Foreign counterparts:

	 	 	 	 	 	 	 	 	 
	Country	 	Pat./Appln. No.	 	 	Issue/Filing Date	 
	Canada
	 	 	2,197,321	 	 	September 20, 1995
	EP*
	 	 	95933864.1	 	 	September 20, 1995
	Japan
	 	 	511040/96	 	 	September 20, 1995

 

			
	*	 	EP designated states = Austria, Belgium, Switzerland, Germany, Spain, France, United Kingdom,
Italy, and the Netherlands.

A-1exv10w22

 

Exhibit 10.22

BONUS AGREEMENT

               BONUS AGREEMENT (this “Agreement”), dated as of March 16,
2006 (the “Effective Date”), between NANOSPHERE, INC., a Delaware corporation having an office
at 4088 Commercial Avenue, Northbrook, Illinois 60062 (the “Company”), and WILLIAM P. MOFFITT, an
individual residing at 942 Pine Tree Lane, Winnetka, Illinois 60093 (“Employee”).

PREAMBLE

               WHEREAS, the Company has instituted a Company-wide performance bonus program; and

               WHEREAS, the Board of Directors of the Company has determined that it is in the best interests
of the Company and its stockholders to incentivize Mr. Moffitt to remain on as the Company’s
President and Chief Executive Officer and to enter into this Agreement as part of the Company-wide
bonus program.

AGREEMENTS

               NOW, THEREFORE, in consideration of the mutual covenants contained herein, and for other good
and valuable consideration, the sufficiency and receipt whereof is hereby acknowledged, the parties
agree as follows:

               1. Definitions. Unless otherwise defined herein, the following terms shall have the
following respective meanings:

               “Bankruptcy Event” means: (i) the commencement of a case or proceeding against the Company
seeking a decree or order in respect of the Company (A) under the provisions of Title 11 of the
United States Code, 11 U.S.C. §§101 et seq., or any other applicable federal, state
or foreign bankruptcy or other similar law now or hereafter in effect (collectively, “Bankruptcy
Laws”), (B) appointing a custodian, receiver, liquidator, assignee, trustee or sequestrator (or
similar official) for the Company or for any substantial part of the Company’s assets, or (C)
ordering the winding up or liquidation of the affairs of the Company, and such case or
proceeding shall remain undismissed or unstayed for sixty (60) days or more or a decree or order
granting the relief sought in such case or proceeding shall be entered by a court of competent
jurisdiction; (ii) the Company’s filing of a petition seeking relief under Bankruptcy Laws; (iii)
the Company’s consent to (or failure to contest in a timely and appropriate manner) the institution
of proceedings thereunder or the filing of any such petition or the appointment of or taking
possession by a custodian, receiver, liquidator, assignee, trustee or sequestrator (or similar
official) for the Company or for any substantial part of the Company’s assets; or (iv) the
Company’s making an assignment for the benefit of creditors.

               “Cause” means (i) any felony conviction or admission of guilt, (ii) any breach or
nonobservance by Employee of any material covenant set forth herein or in the Employment Agreement,
provided that the Board of Directors of the Company has given Employee written notice of such
breach or nonobservance and Employee has failed to cure such breach or

 

 

nonobservance within a period reasonable under the circumstances, (iii) any willful,
intentional or deliberate disobedience or neglect by Employee of the lawful and reasonable orders
or directions of the Board of Directors of the Company, provided that the Board of Directors of the
Company has given Employee written notice of such disobedience or neglect and Employee has failed
to cure such disobedience or neglect within a period reasonable under the circumstances, or
(iv) any willful or deliberate misconduct by employee that is materially injurious to the
Company.

               “Change in Control” means (i) the purchase or other acquisition by any person, entity or group
of persons, within the meaning of Section 13(d) or 14(d) of the Securities Exchange Act of 1934 or
any comparable successor provisions (other than stockholders (or affiliates thereof) of the Company
as of the date of this Employment Agreement), of beneficial ownership (within the meaning of Rule
13d-3 promulgated under the Exchange Act) of 50% or more of either the outstanding shares of Common
Stock (on a fully diluted basis) or the combined voting power of the Company’s then-outstanding
voting securities entitled to vote generally in the election of directors of the Company; (ii) the
consummation of a reorganization, merger or consolidation of the Company, in each case, with
respect to which persons who were stockholders of the Company immediately prior to such
reorganization, merger or consolidation do not, immediately thereafter, own more than 50% of the
combined voting power entitled to vote generally in the election of directors of the reorganized,
merged or consolidated company; (iii) a liquidation or dissolution of the Company; or (iv) the sale
of all or substantially all of the Company’s assets.

