Document:

exv10w49

 

EXHIBIT
10.49

DISTRIBUTION
AGREEMENT WITH HT HOSPITAL TECHNOLOGIES GmbH

This DISTRIBUTION AGREEMENT (“Agreement”) effective between CytoCore, Inc. (“CytoCore”), a
corporation organized and existing under the laws of the State of Delaware, United States of
America whose principal address is 414 N. Orleans, Chicago 60601 and HT Hospital Technologies
GmbH (“Distributor”), organized and existing under the laws of Switzerland, whose principal
address is Kernserstrasse 31 — 6061 Sarnen — Switzerland. Distributor and CytoCore may
sometimes be referred to herein individually as a “party” or collectively as the “parties.”

IN CONSIDERATION of the mutual promises and payments contained herein the parties hereto
agree as follows:

	1.	 	APPOINTMENT OF DISTRIBUTOR.
	 
	 	 	CytoCore hereby appoints Distributor as the exclusive Distributor in Switzerland
(“Area”) of the products set forth on Schedule A annexed hereto as of the date hereof
and such other products (if any) as may be added to the said Schedule by mutual
agreement (“Products”). CytoCore may delete any Products from Schedule A at any time
in its sole discretion upon written notice to Distributor.
	 
	2	 	SUPPLY OF PRODUCTS
	 
	a.	 	CytoCore or its designee shall sell and Distributor shall purchase such quantities of
Products (as are agreed herein) for sale in the Area. CytoCore may from time to time
change the source of supply of Products and, if CytoCore or its designated supplier
shall discontinue the manufacture, sale or promotion of any Product, CytoCore shall
delete such Product Schedule A and cease selling the Product to Distributor. Distributor
shall be entitled to continue selling such Product in the Area until such time as the
stocks of such Product held by Distributor have been exhausted unless CytoCore advises
Distributor to return such inventory to Cytocore.
	 
	b.	 	CytoCore or its designee shall sell and Distributor shall purchase Products at
prices established in accordance with Schedule A.
	 
	c.	 	Risks for Products shall pass to Distributor when Products are delivered into the Area
covered by this agreement and Distributor shall thereafter be responsible for any damage
to or loss of Products. Distributor shall notify CytoCore of the details of any
incorrect delivery or of any damage to or shortage in any delivery within eight (8)
working days of the receipt thereof by Distributor. Title in and to the Products shall
pass to Distributor upon receipt of the Products by Distributor in accordance with
clause 2(e) of this Agreement.
	 
	d.	 	Distributor shall not knowingly re-export or sell Products for sale outside the Area
without the prior written consent of CytoCore, except that nothing in this

 

 

	 	 	Agreement shall prevent Distributor from accepting unsolicited orders from outside the
Area for the Products, as long as there is no exclusive distributor for the Area.
	 
	e.	 	Distributor shall pay the price stated on the invoice by prepayment or a net 60 days on open
account for the Initial Term (as defined below at clause 6a). Distributor shall make payment
to CytoCore in the currency of Euros (€) at such place as CytoCore shall from time to time in
writing.
	 
	f.	 	Distributor shall not be entitled by reason of any set off, counter claim, abatement, or
other similar deduction to withhold payment of any invoiced amount due to CytoCore. If
Distributor fails to pay by the due date any amount payable by it under this Agreement,
CytoCore shall be entitled, but not obliged, to charge Distributor interest on the overdue
amount payable by Distributor immediately on demand, from the due date up to the date of
actual payment, after as well as before judgment at the rate of 1/2 per cent per annum above
the base rate for the time being of (8%), and fixed sum compensation under the Late Payment of
Commercial Debts Regulations 2002. Such interest shall accrue on a daily basis and be
compounded quarterly. CytoCore may increase the Base Rate to reflect then market conditions.
	 
	g.	 	During the term of this Agreement Distributor shall provide CytoCore every quarter with a
written twelve (12) month forecast containing its best estimates of the number of units of
each Product which will be required by Distributor, the production and delivery of which shall
be subject to approval by CytoCore (“Forecast”). The Forecast for the immediate next three (3)
months shall be binding on Distributor. If notice of termination of this Agreement has been
served by either party in accordance with the terms of this Agreement, the Forecast shall be
binding on Distributor until such time as this Agreement terminates.
	 
	h.	 	Distributor shall submit written purchase orders to CytoCore or its designee stating both
the quantities of Products to be purchased and delivery schedules therefore in accordance with
the purchasing procedures mutually agreed upon by CytoCore and Distributor from time to time.
CytoCore, upon acceptance of the purchase order from Distributor, shall use its reasonable
endeavors to deliver or cause to be delivered to Distributor the quantities of Products set
forth in such purchase orders at the times specified therein.
	 
	3.	 	SALVAGE OF DAMAGED GOODS
	 
	 	 	CytoCore shall have the full right under the Distributor’s insurance policies to possession
of any of the Products involved in any loss or damage and shall control the possession of
any such Products, even if full payment of same already has been made by Distributor to
CytoCore. For the duration of this Agreement, Distributor shall maintain insurance in
respect of the Products. CytoCore,
exercising its reasonable discretion, shall be the sole judge as to whether Products

 

 

	 	 	involved in any loss or damage under the Distributor’s policies are fit for consumption or
sale, or shall be sold or otherwise disposed of. Where payment for Products already has
been made by Distributor, Distributor, after deduction of salvage expenses, shall be
entitled to all proceeds below the policy retention or deductible. Under no circumstances
may Distributor release Products involved in any loss or damage to the insurer without
CytoCore’s prior written approval.
	 
	4.	 	RETURN OF MERCHANDISE TO CYTOCORE
	 
	 	 	CytoCore shall be obliged to accept the return of the Products from Distributor only
according to the policy set forth in Schedule B attached hereto.
	 
	5.	 	DISTRIBUTION AND PROMOTION OF PRODUCTS
	 
	a.	 	During the first (six) 6 months of this Agreement from the Effective Date (“Implementation
Period”), and annually thereafter, the parties shall work together and provide the other party
with all reasonable assistance and information in order to produce a business plan in respect
of the Products including, without limitation, minimum purchase requirements (Schedule A) for
the Products in the Area, pricing of Products advertising and marketing expense committed by
each party and any other aspect relevant to the distribution, sale and promotion of the
Products in the Area (“Business Plan”). For this purpose, the parties shall meet no later than
one (1) month prior to the end of the Implementation Period, and thereafter annually
thereafter for the duration of this Agreement, as amended or extended at a mutually convenient
time and location, to review the Business Plan.
	 
	b.	 	The parties will agree on minimum purchase requirements to apply during the Implementation
Period, based on current realistic sales trends as at the Effective Date for the Products (or
similar or competing products) in the Area. No later than one (1) month prior to the end of
the Implementation Period the parties will meet to discuss the minimum purchase requirements
of Distributor for the Products for the following twelve (12) month period following the
Implementation Period. Within seven (7) days of such meeting, the parties will negotiate in
good faith the level of minimum purchase requirements for the Products for the following
twelve (12) months (“Yearly Commitment”) and within seven (7) business days shall agree on the
parties’ respective knowledge of the marketplace in general. Subsequent year volume
commitments will be agreed upon in writing by both parties, no later than the end of each
twelve (12) months of this Agreement. In the event the parties fail for any reason to agree on
minimum purchase requirements for the Products for any calendar year, the minimum purchase
requirements for such year shall be deemed to be the same as those established or deemed
hereby to be established for the preceding calendar year, or the same as the actual sales in
such preceding calendar year if greater, increased in each case by 100% of the prior twelve
month’s sales. The attainment of such minimum purchase requirements shall be an essential
condition to the continuation of this Agreement,

 

 

	 	 	and failure shall constitute for CytoCore the right, but without the obligation to
CytoCore to terminate this Agreement pursuant to clauses 14(b).
	 
	c.	 	Distributor shall use its best efforts to create and maintain a market for and to increase
the sales or Products in the Area, shall provide at its sole expense an organization for the
continuous sale, promotion and distribution of the Products throughout the Area, and shall
sell, ship, and invoice the Products to purchasers in the Area. In the Area, Distributor shall
use its own sales force to sell, promote and distribute the Products. Distributor may not
sell, promote or otherwise distribute any products which compete either directly or indirectly
with the Products and Distributor shall not establish any branch, or maintain any distribution
depot, outside of its Area for the sale of the Products. CytoCore shall not be obligated to
provide any resources to Distributor for the obligations set out in this clause except for
initial Product training to the Distributor’s sales force and the provision of appropriate
marketing materials.
	 
	d.	 	Distributor shall maintain a minimum inventory of Products not less than three (3) months as
set forth in the Forecast, as amended from time to time.
	 
	e.	 	CytoCore or its designee shall have the right to inspect and audit at all reasonable times
and by previous agreement with Distributor, Distributor’s inventory of the Products and any
data related to CytoCore’s business and/or the Products.
	 
	6.	 	Term
	 
	a.	 	This Agreement shall begin on the Effective Date and shall continue in effect, unless sooner
terminated as provided herein, for a period of four (4) years (Initial Term@). At the end of
the Initial Term this Agreement will be automatically extended for a further (three) years
unless one of the parties has advised the other in writing at least twelve (12) months prior
to expiration of the Initial Term that it intends to terminate this Agreement.
	 
	b.	 	In addition to the right of termination granted by Clause 14, CytoCore shall have the right
to terminate this Agreement at any time prior to the expiration of its term upon sixty (60)
days’ prior this Agreement should Distributor shall fail to attain the annual minimum purchase
requirements referred to in clause 5a. above and shall take effect immediately unless
otherwise agreed by CytoCore. Distributor shall notify CytoCore as soon as Distributor becomes
aware that that the annual minimum purchase requirements are unlikely to be attained. For the
first full calendar year of this agreement a mutually agreed range for the value of purchases
will be established by the end of the first quarter. This minimum-maximum range will be agreed
by Distributor and CytoCore and relate to purchases for the remaining three-quarters of the
first calendar year. In the event CytoCore terminates this Agreement before the end of the
Initial Term, CytoCore shall repurchase from Distributor the inventory of Products at prices
prevailing at the start of the calendar year in which such Products are to be repurchased by

 

 

	 	 	CytoCore. Such inventory of Products must be in saleable condition and have at least (12)
months shelf life before expiration.
	 
	c.	 	In addition to such other rights of termination granted by clause 14, CytoCore shall have
the right to terminate of this Agreement at any time if the continued performance under this
Agreement becomes impractical due to the enactment of, or threatened enactment of, any
ordinance, statute, regulation, law or similar provision by any local, state or national
government. This Agreement shall terminate sixty (60) days after the date of written notice by
CytoCore to Distributor.
	 
