Document:

exv4w1

Exhibit 4.1

Form of Warrant

STEMCELLS, INC.

WARRANT TO PURCHASE COMMON STOCK

To Purchase 2,000,000 Shares of Common Stock

Date of Issuance: October 28, 2009

VOID AFTER APRIL 28, 2015

     THIS CERTIFIES THAT, for value received,                      , or permitted registered assigns
(the “Holder”), is entitled to subscribe for and purchase at the Exercise Price (defined below)
from StemCells, Inc., a Delaware corporation (the “Company”), up to 2,000,000 shares of the common
stock of the Company, par value $0.01 per share (the “Common Stock”). This warrant is one of a
series of warrants issued by the Company as of the date hereof (individually a “Warrant”;
collectively, “Company Warrants”) pursuant to that certain subscription agreement between the
Company and the Holder, dated as of October 28, 2009 (the “Subscription Agreement”).

     1. DEFINITIONS. Capitalized terms used herein but not otherwise defined herein
shall have their respective meanings as set forth in the Subscription Agreement. As used herein,
the following terms shall have the following respective meanings:

     (a) “Exercise Period” shall mean the period commencing with the date occurring six months
after the date hereof and ending five years and six months from the date hereof, unless sooner
terminated as provided below.

     (b) “Exercise Price” shall mean $1.50 per share, subject to adjustment pursuant to
Section 4 below.

     (c) “Exercise Shares” shall mean the shares of Common Stock issuable upon exercise of this
Warrant.

     (d) “Trading Day” shall mean (i) any day on which the Common Stock is listed or quoted and
traded on its primary Trading Market, (ii) if the Common Stock is not then listed or quoted and
traded on any eligible market (meaning any of the NYSE, AMEX or NASDAQ), then a day on which
trading occurs on the OTC Bulletin Board (or any successor thereto), or (iii) if trading does not
occur on the OTC Bulletin Board (or any successor thereto), any business day.

     2. EXERCISE OF WARRANT.

     2.1 STANDARD EXERCISE OF WARRANT. The rights represented by this Warrant may be
exercised in whole or in part at any time during the Exercise Period, by delivery of the

 

 

following to the Company at its address set forth on the signature page hereto (or at such
other address as it may designate by notice in writing to the Holder):

     (a) An executed Notice of Exercise in the form attached hereto; and

     (b) Payment of the Exercise Price either (i) in cash or by check (subject to the
limitations in Section 2.4 below), or (ii) pursuant to net exercise terms outlined under
Section 2.2 below.

     The Holder shall not be required to physically surrender this Warrant to the Company until the
Holder has purchased all of the Exercise Shares available hereunder and the Warrant has been
exercised in full, in which case, the Holder shall surrender this Warrant to the Company for
cancellation within three (3) Trading Days of the date the final Notice of Exercise is delivered to
the Company. Partial exercises of this Warrant resulting in purchases of a portion of the total
number of Exercise Shares available hereunder shall have the effect of lowering the outstanding
number of Exercise Shares purchasable hereunder in an amount equal to the applicable number of
Exercise Shares purchased. The Holder and the Company shall maintain records showing the number of
Exercise Shares purchased and the date of such purchases.

     Certificates for shares purchased hereunder shall be transmitted by the transfer agent of the
Company to the Holder by crediting the account of the Holder’s prime broker with the Depository
Trust Company through its Deposits and Withdrawal at Custodian (DWAC) system if the Company is a
participant in such system, and otherwise by physical delivery to the address specified by the
Holder in the Notice of Exercise within three Trading Days from the delivery to the Company of the
Notice of Exercise, surrender of this Warrant and payment of the aggregate Exercise Price as set
forth above. This Warrant shall be deemed to have been exercised on the date the Exercise Price is
received by the Company. The Exercise Shares shall be deemed to have been issued, and Holder or any
other person so designated to be named therein shall be deemed to have become a holder of record of
such shares for all purposes, as of the date this Warrant has been exercised by payment to the
Company of the Exercise Price.

     If by the close of the fifth Trading Day after delivery of an Notice of Exercise, the Company
fails to deliver to the Holder a certificate representing the required number of Exercise Shares in
the manner required pursuant to this Section 2, and such failure to deliver the Exercise
Shares is caused by the Company’s failure to use commercially reasonable efforts to comply with
this Section 2 and/or the covenants in Section 3.1 herein, and if after such fifth
Trading Day and prior to the receipt of such Exercise Shares, the Holder purchases (in an open
market transaction or otherwise) shares of Common Stock to deliver in satisfaction of a sale by the
Holder of the Exercise Shares which the Holder anticipated receiving upon such exercise (a
“Buy-In”), then the Company shall, within three Trading Days after the Holder’s request and in the
Holder’s sole discretion, either (1) pay in cash to the Holder an amount equal to the Holder’s
total purchase price (including brokerage commissions, if any) for the shares of Common Stock so
purchased (the “Buy-In Price”), at which point the Company’s obligation to deliver such certificate
(and to issue such Exercise Shares) shall terminate or (ii) promptly honor its obligation to
deliver to the Holder a certificate or certificates representing such Exercise Shares and pay cash
to the Holder in an amount equal to the excess (if any) of the Buy-In Price over the product of (A)
such number of Exercise Shares, times (B) the closing bid price on the date of
exercise.

 

 

     The person in whose name any certificate or certificates for Exercise Shares are to be issued
upon exercise of this Warrant shall be deemed to have become the holder of record of such shares on
the date on which this Warrant was surrendered and payment of the Exercise Price was made,
irrespective of the date of delivery of such certificate or certificates, except that, if the date
of such surrender and payment is a date when the stock transfer books of the Company are closed,
such person shall be deemed to have become the holder of such shares at the close of business on
the next succeeding date on which the stock transfer books are open.

     To the extent permitted by law, the Company’s obligations to issue and deliver Exercise Shares
in accordance with the terms hereof are absolute and unconditional, irrespective of any action or
inaction by the Holder to enforce the same, any waiver or consent with respect to any provision
hereof, the recovery of any judgment against any person or entity or any action to enforce the
same, or any setoff, counterclaim, recoupment, limitation or termination, or any breach or alleged
breach by the Holder or any other person or entity of any obligation to the Company or any
violation or alleged violation of law by the Holder or any other person or entity, and irrespective
of any other circumstance which might otherwise limit such obligation of the Company to the Holder
in connection with the issuance of Exercise Shares. Nothing herein shall limit a Holder’s right to
pursue any other remedies available to it hereunder, at law or in equity including, without
limitation, a decree of specific performance and/or injunctive relief with respect to the Company’s
failure to timely deliver certificates representing shares of Common Stock upon exercise of this
Warrant as required pursuant to the terms hereof.

     2.2 NET EXERCISE. If during the Exercise Period, the issuance of the Exercise
Shares to the Holder is not covered by the Registration Statement, as defined in the Subscription
Agreement, or any other effective registration statement under the Securities Act of 1933, as
amended, and the fair market value of one share of the Common Stock is greater than the Exercise
Price (at the date of calculation as set forth below), the Holder shall be permitted to exercise
this Warrant by electing to receive (and the Company shall be permitted satisfy its obligation to
issue the shares to be issued on exercise of this Warrant by issuing to the Holder) shares equal to
the value (as determined below) of this Warrant (or the portion thereof being canceled), in lieu of
paying the Exercise Price in immediately available funds. Upon delivery of a properly endorsed
Notice of Exercise, the Company shall issue to the Holder a number of shares of Common Stock
computed using the following formula:

X = Y (A–B)

         A    

	 	 	 
	Where X =

	 	the number of shares of Common Stock to be issued to the Holder
	 
	 	 
	Y =

	 	the number of shares of Common Stock for which the Warrant is
then being exercised

 

 

	 	 	 
	A =

	 	the fair market value of one share of the Company’s Common
Stock (at the date of such calculation)
	 
	 	 
	B =

	 	Exercise Price in effect at the time of exercise

     For purposes of the above calculation, the “fair market value” of one share of Common Stock
shall mean (i) the average of the closing sales prices for the shares of Common Stock on the NASDAQ
Global Market or other trading market where such security is listed or traded as reported by
Bloomberg Financial Markets (or a comparable reporting service of national reputation selected by
the Company and reasonably acceptable to the Holder if Bloomberg Financial Markets is not then
reporting sales prices of such security) (collectively, “Bloomberg”) for the ten (10) consecutive
trading days immediately preceding such date, or (ii) if the NASDAQ Global Market is not the
principal trading market for the shares of Common Stock, the average of the reported sales prices
reported by Bloomberg on the principal trading market for the Common Stock during the same period,
or, if there is no sales price for such period, the last sales price reported by Bloomberg for such
period, or (iii) if neither of the foregoing applies, the last sales price of such security in the
over-the-counter market on the pink sheets or bulletin board for such security as reported by
Bloomberg, or if no sales price is so reported for such security, the last bid price of such
security as reported by Bloomberg or (iv) if fair market value cannot be calculated as of such date
on any of the foregoing bases, the fair market value shall be as determined by the Board of
Directors of the Company in the exercise of its good faith judgment.

     2.3 ISSUANCE OF NEW WARRANTS. Upon any partial exercise of this Warrant, the
Company, at its expense, will forthwith and, in any event within five Trading Days, issue and
deliver to the Holder a new warrant or warrants of like tenor, registered in the name of the
Holder, exercisable, in the aggregate, for the balance of the number of shares of Common Stock
remaining available for purchase under this Warrant.

     2.4 EXERCISE LIMITATIONS; HOLDER’S RESTRICTIONS. A Holder shall not have the
right to exercise any portion of this Warrant, pursuant to Section 2 or otherwise, to the
extent that after giving effect to such issuance after exercise, such Holder (together with such
Holder’s affiliates) would beneficially own in excess of 4.99% of the number of shares of the
Common Stock outstanding immediately after giving effect to such issuance. For purposes of the
foregoing sentence, the number of shares of Common Stock beneficially owned by such Holder and its
affiliates shall include the number of shares of Common Stock issuable upon exercise of this
Warrant with respect to which the determination of such sentence is being made, but shall exclude
the number of shares of Common Stock which would be issuable upon (A) exercise of the remaining,
nonexercised portion of this Warrant beneficially owned by such Holder or any of its affiliates and
(B) exercise or conversion of the unexercised or nonconverted portion of any other securities of
the Company (including, without limitation, any other shares of Common Stock or Warrants) subject
to a limitation on conversion or exercise analogous to the limitation contained herein beneficially
owned by such Holder or any of its affiliates. Except as set forth in the preceding sentence, for
purposes of this Section 2.4, beneficial ownership shall be calculated in accordance with
Section 13(d) of the Exchange Act, it being acknowledged by a Holder that the Company is not
representing to such Holder that such calculation is in compliance with

 

 

Section 13(d) of the Exchange Act and such Holder is solely responsible for any schedules or
other filings required to be filed under the Exchange Act. To the extent that the limitation
contained in this Section 2.4 applies, the determination of whether this Warrant is
exercisable (in relation to other securities owned by such Holder) and of which a portion of this
Warrant is exercisable shall be in the sole discretion of a Holder, and the submission of a Notice
of Exercise shall be deemed to be each Holder’s determination of whether this Warrant is
exercisable (in relation to other securities owned by such Holder) and of which portion of this
Warrant is exercisable, in each case subject to such aggregate percentage limitation, and the
Company shall be entitled to rely on the Holder’s determination and shall have no obligation to
verify or confirm the accuracy of such determination. For purposes of this Section 2.4, in
determining the number of outstanding shares of Common Stock, a Holder may rely on the number of
outstanding shares of Common Stock as reflected in (x) the Company’s most recent Form 10-Q or Form
10-K, as the case may be, (y) a more recent public announcement by the Company or (z) any other
notice by the Company or the Company’s Transfer Agent setting forth the number of shares of Common
Stock outstanding. Upon the written or oral request of a Holder, the Company shall within two
Trading Days confirm orally and in writing to such Holder the number of shares of Common Stock then
outstanding. In any case, the number of outstanding shares of Common Stock shall be determined
after giving effect to the conversion or exercise of securities of the Company, including this
Warrant, by such Holder or its affiliates since the date as of which such number of outstanding
shares of Common Stock was reported. The provisions of this Section 2.4 may be waived by
such Holder, at the election of such Holder, upon not less than 61 days’ prior notice to the
Company, and the provisions of this Section 2.4 shall continue to apply until such 61st day
(or such later date, as determined by such Holder, as may be specified in such notice of waiver).