               “Diminution in Responsibility” means any of (i) a material diminution in Employee’s duties or
responsibilities or the assignment to Employee of duties that are materially inconsistent with his
duties as President and Chief Executive Officer of the Company or that materially impair Employee’s
ability to function in his position; (ii) the Company’s failure, during the term of Employee’s
employment under the Employment Agreement, to cause the election of Employee to the Board of
Directors of the Company; (iii) a relocation of the Company’s principal offices, without Employee’s
acquiescence or consent, to a location that is more than a fifty (50) mile radius from its current
location; (iv) any material reduction in the compensation and benefit opportunities (other than
those in Sections 3.2(b) and (c) of the Employment Agreement that have a stated term) of the
Employee (measured in the aggregate); or (v) any breach by the Company of any material provision of
this Agreement or the Employment Agreement, provided that Employee has given the Company
written notice of such breach and the Company has failed to cure such breach within a period that
is reasonable under the circumstances.

               “Employment Agreement” means that certain Employment Agreement between the Company and
Employee dated as of July 19, 2004, as subsequently amended.

               “Good Reason” means a Diminution in Responsibility.

               “Permanent Disability” means Employee’s inability to substantially perform his duties and
responsibilities hereunder by reason of any physical or mental incapacity for a period of 180
consecutive days, or two or more periods of 90 consecutive days each in any 360-day period.

- 2 -

 

               2. Bonus.

               2.1 Cash Bonus. Subject to the terms and conditions of this Agreement, the Company
hereby agrees to pay Employee a cash bonus in the amount of Two Million Three Hundred Thousand
Dollars ($2,300,000) (the “Bonus”) on the fifth (5th) anniversary of the Effective Date (the “Bonus
Payment Date”), provided that Employee is still employed by the Company on such date.

               2.2 Acceleration of Bonus Upon Certain Events. Notwithstanding Section 2.1 hereof,
the Company’s obligation to pay the Bonus will be accelerated and the bonus shall become
immediately payable: (i) immediately prior to the completion of the Company’s first underwritten
public offering of its securities registered under the Securities Act of 1933, as amended; (ii)
immediately prior to the consummation of a Change in Control, provided, in either instance,
that Employee is still employed by the Company at such time; and (iii) upon the occurrence of a
Bankruptcy Event.

               2.3 Termination of Employment. If, prior to the Bonus Payment Date, (i) Employee
terminates his employment under the Employment Agreement for Good Reason within one (1) year of the
event constituting Good Reason, (ii) the Company terminates Employee’s employment under the
Employment Agreement without Cause or upon Employee’s Permanent Disability, (iii) the Company
provides Employee with notice under Section 5 of the Employment Agreement that it will not renew
the Employment Agreement or (iv) Employee dies (each of the foregoing clauses (i) through (iv) is
referred to as a “Trigger Event”), then the Company shall pay to Employee (or to Employee’s estate,
if Employee is deceased) the Bonus within five (5) days of the occurrence of such Trigger Event.

               2.4 Release for Post-Termination Benefits. In order to be eligible to receive any
benefits provided for in this Agreement that become due on or following termination of employment,
Employee (or Employee’s estate, if Employee is deceased) shall be required to execute and deliver
to the Company a full release of any claims or causes of action that the Employee (or Employee’s
estate, if Employee is deceased) might otherwise have or claim to have or assert against the
Company, other than a claim for any of the post-termination benefits provided for hereunder, in
such form as the Company may reasonably require.

               2.5 Tax Gross-Up. If: (i) the Bonus becomes payable as a result of Employee’s death;
(ii) the Bonus becomes includable in Employee’s estate (the “Estate”) for purposes of U.S. federal
estate taxes; and (iii) Employee is not survived by his spouse, then the Company shall reimburse
the Estate for any U.S. federal, state or local taxes payable in respect of the Bonus, plus any
such taxes payable on such reimbursements, such that the net (after-tax) result to the Estate,
solely in respect of the Bonus, shall be equivalent to what the net (after-tax) result, solely in
respect of the Bonus, would have been to Employee had Employee been alive at the time of payment of
the Bonus. The Company shall make the payments, or portions thereof, provided for in this Section
2.5 not later than fifteen (15) days prior to the date on which such taxes, or portions thereof,
are due as determined by the tax counsel referred to below. Tax counsel selected by the Company
shall determine the amounts (if any) due the Estate under this Section 2.5. The Estate shall
provide such counsel with such information as such counsel reasonably requests in connection with
such determination. All determinations of tax counsel