	7.	 	INTELLECTUAL PROPERTY
	 
	a.	 	Distributor acknowledges and agrees that CytoCore or its Affiliate are the owners of all
Intellectual Property Rights incorporated on, in or relating to the Products. For the purposes
of this Agreement, “Intellectual Property Rights” includes all intellectual property rights
including (without limitation) patents, supplementary
protection certificates, pending patents, utility models, trade marks, database
rights, rights in designs, copyrights and topography rights (whether or not any of these
rights are registered, and including applications and the right to apply for
registration of any such rights) and all inventions, know-how, trade secrets, techniques
and confidential information, and all rights and forms of protection of a similar nature
or having equivalent or similar effect to any of these which may subsist anywhere in the
world, in each case for their full term, and together with any renewals or extensions.
Distributor acknowledges that it neither has nor shall secure by this Agreement or by
its acts during the term of this Agreement any right to any Intellectual Property Rights
incorporated on, in or relating to the Products. Distributor agrees that title to and
the right to use all such Intellectual Property Rights incorporated on, in or relating
to the Products shall at all times be vested in CytoCore or its Affiliates whether or
not such Intellectual Property Rights incorporated on, in or relating to the Products
become vested in Distributor, Distributor hereby assigns to CytoCore, including by way
of present assignment of present and future rights, with full title guarantee, any
Intellectual Property Rights incorporated on, in or relating to the Products, together
with all of the goodwill associated therewith to hold the same unto CytoCore, its
successors in title and assigns.
	 
	b.	 	Distributor shall make no use of Intellectual Property Rights
in or relating to the Products as part of or in conjunction with or in relation to or
associated with Distributors company name, commercial name, tradename, corporate name,
divisional name, subsidiary name, nickname, translated name, transliterated name, trading
style, or similar name (hereinafter referred to as (“...”).

 

 

	c.	 	Distributor shall comply, at all times, with such rules and regulations as CytoCore may
issue with respect to the reproduction or reference to any Intellectual Property Rights
incorporated on, in or relating to the Products. In particular, Distributor shall ensure
that on all advertising and promotional materials to be used and/or prepared by Distributor
relating to the Products, the symbol ® shall be used in conjunction with any registered
trade marks or service marks owned by CytoCore or “TM” in the cast of any unregistered
trade marks owned by CytoCore.
	 
	d.	 	Distributor shall make no use of any Intellectual Property Rights incorporated on, in or
relating to the Products without CytoCore prior to written consent on Distributor’s material
such as, but not limited to, advertising, stationery, bills, business forms, calling cards, or
real property signs.
	 
	e.	 	Distributor shall not use any of CytoCore’s trade marks in any way which would tend to allow
them to become generic, lose their distinctiveness, become liable to mislead the public, or be
materially detrimental to or inconsistent with the good name, goodwill, reputation and image
of CytoCore or any Affiliate and shall use its best endeavors not to do anything which would
bring into disrepute CytoCore, the Products or any of CytoCore’s trade marks.
	 
	f.	 	Distributor shall not adopt or use any trade mark, symbol or device which incorporates or is
confusingly similar to, or is a simulation or colorable imitation of any of CytoCore’s trade
marks or unfairly competes with any of CytoCore’s trade marks. Distributor shall not any time,
whether during or after termination of this Agreement, apply anywhere in the world to register
any trade marks identical to or so nearly resembling any of CytoCore’s trade marks as to be
likely to deceive or cause confusion.
	 
	g.	 	If Distributor believes or becomes aware that third parties are infringing any Intellectual
Property Rights incorporated on, in or relating to the Products or are passing-off their
products as products of CytoCore or of any of its Affiliates or of any allegation that the
Intellectual Property Rights incorporated on, in or relating to the Products infringe the
Intellectual Property Rights of a third party, Distributor shall notify immediately
Distributor shall not, without the prior written consent of CytoCore, take any action in
respect thereof, informal or formal, including but limited to making any admission notifying
others or of bringing any legal proceedings or entering into any administrative proceedings
against any such alleged infringement or passing off. Distributor shall co-operate fully with
CytoCore or its Affiliates in the preparation or prosecution of any legal proceeding or
administrative proceeding and shall be reimbursed by CytoCore for its reasonable costs.
	 
	h.	 	CytoCore may defend or initiate proceedings against unauthorized use of
CytoCore’s Intellectual Property Rights incorporated on, in or relating to the Products and
shall, in its sole discretion, decide what action (including litigation, arbitration or
compromise), if any, to take in respect of any infringement or

 

 

	 	 	alleged infringement of any of the Intellectual Property Rights incorporated on, in or
relating to the Products or any other claim or counterclaim brought or threatened in
respect of the Intellectual Property Rights incorporated on, in or relating to the
Products. CytoCore shall not be obliged to bring or defend any proceedings, whether for
infringement or otherwise in relation to any of Intellectual Property Rights incorporated
on, in or relating to the Products, if it decides in its absolute discretion not do so. In
the event that Distributor is charged with any infringement of the Intellectual Property
Rights of any third party as a consequence of the necessary activities of Distributor
hereunder and Distributor notifies CytoCore fully and promptly in writing thereof, CytoCore
agrees to defend Distributor in any action taken against it based upon such infringement
and to indemnify Distributor in respect of all costs, claims, demands and expenses
associated therewith; provide however, CytoCore shall have the sole conduct of such claims
and shall have the right to require Distributor to discontinue the acts complained of and
to cancel the rights granted by this Agreement in respect thereof.
	 
	i.	 	In any infringement proceedings which are brought by CytoCore, CytoCore shall be entitled to
claim in respect of any loss suffered or likely to be suffered by the Distributor, and any
costs or damages awarded in respect of such claim shall first be applied to satisfy CytoCore’s
costs and expenses and shall then be apportioned between CytoCore and Distributor in
accordance with their respective losses.
	 
	j.	 	Distributor shall, on CytoCore’s reasonable request, give to CytoCore or its authorized
representative any information as to its use of Intellectual Property Rights incorporated on,
in or relating to the Products which may require and will render any reasonable assistance
required at reasonable cost in maintaining resignations of the Intellectual Property Rights
incorporated on, in or relating to the Products.
	 
	8.	 	ADVERTISING AND PROMOTION OF PRODUCTS
	 
	a.	 	As part of the Business Plan to be produced in accordance with clause 5a, CytoCore shall from
time to time deliver advertising, promotional and instructional programs for the Products.
Such programs may be modified in CytoCore in its sole discretion at any time. Advertisements
and the media in which it is to be used, as well as all promotional and instructional
materials to be used, must be approved in advance in writing by CytoCore. Distributor shall at
its sole expense distribute all promotional and instructional materials supplied by CytoCore
from time to time. Distributor shall be free to utilize advertising as is reasonably necessary
to promote the sale of the Products in the Area, however any advertising by Distributor with
regard to the Products shall be conducted with prior approval in writing by CytoCore.
	 
	b.	 	CytoCore recognizes that Distributor may from time to time request authorization in writing
from CytoCore to use the Intellectual Property Rights on, in or relating

 

 

	 	 	to the Products. CytoCore grants a non-exclusive royalty-free license to Distributor to use
in the Area the Intellectual Property Rights on, in or relating to the Products for the
purposes only of fulfilling any orders made pursuant to this Agreement, and performing its
obligations under this Agreement. Distributor shall provide CytoCore, for CytoCore’s prior
written approval, copies of any materials to be used and/or prepared by Distributor on or
in relation to the Products. The right of Distributor to use such Intellectual Property
Rights on, in or relating to the Products may unilaterally be revoked by CytoCore at any
time and Distributor shall immediately stop such use upon receipt of notification from
CytoCore.
	 
	9.	 	RECORDS, REPORTS, AND INSPECTION Within fifteen (15) days after the last day of each
calendar month Distributor shall furnish a report to CytoCore in such form as CytoCore may
from time to time specify covering Distributor’s performance under this Agreement during the
previous calendar month. Distributor shall keep true and correct books of account in which
shall be entered contained in any of said reports. CytoCore or its designee shall have the
right at any reasonable time to inspect and examine such data, records and books of account
and Distributor’s inventory of Products, samples and product literature, and records relating
to Products. Review of the Distributor’s books shall be done by a reputable independent
auditing company that is acceptable to both parties necessary information to permit
Distributor to furnish the data to be
	 
	10.	 	LEGAL MATTERS
	 
	a.	 	Distributor shall notify CytoCore of all laws, regulations, or decrees relating to the
purchase, sale and importation, if applicable, of Products and to the carrying the terms of
this Agreement and of any transactions contemplated hereby.
	 
	b.	 	The formulae, ingredients or specifications for Products may be changed at any time by
CytoCore at the sole discretion of CytoCore when such changes are deemed necessary for any
reason satisfactory to CytoCore. When necessary for the maintenance of any applicable
registrations, approvals, or consents, CytoCore shall inform Distributor of such changes.
	 
	c.	 	Distributor shall promptly send to CytoCore any data, report or information regarding
Products which may come to Distributor’s attention in the Area during the term of this
Agreement and shall report promptly to CytoCore any unexpected or serious adverse reactions
which arise in patients using Products. The person to contact with respect to any such
reactions is Richard Domanik, President, or his successor. Should it be necessary, during the
term of this Agreement, to recall the Products due to an error imputable to the manufacture
of the Products, or to any third party who handled, worked with or gave advice in respect of
the Products or for any other reason, Distributor shall cease selling such Products in the
Area and shall provide CytoCore with all reasonable assistance to recall any such Products
and shall, at all terms, act in accordance with CytoCore’s directions

 

 

	d.	 	Distributor understands that the Business Code of Conduct of CytoCore and its Affiliates
dictates that all of the Products are sold only on the basis of quality, service, price and
other legitimate marketing attributes, only to duly licensed and authorized parties and
that the payment of bribes for any purpose has no place in CytoCore’s business and its
absolutely prohibited. Distributor represents and warrants that it will not engage in any
conduct which is in violation of any applicable law in the Area, the United States Foreign
Corrupt Practices Act, or any other applicable laws or regulations.
	 
	e.	 	CytoCore may in its sole discretion decide to cease the distribution of any of the Products
by Distributor in the Area in circumstances where it appears to CytoCore, acting reasonably,
that any of the Products may, for whatever reason, be injurious to health or unfit for human
consumption or where the continued sale of a Product would be inconsistent with the principles
and standards applicable to good food production. The costs associated with any Product recall
(including, for the avoidance of doubt, the cost of any of the Products and the costs involved
in recalling any of the Products) will be borne by CytoCore. If either party becomes aware of
any circumstances which may require the distribution of any of the Products to be suspended
under this clause 10f, it shall immediately notify the other party of such circumstances.
Distributor shall execute any documents and do all such acts and things in accordance with the
reasonable directions of CytoCore to assist with the recall of any Products. CytoCore shall,
in its sole discretion, determine when the distribution and sale of the affected Product can
recommence. In the event of a recall, the agreed minimum purchase levels will be reviewed by
mutual consent.
	 