     3. COVENANTS OF THE COMPANY.

     3.1 COVENANTS AS TO EXERCISE SHARES. The Company covenants and agrees that all
Exercise Shares that may be issued upon the exercise of the rights represented by this Warrant
will, upon issuance, be validly issued and outstanding, fully paid and nonassessable, and free from
all taxes, liens and charges with respect to the issuance thereof.

     The Company further covenants and agrees that the Company will at all times during the
Exercise Period, have authorized and reserved, free from preemptive rights, a sufficient number of
shares of Common Stock to provide for the exercise of the rights represented by this Warrant. If at
any time during the Exercise Period the number of authorized but unissued shares of Common Stock
shall not be sufficient to permit exercise of this Warrant, the Company will take such corporate
action as may, in the opinion of its counsel, be necessary to increase its authorized but unissued
shares of Common Stock to such number of shares as shall be sufficient for such purposes.

     3.2 NO IMPAIRMENT. The Company will not, by amendment of its Certificate of
Incorporation or through any reorganization, transfer of assets, consolidation, merger,
dissolution, issue or sale of securities or any other voluntary action, avoid or seek to avoid the
observance or performance of any of the terms to be observed or performed hereunder by the Company,
and will at all times in good faith assist in the carrying out of all the provisions of this
Warrant and in the taking of all such action as may be necessary or appropriate in order to

 

 

protect the exercise rights of the Holder against impairment.

     3.3 NOTICES OF RECORD DATE AND CERTAIN OTHER EVENTS. In the event of any taking
by the Company of a record of the holders of any class of securities for the purpose of determining
the holders thereof who are entitled to receive any dividend or other distribution, the Company
shall provide to the Holder, at least ten (10) days prior to the date on which any such record is
to be taken for the purpose of such dividend or distribution, a notice specifying such date. In the
event of any voluntary dissolution, liquidation or winding up of the Company, the Company shall
provide to the Holder, at least ten (10) days prior to the date of the occurrence of any such
event, a notice specifying such date. In the event the Company authorizes or approves, enters into
any agreement contemplating, or solicits stockholder approval for any Fundamental Transaction, as
defined in Section 6 herein, the Company shall provide to the Holder, at least ten (10) days prior
to the date of the occurrence of such Fundamental Transaction, a notice specifying such date.
Notwithstanding the foregoing, the failure to deliver such notice or any defect therein shall not
affect the validity of the corporate action required to be described in such notice.

     4. ADJUSTMENT OF EXERCISE PRICE AND EXERCISE SHARES.

     (a) If the Company, at any time while this Warrant is outstanding, (i) pays a stock
dividend on its Common Stock or otherwise makes a distribution on any class of capital stock that
is payable in shares of Common Stock, (ii) subdivides outstanding shares of Common Stock into a
larger number of shares, or (iii) combines outstanding shares of Common Stock into a smaller number
of shares, then in each such case the Exercise Price shall be multiplied by a fraction of which the
numerator shall be the number of shares of Common Stock outstanding immediately before such event
and of which the denominator shall be the number of shares of Common Stock outstanding immediately
after such event. Any adjustment made pursuant to clause (i) of this paragraph shall become
effective immediately after the record date for the determination of stockholders entitled to
receive such dividend or distribution, and any adjustment pursuant to clause (ii) or (iii) of this
paragraph shall become effective immediately after the effective date of such subdivision or
combination. The form of this Warrant need not be changed because of any adjustment in the number
of Exercise Shares subject to this Warrant.

     (b) If the Company, at any time while this Warrant is outstanding, distributes to holders
of Common Stock, (i) Common Stock or any shares of stock or other securities which are at any time
directly or indirectly convertible into or exchangeable for Common Stock, or any rights or options
to subscribe for, purchase or otherwise acquire any of the foregoing by way of dividend or other
distribution (other than a dividend or distribution covered in Section 4(a) above); (ii)
any cash paid or payable otherwise than as a cash dividend; or (iii) any other asset, then and in
each such case, the Holder hereof will, upon the exercise of this Warrant, be entitled to receive,
in addition to the number of shares of Common Stock receivable thereupon, and without payment of
any additional consideration therefor, the amount of stock and other securities and property
(including cash in the cases referred to in clauses (ii) and (iii) above) which such Holder would
hold on the date of such exercise had such Holder been the holder of record of such Common Stock as
of the date on which holders of Common Stock received or became entitled to receive such shares or
all other additional stock and other securities and property.

 

 

     (c) Upon the occurrence of each adjustment pursuant to this Section 4, the Company
at its expense will, at the written request of the Holder, promptly compute such adjustment in
accordance with the terms of this Warrant and prepare a certificate setting forth such adjustment,
including a statement of the adjusted Exercise Price and adjusted number or type of Exercise Shares
or other securities issuable upon exercise of this Warrant (as applicable), describing the
transactions giving rise to such adjustments and showing in detail the facts upon which such
adjustment is based. Upon written request, the Company will promptly deliver a copy of each such
certificate to the Holder and to the Company’s transfer agent.

     5. FRACTIONAL SHARES. No fractional shares shall be issued upon the exercise of
this Warrant as a consequence of any adjustment pursuant hereto. All Exercise Shares (including
fractions) issuable upon exercise of this Warrant may be aggregated for purposes of determining
whether the exercise would result in the issuance of any fractional share. If, after aggregation,
the exercise would result in the issuance of a fractional share, the Company shall, in lieu of
issuance of any fractional share, pay the Holder otherwise entitled to such fraction a sum in cash
equal to the product resulting from multiplying the then current fair market value of an Exercise
Share by such fraction.

     6. FUNDAMENTAL TRANSACTIONS. If, at any time while this Warrant is outstanding,
(i) the Company effects any merger or consolidation of the Company with or into another entity, in
which the shareholders of the Company as of immediately prior to the transaction own less than a
majority of the outstanding stock of the surviving entity, (ii) any tender offer or exchange offer
(whether by the Company or another person or entity) is completed pursuant to which the holders of
more than the 50% of the outstanding shares of Common Stock (not including any shares of Common
Stock held by the person or persons making or party to, or associated or affiliated with the
Persons making or party to, such purchase, tender or exchange offer) are permitted to tender or
exchange their shares for other securities, cash or property, or (iii) the Company effects any sale
of all or substantially all of its assets in one or a series of related transactions, or (iv) the
Company effects any reclassification of the Common Stock or any compulsory share exchange pursuant
to which the Common Stock is effectively converted into or exchanged for other securities, cash or
property (other than as a result of a subdivision or combination of shares of Common Stock covered
by Section 4 above), (v) the Company consummates a stock purchase agreement or other
business combination (including, without limitation, a reorganization, recapitalization, spin-off
or scheme of arrangement) with another person whereby such other person acquires more than the 50%
of the outstanding shares of Common Stock (not including any shares of Common Stock held by the
other person or other persons making or party to, or associated or affiliated with the other
persons making or party to, such stock purchase agreement or other business combination), or (vi)
any “person” or “group” (as these terms are used for purposes of Sections 13(d) and 14(d) of the
Securities Exchange Act of 1934, as amended) becomes the “beneficial owner” (as defined in Rule
13d-3 under the Securities Exchange Act of 1934, as amended), directly or indirectly, of 50% of the
aggregate ordinary voting power represented by issued and outstanding Common Stock (each, a
“Fundamental Transaction”), the Holder shall have the right thereafter to receive, upon exercise of
this Warrant, the same amount and kind of securities, cash or property as it would have been
entitled to receive upon the occurrence of such Fundamental Transaction if

 

 

it had been, immediately prior to such Fundamental Transaction, the holder of the number of
Exercise Shares then issuable upon exercise in full of this Warrant (the “Alternate
Consideration”). To the extent necessary to effectuate the foregoing provisions, any successor to
the Company or surviving entity in such Fundamental Transaction shall issue to the Holder a new
warrant consistent with the foregoing provisions and evidencing the Holder’s right to exercise such
warrant into Alternate Consideration. In lieu of the Alternate Consideration, the Holder shall have
the right to require the Company to redeem this Warrant, for a purchase price, payable in cash on
the closing date of such Fundamental Transaction, equal to the Black Scholes Value of the remaining
unexercised portion of this Warrant on the closing date of such Fundamental Transaction. “Black
Scholes Value” means the value of this Warrant based on the Black and Scholes Option Pricing Model
obtained from the “OV” function on Bloomberg determined as of the day immediately following the
public announcement of the applicable Fundamental Transaction and reflecting (i) a risk-free
interest rate corresponding to the U.S. Treasury rate for a period equal to the remaining term of
this Warrant as of such date, (ii) an expected volatility equal to the lesser of (x) 60-day
volatility or (y) 100-day volatility, in each case obtained from the HVT function on Bloomberg,
provided however, the expected volatility used to calculate such value shall not exceed eighty
(80%) percent and (iii) an underlying price per share used in such calculation equal to the sum of
the price per share being offered in cash, if any, plus the value of any non-cash consideration, if
any, being offered in the Fundamental Transaction. The terms of any agreement pursuant to which a
Fundamental Transaction is effected shall include terms requiring any such successor or surviving
entity to comply with the provisions of this Section 6 and ensuring that this Warrant (or
any such replacement security) will be similarly adjusted upon any subsequent transaction analogous
to a Fundamental Transaction.

     7. NO STOCKHOLDER RIGHTS. Other than as provided in Section 3.3 or
otherwise herein, the Holder, solely in such Holder’s capacity as a holder of this Warrant, shall
not be entitled to vote or receive dividends or be deemed the holder of share capital of the
Company for any purpose, nor shall anything contained in this Warrant be construed to confer upon
the Holder, solely in such Holder’s capacity as the Holder of this Warrant, any of the rights of a
stockholder of the Company or any right to vote, give or withhold consent to any corporate action
(whether any reorganization, issue of stock, reclassification of stock, consolidation, merger,
conveyance or otherwise), receive notice of meetings, receive dividends or subscription rights, or
otherwise, prior to the issuance to the Holder of the Exercise Shares which such Holder is then
entitled to receive upon the due exercise of this Warrant. In addition, nothing contained in this
Warrant shall be construed as imposing any liabilities on the Holder to purchase any securities
(upon exercise of this Warrant or otherwise) or as a stockholder of the Company, whether such
liabilities are asserted by the Company or by creditors of the Company.

     8. TRANSFER OF WARRANT. Subject to compliance with any applicable laws, this
Warrant and all rights hereunder are transferable, by the Holder in person or by duly authorized
attorney, upon delivery of this Warrant and the form of assignment attached hereto to any
transferee designated by Holder. If this Warrant is to be transferred, the Holder shall surrender
this Warrant to the Company, whereupon the Company will forthwith issue and deliver upon the order
of the Holder a new Warrant (in accordance with Section 2.3), registered as the Holder may request,
representing the right to purchase the number of Exercise Shares being transferred

 

 

by the Holder and, if less then the total number of Exercise Shares then underlying this
Warrant is being transferred, a new Warrant (in accordance with Section 2.3) to the Holder
representing the right to purchase the number of Exercise Shares not being transferred.