- 3 -

 

shall be binding on the Estate and the Company. Tax counsel shall determine that payments
shall be due hereunder only if, and to the extent that, it is more likely than not that such
payments are required to achieve the result intended by this Section 2.5. In making the
determinations required by this Section 2.5, tax counsel may rely on benefit consultants,
accountants or other experts. The Company agrees to pay all reasonable fees and expenses of such
tax counsel, benefit consultants, accountants or other experts. If, subsequent to the payment to
the Estate of any payment pursuant to this Section 2.5, the tax counsel referred to in this Section
2.5 reasonably determines that the amount of the payments made pursuant to this Section 2.5 are
greater than, or less than, the amount required to have been paid hereunder, the Estate shall
reimburse the Company an amount, or the Company shall pay to the Estate an additional amount,
respectively, based upon such determination.

               3. General.

               3.1 Governing Law. This Agreement shall be construed, interpreted and governed by the
laws of the State of Illinois, without regard to the conflicts of law rules thereof.

               3.2 Binding Effect. This Agreement shall extend to and be binding upon Employee, his
legal representatives, heirs and distributees and upon the Company, its successors and assigns
regardless of any change in the business structure of the Company.

               3.3 Assignment. Neither this Agreement nor any of the rights or obligations hereunder
shall be assigned or delegated by any party without the prior written consent of the other party.

               3.4 Entire Agreement. Except for any stock option or stock award agreement between
the parties, this Agreement contains the entire agreement of the parties with respect to the
subject matter hereof. No waiver, modification or change of any provision of this Agreement shall
be valid unless in writing and signed by both parties.

               3.5 Waiver. The waiver of any breach of any duty, term or condition of this Agreement
shall not be deemed to constitute a waiver of any preceding or succeeding breach of the same or any
other duty, term or condition of this Agreement.

               3.6 Severability. If any provision of this Agreement shall be unenforceable in any
jurisdiction in accordance with its terms, the provision shall be enforceable to the fullest extent
permitted in that jurisdiction and shall continue to be enforceable in accordance with its terms in
any other jurisdiction and the validity, legality and enforceability of the remaining provisions
contained herein shall not be affected thereby.

               3.7 Resolution of Disputes. Any disputes arising under or in connection with this
Agreement between Employee and the Company (or any officer, director, employee or agent of the
Company) shall, at the election of Employee or the Company, be resolved by confidential binding
arbitration, to be held in Chicago, Illinois (or in such other location as the Company may at the
time be headquartered) in accordance with the rules and procedures of the Model Employment Rules of
the American Arbitration Association. Judgment upon the award rendered by the arbitrator(s) may be
entered in any court having jurisdiction thereof.

- 4 -

 

               3.8 Notices. All notices pursuant to this Agreement shall be in writing and shall be
sent by prepaid certified mail, return receipt requested or by recognized air courier service
addressed as follows:

	 	(i)	 	If to the Company to:
	 
	 	 	 	Mark Slezak

Chairman of the Board

Nanosphere, Inc.

c/o Lurie Investments, Inc.

Two North Riverside Plaza

Chicago, IL 60606

	 
	 	 	 	copy to:
	 
	 	 	 	Paul, Hastings, Janofsky & Walker LLP

1055 Washington Boulevard

Stamford, CT 06901

Attention: Esteban A. Ferrer, Esq.

	 
	 	(ii)	 	If to Employee to:
	 
	 	 	 	Mr. William P. Moffitt

942 Pine Tree Lane

Winnetka, IL 60093

or to such other addresses as may hereafter be specified by notice in writing by either of the
parties, and shall be deemed given three business days after the date so mailed or sent.
Notwithstanding any other provision of this Agreement, neither party shall have the benefit of, or
be entitled to, any notice or cure period for any breach of a material provision hereof that is not
reasonably susceptible of cure.

               3.9 Understanding. Executive has had the opportunity to seek legal counsel concerning
this Agreement, and has read and understands the provisions hereof.

               3.10 Counterparts. This Agreement may be executed in counterparts, each of which
shall be deemed an original but all of which shall together constitute one and the same agreement.