	11.	 	FORCE MAJEURE Neither CytoCore, nor its Affiliates, or their suppliers shall. be
liable for any failure or delay in the delivery of Products occasioned in whole or in part by
force majeure, Act of God, strike, lockout, fire, inability to obtain materials or shipping
space, boycott, breakdown, war, terrorism, civil commotion, destruction of plant, delay of
carrier, any governmental act, requirement, or regulation, or any other cause beyond its
control. IN NO EVENT WILL CYTOCORE BE LIABLE FOR CONSEQUENTIAL OR SPECIAL DAMAGES DUE TO ANY
SUCH CAUSE.
	 
	12.	 	RELATIONSHIP OF PARTIES The relationship between CytoCore and Distributor is and
during the term hereof shall be that of the seller and purchaser. Distributor, its agents and
employees are not the legal representatives, employees or agents of CytoCore for any purpose
and have no right or authority to assume or create, in writing or otherwise, any obligation of
any kind, express or implied, in the name of or on behalf of CytoCore. Distributor shall make
not representation inconsistent with the foregoing during or after termination of this
Agreement.
	 
	13.	 	OTHER OBLIGATIONS OF DISTRIBUTOR

 

 

	a.	 	Distributor shall not market or sell, distribute or promote any product comparable to or
competitive with any Product covered by this Agreement. Distributor may request the
CytoCore’s prior written approval. The notice shall specify the source and name of such
product and include a full and complete description of the nature, characteristics, and
uses of such product.
	 
	b.	 	Distributor shall maintain in confidence and not use except for purposes of this Agreement
any confidential information furnished to it by CytoCore including information contained in
any report furnished by Distributor hereunder, all confidential Product information and all
advertising programs and plans. Distributor shall impose the same obligation upon its
employees and agents, including advertising agencies. Such obligation will not apply in
respect of any information which was already in the public domain; or is already known to
Distributor or which Distributor acquired from a third party who has the free right to
disclose the information to them.
	 
	c.	 	Distributor shall maintain in confidence and not use except for purpose of this Agreement any
Confidential Product Information and all advertising programs and plans. Distributor shall
impose the same obligation upon its employees and agents, including advertising agencies. Such
obligation will not apply in respect of any information which was already in the public
domain; or is already known to Distributor or which Distributor acquired from a third party
who has the free right to disclose the information to them.
	 
	d.	 	Inasmuch as the laws of particular countries mandate the use of specified ingredients, forms
of labels and instructions for use, the precise requirements for which vary from country to
country and also frequently differ even as between lines of trade in the same country,
Distributor shall resell Products only to purchasers as to whom Products meet all local legal
requirements and shall not sell Products to any purchaser that Distributor has reason to
believe may resell them otherwise than as provided herein.
	 
	e.	 	CytoCore will not accept any return Products for credit unless (1) Distributor has first
obtained CytoCore’s authorization in writing to return such Products in saleable condition and
Distributor prepays the return freight, or (2) packaging for the Products is defective, or
Distributor becomes aware that the Products are defective, and notice of such defect is
received by CytoCore from Distributor within thirty (30) days of delivery of such Products to
Distributor.
	 
	14.	 	TERMINATION FOR CAUSE
	 
	a.	 	Subject to clause 6 of this Agreement, failure by any party to comply with any of its
material obligations hereunder shall entitle the other party to give the party in default
notice requiring it to make good such default. If such default be cured within sixty (60) days
after such notice, the notifying party shall be entitled (without prejudice to any of its
other rights conferred on it by this Agreement or

 

 

	 	 	By Law) to terminate this Agreement by giving written notice to take effect immediately.
The cure period shall not apply to default under Sub-sections 2 and four.
	 
	b.	 	CytoCore may (without prejudice to any of its other rights conferred on it by this Agreement
by law) terminate this Agreement forthwith by giving notice to such effect in the event.
	 
	 	 	(1) of war, insurrection, invasion or extended civil commotion in the Area,
	 
	 	 	(2) that Distributor or any part of its assets is acquired by or otherwise comes under the
direct or indirect control of any third party (governmental, private or public) other than
the present owners, or
	 
	 	 	(3) that Distributor becomes insolvent or any insolvency proceedings are instituted by or
against it, or
	 
	 	 	(4) that Distributor engages in illegal activities or conduct which CytoCore deems to
damage the commercial reputation of either CytoCore or Distributor or
	 
	 	 	(5) of any breach by Distributor of any of the provision of Clause 10, 13 (b) (c), or (d)
above, or
	 
	 	 	(6) of any failure to attain the minimum purchase requirements referred to in clause
5b of the Agreement or
	 
	 	 	(7) of any failure to make the expenditures for advertising and promotion agreed to in
clause 8 above, or
	 
	 	 	(8) that Distributor knowingly without CytoCore’s prior written consent, re-exports or
sells the Products outside the Area (but excluding any re export or sale of the Products
outside the Area by Distributor in response to unsolicited orders), or
	 
	 	 	(9) Distributor challenges the validity of any of CytoCore’s trade marks.
	 
	 	 	(10) Distributor, without CytoCore’s prior written consent, sells, promotes, or otherwise
distributes products which compete either directly or indirectly with the Products.
	 
	c.	 	The parties hereby agree that any of the above-mentioned events will constitute just cause
for termination as provided in this clause 14.
	 
	15.	 	UPON TERMINATION OR EXPIRATION
	 
	a.	 	CytoCore or its designee may, by giving Distributor written notice within

 

 

	 	 	Ninety (90) days following the expiration or termination of this Agreement, purchases from
Distributor any part of all or Products not theretofore sold by Distributor, at a price,
payable in such currency as CytoCore shall determine, equal to the sum of the purchase
price paid by Distributor plus the actual cost of shipment and importation of such
Products, against which amounts due from Distributor may be applied. Such Products must be
in saleable condition and have at least 12 months shelf life remaining.
	 
	 	 	Upon such purchase or upon the expiration of two (2) months from the aforesaid expiration
or termination, Distributor shall cease to display or use any Intellectual Property Rights
on, in or relating to the Products or signs, labels or other indications identifying
Distributor or any products in any way with CytoCore and shall deliver to CytoCore all
printed material, including advertising, promotional and instruction material, and all
labels and packages, relating to Products, together with all samples, parts, tools, or
other equipment relating to Products that CytoCore may have furnished free of charge (other
than for shipping and import costs) to Distributor and together with all records of
Distributor’s sales necessary for CytoCore to ascertain any outstanding guarantee
obligations thereunder.
	 
	b.	 	Following any expiration or termination of this Agreement, Distributor shall immediately
cease to make any use of the Intellectual Property Rights on, in or relating to the Products
in any way.
	 
	c.	 	Immediately upon termination or expiration of this Agreement, Distributor shall cease in any
manner whatsoever to make any reference to its former role as the Distributor of the Products.
	 
	d.	 	Upon the expiration of this Agreement all rights granted or obligations undertaken hereunder
shall terminate forthwith except rights and obligations which arose prior to such expiration
or termination and those set forth in clauses 7, 8, 9, 10, 15, 16, and 21, and in sub-classes
13(b), (c) and (d). Neither CytoCore or Distributor shall incur any liability to the other by
reason of the expiration or termination of this Agreement as provided herein, nor for its
non-renewal, whether for loss of goodwill, anticipated profits or otherwise, and CytoCore and
Distributor shall accept all rights granted and all obligations assumed hereunder including
those in connection with such expiration or termination in full satisfaction of any claim
resulting from such expiration or termination.
	 
	e.	 	The acceptance of any order form or the sale of any Products to Distributor, after the
expiration or termination of this Agreement shall, unless otherwise specified, be subject to
all the pertinent terms of this Agreement but shall not be construed as a renewal or extension
of this Agreement nor as a waiver of termination thereof.

 

 

	16.	 	INDEMNIFICATION
	 
	a.	 	Distributor agrees to indemnify and hold harmless CytoCore, its Affiliates and their
respective directors, officers, and employees against any and all claims, demands,
proceedings, losses, costs, and expenses which may be brought against or suffered or incurred
by CytoCore, its Affiliates or its or their respective directors, officers, and employees, in
consequence of any error, mistake, acts, omissions, or negligence on the part of Distributor
or any of its employees or agents, in storing, selling, promoting, or distributing any of the
Products.
	 
	b.	 	CytoCore agrees to indemnify and hold harmless Distributor, its affiliates, and its
directors, officers, and employees, against any and all claims, demands, proceedings, losses,
costs, expenses which may be brought against or suffered or incurred by Distributor, its
affiliates, or its directors, officer, and employees, in consequence of any error, mistake, or
negligence on the part of CytoCore or any of its employees or agents, in promoting, or
manufacturing any of the Products. CytoCore’s liability to Distributor as an indemnification
is limited to an amount no greater than 1.5 times the net sales of Distributor arising from
the sale of the Product regarding which such default shall have resulted under this agreement
(directly or through the designated sub-Distributors) during the preceding contractual year,
being those sales calculated on the basis of end-user prices. CytoCore shall not, in any
event, CytoCore shall not be liable for indirect or consequential losses, special charges,
loss of profit or loss of reputation or goodwill. Distributor shall have no right to an
indemnity under this clause 16b to the extent that the negligence of Distributor, or its
employees or agents has contributed to the loss, liability or cost for which Distributor is
claiming an indemnity.
	 
	c.	 	It shall be a condition of any obligation to defend, indemnify and hold harmless hereunder
that the party seeking indemnification (i) promptly notify the party from which
indemnification is sought of the assertion of any claim to be covered, (ii) permit the
indemnifying party to assume and control the defense thereof, and (iii) co-operate fully in
such defense.
	 
	d.	 	Nothing in this Agreement shall in any way exclude or limit either party’s liability for
death or personal injury.
	 
	17.	 	ASSIGNMENT
	 
	a.	 	CytoCore may assign all or any part of this Agreement to any Affiliate. Subject clause 17b.
below, in all other respects this Agreement and the distributorship and/or sub-distributorship
shall be non-assignable. Any non-permitted assignment shall be void.
	 
	b.	 	Distributor may, with CytoCore’s prior written consent, appoint agents for the

 

 

distribution, sale and promotion of the Products provided that: 

	 	(1)	 	no such sub-license shall relieve Distributor of any of its obligations under
his Agreement.
	 
	 	(2)	 	Distributor shall ensure that any sub-licensee agrees to be bound by the
terms of this Agreement, and
	 
	 	(3)	 	such sub-licensee shall only be used to supplement the existing structure of
CytoCore’s business and not for the purposes of creating other opportunities for
Distributor.