     9. LOST, STOLEN, MUTILATED OR DESTROYED WARRANT. If this Warrant is lost,
stolen, mutilated or destroyed, the Company may, on such terms as to reasonable bond and indemnity
or otherwise as it may reasonably impose (which shall, in the case of a mutilated Warrant, include
the surrender thereof), issue a new Warrant of like denomination and tenor as this Warrant so lost,
stolen, mutilated or destroyed.

     10. DISPUTE. In the case of a dispute as to the determination of the Exercise
Price or the arithmetic calculation of the Exercise Shares, the Company shall promptly issue to the
Holder the number of Exercise Shares that are not disputed and resolve such dispute in accordance
with this Section 10. In the case of a dispute as to the determination of the Exercise
Price or the arithmetic calculation of the Exercise Shares, the Company shall provide notice to the
Holder of the disputed determinations or arithmetic calculations within two Trading Days of receipt
of the Notice of Exercise giving rise to such dispute, as the case may be. If the Holder and the
Company are unable to agree upon such determination or calculation of the Exercise Price or the
Exercise Shares within three Trading Days of such disputed determination or arithmetic calculation
being submitted to the Holder, then the Company shall, within two Trading Days provide submit (a)
the disputed determination of the Exercise Price to an independent, reputable investment bank
selected by the Company and approved by the Holder or (b) the disputed arithmetic calculation of
the Exercise Shares to the Company’s independent, outside accountant. The Company shall cause at
its expense the investment bank or the accountant, as the case may be, to perform the
determinations or calculations and notify the Company and the Holder of the results no later than
ten Trading Days from the time it receives the disputed determinations or calculations. Such
investment bank’s or accountant’s determination or calculation, as the case may be, shall be
binding upon all parties absent demonstrable error.

     11. NOTICES, ETC. All notices required or permitted hereunder shall be in
writing and shall be deemed effectively given: (a) upon personal delivery to the party to be
notified, (b) when sent by confirmed telex or facsimile if sent during normal business hours of the
recipient, if not, then on the next Trading Day, (c) five days after having been sent by registered
or certified mail, return receipt requested, postage prepaid, or (d) one day after deposit with a
nationally recognized overnight courier, specifying next day delivery, with written verification of
receipt. All communications shall be sent to the Company at the address listed on the signature
page hereto and to Holder at the applicable address set forth on the applicable signature page to
the Subscription Agreement or at such other address as the Company or Holder may designate by ten
(10) days advance written notice to the other parties hereto.

     12. ACCEPTANCE. Receipt of this Warrant by the Holder shall constitute
acceptance of and agreement to all of the terms and conditions contained herein.

     13. GOVERNING LAW; WAIVER OF JURY TRIAL. This Warrant shall be governed by, and
construed in accordance with, the laws of the State of New York. The Holder and the Company hereby
submit to the non-exclusive jurisdiction of the Federal and state courts in the

 

 

Borough of Manhattan in The City of New York in any suit or proceeding arising out of or
relating to this Agreement or the transactions contemplated thereby. The Holder and the Company
irrevocably and unconditionally waive any objection to the laying of venue of any suit or
proceeding arising out of or relating to this Warrant in Federal and state courts in the Borough of
Manhattan in The City of New York and irrevocably and unconditionally waives and agrees not to
plead or claim in any such court that any such suit or proceeding in any such court has been
brought in an inconvenient forum. EACH OF THE COMPANY AND THE HOLDER HEREBY WAIVES ALL RIGHTS TO A
TRIAL BY JURY.

     14. AMENDMENT OR WAIVER. Any term of this Warrant may be amended or waived (either
generally or in a particular instance and either retroactively or prospectively) with the written
consent of the Company and the Holder. The Company shall give prompt written notice to the Holder
of any amendment hereof or waiver hereunder that was effected without the Holder’s written consent.
No waivers of any term, condition or provision of this Warrant, in any one or more instances, shall
be deemed to be, or construed as, a further or continuing waiver of any such term, condition or
provision.

[REMAINDER OF PAGE INTENTIONALLY LEFT BLANK]

 

 

     IN WITNESS WHEREOF, the Company has caused this Warrant to be executed by its duly authorized
officer as of                     , 2009.

	 	 	 	 	 	 	 
	 	 	STEMCELLS, INC.	 	 
	 
	 	 	 	 	 	 
	 

	 	By:
	 	 	 	 
	 

	 	 	 	 	 	 
	 

	 	 	 	Name:	 	 
	 

	 	 	 	Title:	 	 
	 
	 	 	 	 	 	 
	 	 	3155 Porter Drive	 	 
	 	 	Palo Alto, CA 94304	 	 

 

 

NOTICE OF EXERCISE

TO: STEMCELLS, INC.

     (1)     o The undersigned registered holder hereby elects to purchase [           
] shares of the common stock, par value $0.01 (the “Common Stock”), of STEMCELLS, INC. (the
“Company”) pursuant to the terms of the attached Warrant, and tenders herewith payment of the
exercise price in full, together with all applicable transfer taxes, if any, subject to the
limitations set forth in Section 2.4 of the Warrant.

          o The undersigned hereby elects to purchase [          ] shares of Common Stock
of the Company pursuant to the terms of the net exercise provisions set forth in Section
2.2 of the attached Warrant, and shall tender payment of all applicable transfer taxes, if any.

     (2) Please issue the certificate for shares of Common Stock in the name of:

	 	 	 	 	 
	 
	 
	 	 	 	 
	 
	 	Print or type name
	 	 
	 	 	 	 	 
	 
	 
	 	 	 	 
	 
	 	Social Security or other Identifying Number	 	 
	 
	 	 	 	 	 
	 
	 	 	 	 
	 
	 	Street Address	 	 
	 	 	 	 	 
	 
	 
	 	 	 	 
	 
	 	City State Zip Code	 	 

     (3) If such number of shares shall not be all the shares purchasable upon the exercise of
the Warrants evidenced by this Warrant, a new warrant certificate for the balance of such Warrants
remaining unexercised shall be registered in the name of and delivered to:

 

	 	 	 	 	 
	 
	 
	 	 	 	 
	 
	 	Print or type name
	 	 
	 	 	 	 	 
	 
	 
	 	 	 	 
	 
	 	Social Security or other Identifying Number	 	 

 

 

	 	 	 	 	 
	 
	 	 	 	 
	 
	 	Street Address	 	 
	 	 	 	 	 
	 
	 
	 	 	 	 
	 
	 	City State Zip Code	 	 

	 	 	 	 	 	 	 
	Dated:
	 	 	 	 	 	 
	 

	 	 	 	 	 	 
	 
	 	 	 	 	 	 
	(Date)
	 	 	 	 	 	 
	 

	 	 	 	 	 	 
	 

	 	 	 	 	 	(Signature)
	 
	 	 	 	 	 	 
	 
	 

	 	 	 	 	 	 
	 
	 	 	 	 	 	 
	 

	 	 	 	 	 	(Print name)

 

 

ASSIGNMENT FORM

     (To assign the foregoing Warrant, execute this form and supply required information. Do not
use this form to purchase shares.)

     FOR VALUE RECEIVED, the foregoing Warrant and all rights evidenced thereby are hereby assigned
to

	 	 	 
	Name:
	 	 
	 
	 	 
	 
	 	(Please Print)
	 
	Address:
	 	 
	 
	 	 
	 
	 	(Please Print)
	 
	Dated:     , 200[ ]
	 	 

	 	 	 
	Holder’s Signature:
	 	 
	 
	 	 
	 
	 	 
	Holder’s Address:
	 	 
	 
	 	 

NOTE: The signature to this Assignment Form must correspond with the name as it appears on the face
of the Warrant, without alteration or enlargement or any change whatever. Officers of corporations
and those acting in a fiduciary or other representative capacity should file proper evidence of
authority to assign the foregoing Warrant.Exhibit 10.1

Exhibit 10.1

Confidential treatment has been requested for portions of this exhibit. The copy filed herewith
omits the information subject to the confidentiality request. Omissions are designated as [ * ].
A complete version of this exhibit has been filed separately with the Securities and Exchange
Commission.

MAGNETRON SUBSCRIPTION AGREEMENT

This Agreement, entered into as of the date of the last signature to this Agreement, with an
effective date of May 1, 2009 (the “Effective Date”)

BETWEEN

TomoTherapy Incorporated having its principal place of business at 1240 Deming Way, Madison, WI
53717, USA (hereinafter referred to as TOMO),

AND

E2V Inc whose main place of business is at 520 White Plains Road, Suite 450, Tarrytown, NY 10591,
USA (hereinafter referred to as E2V)

AND

E2V TECHNOLOGIES (UK) LIMITED having its principal place of business at 106 Waterhouse Lane,
Chelmsford, CM1 2QU, UK (hereinafter referred to as E2V LTD).

E2V and E2V LTD hereinafter collectively referred to as E2V.

Each of the above may also be singularly referred to as the “Party” and collectively as the
“Parties”.

WHEREAS

E2V LTD manufactures inter alia magnetron Products (the Products) and supplies these through E2V
INC.

TOMO is an organisation that seeks to purchase from E2V quantities of the Products for
incorporation into and/or use with a medical device.

The Parties wish to work together with the intention of improving TOMO’s Hi•Art® treatment system
quality and reliability and intrinsically linked with this is the performance and average life of
the E2V Product. To this end the Parties will work to their mutual benefit by undertaking
improvement and enhancement activities aimed at reducing service cost and improved reputation and
system sales for TOMO and reduced volumes of Products for E2V.

 

 

 

NOW IT IS HEREBY AGREED AS FOLLOWS

	1.	 	DEFINITIONS

In this Agreement (unless the context otherwise requires) the following expressions shall have the
following meanings:

	•	 	Acceptance Test Procedure (ATP): A TOMO procedure where a Hi•Art® treatment system is
accepted by the clinical site and is commissioned.

	•	 	Actual Product Life: The actual life of a Product, defined in hours of operation, if used
under Typical Operating Conditions (as defined herein) in a Hi•Art® treatment system under the
MSP.

	•	 	Agreement: These terms and conditions, all appendices and other documentation referenced
hereunder.

	•	 	Average Product Life: Calculated from all Product failure data for the preceding three
months across the Subscription Pool.

	•	 	Field service engineer (FSE): Person from TOMO’s service and support group which undertakes
planned and unplanned maintenance and repair work on Hi•Art® treatment systems.

	•	 	Intellectual Property Right: Any right derived from intellectual property such as patents,
petty patents, patent applications, registered and unregistered design rights, copyright,
trade secret and like protection.

	•	 	Leadership Team: A team of TOMO and E2V personnel responsible for managing the relationship
between TOMO and E2V which will comprise at a senior level of the TOMO Director of
Manufacturing and the E2V Business Unit General Manager.

	•	 	Magnetron Subscription Program (MSP): The program under which E2V supplies Products to
TOMO, governed by the terms and conditions herein, and more specifically described in Exhibit
A hereto.

	•	 	No Fault Found (NFF): A Product which is returned to E2V by TOMO and is found by E2V to
meet the agreed Specification. It is understood that the Specification and the TOMO Initial
Test are not the same and require further refinement to achieve optimal alignment.

	•	 	NFF Pool: The pool of Products returned by TOMO from which E2V may find NFF Product. The
NFF Pool shall include Products returned from TOMO that have failed TOMO’s Initial Tests but
shall not include Products that have passed the TOMO Initial Tests and are put into the usable
pool by TOMO, such as those Products returned from TOMO service stock.

	•	 	NFF Service Fee: A monthly fee for an assumed number of NFF occurrences to be reviewed by
the Parties on a regular basis. The Fee will be [ * ] (NFF base cost) multiplied by the
assumed number of monthly NFF occurrences. As of the Effective Date, the assumed monthly
number of NFFs is [ * ], resulting in a NFF Service Fee of [ * ]. While the NFF base cost
will remain constant for the term of the Agreement, the assumed monthly number of NFFs may
change.