[Signature page follows.]

- 5 -

 

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

	 	 	 	 	 
	 	WILLIAM P. MOFFITT

 	 
	 	/s/ William P. Moffitt
 	 
	 	 	 
	 	 	 
	 
	 	NANOSPHERE, INC.

 	 
	 	By:  	/s/ Mark Slezak
 	 
	 	 	Name:  	Mr. Mark Slezak 	 
	 	 	Title:  	Chairman of the Board of Directors 	 
	 

 

 

FIRST AMENDMENT TO BONUS AGREEMENT

          FIRST AMENDMENT TO BONUS AGREEMENT (this “Amendment”), dated as of August 7, 2007, by and between
Nanosphere, Inc., a Delaware corporation (the “Company”), and Mr. William P. Moffitt, an individual
resident in the State of Illinois (“Employee”).

RECITALS

          A. The Company and Employee entered into a Bonus Agreement (the “Agreement”), dated as of
March 16, 2006, whereby the Company established incentives for the Employee, in his capacity as the
Company’s President and Chief Executive Officer, as part of the Company-wide bonus program.

          B. The Agreement provides for the acceleration of the Company’s obligation to pay the Bonus
(as that term is defined in the Agreement) immediately prior to completion of the Company’s first
underwritten public offering (the “Acceleration Event”).

          C. Pursuant to a loan and security agreement made by and between the Company and Employee on
March 16, 2006, the Company made a loan to Employee, which loan also matures upon the Acceleration
Event.

          D. In order to comply with applicable laws, no loan to an executive officer or director of a
company may be outstanding at the time the company files its first Registration Statement on Form
S-1 (“Form S-1”) with the U.S. Securities and Exchange Commission (the “New Acceleration Event”).

          E. The Company, for and in consideration of Employee’s execution of an amendment of even date
herewith to the aforementioned loan and security agreement, which amendment (among other things)
changes the Acceleration Event to the New Acceleration Event, has agreed to accelerate the payment
of the Bonus to Employee to immediately prior to the filing of the S-1 of the Company’s first
underwritten public offering, as opposed to immediately prior to completion of the Company’s first
underwritten public offering, as set forth in this Amendment.

AGREEMENT

          NOW, THEREFORE, in consideration of the mutual covenants contained herein, and for such other
good and valuable consideration, the sufficiency and receipt of which are hereby acknowledged, the
parties hereto agree as follows:

          1. Amendment to Section 2.2. Section 2.2 of the Bonus Agreement is hereby amended in
its entirety to read as follows:

2.2 Acceleration of Bonus Upon Certain Events. Notwithstanding Section 2.1 hereof,
the Company’s obligation to pay the Bonus will be accelerated and the bonus shall become
immediately payable: (i) immediately prior to the filing of the Registration Statement on
Form S-1 of the Company’s first underwritten public offering of its securities registered
under the Securities Act of 1933, as amended; (ii) immediately prior to the consummation of
a Change in Control, provided, in either instance, that Employee is still employed
by the Company at such time; and (iii) upon the occurrence of a Bankruptcy Event.

          2. Full Force and Effect. Except as amended by Section 1 hereof, the Bonus Agreement
remains in full force and effect.

 

 

          3. Governing Law. This Amendment shall be construed, interpreted and governed by the
laws of the State of Illinois, without regard to the conflicts of law rules thereof.

          4. Notices. Any notice given in connection with this Amendment shall be in writing
and shall be considered effected if delivered in accordance with the provisions of Section 3.8 of
the Bonus Agreement, as if such notice had been given in connection therewith.

          5. Counterparts. This Amendment may be executed in counterparts, each of
which shall be deemed an original but all of which together shall constitute one and the same
instrument.

[Signature page follows.]

 

 

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

	 	 	 	 	 
	 	 	 
	 	                                                  /s/ William P. Moffitt
 	 
	 	MR. WILLIAM P. MOFFITT 	 
	 	 	 
	 

	 	 	 	 	 	 	 
	 	 	NANOSPHERE, INC.	 	 
	 
	 	 	 	 	 	 
	 

	 	By:
	 	/s/ Mark Slezak
 

	 	 
	 

	 	Name:
	 	Mr. Mark Slezak	 	 
	 

	 	Title:
	 	Chairman of the Board of Directors	 	 

[Signature Page to First Amendment to Bonus Agreement]

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