	18.	 	NOTICES Any notice or report pursuant to this Agreement shall be deemed duly given if
sent by prepaid registered mail letter (air mail, if sent overseas), or facsimile addressed to
the party at the address or fax number, as applicable, set forth at the beginning of this
Agreement, or to such other address or fax number as shall have been furnished in writing.
	 
	19.	 	SEVERABLE CONDITIONS/UNENFORCED PROVISIONS
	 
	a.	 	Any provision of this Agreement held to be void, invalid, or unenforceable, will be
construed as severable and will not in any way affect render void, invalid, or unenforceable
any other provision of this Agreement, and this Agreement will be carried out as if such
void, invalid, or Unenforceable provision was not a part of this Agreement.
	 
	b.	 	Failure by any party to exercise any right given in this Agreement or to insist on strict
compliance by the other party of any obligation under this Agreement does not constitute a
waiver of the Party’s right to later demand exact compliance with the terms of this
Agreement.
	 
	20.	 	GOVERNING LAW The validity, construction and performance of this Agreement shall be
governed by and construed in accordance with the law of England and Wales. Each party
irrevocably agrees to submit to the exclusive jurisdiction of the courts of England and Wales
over any claim, dispute or matter arising under or in connection with this Agreement.
	 
	21.	 	ENTIRE AGREEMENT This Agreement, including its Schedules, contains the
entire understanding of the parties with respect to the matters herein contained and voids
all prior understandings, if any, between the parties with respect to the distribution of
the Products. With the exception of changes that may be made by CytoCore at its sole
discretion to Schedule A as set forth in clause 2 (a), the Agreement may be changed from
time to time only by an instrument in writing signed by an officer of CytoCore and an
authorized representation of Distributor.
	 
	22.	 	THIRD PARTY RIGHTS

 

 

	a.	 	Except as provide at clause 23b (or insofar as this Agreement otherwise expressly
provides that a third party may in his own right enforce a term of this Agreement), a
person who is not a party to this Agreement has no right under the Contracts (Rights of
Third Parties) Act 1999 to rely upon or enforce any term of this Agreement but this does
not affect any right or remedy of a third party which exists or is available apart from
that Act.
	 
	b.	 	Any Affiliate may rely upon and enforce the terms of clause 16a.
	 
	c.	 	The decision of the Expert shall be final and binding on the parties. The costs of the
reference to the Expert (including the costs of any expert appointed by him) and will be
borne as agreed between the parties prior to making the reference or, failing such agreement,
in accordance with the instructions of the Expert.
	 
	d.	 	Except for any party’s right to seek interim relief in the courts, no party may commence
legal proceedings while the dispute resolution procedures referred to in this clause 24 are
being undertaken.
	 
	23.	 	EXECUTION IN COUNTERPARTS This Agreement may be executed in one or
more counterparts, all of which should be considered one and the same agreement, and
should become a binding agreement when one or more counterparts have been signed by each
of the parties and delivered to the other party.

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

	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	HT Hospital Technologies GmbH	 	 	 	CytoCore, Inc.	 	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	By:

	 	/s/ Mr. Paolo Burg 	 	 	 	By:	 	/s/ Bob McCullough, Jr.	 	 
	 

	 	Name:
	 	Mr. Paolo Burg
	 	 
	 	 	 	Name:
	 	Bob McCullough, Jr.
	 	 
	 

	 	Title:
	 	 	 	 	 	 	 	Title:
	 	CFO	 	 

 

 

SCHEDULE .A

PRODUCTS, PRICES, AND QUOTAS

Whether described generically or by reference to trade mark, only the products having the form and
composition in which they are sold by CytoCore on the Effective Date, are intended to be included
in this Agreement.

Prices

For the first calendar year from the Effective Date, prices to be charged for the Products by
CytoCore to Distributor are as per attached appendix.

Quotas

	 	1.	 	Annual Quotas

	 	o 	 	Period
	 
	 	1.	 	First 12 Months—150,000 Units
	 
	 	2.	 	Second 12 Months—200,000 Units
	 
	 	3.	 	Third 12 Months—250,000 Units

	 	2.	 	Terms

	 	o 	 	Orders will be applied against the Annual Quota based on the net
invoice price of the Products ordered from and billed by Seller during the
Period

     Thereafter, the parties shall meet twelve (12) months after the date hereof during each
calendar year of this Agreement to discuss and agree on any increase in prices to be charged for
the Products to Distributor by CytoCore. Prices may be changed at other times on agreement between
the parties, taking into account market conditions in the Area which have an effect on the
distribution, sale or promotion of the Products. Notwithstanding the foregoing, if prices can not
be agreed to by both parties acting in good faith, either party may terminate this Agreement upon
sixty (60) days’ prior written notice.

 

 

SCHEDULE B

	A.	 	CytoCore will only entertain claims for returned Products where same was originally purchased
from CytoCore. Proof of purchase must be provided upon request.

	B.	 	Returned Products will be valued at the original sale price or the current price whichever is
lower.

	C.	 	Full credit will only be given if CytoCore is notified within twelve (12) months prior to
expiry of the returned Product so that arrangements can be made for disposal prior to the
Product’s expiry date. This request is made in recognition of the fact that, in most
instances, the Products are delivered with expiry dating in excess of one (1) year B twelve
(12) months.
	 
	 	 	Credit for returned Products with a shelf life shorter than twelve (12) months before
expiration shall be from time to time discussed and quantified by mutual consent between
CyotoCore and Distributor.

	D.	 	In no instance will credit be given for Products which are returned because of insufficient
sales except for the case CytoCore decides to terminate the Agreement.

	E.	 	Credit will also be denied for Products which have not been stored in accordance with
CytoCore’s instructions.

	F.	 	It is not CytoCore’s policy to reimburse Distributor damaged Products but each case will be
reviewed at CytoCore’s sole discretion in light of any special circumstances that may
necessitate special consideration.
	 
	 	 	CytoCore Sales Representative will inspect all expired or damaged Products and will issue a
Preliminary Credit Report which will be referred to his/her immediate Supervisor for final
approval.
	 
	 	 	Destruction of all expired and/or damaged Products is to be in accordance with the Food and
Drugs ordinances within the Area and, if requested, witnessed by a CytoCore Sales
Representative.

 

 

SCHEDULE C

UNIT BY PRODUCT

	 	 	 	 	 
	ITEM	 	DESCRIPTION	 	UNIT PRICE
	 

	 	Soft PapTM Disposable
	 	TBD $5.00
	 

	 	Soft PapTM Reusable Handle
	 	TBD $12.00exv10w50

 

EXHIBIT 10.50

EXCLUSIVE LICENSE AGREEMENT

 

Bio-Marker

This Exclusive License Agreement (the “Agreement”) is made as of January 27, 2006 (the “Effective
Date”) by and between University Hospitals of Cleveland (“LICENSOR”), an Ohio
not-for-profit corporation having its principal offices at 11100 Euclid Ave, Cleveland, Ohio 44106,
for itself and Case Western Reserve University, and Molecular Diagnostics, dba CytoCore, Inc. (the
“LICENSEE”)a Delaware corporation having its principal offices at 414 N. Orleans St.,
Suite 800, Chicago, IL 60610. The LICENSOR and the LICENSEE are sometimes referred to herein
individually as the “Party” and collectively as the “Parties.”

W I T N E S S E T H:

WHEREAS, the LICENSOR desires to herewith license to LICENSEE the Cancer and Cancer Potential
Marker, Target, Antibody and Therapeutic Technology, as further defined here-in.

NOW, THEREFORE, in consideration of the mutual promises and covenants herein contained, the
parties hereto agree as follows:

	1.	 	LICENSE
	 
	1.1	 	Grant of License
	 
	 	 	A. LICENSOR hereby grants to LICENSEE, upon and subject to all the terms and conditions of
this Agreement, a worldwide, exclusive, royalty-bearing license with right to sub-license
under the Licensed Technology and to know-how necessary to practice the patents and patent
applications listed in Appendices A, to make, use, distribute, and sell products based upon
the licensed technology. This grant to Licensed Technology and know-how is exclusive to
LICENSEE subject to the rights retained by UHC to:

(a) publish or otherwise disclose the general scientific findings from research related
to Licensed Technology in accordance with the Sponsored Research Agreement; and

(b) (i) develop, make and use Licensed Technology for UHC’s own research, teaching and
other educationally-related and non-commercial purposes and (ii) under a Material
Transfer Agreement, provide to not-for-profit research or educational institutions
embodiments and copies of the Licensed Technology for their own research, teaching and
other educationally-related and non-commercial purposes, provided however, LICENSOR is
specifically prohibited from providing Licensed Technology in any form to not-for-profit
hospitals or laboratories for the purpose of providing services.

 

 

EXCLUSIVE LICENSE AGREEMENT

 

	 	 	B. LICENSEE acknowledges and agrees that (i) the Licensed Technology or any Tangible Property
associated therewith may have been developed under a government-funded grant, and if so, the
United States government may have certain rights relative thereto, (ii) all rights and
licenses granted to LICENSEE under Section 1.1(A) are made explicitly subject to the United
States government’s rights, and (iii) any conflict between the rights and licenses granted to
LICENSEE under this Agreement and the rights of the United States government to the Licensed
Technology and any Tangible Property associated therewith may be resolved in favor of the
United States government. As of the Effective Date, LICENSOR represents and warrants that the
United States government has not sent notice to LICENSOR in either written or oral form
regarding rights it may have under Licensed Technology.
	 
	1.2	 	The Licensed Technology
	 
	 	 	As used in this Agreement, “Licensed Technology” shall mean and include the Cancer and Cancer
Potential Marker, Target, Antibody and Therapeutic Technology (Appendix A):
	 
	 	 	A. the United States patent applications identified in Appendix A,
	 
	 	 	B. any divisional, continuation (but excluding continuations-in-part except to the extent of
claims entitled to the priority date of the parent case), or substitute patent application
that shall be based on the United States patents and patent applications identified in
Appendix A;
	 
	 	 	C. any patents that shall issue on any of the patent applications identified in Sections 1.2A
or B, and any reissues and extensions thereof;
	 
	 	 	D. any patents and patent applications corresponding to the patents and patent applications
described in Sections 1.2A, B or C that are issued, filed, or to be filed in any and all
foreign countries; and any patents or foreign equivalent thereto (including but not limited
to patents of importation, utility models, and inventors certificates) that shall
subsequently issue thereof; and any renewals, divisions, reissues, continuations, or
extensions of the foregoing patents identified in this Section 1.2D;
	 
	1.3	 	Sublicenses
	 
	 	 	A. LICENSOR grants to the LICENSEE the right to grant sublicenses to third parties consistent
with the Agreement, provided that LICENSEE shall remain bound by Section 3 hereof regardless
of whether such payment conditions are met by LICENSEE or the activities of any of its
sublicensees, and further provided that all sublicenses (both directly and indirectly from
LICENSEE) shall contain

- 2 -

 

EXCLUSIVE LICENSE AGREEMENT

 

	 	 	all obligations herein applicable to LICENSEE, in addition to those obligations specified
herein as applicable to the sublicensee. Sublicensees of LICENSEE do not have the right to
grant sublicenses without the prior written consent of LICENSOR. LICENSEE must deliver to
LICENSOR a true and correct copy of each sublicense granted by LICENSEE or any of its direct
or indirect sublicenses, and any modification or termination thereof within thirty (30) days
after execution, modification or termination and shall deliver a copy of royalty reports
received by LICENSEE from such sublicenses in accordance with Section 3.5.
	 