	•	 	Product: [ * ] magnetron produced to the Specification.

 

 

 

	•	 	Selling Price (SP): The selling price is the price paid by TOMO to purchase a Product from
E2V outside of the MSP. For the purposes of this Agreement and for the term thereof, the SP
is equal to the Transfer Price (defined herein).

	•	 	Specification: The most recently released version of the technical specification relating
to the Product, the current version being [ * ] attached at Exhibit B.

	•	 	Subscription Price: The price paid by TOMO per year for each subscription System.

	•	 	Subscription Pool: The list of Hi•Art® treatment systems included in the MSP identified by
serial number. TOMO will also be able to provide general geographic information regarding the
Systems for statistical trending purposes on an as needed basis.

	•	 	System: The TOMO Hi•Art® treatment system into which the Product is to be installed.

	•	 	TOMO Initial Tests: Tests of the Products performed by TOMO upon receipt of the Products
from E2V.

	•	 	Transfer Price (TXP): The price in which a Product is sold and supplied by E2V to TOMO, and
credited to TOMO by E2V, through the MSP.

	•	 	Typical Operating Conditions: The number of beam on time as hours defined by the average
indicated hours of [ * ] annual beam on hours per System as of the Effective Date.

	2.	 	DURATION

This Agreement will commence on the Effective Date and will, subject to earlier termination,
continue for a period of 36 months (the ‘Initial Term’). The Agreement may be renewed by written
agreement required as a minimum six months before expiry of the Initial Term between the Parties
for a subsequent period (the ‘Subsequent Terms’).

	3.	 	SCOPE OF SUPPLY FROM E2V

	3.1	 	Subject to the following price and delivery terms, E2V shall supply the Products to TOMO in
accordance with this Agreement at the prices specified in Exhibit E, subject to the terms of
the MSP at Exhibit A. TOMO commits to purchasing all of its System manufacturing requirements
for the Product from E2V as a sole source for the duration of this Agreement.

	3.2	 	Upon the Effective Date TOMO will release blanket purchase orders to E2V against which E2V
will invoice TOMO for the Subscription Price for the Systems in the Subscription Pool (updated
monthly), and against which E2V will invoice and credit TOMO for Products sent to TOMO to be
used in the MSP and to replenish TOMO stock (updated weekly). TOMO will also release another
purchase order against which the monthly NFF Service Fee shall be invoiced (updated as
necessary).

 

 

 

In addition TOMO may order Products outside of the MSP at the prevailing SP under standard
purchase order cover in order to build up or adjust service
inventory or for new product development work, it is however the intention of the Parties
that TOMO will place all Systems into the MSP. The Parties understand that in order to
adjust Product inventory levels from time to time, TOMO may delay placing a System into the
MSP.

	3.3	 	Quantities, prices and delivery for Subsequent Terms will be subject to formal amendment by
E2V following discussion with TOMO.

	3.4	 	The terms and conditions of this Agreement shall prevail over and apply in precedence of any
other document, term or condition.

	4.	 	PRICE AND PAYMENT

	4.1	 	The total Subscription Price shall be established in US$ one business day after the Effective
Date for the Agreement, based on the GBP pricing specified in Exhibit E, and be valid for
twelve months at the current twelve month forward rate as defined below.

	4.2	 	E2V will obtain a quotation from its bank, as specified below, to determine the USD pricing
for the first 12-month period. At the end of that 12-month period, a further quote will be
obtained for the next 12-month period and then again at the end of that 12-month period for
the final 12-month period.

The exchange rate used to determine the USD pricing for each 12-month period will be the
average of the forward rates for each month for the 12 months going forward as quoted by
E2V’s bank. E2V will submit this quotation to TOMO for review and acceptance when
received. TOMO will be obliged to notify acceptance or rejection within 2 business days.
In the event of rejection E2V will obtain two additional quotes on the same basis from two
of its other banks and will submit these to TOMO. TOMO will then immediately notify E2V
which of the rates should be implemented for the purposes of establishing the Contract
Price. E2V agrees that all quotations will be obtained from major international financial
institutions or banks.

	4.3	 	E2V shall invoice TOMO. on the 1st of the month, for a monthly instalment of the
Subscription Price for each System in the Subscription Pool. New systems added to the MSP
will be invoiced at [ * ] of the Subscription Price for the month of installation and at the
full Subscription Price for every month thereafter. E2V shall invoice TOMO for Products on the
date of their despatch.

	4.4	 	Payment will be 45 days open account against invoice with a total credit line of $2.5 Million
across all products and services. The credit line will be evaluated by the Parties as needs
dictate.

	4.5	 	If TOMO defaults under the terms of this Agreement with E2V in payment on the due date of any
sum due to E2V, E2V may without liability postpone delivery, without prejudice to any other
right or remedy which E2V may have against TOMO in respect of such default until such time
that the payment is made. Should E2V exercise its rights under this provision, E2V agrees to
immediately proceed with any postponed delivery upon receipt of payment by TOMO.

 

 

 

	5.	 	DELIVERY

	5.1	 	Products shall be delivered FCA, Madison, WI (INCOTERMS 2000) for risk and title transfer
purposes. For the purposes of shipping costs, the Party shipping the Product will be
responsible for paying for such shipment unless otherwise specified herein.

	5.2	 	Subject to the provisions of Section 6, in the event of a delay at the fault of E2V in the
delivery of any Product, E2V shall after expiration of a 45 (forty five) day period of grace
be liable to pay TOMO in settlement for the delay, liquidated damages calculated at the rate
of [ * ] to a maximum of [ * ]. E2V shall make reasonable efforts to avoid delays, including
the use of overtime and capital expenditures to improve capacity bottlenecks. In the event of
recurring defaults by E2V on agreed delivery due dates, and the Parties, having used all
reasonable efforts and discussed in good faith, fail to agree a plan to rectify this for
future deliveries, then such recurring defaults may constitute default of the Agreement by
E2V.

	5.3	 	Risk and title in the Products shall transfer from E2V to TOMO in accordance with the
delivery term specified.

	5.4	 	TOMO shall inspect the Products upon delivery and may reject Products that do not conform to
the Specification provided that written notification of such rejection is submitted to E2V.
Products not notified as rejected within 45 days from delivery shall be deemed to be accepted.

	5.5	 	Products will be tested before delivery for conformance to Specification.

	5.6	 	E2V shall not be responsible for the commissioning or installation of the Product into any
System.

	5.7	 	TOMO reserves a right at all times to conduct quality and regulatory system audits of E2V for
the purposes of assurance that the Products and the manufacturing processes used to make them
meet the quality and regulatory standards necessary for the Products to be incorporated into
or used with the System. Such audits, if necessary, will be performed at mutually agreed-upon
times. E2V agree to have any necessary personnel present for any such audits and agree to
cooperate with TOMO in conducting any necessary audits. In the event that issues arise as a
result of these audits then the Parties will work together to resolve these issues and will
not use issues arising from the audit as grounds for finding E2V in default of the Agreement
unless such issues cannot be resolved by the Parties and cause the Product to fail to meet the
Specification. In the event that any issues arise from the audit that cannot be resolved and
such issues make it such that continued use of the Product by TOMO in the System would cause
TOMO to fail to meet its regulatory and quality obligations with respect to the System, then
TOMO shall have the right to terminate the Agreement, either in whole or in part, subject to
paying the costs for termination specified in Section 11.3 herein.

 

 

 

	6.	 	FORCE MAJEURE

	6.1	 	Neither Party shall be liable for any delay or failure to perform its obligations hereunder
which may be due to circumstances beyond its reasonable control and shall be entitled to such
extension of time thereof as may be reasonable in the circumstances. Such circumstances shall
include but not be limited to fire, flood, long term strikes, act of God and industrial action
at its plant or that or its subcontractor or supplier.

	6.2	 	The Party experiencing the Force Majeure circumstance shall notify the other Party in writing
as soon as possible on becoming aware of such events described in Section 6.1 and consult with
the other Party concerning the subsequent treatment thereof.

	7.	 	WARRANTY

	7.1	 	Products under the MSP will be unwarranted and failures will be managed in accordance with
Product replacement under the MSP.

	7.2	 	Products purchased outside the MSP will be warranted by E2V against defects in materials and
workmanship, and failure to meet the Specification according to E2V warranty term A50, in
accordance with E2V’s standard conditions of warranty leaflet attached hereto as Exhibit C.

	7.3	 	The Parties hereby acknowledge and agree that the performance and application of the System
shall be the sole responsibility of TOMO.

	8.	 	MODIFICATION TO SPECIFICATION

	8.1	 	E2V reserve the right to make minor modifications to the Products specifications, designs or
materials that do not affect form, fit and function as E2V deem necessary. In the event that
any modifications are made to the Products, E2V shall notify TOMO prior to delivery of
Products incorporating the change so that TOMO may determine whether the changes may affect
the quality of the finished device.

	8.2	 	Any change to a Product that reaches the threshold within the E2V quality system that it
would require the Product to receive either a major or minor revision increment shall be
approved in writing by TOMO before implementation, E2V shall provide thirty (30) days prior
written notice of such changes in order to enable TOMO to provide approval or rejection, or to
ask for reasonable additional time to complete any necessary testing and analysis with respect
to the continued use of the revised Product. TOMO will not unreasonably withhold approval.
TOMO’s failure to provide approval or rejection or to ask for reasonable additional time for
analysis of the impact of the proposed change within this period will be deemed an acceptance
of such changes.

	8.3	 	In the event that any Product is replaced with a new product or major revision, such as a
revision classified as a new product platform or one classified as a next generation product,
the Parties agree to work together in good faith to reconcile this Agreement as necessary with
such new product or revision. TOMO will be given reasonable prior written notice of one
hundred eighty (180)
days or such other time period as agreed upon by the Parties, of new products or major
Product revisions before implementation.

 

 

 

	8.4	 	TOMO reserves the right to reject any changes to the Products proposed by E2V in the event
that such changes would not be backwards compatible with TOMO’s system or if such changes
would necessitate TOMO undertaking additional work in its installed base. In this event E2V
agrees to supply TOMO unchanged Product in accordance with the blanket purchase order
quantities.

	9.	 	INTELLECTUAL PROPERTY RIGHTS AND INDEMNITY

	9.1	 	Intellectual Property Right to Product or parts thereof either existing or emerging that are
invented or conceived by E2V shall remain or become the absolute property of E2V. Similarly,
TOMO shall retain or obtain full title and ownership in all Intellectual Property Rights
either existing or emerging to the System, and any TOMO confidential information, and any
documents or other materials provided to E2V for the purpose of supplying the Products to
TOMO.

	9.2	 	E2V will indemnify and hold harmless TOMO against all reasonable defence costs and for
reasonable damages as finally determined by a court of competent jurisdiction in any suit
brought by a third party for infringement of any Intellectual Property Right of the third
party, including but not limited to Letters Patent or Registered Design by the normal use or
sale of the Product or part thereof supplied by E2V to TOMO provided always that this
indemnity shall not apply to any infringement:

	 	a.	 	which is due to E2V having followed a design furnished or given by TOMO or to
the use of the Product or part thereof in a manner or for a purpose not specified or
disclosed to E2V at the time of its delivery hereunder, or in a country not specified
or disclosed at the time of its delivery with respect to any claims of infringement
made under the intellectual property laws of that country, or

	 	b.	 	Which is due to the use of the Product or part thereof together with, or in
combination with, the System or any other article, material or apparatus not provided
by E2V,

and provided also that this indemnity is conditional on:

	 	a.	 	TOMO giving to E2V the earliest possible notice in writing of any claim being
made or action being threatened or brought against TOMO,

	 	b.	 	TOMO permitting E2V at its own expense to conduct any litigation that may
ensue and/or all negotiations for a settlement of a claim, and

	 	c.	 	TOMO not making any statement or admission regarding the claim or action
being threatened other than factual statements as requested or required by a competent
authority.

 

 

 

	9.3	 	Except as otherwise specified herein, the indemnity provision in Section 9.2 is given in lieu
of any or all liabilities which E2V might otherwise have in relation to
any infringement or alleged infringement of any patent or other right. Should any E2V
Product be found to infringe the Intellectual Property Rights of a third party, E2V shall,
at its discretion, either procure the right for E2V and TOMO to continue to use such
infringing Product(s), or shall offer TOMO a non-infringing replacement product that meets
TOMO’s technical requirements and specifications. If E2V is unable to offer either of
those options, TOMO’s obligations under this Agreement with respect to such infringing
Product(s) are excused with no further obligation to E2V with respect to the infringing
Product(s).

	10.	 	TERMINATION

	10.1	 	Either Party may terminate the Agreement or any Purchase Order forthwith by written notice in
the event that:

	 	a.	 	any provision of this Agreement allows for such termination, or

	 	b.	 	the other Party has defaulted or failed to perform or observe any of the
provisions of the Agreement on its part to be performed or observed and shall, if the
breach be remediable, have failed to take reasonable steps to remedy such breach
within 90 (ninety) days of receipt of written notice requiring him to do so, or

	 	c.	 	The other Party shall become insolvent, or makes any arrangement with its
creditors, goes into liquidation whether voluntary or compulsory or shall have
appointed a receiver and/or manager in respect of part or the whole of its assets
except as part of a bona fide scheme of reconstruction or amalgamation, or

	 	d.	 	for convenience subject to prior written notice of six months (6 months)
during which period the Parties will either agree that the supply should revert to a
standard Product Supply Agreement or that a last time buy option for the Products
should be implemented during the notice period.

	10.2	 	The accrued rights of either Party shall not be affected by termination for whatever cause.

	11.	 	CONSEQUENCES OF TERMINATION

	11.1	 	The Parties shall not be liable for indirect or consequential damages (such term to include
without prejudice to the generality of the foregoing, loss of profits or third party claims)
howsoever arising in the event of any default under the Agreement or any Purchase Order.

	11.2	 	In the event of termination of the Agreement by TOMO as a result of breach or default by E2V
pursuant to clause 10, E2V’s liability shall be limited to TOMO’s reasonable excess
reprocurement costs incurred in securing an alternative Product supplier capped to an
aggregate liability payment for any and all defaults under this Agreement, of the amount equal
to the Total Subscription Price of the three months preceding the date of Termination for
default. This shall be in full and final settlement of E2V’s liability in termination for
default. Excess
reprocurement costs shall include, but are not limited to, NRE costs, supplier
qualification activities and costs related thereto, and expediting fees. In the event that
E2V terminates the Agreement for convenience for the purposes of terminating the
relationship with TOMO, TOMO shall also be entitled to recover payment from E2V for excess
reprocurement costs as specified herein.

 

 

 

	11.3.	 	In the event of termination of the Agreement by E2V as a result of breach by TOMO pursuant
to clause 10, E2V shall be entitled to recover payment from TOMO for all Products delivered
and included in the Subscription Price prior to termination according to Section 11.4 herein
and at the request of E2V, reasonable payment for any work in progress under this Agreement,
and for third party financial commitments entered into in reliance upon this Agreement such
third party financial commitment and work in progress recovery limited to the Total
Subscription Price of the three months preceding the date of Termination for default. In
addition to 11.4, this shall be in full and final settlement of TOMO’s liability in
termination for default. In the event that TOMO terminates the Agreement for convenience for
the purposes of terminating the relationship with E2V, E2V shall also be entitled to recover
payment from TOMO for all Products delivered and reasonable work in progress in addition to
the payments provided in Section 11.4.

	11.4.	 	Upon termination or upon expiration of this Agreement in any event, or in the event that any
System is withdrawn from the Subscription Pool, TOMO shall pay to E2V a reconciliation
account. This reconciliation recognises that the Products within the MSP will in the event of
termination or withdrawal have the balance of Average Product Life. Accordingly the Parties
will determine this balance for each Product and attribute a proportionate value to this
payable by TOMO to E2V payable in equal monthly instalments over a twelve month period
following termination. Alternatively, TOMO may, at TOMO’s sole discretion, pay the
reconciliation amount to E2V in a lump sum payment upon termination. The reconciliation
account shall be calculated as follows:

	 	•	 	Average Product Life (in years) divided by two multiplied by the Subscription Pool
multiplied by the Subscription Price.

	 	•	 	In addition some Products will have a balance of warranty based on the standard
warranted life of A50.

	12.	 	NON ASSIGNMENT

The Parties may not assign or purport to assign any or all of its rights or obligations hereunder
without the prior written consent of the other Party, except in the instance of a change in control
or sale of substantially all the assets of a Party. Where such consent is requested, the Parties
agree that such consent shall not be unreasonably withheld. In the instance of an assignment by one
Party due to a change in control or sale of substantially all the assets of that Party, the
assigning Party agrees that the new assignee shall be bound by all of the rights and obligations of
the assigning Party under the terms of this Agreement, and further that the assigning Party shall
give the other Party no less than ninety (90) days prior written notice of such assignment.

 

 

 

	13.	 	NEGATION OF WAIVER

Failure of either Party at any time to enforce any of the provisions of the Agreement shall not be
construed as a waiver by such Party of any such provisions neither shall such failure in any way
affect the validity of the Agreement or any part thereof.

	14.	 	PRIOR AGREEMENTS, REPRESENTATIONS, STATEMENTS

The Parties hereto agree that the terms set out herein shall supersede all prior representations,
agreements, statements and understandings whether oral or in writing relevant to the Agreement.

	15.	 	SURVIVORSHIP

In the event that any portion of the Agreement is determined by a cognizant authority to be illegal
and/or invalid, the remaining portion of the document shall remain in effect provided the intent of
the Parties is not substantially changed; the illegal or invalid provision to be replaced by a
mutually agreed legal and valid provision, if necessary to continue the operability of the
Agreement.

	16.	 	AMENDMENTS

The terms of the Agreement may only be amended following the written consent of the Parties.

	17.	 	NOTICES

Any notices to be given pursuant to the Agreement shall be in writing and shall be deemed to have
been validly served:

	a.	 	15 (fifteen) days from the time of posting if sent by prepaid registered or recorded delivery
airmail post to the party to be served at its above mentioned address or such other address as
it may from time to time have communicated to the other as its address for service, or

	b.	 	At the time of completion of the transmission if sent by telefax during the normal business
hours of the party to be served (or on the next following business day of such party if not
sent during such business hours) provided always that in the case of service of notice by
telefax a further copy of such notice shall promptly have been sent by post in the aforesaid
manner to the party to be served.

	18.	 	HEADINGS

The clause headings hereof are for reference purposes only and shall not affect the construction of
the Agreement.

	19.	 	CONFIDENTIALITY

The Parties acknowledge that the Agreement is confidential and undertake not to disclose its
contents to any third party without the express permission of the other Party. The
Confidentiality Agreement entered into by the Parties as of July 27, 2006 shall remain in full
force and effect for the duration of this Agreement, and shall remain in effect for two years after
the expiration or termination of this Agreement.

 

 

 

	20.	 	ACCESS AND VERIFICATION

The Parties recognise the mutual dependency that each will place on the information provided from
the other and accordingly commit to provide and allow access to all necessary documents and
information to support the smooth operation of this Agreement, excluding cost disclosure which is
not required under this clause. Further the Parties will disclose all sources of data provided and
will submit to any reasonable request for verification, access to or audit of said source data and
information as available.

	21.	 	ESCALATION PROCESS AND DISPUTE SETTLEMENT

The Parties will review the operation of the Agreement both through the bi-weekly engineering
meetings and the Leadership Team meetings.

A specific trigger review meeting will be held twelve (12) months after the Effective Date between
the Leadership Team to status the operation of the Agreement and focus the Parties on assessing the
successful operation of the Agreement. An output of this review meeting will be an agreement to
implement any agreed changes necessary to enhance or modify the Agreement in order to better
achieve the WHEREAS objectives.

In the event that the Parties are in formal written notified dispute regarding any aspect of the
Agreement then the Parties will submit to an internal escalation process before implementing any
formal legal proceedings. This escalation process will be by referral to the Leadership Team for
resolution. If this cannot be achieved to the Parties mutual satisfaction within 15 working days
then the dispute will be referred to the next level of appropriate directorship within each of the
Parties for resolution. If this cannot be achieved to the Parties mutual satisfaction within 10
working days then the dispute will be referred to arbitration.

	22.	 	LAW AND ARBITRATION

This agreement shall be governed by and the rights and obligations of the Parties shall be
construed in all respects in accordance with the laws of the State of New York, USA, excluding its
conflicts of laws provisions. Any controversy, dispute or claim arising out of or relating to this
agreement shall be finally determined by arbitration under the international arbitration rules of
the American Arbitration Association. The number of arbitrators shall be three. The place of
arbitration shall be New York, New York. The language of the arbitration shall be English. The
arbitrators shall not be empowered to award punitive or exemplary damages.

 

 

 

IN WITNESS THEREOF the parties hereto have caused this Agreement to be signed by their duly
authorised representatives.

	 	 	 	 	 	 	 
	Signed for and on behalf of
	 	Signed for and on behalf of	 	 
	E2V TECHNOLOGIES (UK) LIMITED

	 	TOMOTHERAPY INCORPORATED	 	 
	 
	 	 	 	 	 	 
	/s/ C. Parmenter	 	/s/ Stephen C. Hathaway	 	 
	Name: 	C. Parmenter	 	Name: 	Stephen C. Hathaway	 	 
	Position: 
	Manager of Commercial	 	Position: 	Chief Financial Officer	 	 
	Date: 
	April 24, 2009	 	Date: 	April 22, 2009	 	 
	 
	 	 	 	 	 	 
	Signed for and on behalf of E2V
	 	 	 
	 
	 	 	 	 	 	 
	/s/ Robert E. Calabrese	 	 	 	 	 	 
	Name: 	Robert E. Calabrese 	 	 	 	 	 	 
	Position: 
	Sr. VP Sales America’s 	 	 	 	 	 
	Date: 
	4-23-09 	 	 	 	 	 

 

 

 

EXHIBIT A

MAGNETRON SUBSCRIPTION PROGRAM (MSP)

	I.	 	MSP Processes

	 	A.	 	PROCEDURES

The Procedures used to manage the activities outlined in this section shall be managed
through the work groups and through the steering teams via the agreed MSP Policies and
Processes document, not attached hereto but known by the Parties, which will be subject to
revision control and maintained by TOMO, which may be amended from time to time upon
agreement by the Parties. It is the spirit of this agreement that both parties will work to
achieve the most effective, low cost solution to administrative issues. It is anticipated
that the processes will evolve over time with experience and to accommodate external events
that might affect the program.

	 	B.	 	SERVICE FEES: THE MONTHLY SUBSCRIPTION BLANKET ORDER FOR MSP SITES AND THE
MONTHLY NFF CHARGE

	 	1.	 	At start-up an allowance will be made for TOMO-owned Products currently in
use. These Products currently have an estimated average remaining life of [ * ].
Therefore, Systems containing Product already purchased by TOMO will be credited for
an average remaining Product life over the first year of the program in the form of a
discount of [ * ]% to the first year’s Subscription Price, deducted monthly. After
the first year under the MSP, this discount will lapse and revert to non discounted
Subscription Price with effect from the thirteenth month of the Agreement.

	 	2.	 	New Systems added to the MSP list (increasing the baseline) chargeable at the
prevailing per System Subscription Prices. New systems shall assume to ATP on the
15th of the month in which the ATP occurs and thus shall be discounted [ *
] for the ATP month. The controlling document will be the MSP Systems list provided by
TOMO and reviewed each month.