	 	 	B. LICENSEE grants to LICENSOR the limited right and license under all improvements or
derivative works of the Licensed Technology owned by LICENSEE or any of its sublicensees for
the same purposes set forth in Section 1.1A.
	 
	1.4	 	Ownership: Reservation of Rights

Nothing in this Agreement is intended to transfer LICENSOR’s interest in or ownership of any
Licensed Technology or Tangible Property (as defined in Section 12.1) to the LICENSEE.

	2.	 	TERM

This Agreement shall be effective with respect to each patent or patent application licensed
hereunder commencing upon the effective date and ending with expiration of the last Valid Patent
Claim, as defined in Section 3.1, and unless terminated earlier pursuant to Article 8, shall
continue in effect until the expiration of Royalty Term, as defined in Section 3.2.

	3.	 	ROYALTIES AND LICENSING PAYMENTS
	 
	3.1	 	Definitions

     For purposes of this Agreement, the following defined terms shall have the meaning ascribed to
them in this Section 3.1.

A. “Product” means any product or products derived from or made using the Licensed Technology
by or on behalf of the LICENSEE and/or its sublicensees for all applications. Product may
include, but is not limited to, development of a cancer and cancer potential marker, target,
antibody and therapeutic technology.

B.
“Net Sales from Royalties” means royalty revenue derived from the sale of products covered
by this agreement paid to LICENSEE from any sublicense granted by LICENSEE.

D. “Royalty Term” means (i) with respect to Licensed Technology that is covered by a Valid
Patent Claim, expiration of the last Valid Patent Claim

- 3 -

 

EXCLUSIVE LICENSE AGREEMENT

 

covering such technology and (ii) with respect to Licensed Technology that is not covered by
a Valid Patent Claim, twenty (20) years from the Effective Date.

E. “Valid
Patent Claim” means a claim of a pending patent application or an issued patent,
in either case to the extent that such claim patent or application has not expired, gone
abandoned, been finally rejected or finally held invalid or unenforceable by an order of a
court or other governmental agency of competent jurisdiction or been admitted to be invalid
or unenforceable through re-issue, disclaimer or otherwise.

     In the event that Licensee elects to directly or indirectly manufacture and distribute any of
the products associated with this Agreement, the following terms apply.

F. “Cost of Goods Sold” means the sum total of all costs and expenses associated with getting
the finished packaged Licensed Product ready for sale (to include manufacturing, inbound
transportation and packaging). This calculation specifically excludes those costs associated
with research and development, regulatory compliance, product distribution and sales and
marketing, administrative, and overhead expenses attributable to the development,
manufacture, distribution and support of the Licensed Product.

G. “Gross Sales” means the amount of all sales, revenues, receipts, fees and other amounts
collected by Licensee either directly or through its distributors or agents arising from the
sale, lease, rental or other transfer of a Licensed Product, less the following deductions
where they are factually applicable and to the extent they were included in the actual
billings: (i) discounts, allowed and taken, in amounts customary in the trade; (ii)
documented sales and/or use taxes, duties or fees imposed upon, and with specific reference
to, particular sales; (iii) amounts credited on returns (not exceeding the original billing),
or retroactive price reductions; and (iv) outbound transportation prepaid or allowed.

H.
“Net Sales from Manufacturing” means Gross Sales
less the Cost of Goods Sold.

I. “Distribution Rights Fee” means any upfront payment from an entity

(commercial or otherwise) for the rights to distribute any product covered by this agreement.

	3.2	 	Products

A. Upfront Licensing Fee.

LICENSEE agrees to pay an upfront licensing fee totaling Twenty-Five Thousand Dollars
(US$25,000) for Independently Developed Patents, with such payment due immediately upon
execution of this Agreement.

- 4 -

 

EXCLUSIVE LICENSE AGREEMENT

 

B. Valid Patent Claim.

In consideration for the rights and licenses granted hereunder, the LICENSEE agrees to pay,
for the duration of the Royalty Term to LICENSOR for each Product protected by at least one
Valid Patent Claim, a royalty of four percent (4.0%) of the “Net Sales from Royalties” and
“Net Sales from Manufacturing” of each such Product.

	3.3	 	Minimum Royalty

The LICENSEE agrees to use its best efforts to maximize the worldwide sales of Product. The
LICENSEE agrees to make Minimum Annual Royalty Payments of Twenty Five Thousand Dollars
(US$25,000) to LICENSOR for Product that uses Licensed Technology as defined in Appendix A wherein
a Product is covered by a Valid Patent Claim. Should cumulative payments be less than $25,000 in a
single calendar year, then the balance due is payable with the fourth quarter Royalty Period
payment.

	3.4	 	Payments Related to Sublicensees or Distributors

If other, non-royalty sublicensing or Distribution Rights Fee payments are made to LICENSEE;
LICENSEE SHALL pay LICENSOR fifteen percent (15%) of such payments within the Royalty Period in
which LICENSEE received payment from the sublicensee(s) or Distributors.

	3.5	 	Written Payment Statement

A. For LICENSEE’s Sublicensing of Product: For each Royalty Period (as defined below),
LICENSEE shall provide LICENSOR with a written statement reciting, on a country-by-country
basis, the item, units sold, description, Net Sales from Royalties, payment due and such
other information as reasonably requested by LICENSOR for each Product sold by its
sub-licensees.

B. For LICENSEE’s Manufacturing of Product: For each Royalty Period (as defined below),
LICENSEE shall provide LICENSOR with a written statement reciting, on a country-by-country
basis, the stock number, the item, units sold, description, quantity shipped, gross invoice,
amount billed customers less discounts, allowances, returns, Gross Sales, Cost of Goods Sold,
Net Sales from Manufacturing, payment due and such other information as reasonably requested
by LICENSOR for each Product sold by LICENSEE.

	3.6	 	Form of Payments

All payments due LICENSOR shall be made in United States currency by check drawn on a U.S. bank,
unless otherwise specified by LICENSOR. Furthermore, all payments due LICENSOR based on sales in
countries outside the United States shall accrue in the currency of the country in which the sales
are made. LICENSEE shall utilize its best efforts to affect U.S. dollar transfers with respect to
such royalties. However, any and all loss of

- 5 -

 

EXCLUSIVE LICENSE AGREEMENT

 

exchange value, taxes, or other expenses incurred in the transfer or conversion of foreign currency
into U.S. dollars, and any income, remittance, or other required taxes on such royalties are
deductible from payments due to LICENSOR. All payments shall be made to the following address:

Center for Clinical Research 

University Hospitals of Cleveland 

PO Box 74420 

Cleveland, Ohio 44194-4420

	3.7	 	Royalty Payment Schedule

Payments due hereunder shall be made by the LICENSEE to LICENSOR on or before the thirtieth (30th)
day of April, July, October and January of each calendar year for sale of all Products sold during
the immediately preceding calendar quarterly periods ending on the last day of March, June,
September and December (each a “Royalty Period”).

	4.	 	RECORD INSPECTION AND AUDIT
	 
	4.1	 	Inspection of Books and Records

LICENSOR shall have the right, upon reasonable notice, to inspect LICENSEE’s books and records and
all other documents and material in LICENSEE’s possession or control with respect to the subject
matter of this Agreement. LICENSOR shall have access thereto for such purposes and may make copies
thereof. However, in no event shall LICENSOR have the right to examine information with respect to
LICENSEE’s costs, pricing formulas, or percentages of markup. LICENSEE shall impose similar
obligations on its sublicensees for the benefit of itself and of LICENSOR.

	4.2	 	Independent Audit

LICENSOR shall have the right for a period of five (5) years after receiving any report required
under Section 3.7 to appoint an independent certified public accountant, at LICENSOR’s sole
expense, who shall have access to LICENSEE’s records during reasonable business hours for the
purpose of verifying the amounts payable under this Agreement, but this right may not be exercised
more than once in any calendar year, and the accountant shall disclose to LICENSOR only
information relating solely to the accuracy of such report and the payments made in accordance
with this Agreement. The failure of LICENSOR to request verification of any royalty report during
said five (5) year period shall be considered acceptance of the accuracy of such report and the
LICENSEE shall have no obligation to maintain any records pertaining to such report beyond said
five (5) year period. If the independent certified public accountant’s review reveals an increase
of more than five percent (5.0%) in any payment due to the LICENSOR hereunder, LICENSEE shall be
obligated to pay any out-of-pocket expenses incurred by LICENSOR with respect to such review, in
addition to paying such arrears within fifteen (15) days of the date that LICENSEE receives notice
of such audit results.

- 6 -

 

EXCLUSIVE LICENSE AGREEMENT

 

	5.	 	INTELLECTUAL PROPERTY
	 
	5.1	 	Patent Prosecution
	 
	 	 	A. LICENSOR shall have the sole right to control the filing, prosecution and maintenance of
patents for the Licensed Technology; provided however, that LICENSOR shall consult with
LICENSEE regarding the filing, prosecution and maintenance of any such patent applications to
the extent such applications relate to the Licensed Technology licensed to LICENSEE
hereunder, including, without limitation, by providing LICENSEE a reasonable opportunity to
review and comment on all aspects of patent prosecution and proposed submissions to any
patent office before submittal, and provided further that LICENSOR shall keep LICENSEE
reasonably informed as to the status of prosecution of any such patent applications by
promptly providing LICENSEE copies of all communications relating to same that are received
from any patent office or foreign associate, and provide LICENSEE a reasonable opportunity to
review and comment on all submissions to any patent office before submittal. If LICENSEE
obtains an exclusive license to the Licensed Technology pursuant to the terms and conditions
of this Agreement that is the subject of such patent application, then LICENSEE shall
reimburse LICENSOR, within thirty (30) days of receipt by the LICENSOR of the billing
invoices, or otherwise be responsible, for all expenses related to the filing of such patent
applications, including attorney’s fees, for domestic and foreign patent applications filed
under this paragraph. The LICENSOR agrees to provide the LICENSEE with copies of any such
patent applications, as well as copies of any documents related to the prosecution of said
patent applications. Notwithstanding the above, LICENSOR may at its discretion and upon
written notification choose to allow LICENSEE to direct all patent prosecution.
	 