	 	3.	 	The monthly NFF Service Fee shall be charged against a separate purchase
order. This shall be for an assumed number of NFF devices, the basis at Effective Date
shall be [ * ] NFF per month at [ * ] per NFF. This will be reviewed on a regular
basis to take account of actual NFF during previous period, and may be rebased by
agreement of the Parties if the actual NFF changes substantially. It is understood
that both parties shall work together to reduce or eliminate NFF Product and
subsequently the NFF fee.

 

 

 

	 	C.	 	ORDERING PRODUCTS

An inventory of Products is maintained internally for testing and disposition. This supply
of Products is replenished weekly from orders placed to E2V. Products are not considered
part of the MSP program until they are tested (TOMO Initial Tests) and dispositioned.

In general, Product demand is created when

	 	1)	 	new sites ATP;

	 
	 	2)	 	when service Products fail,

	 	3)	 	or when Products are needed for to supply Product Development, to
increase Tomo stock, or to replenish Product consumption from non-MSP sites

Under the MSP program weekly orders will be placed to E2V to fill all needs for the week
against specific Purchase Orders.

Unless changed by the Parties;

	 	•	 	The order for MANUFACTURING (ATP) and SERVICE Products is created and
managed from tube test results data and made available to E2V on a weekly basis.
In both cases purchases are offset by full tube credits when the Products are
issued to an MSP site. In the case of SERVICE Products the debit/credit
transaction will always be simultaneous. Any instances of outstanding credit or
debit on the SERVICE Products will be resolved by the Parties immediately.

	 	•	 	It is understood that every tube released and assigned to
MANUFACTURING will be offset by a corresponding credit when the system that the
Product is assigned to reaches ATP. At this time the ATP site will be added to
the MSP site list as a new system.

	 	•	 	Products released to replace SERVICE failure shall be determined from
failure data provided by Tomo on a weekly basis. It is understood that once E2V
sends a SERVICE Product it will send a corresponding invoice immediately for the
new Product along with an offsetting credit for the new TOMO Product installed
into the system. The Order for SERVICE failure replacement shall always be
immediately netted to zero and no net debit or credit should ever be created by
this order.

	 	•	 	Non-MSP orders shall be made by separate discrete orders. It is
understood that non-MSP sites such as Distributors may draw Products from any Tomo
Inventory and that Tomo will replenish these Products with Non-MSP orders. Serial
number tracking will not be available for Distributor Products, but quantities
will be known and shared upon request.

	 	D.	 	CHANGES TO TOMO INVENTORY

	 	•	 	Increases to TOMO Inventory

	 	•	 	TOMO may place non-MSP orders to increase net TOMO Inventory
(beyond orders to replenish other Non-MSP needs)

	 	•	 	Decreases to TOMO Inventory

 

 

 

	 	•	 	Should TOMO elect to reduce inventory this may be
accomplished as follows;

	 	•	 	By fully consuming an ATP Product rather
than returning it for full credit (and thereby delaying the addition
of the site to the MSP program until the end of the initial Product
life)

	 	•	 	By not replenishing Products taken by
non-MSP sites

	 	•	 	TOMO will not reduce or increase TOMO Inventory through the
MANUFACTURING (ATP) or SERVICE orders, as these orders involve net debit/credit
offsets.

	 	E.	 	DISPOSITION OF RETURNED SERVICE FAILURES

Products over [ * ] hours shall be destroyed and scrapped unless specifically requested for
testing by E2V. Products with over [ * ] hours use and less than [ * ] hours shall be held for a reasonable period of time, during which e2v may request up
to [ * ]% of Products to be returned for testing, those not returned shall be destroyed and
scrapped.

	 	F.	 	OPERATIONAL MATTERS

	 	1.	 	When a Product is to be returned to E2V for
any reason, TOMO will ensure that the Product is clearly identified
as a Product which is part of the MSP or otherwise.

	 	2.	 	No Fault Found Products Returned to E2V
applies only to new Products receiving acceptance gantry testing
(i.e., TOMO Initial Tests) at the TOMO factory. Service failures may
be tested for data purposes but shall not be considered NFF for any
commercial purpose. It is expected that both parties shall work
together to eliminate NFF results and related fees.

	 	G.	 	TRAINING

If E2V deems appropriate, then E2V will provide training in Product knowledge for TOMO personnel,
including FSEs. TOMO’s permission for such activity will not be unreasonably withheld.

	 	H.	 	USAGE

Should it be recognised by either TOMO or E2V that a particular System is returning Products on a
more frequent than average quantity on a regular basis then the Parties will work together to
investigate the cause of the returns, determine mechanisms to reduce these and implement these in
the System, this may include but is not limited to System maintenance, changes in the operating
environment and System user training.

	 	I.	 	CHANGES TO THE PRODUCT

It is the intention of the parties to work together in a collaborative manner to improve the life
performance of the Products and as a result, the reliability of the TOMO System. Within this
collaborative approach E2V will undertake enhancement programmes, within
the scope of the agreed MSP Subscription Price, that are for the purpose of extending the life of
the Product. However it is also the intention of the Parties, from time to time, to agree to
allocate resources to investigate specific areas of Product performance.

 

 

 

Any such investigative engineering work will be managed and agreed through bi-weekly engineering
meetings and the Leadership Team who will oversee and approve any additional engineering work. E2V
agrees that it will not undertake any such work without first informing TOMO as to whether the work
is within the scope of the agreed MSP Price and if such work is not within the scope, E2V will not
undertake such work without first providing TOMO with a project timeline, including deadlines for
deliverables, and the NRE costs for the work, nor will E2V proceed with the work without written
authorization from TOMO.

If, at the bi-weekly engineering meeting, it is agreed by E2V to undertake an investigation into a
specific area of performance (excluding performance issues relating to the quality of the Products
in their current state, which are included in the agreed MSP price), the parameters, outputs,
resource level, timescale and if necessary, additional funding will be agreed by the Parties and
minuted prior to the commencement of the investigation. Such investigative effort will also have
the written approval of the Leadership Team before being undertaken.

Any investigative effort carried-out will be prioritized on a case-by-case basis provided this
effort does not negatively impact or delay other magnetron-related projects and priorities that are
within the scope of the agreed MSP Subscription Price.

1. Agreed Enhancement Projects:

Taking account of the above intentions, the Parties agree that TOMO will undertake
an enhancement project relating to [ * ]. Subject to completion of this programme
of work and achievement of performance enhancement objectives, to be agreed, and
following in field evidencing of this programme and achievement of objectives, then
E2V will make a proportionate pro rata reduction in the Subscription Price for each
Subscription Product incorporating the [ * ]enhancement(s).

2. The Parties understand that changes to the System may impact the Product. The
Parties therefore commit through the bi-weekly engineering meetings, to fully
communicate and disclose any changes to the System or its components that may
impact the performance of the magnetron. Subject to clause 8 E2V and TOMO will
agree all changes to the Product prior to incorporation. All improvements to the
Product will be at E2V’s sole discretion.

	 	J.	 	IMPACT OF CHANGES TO TYPICAL OPERATING CONDITIONS

The Parties recognize that certain projects or changes to the System may result in a change in the
Typical Operating Conditions of the System from the [ * ] hour average beam on hours that is
typical as of the Effective Date of the MSP. The Parties further recognize that a significant
change in Typical Operating Conditions across the base of installed Systems could impact overall
Product consumption in a manner not anticipated at the time of execution of the MSP.

 

 

 

The Parties thereby agree that should the Typical Operating Conditions of the Systems (meaning the
average Typical Operating Conditions of all of the Systems in the MSP) change in either direction
by 10% then E2V reserves the right to adjust the Subscription Price accordingly by a proportionate
amount unless TOMO can present reasonable evidence that the change in the Typical Operating
Conditions has not affected the overall Product consumption rate.

In the instance of a change to some identifiable sub-group of the Systems under the MSP, such as
for example the addition of TomoDirectTM, then the above adjustments in the Subscription Price will
be implemented in the identifiable sub-group only.

 

 

Exhibit B

Confidential treatment has been requested for portions of this exhibit. The copy filed herewith
omits the information subject to  confidentiality request. Omissions
are designated as [ * ]. A complete version of this exhibit has been filed separately with the
Securities and Exchange Commission.

			
	 	 	 
	[ * ] Technical Specification
	 	[ * ]

Version 1

Page 1 of 9

PURPOSE & SCOPE

This document details the technical specification for the [ * ] magnetron
supplied by e2v technologies (uk) limited. The magnetron is used in
conjunction with electromagnet [ * ] and transition [ * ] to
provide RF power to medical linar accelerators. The magnetron is powered by
Solid-State Modulator [ * ]

RELATED DOCUMENTS

e2v
technologies A1A-Magnetron_Preamble

British Standard [ * ]

[ * ] Test Specification

TECHNICAL REQUIREMENTS

Frequency

Frequency range (with cooling water at [ * ]°
C):[ * ] to [ * ] MHz.

On
rotation of the magnetron through 360° the frequency will not vary by more
than [ * ] kHz. To minimise the frequency deviation
the rotational axis
should be parallel to the axis of the tuner.

For information only; the steady state temperature coefficient of frequency is
approximately [ * ]
kHz/°C.
Typically at start-up the frequency will be [ * ] MHz high, [ * ] seconds after
switching on the high voltage supply.

Power Output

Peak output power [ * ] MW (see Performance Chart). The maximum variation of output
power is [ * ]% when the magnetron is rotated through 360° around any axis.

Power Input

The maximum power input is [ * ] kW (mean).

Pulse Width

The maximum pulse width is [ * ]   μs. Longer pulses are possible but may impact magnetron life.

Rate of Rise of Voltage Pulse

The steepest tangent to the leading edge of the voltage pulse above [ * ] % amplitude
must be between [ * ] kV/μs and [ * ] kV/μs. Any capacitance in the viewing system
must not exceed [ * ] pF.

Missing
Pulses

Missing pulses will not exceed [ * ]%. Test duration is a minimum of [ * ]
minutes.

Pulses are defined as missing if the total energy within the pulse is less
than [ * ]% of normal value. The pulses may be of reduced duration,
amplitude, or at a frequency outside the linac bandwidth. These faults  may be
caused by a number of magnetron failure modes. [ * ]

Missing
 pulses due to arcing can periodically increase to higher levels for
short periods throughout the life of the magnetron. This is considered normal
magnetron behaviour. If the tube is not at end of life then the missing pulse
count should recover to the normal level if the tube is allowed to run.

[ * ]

	 	 	 	 	 
	e2v

	 	©
e2v technologies  (uk) ltd  2008

A Limited Company Registered in England No. 432014

Registered Office: 106 Waterhouse Lane, Chelmsford CM1 2QU, UK 

Holding Company: e2v technologies plc

This document is supplied by e2v technologies (uk) ltd on the express
understanding that it is
to be treated as confidential and that it may not be copied, used or
disclosed to others in
whole or in part for any purpose except as authorised in writing by e2v
technologies (uk) ltd.
	 	Approved by

[ * ]
	 

	 	 	 	Template DF763503A-3

 

 

Confidential treatment has been requested for portions of this exhibit. The copy filed herewith
omits the information subject to the confidentiality request. Omissions
are designated as [ * ]. A complete version of this exhibit has been filed separately with the
Securities and Exchange Commission.

			
	 	 	 
	[ * ] Technical Specification
	 	[ * ]

Version 1

Page 2 of 9

Parasitic
Oscillations

Spurious signals (sidebands) will be better than [ * ] dB below the main RF signal.

Heater

The required heater current on standby is [ * ] A.  Voltage is [ * ] V approx. The cathode
pre-heating time is [ * ]  minutes minimum. [ * ]

Outline

For overall dimensions, see outline.

Weight

Net weight approx [ * ] kg.