	 	 	B. If LICENSOR decides not to file a patent application as directed by LICENSEE in writing on
any aspect of the Licensed Technology, LICENSOR will promptly notify LICENSEE of the decision
and permit LICENSEE to file patent applications on such subject matter, which shall then be
considered a Licensed Technology, as the case may be.
	 
	 	 	C. If the LICENSEE subsequently informs the LICENSOR, upon a 90 day advanced written notice,
that LICENSEE no longer wishes to pay patent prosecution and maintenance fees and expenses on
any aspect of the Licensed Technology, then the LICENSOR will be free to either abandon such
patent applications or patents or to continue such prosecution and maintenance at the
LICENSOR’s sole expense, all solely in the name of LICENSOR and the LICENSEE shall have no
further interest or rights in said patents and applications whatsoever.

- 7 -

 

EXCLUSIVE LICENSE AGREEMENT

 

	5.2	 	Third Party Infringers

If either Party to this Agreement becomes aware that any of the Licensed Technology for which a
patent has issued is being or has been infringed by a third party, that Party shall promptly notify
the other Party in writing describing the facts relating to the infringement. Following said
notification:

A. LICENSEE shall have the initial right, but not the obligation, to institute, prosecute and
control any action, suit or proceeding (an “Action”) with respect to such infringement,
including any declaratory judgment action, at its expense, using legal counsel of its choice.
The LICENSOR shall have the right to participate in any such Action, at its own expense,
using legal counsel of its choice.

B. If the LICENSEE elects not to exercise its right to initiate, prosecute and control any
Action within one hundred twenty (120) days after notice of infringement, then the LICENSOR
shall have the exclusive right, but not the obligation, to initiate, prosecute and control
such Action at its sole expense.

C. The LICENSEE shall be entitled to offset fifty percent (50%) of any reasonable and
documented (to the LICENSOR) expenses that are incurred by the LICENSEE in connection with
such Action. LICENSEE agrees to reimburse LICENSOR for fifty percent (50%) of such expenses
provided that LICENSEE has obtained an exclusive license to the Licensed Technology subject
to such Action. Any amounts recovered in such Action shall be used first to reimburse the
LICENSEE and/or the LICENSOR, as the case may be, for expenses it incurred in connection with
any Action. Any remaining amount shall be equally divided between the LICENSEE and the
LICENSOR.

	5.3	 	Third Party Claims of Infringement

If the exercise by the LICENSEE of the exclusive license rights granted by the LICENSOR to the
LICENSEE under this Agreement results in any claim of patent infringement by a third party against
the LICENSEE, the LICENSEE shall have the exclusive right to defend itself against any such claim,
suit or proceeding at its own expense, using legal counsel of its own choice, and shall have the
sole right and authority to settle any such suit with the written consent of the Licensor. In the
event of such litigation, the LICENSOR agrees to cooperate with the LICENSEE, at the LICENSEE’s
reasonable request and sole expense, in connection with the defense of such claim. The LICENSEE
shall be entitled to offset any costs and expenses (including attorneys and professional fees)
incurred by it in connection with any such proceeding against any amounts it would otherwise owe
the LICENSOR in license-derived payments, up to a maximum of fifty percent (50%) of the amounts
the LICENSEE would otherwise owe the LICENSOR. Should the LICENSEE choose to not proceed with
defense with any third party infringement claim, suit or proceeding, LICENSOR shall have the right
to defend such claims at LICENSOR’s sole expense.

- 8 -

 

EXCLUSIVE LICENSE AGREEMENT

 

	6.	 	WARRANTIES AND DISCLAIMER
	 
	6.1	 	General Warranties

The LICENSOR represents and warrants that (except for the rights, if any, of the government of the
United States of America): (i) it has an ownership interest in the entire right, title, and
interest in and to the Licensed Technology either alone or jointly with Case Western Reserve
University (CWRU); (ii) it has the right and power to grant the licenses granted herein; (iii) that
it has not knowingly granted licenses thereunder to any other entity that would restrain the rights
granted Licensee except as stated herein; and (iv) it has not received written notification from
any third party relating to actions against LICENSOR for infringement with respect to the Licensed
Technology anywhere in the world.

6.2 ANY AND ALL INFORMATION, INTELLECTUAL PROPERTY, PATENT RIGHTS, TECHNOLOGY, LICENSED SUBJECT
MATTER OR OTHER RIGHTS, MATERIALS OR PROPERTY GRANTED OR PROVIDED TO LICENSEE BY LICENSOR UNDER
THIS AGREEMENT IS GRANTED OR PROVIDED TO LICENSEE BY LICENSOR UNDER THIS AGREEMENT IS GRANTED OR
PROVIDED ON AN “AS IS” “WHERE-IS” BASIS WITH ALL FAULTS. LICENSEE UNDERSTANDS AND ACKNOWLEDGES
THAT LICENSOR MAKES NO REPRESENTATION AS TO ALL SUCH INFORMATION, INTELLECTUAL PROPERTY, PATENT
RIGHTS, TECHNOLOGY, LICENSED SUBJECT MATTER OR OTHER RIGHTS, MATERIALS OR PROPERTY GRANTED OR
PROVIDED TO LICENSEE, AND LICENSOR DISCLAIMS ALL EXPRESS OR IMPLIED WARRANTIES OF ANY KIND
WHATSOEVER WITH RESPECT TO THE FOREGOING INCLUDING, WITHOUT
LIMITATION, ANY SUCH WARRANTIES
CONCERNING INFRINGEMENT, THE OPERATABILITY OR FITNESS FOR ANY PARTICULAR PURPOSE, COMMERCIAL
POTENTIAL, USE, SAFETY EFFICACY, APPROVABILITY BY REGULATORY AUTHORITIES, TIME AND COST OF
DEVELOPMENT, PATENTABILITY, VALIDITY, ENFORCEABILITY AND/OR BREADTH OF THE LICENSED SUBJECT AND/OR
PATENT RIGHTS. LICENSOR ALSO MAKES NO REPRESENTATIONS AS TO, AND LICENSOR DISCLAIMS ALL EXPRESS OR
IMPLIED WARRANTIES CONCERNING, WHETHER THERE ARE ANY PATENTS NOW HELD, OR WHICH WILL BE HELD, BY
OTHERS OR BY LICENSOR WHICH MAY BE DOMINANT OR SUBORDINATE TO THE PATENT RIGHTS, NOR DOES LICENSOR
MAKE ANY REPRESENTATION THAT THE INVENTIONS CONTAINED IN THE PATENT RIGHTS, THE LICENSED SUBJECT
MATTER OR LICENSED PRODUCTS DO NOT INFRINGE ANY OTHER PATENTS NOW HELD OR THAT WILL BE HELD BY
OTHERS OR BY LICENSOR. IN NO EVENT WILL THE LICENSOR BE LIABLE FOR ANY INCIDENTAL, SPECIAL OR
CONSEQUENTIAL DAMAGES RESULTING FROM EXERCISE OF THIS LICENSE OR THE USE OF THE INVENTION OR
LICENSED PRODUCTS OR THE USE OR THE PRACTICE OF LICENSED METHODS.

- 9 -

 

EXCLUSIVE LICENSE AGREEMENT

 

NOTHING IN THIS AGREEMENT WILL BE CONSTRUED AS CONFERRING BY IMPLICATION, ESTOPPEL OR OTHER WISE
ANY LICENSE OR RIGHTS UNDER ANY PATENTS OF LICENSOR OTHER THAN THOSE DEFINED HEREIN UNDER LICENSED
TECHNOLOGY AND JOINT LICENSED TECHNOLOGY, RETGARDLESS OF WHETHER SUCH PATENTS ARE DOMINANT OR
SUBORDINATE TO THOSE DEFINED UNDER LICENSED TECHNOLOGY.

	6.3	 	Manufacture, Production, Sale, and Distribution

The LICENSEE shall be solely responsible for the manufacture, production, sale, and distribution
of the Licensed Technology and will bear all costs associated therewith except as specifically
defined herein.

	7.	 	MARKING AND SAMPLES

LICENSEE shall, and agrees to require its sublicensees to, fully comply with the patent marking
provisions of the intellectual property laws of the applicable countries in which the Product is
sold or distributed. Furthermore, within a reasonable period of time, not to exceed one year from
the effective date, Licensee shall have included in all marketing literature relating to all
Licensed Products a statement to the effect that “this product or a portion thereof is made under
license from University Hospitals of Cleveland.”

	8.	 	TERMINATION
	 
	8.1	 	Immediate Right of Termination.

LICENSOR shall have the right to immediately terminate this Agreement by giving written notice to
LICENSEE in the event that LICENSEE files a petition in bankruptcy or is adjudicated a bankrupt or
insolvent, or makes an assignment for the benefit of creditors or an arrangement pursuant to any
bankruptcy law, or if the LICENSEE discontinues or dissolves its business.

	8.2	 	Right to Terminate Upon Notice of Material Breach

Either party may terminate this Agreement upon sixty (60) days’ written notice to the other party
in the event of a material breach of any provision of this Agreement by the other party, provided
that, during the sixty (60) day period, the breaching party fails to cure such breach. If,
however, one Party (the “Receiving Party”) receives notification from the other Party (the
“Notifying Party”) of a material breach or default and the Receiving Party notifies the Notifying
Party, in writing within thirty (30) days of receipt of such breach or default notice, that it
disputes the asserted breach or default, the matter will be resolved according to the dispute
resolution procedures in Paragraph 20 of this Agreement. In such event, the

- 10 -

 

EXCLUSIVE LICENSE AGREEMENT

 

Notifying Party shall not have the right to terminate this Agreement until it has been determined
that the Receiving Party materially breached or was in default of any of the terms and conditions
of this Agreement, and the Receiving Party fails to cure such breach within sixty (60) days after
the conclusion of such proceeding.

	8.3	 	Licensee’s Right to Terminate

LICENSEE shall have the right to terminate this Agreement at any time upon thirty (30) days’
written notice to LICENSOR, such termination to become effective at the conclusion of such thirty
(30) day period. Notwithstanding the previous sentence, upon termination of this Agreement, the
LICENSEE shall be entitled to (i) complete the manufacture of any Products in process at the time
of such termination, and (ii) dispose of any Products on hand in the ordinary course of business.