Tuner
Drive

The frequency range is covered by [ * ] tuner revolutions.
The tuner torque is less than [ * ] Nm
and any variation of torque with respect to position is monotonic.

Output
Waveguide

Output is via transition [ * ] to no [ * ] waveguide [ * ] mm internal). The waveguide must be
pressurised to prevent RF breakdown. The maximum pressure is [ * ] kPa [ * ] bar) where the
maximum leak rate from the magnetron is [ * ]  mbar
litre/s. The pressurised are suppressant gas
used in the waveguide should contain no more [ * ] than is typically found in air, i.e. [ * ]%.
The VSWR should not exceed [ * ] unless the phase of the reflected power can be adjusted to
compliment magnetron stability. The VSWR must never exceed [ *
]

Electromagnet

Electromagnet [ * ] should be powered as marked on the terminals such that the north-seeking pole
of the magnet is adjacent to the cathode terminal (marked [ * ]. The position of the magnetron is
set with the integral positioning block.

Water
Cooling

The magnetron is water-cooled and has an integral water jacket. The required water flow is a
minimum of [ * ] litres per minute. A pressure of
approximately [ * ] kPa [ * ] bar) will be
necessary to give this rate of flow. The outlet water temperature
must not exceed [ * ] °  C.

	 	 	 	 	 
	e2v

	 	©
e2v technologies  (uk) ltd  2008

A Limited Company Registered in England No. 432014

Registered Office: 106 Waterhouse Lane, Chelmsford CM1 2QU, UK 

Holding Company: e2v technologies plc

This document is supplied by e2v technologies (uk) ltd on the express
understanding that it is
to be treated as confidential and that it may not be copied, used or
disclosed to others in
whole or in part for any purpose except as authorised in writing by e2v
technologies (uk) ltd.
	 	Approved by

[ * ]
	 

	 	 	 	Template DF763503A-3

 

 

Confidential treatment has been requested for portions of this exhibit. The copy filed herewith
omits the information subject to the confidentiality request. Omissions
are designated as [ * ]. A complete version of this exhibit has been filed separately with the
Securities and Exchange Commission.

			
	 
	[ * ] Technical
Specification
	 	[ * ]
	 
	 	Version 1
	 
	 	Page 3 of 9

TUBE PERFORMANCE

The following performance chart shows the typical performance for a new magnetron. The
magnetron will operate satisfactorily within the magenta coloured region. Best performance is obtained
within the red, or preferably green, lines. [ * ]

[ * ]

	 	 	 	 	 
	e2v

	 	©
e2v technologies  (uk) ltd  2008

A Limited Company Registered in England No. 432014

Registered Office: 106 Waterhouse Lane, Chelmsford CM1 2QU, UK 

Holding Company: e2v technologies plc

This document is supplied by e2v technologies (uk) ltd on the express
understanding that it is
to be treated as confidential and that it may not be copied, used or
disclosed to others in
whole or in part for any purpose except as authorised in writing by e2v
technologies (uk) ltd.
	 	Approved by

[ * ]
	 

	 	 	 	Template DF763503A-3

 

 

 

Confidential treatment has been requested for portions of this exhibit. The copy filed herewith
omits the information subject to the confidentiality request. Omissions
are designated as [ * ]. A complete version of this exhibit has been filed separately with the
Securities and Exchange Commission.

			
	 
	[ * ] Technical
specification
	 	[ * ]
	 
	 	Version 1
	 
	 	Page 4 of 9

ACCEPTANCE TEST PROCEDURE

Details
and limits for tests undergone by all magnetrons. Reference: test procedures [ * ]

Test Conditions

	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	 	 	Modulator	 	Pulse Length	 	Magnetic Field	 	Duty	 	 	 	Ipeak	 	Imean	 	rrv
(kV/μs)
	 	 	Type	 	(μs ±10%)	 	(gauss)	 	Cycle	 	PRF	 	(A)	 	(mA)	 	min	 	max
	TC [ * ]
	 	[ * ]	 	[ * ]	 	[ * ]	 	[ * ]	 	[ * ]	 	 	 	[ * ]	 	[ * ]	 	[ * ]
	[ * ]
	 	[ * ]	 	[ * ]	 	[ * ]	 	 	 	[ * ]	 	[ * ]	 	 	 	[ * ]	 	[ * ]
	[ * ]
	 	[ * ]	 	[ * ]	 	[ * ]	 	 	 	[ * ]	 	[ * ]	 	 	 	[ * ]	 	[ * ]
	[ * ]
	 	[ * ]	 	[ * ]	 	[ * ]	 	 	 	[ * ]	 	[ * ]	 	 	 	[ * ]	 	[ * ]
	[ * ]
	 	[ * ]	 	[ * ]	 	[ * ]	 	 	 	[ * ]	 	[ * ]	 	 	 	[ * ]	 	[ * ]
	[ * ]
	 	[ * ]	 	[ * ]	 	[ * ]	 	 	 	[ * ]	 	[ * ]	 	 	 	[ * ] 	 	[ * ]

Limits

Tests are carried out in the test number order.

	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	 	 	 	 	 	 	New Tube Limits	 	 	 	End of Life Limits
	 	 	 	 	 	 	Min	 	Max	 	Units	 	Min	 	Max
	[ * ]	 	[ * ]	 	[ * ]	 	[ * ]	 	[ * ]	 	[ * ]	 	[ * ]	 	[ * ]
	[ * ]	 	[ * ]	 	[ * ]	 	[ * ]	 	[ * ]	 	[ * ]	 	 	 	 
	[ * ]	 	[ * ]	 	[ * ]	 	[ * ]	 	[ * ]	 	[ * ]	 	[ * ]	 	[ * ]
	[ * ]	 	[ * ]	 	[ * ]	 	[ * ]	 	 	 	[ * ]	 	[ * ]	 	 
	 
	 	 	 	[ * ]	 	 	 	[ * ]	 	[ * ]	 	 	 	[ * ]
	[ * ]	 	[ * ]	 	[ * ]	 	 	 	[ * ]	 	[ * ]	 	 	 	[ * ]
	[ * ]	 	[ * ]	 	[ * ]	 	[ * ]	 	 	 	[ * ]	 	[ * ]	 	 
	[ * ]	 	[ * ]	 	[ * ]	 	 	 	[ * ]	 	[ * ]	 	 	 	[ * ]
	[ * ]	 	[ * ]	 	[ * ]	 	[ * ]	 	[ * ]	 	[ * ]
	[ * ]	 	[ * ]	 	[ * ]	 	 	 	[ * ]	 	[ * ]	 	 	 	[ * ]
	[ * ]	 	[ * ]	 	[ * ]	 	[ * ]	 	[ * ]
	[ * ]	 	[ * ]	 	 	 	[ * ]	 	[ * ]	 	 	 	[ * ]
	[ * ]	 	[ * ]	 	 	 	[ * ]	 	[ * ]	 	 	 	[ * ]
	[ * ]	 	[ * ] A.
Test duration 10 minutes.	 	 	 	[ * ]	 	[ * ]	 	 	 	[ * ]
	[ * ]	 	[ * ]	 	[ * ]	 	[ * ]	 	[ * ]
	[ * ]	 	[ * ]	 	 	 	[ * ]	 	 	 	 	 	[ * ]
	[ * ]	 	[ * ]	 	[ * ]	 	 	 	[ * ]

	 	 	 	 	 
	e2v

	 	©
e2v technologies  (uk) ltd  2008

A Limited Company Registered in England No. 432014

Registered Office: 106 Waterhouse Lane, Chelmsford CM1 2QU, UK 

Holding Company: e2v technologies plc

This document is supplied by e2v technologies (uk) ltd on the express
understanding that it is
to be treated as confidential and that it may not be copied, used or
disclosed to others in
whole or in part for any purpose except as authorised in writing by e2v
technologies (uk) ltd.
	 	Approved by

[ * ]
	 

	 	 	 	Template DF763503A-3

 

 

 

Confidential treatment has been requested for portions of this exhibit. The copy filed herewith
omits the information subject to the confidentiality request. Omissions
are designated as [ * ]. A complete version of this exhibit has been filed separately with the
Securities and Exchange Commission.

			
	 	 	 
	[ * ] Technical
Spcification	 	[ * ] 

Version 1 

Page 5 of 9

Initial
Test Criteria

Additionally, tubes should be rejected for the following:

	 	•	 	[ * ]

	 	[ * ]	 	[ * ]

	 	[ * ]	 	[ * ]

Test Notes

	1.	 	A magnetron that trips the
[ * ] are count wthin [ * ] software is deemed a failure.

	 
	2.	 	Returned tubes will be aged
for approximately [ * ] minutes [ * ] Starting
with test [ * ] at
level [ * ]

	 
	3.	 	Late starting pulse (1): Measured from the oscilloscope trace of [ * ] and [ * ] The trigger level is
set to [ * ]  and a count is made if a negative edge is
seen. This [ * ]% in amplitude equates to  [ * ]% time delay. Count to be taken over a [ * ] minute period.

	 
	4.	 	Late starting pulse (2): Measured from the oscilloscope trace of [ * ] and derived
from the level of the dip in current after the capacitance-charging
spike. The trigger  level is
set to  [ * ]% of the “dip” level and a count is made if a negative edge is seen. This [ * ]%
in amplitude equates to  [ * ]%  time delay. Count to be
taken over a   [ * ] minute period.

[ * ]

	 	 	 	 	 
	e2v

	 	©
e2v technologies  (uk) ltd  2008

A Limited Company Registered in England No. 432014

Registered Office: 106 Waterhouse Lane, Chelmsford CM1 2QU, UK 

Holding Company: e2v technologies plc

This document is supplied by e2v technologies (uk) ltd on the express
understanding that it is
to be treated as confidential and that it may not be copied, used or
disclosed to others in
whole or in part for any purpose except as authorised in writing by e2v
technologies (uk) ltd.
	 	Approved by

[ * ]
	 

	 	 	 	Template DF763503A-3

 

 

 

Confidential treatment has been requested for portions of this exhibit. The copy filed herewith
omits the information subject to the confidentiality request. Omissions
are designated as [ * ]. A complete version of this exhibit has been filed separately with the
Securities and Exchange Commission.

			
	 	 	 
	[ * ] Technical Specification
	 	[ * ] 

Version 1 

Page 6 of 9

[ * ]

	 	 	 	 	 
	e2v

	 	©
e2v technologies  (uk) ltd  2008

A Limited Company Registered in England No. 432014

Registered Office: 106 Waterhouse Lane, Chelmsford CM1 2QU, UK 

Holding Company: e2v technologies plc

This document is supplied by e2v technologies (uk) ltd on the express
understanding that it is
to be treated as confidential and that it may not be copied, used or
disclosed to others in
whole or in part for any purpose except as authorised in writing by e2v
technologies (uk) ltd.
	 	Approved by

[ * ]
	 

	 	 	 	Template DF763503A-3

 

 

 

Confidential treatment has been requested for portions of this exhibit. The copy filed herewith
omits the information subject to the confidentiality request. Omissions
are designated as [ * ]. A complete version of this exhibit has been filed separately with the
Securities and Exchange Commission.

			
	 
	[ * ] Technical
Specification
	 	[ * ]

Version 1

Page 7 of 9

ENVIRONMENTAL REQUIREMENTS

	 	 	AMBIENT TEMPERATURE

	 	 	 	 
	 	 Storage and transport:

	 	[ * ]°C to [ * ]°C
	 	Operational:

	 	[ * ]°C to [
* ]°C

	 	 	Note: Ensure water is fully drained from cooling system prior to storage at low temperatures.

	 	 	 	 
	 	ATMOSPHERIC PRESSURE
	 	(Reference Standard Atmosphere USA 1974)

	 	 	 	 
	 	Storage and transport:

	 	[ * ] mbar to [ *
] mbar
	 	Operational:

	 	[ * ] mbar to [ *
] mbar. Tested by DC breakdown test ony.