	8.4	 	Post Termination Rights

Upon expiration or termination of this Agreement, LICENSEE shall thereafter immediately cease all
further use of the Licensed Technology and know-how required to practice the Licensed Technology
(except for which the Royalty Term has expired before termination) and LICENSOR’S Confidential
Information in the possession or control of LICENSEE and each of the sublicensees of the Licensed
Technology, and all rights granted to LICENSEE and the sublicensees under this Agreement or any
sublicense agreement shall forthwith terminate and immediately revert to LICENSOR. In addition,
LICENSEE and each sublicensee of the Licensed Technology shall promptly return or destroy any
tangible embodiments of the Confidential Information, Licensed Technology, Tangible Property or
Products in its possession or control at the time of such termination. However, nothing herein
shall be construed to release either Party of any obligation that matured prior to the date of
such termination, Moreover, the obligations of the Parties in Sections 4, 6, 8.4,9.3-9.5, and
Articles 10,11,14 and 20 shall survive termination of this Agreement for any reason.

	9.	 	CONFIDENTIALITY
	 
	9.1	 	Confidential Information

“Confidential Information” means any and all information about a Party which is used, developed or
obtained by a Party relating to that Party’s business, research and development efforts,
including, without limitation, technical information, know-how, compositions of matter, processes,
material, technology, software, prototypes, ideas, inventions, improvements, data, files,
information relating to supplier and customer identities and lists, accounting records, business
and marketing plans, and all similar information, and all copies and tangible embodiments thereof
(in whatever form or medium).

- 11 -

 

EXCLUSIVE LICENSE AGREEMENT

 

	9.2	 	Exceptions

Notwithstanding Paragraph 9.1, Confidential Information shall not include information which: (i)
is known to the receiving party at the time of disclosure or becomes known to the receiving party
without breach of this Agreement; (ii) is or becomes publicly known through no wrongful act of the
receiving party or any subsidiary of the receiving party; (iii) is rightfully received from a
third party without restriction on disclosure; (iv) is independently developed by the receiving
party or any of its subsidiary; (v) is furnished to any third party by the disclosing party
without restriction on its disclosure; (vi) is approved for release upon a prior written consent
of the disclosing party; or (vii) is disclosed pursuant to judicial order, requirement of a
governmental agency or by operation of law.

	9.3	 	Terms of Confidentiality

The receiving party agrees that it will not disclose any Confidential Information to any third
party and will not use Confidential Information of the disclosing party for any purpose other than
for the performance of the rights and obligations hereunder during the term of this Agreement and
for a period of five (5) years thereafter, without the prior written consent of the disclosing
party. The receiving party further agrees that Confidential Information shall remain the sole
property of the disclosing party and that it will take all reasonable precautions to prevent any
unauthorized disclosure of Confidential Information by its employees. No license shall be granted
by the disclosing party to the receiving party with respect to Confidential Information disclosed
hereunder unless otherwise expressly provided herein.

	9.4	 	Publicity

The Parties agree that all publicity and public announcements concerning the formation and
existence of this Agreement shall be jointly planned and coordinated by and among the Parties.
Except as otherwise set forth in this Agreement, neither party will make any public statement,
press release or other announcement relating to the terms of or existence of this Agreement
without the prior written approval of the other.

	9.5	 	Publication

LICENSOR agrees that any publication of data or other technical information related to the
Licensed Technology or the Products will be submitted to the LICENSEE at least forty five (45)
days prior to the publication date. No publication of data or other technical information related
to the Licensed Technology or the Products shall be made by LICENSEE without the prior written
consent of LICENSOR.

- 12 -

 

EXCLUSIVE LICENSE AGREEMENT

 

	10.	 	INDEMNITY AND INSURANCE
	 
	10.1	 	Licensee’s Obligation

LICENSEE agrees to defend, indemnify and hold Dr. Gorodeski, (MacDonald Physicians, Inc.), Case
Western Reserve University, LICENSOR, their successors and assigns, and its officers, trustees,
directors, agents, and employees, harmless against all costs, expenses, and losses (including
reasonable attorney fees and costs) incurred through claims or actions of third parties against
LICENSOR arising from or related in any way to LICENSEE’S performance of the Agreement or based on
the manufacture or sale, marketing, commercialization or sublicensing of Product or portions of
the Product including, but not limited to, claims or actions founded on product liability, the use
of the Licensed Technology or any other actions or omissions of LICENSEE in connection with this
Agreement except those described in Section 10.2.

	10.2	 	Licensor’s Obligation; Limitation

LICENSOR agrees to defend, indemnify and hold LICENSEE and its officers, directors, agents,
sublicensees, employees, and customers, harmless against all costs, expenses, and losses
(including reasonable attorney fees and costs) incurred through claims or actions of third parties
against LICENSEE based on a breach by LICENSOR of any representation and warranty made in this
Agreement.

In no event shall LICENSOR be liable for lost profits, lost business opportunity and any other
reliance or expectancy, any indirect, serial, punitive, future, incidental or consequential
damages of any kind, even if advised of the possibility of such damage.

	10.3	 	Insurance

In addition to any other insurance LICENSOR may reasonably require, LICENSEE shall obtain and keep
in full force during the term of this Agreement and for a period of three (3) years thereafter,
comprehensive general liability insurance, including coverage for workers compensation, products
liability, bodily and personal injury, death, and its indemnity obligations under this Agreement,
issued by a responsible insurance company or companies, rated at least A-VII by A.M. Best, in good
standing and authorized to do business in the State of Ohio, in the amount of no less than $2
million per occurrence. LICENSOR shall be named as an additional insured under said policies.
LICENSOR shall within ten (10) days after request, provide LICENSOR with a copy of all policies or
certificates showing such insurance to be then in force. All policies shall contain an undertaking
by the insurers to notify LICENSOR, in writing, by registered or certified mail, not less than
thirty (30) days prior to any material change, cancellation or other terminations thereof

- 13 -

 

EXCLUSIVE LICENSE AGREEMENT

 

	11.	 	TAXES AND GOVERNMENTAL APPROVALS
	 
	11.1	 	Compliance with Law, Taxes, Fees, and Duties

LICENSEE shall be solely responsible for the payment of any and all taxes, fees, duties and
other payments incurred in relation to the manufacture, use and sale of the Licensed Technology,
or Products.

	11.2	 	Approvals, Authorizations, and Validations

LICENSEE shall comply with all applicable national, regional, state, and local laws and
regulations (all as may be amended from time to time) in connection with its activities under
this Agreement. LICENSEE shall be solely responsible, at its own expense, for applying for and
obtaining any approvals, authorizations, or validations necessary to effectuate the terms of
this Agreement under the laws of the appropriate national laws of each of the countries where
the Products are sold.

	12.	 	FORCE MAJEURE

Neither Party shall lose any rights hereunder or be liable to the other Party for damages or
losses (except for payment obligations) on account of failure of performance by the defaulting
Party if the failure is occasioned by war, strike, fire, Act of God, earthquake, flood,
terrorism, lockout, embargo, governmental acts or orders or restrictions, failure of suppliers,
or any other reason where failure to perform is beyond the reasonable control and not caused by
the negligence, intentional conduct or misconduct of the nonperforming Party has exerted all
reasonable efforts to avoid or remedy such force majeure; provided, however, that in no event
shall a Party be required to settle any labor dispute or disturbance.

	13.	 	NOTICE AND COMMUNICATIONS

Notices and other communications required by the terms and conditions of this Agreement shall be
made by first-class mail, postage prepaid, with confirmation by facsimile, addressed to the
Party receiving the notice or communication at the address specified below, or at any other
address as either Party may designate in writing to the other Party:

	 	 	 
	If to:

	 	If to:
	 
	 	 
	University Hospitals of Cleveland

	 	CytoCore, Inc.
	President and CEO

	 	President and CEO
	11100 Euclid Avenue

	 	414 N. Orleans,
	Cleveland, OH 44106

	 	Suite 502
	(216)844-1428

	 	Chicago, IL 60610
 312-222-9550

- 14 -

 

EXCLUSIVE LICENSE AGREEMENT

 

with a copy to:

University Hospitals of Cleveland

11100 Euclid Avenue

Cleveland, OH 44106

Phone: (216) 844-3817

Fax: (216) 844-5010

Attention: General Counsel

	14.	 	AGREEMENT BINDING ON SUCCESSORS

The provisions of the Agreement shall be binding upon and shall inure to the benefit of the
Parties hereto, their heirs, administrators, successors and assigns.

	15.	 	ASSIGNABILITY

     Neither this Agreement nor the rights and obligations hereunder may be assigned by either
Party without the prior express written approval of the other Party, unless through the sale of
all or substantially all of the assets of either organization to a third party.

	16.	 	WAIVER

No waiver by either party of any default shall be deemed as a waiver of prior or subsequent
default of the same of other provisions of this Agreement. Any waiver must be in writing and
signed by the Party entitled to the benefit of the right being waived.

	17.	 	SEVERABILITY

If any term, clause or provision hereof is held invalid or unenforceable by a court of competent
jurisdiction, such invalidity shall not affect the validity or operation of any other term, clause
or provision and such invalid term, clause or provision shall be deemed to be severed from the
Agreement.

	18	 	INTEGRATION

This Agreement constitutes the entire understanding of the Parties, and revokes and supersedes all
prior agreements between the Parties regarding the subject matter hereof, and is intended as a
final expression of their Agreement concerning the subject matter hereof. It shall not be modified
or amended except in writing signed by the Parties hereto and specifically referring to this
Agreement.

- 15 -

 

EXCLUSIVE LICENSE AGREEMENT

 

	19.	 	DISPUTE RESOLUTION

If a dispute arises out of or relates to this Agreement, or the breach thereof, and if such
dispute cannot be settled promptly, the Parties agree first to try in good faith to settle the
dispute by good faith discussions between the senior management of each Party. If such
discussions do not resolve the dispute within thirty (30) days after a Party has referred the
dispute to resolution by the senior management, the Parties agree to submit such dispute within
ten (10) days to non-binding mediation in Cleveland, Ohio, under the Commercial Mediation Rules
of the American Arbitration Association. If such mediation fails to resolve the dispute within
sixty (60) days, either Party may proceed to seek any remedies available to it.

	20.	 	GOVERNING LAW

THIS AGREEMENT IS TO BE INTERPRETED AND CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF
OHIO, but the scope and validity of any patent or patent application will be governed by the
applicable laws of the country of the patent or patent application.

	21.	 	EXPORT CONTROL LAWS

LICENSEE shall observe all applicable United States and foreign laws with respect to the
transfer of Licensed Products and related technical data to foreign countries, including the
International Traffic in Arms Regulations (ITAR) and the Export Administration Regulations.

IN WITNESS WHEREOF, the Parties hereto have caused their duly authorized representatives to
execute this Agreement on behalf of the parties as of the date appearing at the beginning of
this Agreement.

	 	 	 	 	 
	UNIVERSITY HOSPITALS OF CLEVELAND	 	 
	 
	 	 	 	 
	By:
	 	 	 	 
	 

	 	 	 	 
	Name:
	 	 	 	 
	 

	 	 	 	 
	Date:
	 	 	 	 
	 

	 	 	 	 
	 
	 	 	 	 
	CYTOCORE, INC.	 	 
	 
	 	 	 	 
	By:

	 	/s/ David Weissberg	 	 
	 

	 	 	 	 
	Name:
	 	David Weissberg 	 	 
	Date:

	 	1/27/06	 	 

- 16 -

 

EXCLUSIVE LICENSE AGREEMENT

 

Appendix A.

	 	 	 	 	 	 	 
	UHC File #	 	Activity	 	Date	 	Patent#
	 
	UH2004-006	 	Naturally occurring truncated
P2X7 Receptor
	 	06/02/05	 	60/686,770

 

 

EXCLUSIVE LICENSE AGREEMENT

 

APPENDIX B

University Hospitals of Cleveland

MATERIAL TRANSFER AGREEMENT

This document may not be used for the transfer of radioactive materials.

Parties to this Agreement:

	 	 	 
	Recipient Company/Organization/Institution:

	 	 
	 

	 	 

	 	 	 
	Recipient’s Address:

	 	 
	 

	 	 

	 	 	 
	Recipient’s Scientist(s):

	 	 
	 

	 	 

	 	 	 
	Recipient Scientist’s Address:

	 	 
	 

	 	 
	 
	 	 
	 

	 	 	 
	Provider Company/Organization/Institution:

	 	 
	 

	 	 

	 	 	 
	Provider’s Address:

	 	 
	 

	 	 
	 
	 	 
	 

	 	 	 
	Provider’s Scientist(s):

	 	 
	 

	 	 

Definitions:

	 	 	 
	Effective Date:

	 	 
	 

	 	 
	 
	Original Material:

	 	 
	 

	 	 

Progeny: Unmodified descendant from the Original Material, such as virus from virus, cell from
cell, or organism from organism, and any immediate or remote progeny of or descendant from
organisms or cell lines containing the same genetic mutation(s) or lesion(s) as Original Material.

Unmodified Derivatives: Substances created by Recipient which constitute an important unmodified
functional sub-unit or expression product of the Original Material, e.g., subclones of unmodified
cell lines, purified or fractionated sub-sets of the Original Material such as novel plasmids or
vectors, proteins expressed by DNA or RNA, antibodies secreted by a hybridoma.

Material: Original Material plus Progeny and Unmodified Derivatives.

- 18 -

 

EXCLUSIVE LICENSE AGREEMENT

 

Modifications: Substances created by Recipient which contain/incorporate any form of the Material
(Original Material, Progeny or Unmodified Derivatives).

Information: All information relating to Material or Modifications disclosed to Recipient by
Provider

	 	 	 
	Purpose for Transfer:

	 	 
	 

	 	 
	 
	 	 
	 

Terms and Conditions of this Agreement:

1. (a) The Material as defined above is and remains the property of Provider and is to be used by
Recipient only under the direction of Recipient’s Scientist for the Purpose stated above.

     (b) Provider does not claim ownership of substances or Modifications produced as a result of
Recipient’s research with the Material that are not included in the definition of Material above;
however, Provider does retain ownership of any form of the Material included in such substances or
Modifications.

     (c) Except as expressly provided in this Agreement, no rights are provided to Recipient under
any patent applications, trade secrets or other proprietary rights of Provider. In particular,
except as provided for under the
Exclusive License Agreement of               , 2006, between CytoCore, Inc.
and University Hospitals of Cleveland, no rights are provided to use the Material or Modifications
for profit-making or commercial purposes, such as sale; use in manufacturing; use in drug
screening, evaluation, and/or design programs; or provision of a commercial service based upon the
Material or Modifications.

     (d) If Recipient desires to use the Material or Modifications for such profit-making or
commercial purposes, Recipient agrees that it must first negotiate a
license or other appropriate
agreement with Provider and third parties as may be required, and it is further understood by
Recipient that Provider shall have no obligation to enter into such a license or agreement and in
fact may grant exclusive or non-exclusive commercial licenses to others.

     (e) Recipient agrees to obtain Provider’s written approval before entering into any sponsored
research agreement in which the sponsor (other than the government) gains rights to intellectual
property arising from research with the Material and/or Modifications.

2. The Recipient agrees not to transfer the Material or Modifications without the prior written
consent of Provider to anyone who does not work under the Recipient Scientist’s direct supervision.
No person authorized to use the Material

- 19 -

 

EXCLUSIVE LICENSE AGREEMENT

 

shall be
allowed to take or send the Material to any location other than the Recipient Scientist’s
Address without Provider’s written consent.

3. Each party agrees to use reasonable efforts to hold confidential all Information identified as
confidential at the time of disclosure and, if orally disclosed, then confirmed in writing or other
tangible medium within thirty (30) days, except for Information that: (a) is now or will enter the
public domain as the result of its disclosure in a publication, the issuance of a patent, or
otherwise without the legal fault of the receiving party; (b) the receiving party can prove was in
its possession at the time of the disclosure by the other party other than by prior disclosure by
Provider, or was developed by recipient alone or in collaboration with a third party without
knowledge of the Confidential Information; (c) comes into the hands of the receiving party by means
of a third party who is entitled to make such disclosure and who has no obligation of
confidentiality toward the disclosing party; or (d) must be disclosed pursuant to a court order or
as otherwise required by law. Obligations of non-disclosure of Information shall terminate three
(3) years from the Effective Date of this Agreement.

4. If Recipient’s research results in a discovery, invention, new use, or a product (collectively
referred to as “Invention”), Recipient agrees to disclose promptly such Invention(s) to Provider
on a confidential basis. Inventorship shall be determined in accordance with United States patent
law (if patentable) or by mutual agreement between the parties (if not patentable) taking into
account the role and contributions of individuals involved in the development of the Invention. If
Provider personnel are co-inventors of such inventions, the Recipient agrees to enter into a
license agreement with Provider concerning Recipient’s and/or Provider’s use of the invention,
such license to provide a reasonable royalty to be negotiated in good faith based on the
respective parties’ contributions and relevant industry standards. If either Provider or Recipient
is the sole inventor of any Invention, that party shall be free to dispose of such Invention as it
sees fit. Any educational institution which is a party to this Agreement shall have the right to
use for its internal research purposes Inventions developed through use of the Material under this
Agreement without payment of license or royalty fees.

5. This Agreement shall not be interpreted to prevent or delay publication of research results
using the Material or Modifications. Recipient’s Scientist and Recipient agree to provide
appropriate acknowledgment of the source of the Material in all publications and presentations
based on use of the Material, and agrees to furnish Provider with a copy of the manuscript or
abstract disclosing such results prior to submission thereof to publisher, and not less than
thirty (30) days prior to publication to allow Provider an opportunity to protect proprietary or
intellectual property rights relating to the Material that might be contained in such disclosure.
Provider agrees to keep such copy confidential during the thirty (30) day period and until
publication. Other than as specified above, Provider will not use the Recipient’s name or the
names of its schools or departments in any publication or marketing materials without prior
written consent.

- 20 -

 

EXCLUSIVE LICENSE AGREEMENT

 

6. Any Material delivered pursuant to this Agreement is understood to be experimental in nature,
and Provider makes no representations and extends no warranties of any kind, either express or
implied. There are no express or implied warranties of merchantability or fitness for a particular
purpose, or that the use of the Material will not infringe any patent, copyright, trademark, or
other rights.

7. In no event shall Provider be liable for any use by Recipient of the Material or for any loss,
claim, damage, or liability, of any kind or nature, that may arise from or in connection with the
Recipient’s use, handling, storage, or disposal of the Material, except as such claims, demands,
costs, or judgments may arise from Provider’s gross negligence or willful misconduct. Recipient
assumes responsibility for, and agrees to indemnify and hold harmless Provider and Provider’s
trustees, officers, agents, and employees from any liability, loss, or damage they may suffer as a
result of any claims, demands, costs, or judgments against them arising but of the use, handling,
storage, or disposal of the Material by Recipient, except as such claims, demands, costs, or
judgments may arise from Provider’s gross negligence or willful misconduct.

8. The Material shall in no event be used in human beings (including for diagnostic purposes)
without the appropriate prior government regulatory approval. All research involving the Material
(including but not limited to research involving the use of animals and recombinant DNA) and
disposal of the Material shall be conducted in accordance with all federal, state, local and other
laws, regulations, and ordinances governing such research including applicable NIH guidelines.

9. (a) This Agreement will terminate on the earliest of the following dates: (1) when the Material
becomes generally available, for example, through reagent catalogs or from a repository under the
Budapest treaty, in which case Recipient shall be bound by the least restrictive terms applicable
to Material obtained from the then-available sources, or (2) on completion of Recipient’s proposed
research studies with the Material, or (3) on thirty (30) days written notice by either party to
the other, or (4) one year from the date that this Agreement is signed by Provider.

     (b) On termination of this Agreement, Recipient will discontinue its use of the Material and
will, unless otherwise directed by Provider, return or destroy the Material. Recipient will also
either destroy Modifications or remain bound by the terms of this Agreement as they apply to
Modifications.

     (c) Paragraphs 3, 4, 5, 6 and 7 shall survive termination.

- 21 -

 

EXCLUSIVE LICENSE AGREEMENT

 

10. This Agreement is not assignable without the prior written consent of Provider,
and shall be governed by the laws of the State of Ohio, without reference to its
choice of law provisions.

AGREED to this  
              
      day of        
              
              
     , 20          :

Recipient Company/Organization/Institution:

	 	 	 	 	 
	 
	 	 	 	 
	 
	(authorized signature)

	 	 	 	(name and title)
	 
	 	 	 	 
	 
	 	 	 	 
	 	 	 	 	 
	(date)
	 	 	 	 
	 
	 	 	 	 
	Recipient’s Scientist(s):
	 	 	 	 
	 
	 	 	 	 
	 
	 	 	 	 
	 
	(signature)

	 	 	 	(printed name)
	 
	 	 	 	 
	 
	 	 	 	 
	 	 	 	 	 
	(date)
	 	 	 	 
	 
	 	 	 	 
	Provider Company/Organization/Institution
	 	 	 	 
	 
	 	 	 	 
	 
	 	 	 	 
	 
	(authorized signature)

	 	 	 	(name and title)
	 
	 	 	 	 
	 
	 	 	 	 
	 	 	 	 	 
	(date)
	 	 	 	 
	 
	 	 	 	 
	Provider’s Scientist(s):
	 	 	 	 
	 
	 	 	 	 
	 
	 	 	 	 
	 
	(signature)

	 	 	 	(printed name)
	 
	 	 	 	 
	 
	 	 	 	 
	 

	 	 	 	 
	(date)
	 	 	 	 

- 22 -

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