	 	 	HUMIDITY

	 	 	Operational: Relative humidity shall not exceed [ *
]% for temperatures up to [ * ]°C, decreasing
linearly to [ * ]% at [ * ]°C (non-condensing).

	 	 	SHOCK (NON-OPERATING)

	 	 	Form  [ * ] conditions apply to packed magnetron.

	 	 	 	 	 
	Acceleration

	 	Duration
	 	Pulse Shape
	[ * ][ * ]

	 	[ * ]
	 	[ * ]

	 	 	VIBRATION (NON-OPERATING)

From [ * ] conditions apply to packed magnetron. This level simulates 40 hours of transportation.

	 	 	 	 	 
	Acceleration rms

	 	Hz
	 	gn2.Hz-1
	21.6 [ * ][ * ]

	 	[ * ]
	 	[ * ]

	 	 	IONISING RADIATION

	 	 	The magnetron will operate successfully when exposed to
[ * ] gray from an external source.

	 	 	EMC and EMI

	 	 	Meeting the limits is a system responsibility, and the magnetron cannot be tested as a
component.

	 	 	PACKING

	 	 	The pack will be as compact as may reasonably be achieved while complying with the
environmental specification above, and the requirements of European directive 93/339/EEC.
Also, the packing will be free of CFCs, chlorinated polymers, and reusable, or easily
recyclable.

	 	 	 	 	 
	e2v

	 	©
e2v technologies  (uk) ltd  2008

A Limited Company Registered in England No. 432014

Registered Office: 106 Waterhouse Lane, Chelmsford CM1 2QU, UK 

Holding Company: e2v technologies plc

This document is supplied by e2v technologies (uk) ltd on the express
understanding that it is
to be treated as confidential and that it may not be copied, used or
disclosed to others in
whole or in part for any purpose except as authorised in writing by e2v
technologies (uk) ltd.
	 	Approved by

[ * ]
	 

	 	 	 	Template DF763503A-3

 

 

 

Confidential treatment has been requested for portions of this exhibit. The copy filed herewith
omits the information subject to the confidentiality request. Omissions
are designated as [ * ]. A complete version of this exhibit has been filed separately with the
Securities and Exchange Commission.

			

	 
	[ * ] Technical Specification
	 	[ * ]
	 
	 	Version 1

Page 8 of 9

[ * ]

	 	 	 	 	 
	e2v

	 	©
e2v technologies  (uk) ltd  2008

A Limited Company Registered in England No. 432014

Registered Office: 106 Waterhouse Lane, Chelmsford CM1 2QU, UK 

Holding Company: e2v technologies plc

This document is supplied by e2v technologies (uk) ltd on the express
understanding that it is
to be treated as confidential and that it may not be copied, used or
disclosed to others in
whole or in part for any purpose except as authorised in writing by e2v
technologies (uk) ltd.
	 	Approved by

[ * ]
	 

	 	 	 	Template DF763503A-3

 

 

 

Confidential treatment has been requested for portions of this exhibit. The copy filed herewith
omits the information subject to the confidentiality request. Omissions
are designated as [ * ]. A complete version of this exhibit has been filed separately with the
Securities and Exchange Commission.

			
	[ * ] Technical Specification
	 	[ * ]
	 
	 	Version 1

Page 9 of 9

OUTLINE NOTES

	 	1.	 	This surface is marked with the letter ‘C’ to indicate the cathode terminal.

	 
	 	2.	 	The magnetron will fit between magnet poles [ *
]  mm diameter and [ * ] mm apart.
	 
	 	3.	 	Positional tolerance of holes [ * ]  mm diameter.
	 
	 	4.	 	Positional tolerance of holes [ * ] mm diameter.
	 
	 	5.	 	Positional tolerance of flange [ * ] mm diameter with respect to reference planes A and B.

HEALTH AND SAFETY HAZARDS

	 	 	e2v technologies magnetrons are safe to handle and operate, provided that the relevant
precautions stated herein are observed. e2v technologies does not accept responsibility for
damage or injury resulting from the use of the electronic devices it produces. Equipment
manufacturers and users must ensure that adequate precautions are taken. Appropriate warning
labels and notices must be provided on equipments incorporating e2v technologies devices and
in operating manuals.

	 	 	High voltage

	 	 	Equipment must be designed so that personnel cannot come into contact with high voltage
circuits. All high voltage circuits and terminals must be enclosed and fail-safe interlock
switches must be fitted to disconnect the primary power supply and discharge all high voltage
capacitors and other stored charges before allowing access. Interlock switches must not be
bypassed to allow operation with access doors open.

	 	 	RF Radiation

	 	 	Personnel must not be exposed to excessive RF radiation. All RF connectors must be correctly
fitted before operation so that no leakage of RF energy can occur and the RF output must be
coupled efficiently to the load. It is particularly dangerous to look into open waveguide or
coaxial feeders while the device is energised. Screening of the cathode sidearm of high power
magnetrons may be necessary.

	 	 	X-Ray Radiation

	 	 	High voltage magnetrons emit a significant intensity of X-rays not only from the cathode
sidearm but also from the output waveguide. These rays can constitute a health hazard unless
adequate shielding for X-ray radiation is provided. This is a characteristic of all
magnetrons and the X-rays emitted correspond to a voltage much higher than that of the anode.

DOCUMENT AMENDMENT RECORD

	 	 	 	 	 	 	 
	Version	 	Issue Date	 	Change Request	 	Reasons for Change
	1

	 	[ * ]
	 	[ * ]
	 	New document

	 	 	 	 	 
	e2v

	 	©
e2v technologies  (uk) ltd  2008

A Limited Company Registered in England No. 432014

Registered Office: 106 Waterhouse Lane, Chelmsford CM1 2QU, UK 

Holding Company: e2v technologies plc

This document is supplied by e2v technologies (uk) ltd on the express
understanding that it is
to be treated as confidential and that it may not be copied, used or
disclosed to others in
whole or in part for any purpose except as authorised in writing by e2v
technologies (uk) ltd.
	 	Approved by

[ * ]
	 

	 	 	 	Template DF763503A-3

 

 

 

Exhibit C

Standard Conditions of Warranty for e2v Products

e2V

The following Standard Conditions of Warranty are issued in conjunction with e2v General Terms
and Conditions of Sale for the Purchaser’s benefit and contain important information relating to
the Warranty in respect of the Product and a Return Procedure. Please read this carefully.

	1.	 	CONDITION

Except where otherwise agreed in writing, the Product shall be subject to the following
conditions of warranty.

Each Product for which a warranty is offered is guaranteed against defects in workmanship and
materials and designed to perform to its specification when operated in accordance with e2v’s
instructions. The warranty applicable to each Product is defined in a warranty code contained in
e2v’s written quotation and confirmed on e2v’s written order acknowledgement.

A warranty code is comprised of a  letter and one  or  two groups of numbers.

The letter gives the total warranty period commencing from the date of despatch of the Product
from e2v, subject to the group or groups of numbers.

	A.	 	indicates 2 years.
	 
	B.	 	indicates 18 months.
	 
	C.	 	indicates that the number following gives the warranty period in months.
	 
	E.	 	indicates 1 year.
	 
	G.	 	indicates 3 years.
	 
	H.	 	indicates 4 years.
	 
	J.	 	indicates that the number following gives the warranty period in months.

Where the letter is followed by two groups of numbers (e.g. A100/1000):

	a.	 	the first group (e.g. A 100/1000) gives the filament or high tension (HT) life in hours
within which the Product may, at e2v’s sole option, be repaired or replaced free of charge
or credited in full; except for J terms, which gives this period in
months.

	b.	 	the second group (e.g. A100/1000) gives the total warranted number of filament or HT life
in hours; except for J terms, which gives this period in months. For a Product failing with
a filament or HT life in excess of the hours specified by the first group of numbers (100)
but less than the total number of hours/months given by the second group (1000), repairs,
replacements or credit will be given on a pro-rata basis, determined by the ratio of the
unused portion of the total warranted hours to the second group of numbers, provided that
the period indicated by the letter (A = 2 years) has not expired.

Where the letter is preceded by a number (e.g. 6C24), this indicates an agreed shelf life before
use. Therefore, the warranty period begins as soon as the product is used, or at latest, six
months after delivery of the product by e2v.

Where the letter is followed by one group of numbers (e.g. C12), this gives the total warranted
period either in months for ‘C’ terms or in filament or HT hours for other terms during which, at
e2v’s sole option, the Product will be repaired, or full replacement or credit will be given.

In the unlikely event that a quotation or acknowledgement does not contain a warranty coding for
your specific Product, or in the event that you require clarification of a warranty coding,
please contact the appropriate e2v Sales Department Personnel.

	2.	 	CLAIMS

	2.1	 	Damage in Transit

	a.	 	Each Product is inspected by e2v prior to despatch and should be examined by the Purchaser
immediately on receipt.

	 
	b.	 	The carton or packing crate should be examined for signs of damage and the Carrier’s note
endorsed accordingly. If inspection is not
possible at this stage the item should be signed for as “unexamined”. The Product must then be
unpacked with minimum delay and, after
inspection for damage to its glasswork or internal structure, an electrical test applied. Where
a static test is impracticable, a functional test in
its intended equipment is recommended.

	 
	c.	 	Where damage in transit is suspected, the original packing materials should be retained to
return the product. If the Product has been
damaged in transit, and if e2v has arranged the insurance cover on behalf of the Purchaser, the
Purchaser should, within 7 days of receipt of the Product, either (a) inform the nearest Lloyds Representative, or (b) notify e2v, who will
file an insurance claim. If insurance has been
arranged by the Purchaser, then the Purchaser should deal with this in his usual way.

	2.2	 	Conditions of Warranty

This
warranty is valid only if the following conditions are met:

	a.	 	The Product has been supplied directly by e2v or via a distributor, representative or other
selling medium authorised by e2v.
	 
	b.	 	The Product has been operated within its specification and in accordance with e2v instructions.

	 
	c.	 	The Product has not been subjected to any accident, abuse, alteration, misuse or neglect in
storage, transportation, handling or use.
	 
	d.	 	The return procedure specified in Paragraph 3 below is followed.
	 
	e.	 	The decision of e2v on the cause of failure and on the value and form of any applicable
allowances is accepted by the Purchaser.
	 
	f.	 	Right of access to equipment for the purpose of checking operating conditions is granted to
any representative of e2v where e2v may so require.
	 
	g.	 	e2v is notified within 30 days of the Product failure.
	 
	h.	 	The Product is withdrawn from service as soon as possible after the alleged failure has
occurred.

2.3 Limitation of Liability

Unless expressly stated in a separate written agreement between e2v and the Purchaser, this
warranty defines fully the extent of e2v’s liability for the Product and shall be in lieu of any
warranty condition or liability express or implied by law or otherwise, including warranties of
merchantability and fitness for a particular purpose which are hereby expressly excluded. The sole
obligation of e2v under this warranty is to carry out repairs, supply replacement Products or give
credit as specified herein. In no event shall e2v be liable for consequential damage howsoever
arising. In the event of any conflict between the original English version and the French and
German or other translations of this document, the English version shall prevail.

	 	 	 
	© e2v technologies plc and subsidiaries 2006, 2008	 	11555A-6, Page 1

 

 

 

	3.	 	RETURN PROCEDURE

The return procedure specified below must be followed if returning a product under warranty:

	3.1	 	A Product Service Report Form, which is despatched with the product, must be completed giving
all information requested and noting, in Particular, any unusual occurrences before or at the time of failure. The Form must be
returned with the returned product.

	 
	3.2	 	The returned product should be packed in the same manner as
originally, preferably by use of the same packaging materials. If the purchaser cannot provide suitable packing it can be provided at the purchaser’s expense.

	 
	3.3	 	The returned product must be insured and carriage paid by the Purchaser, and e2v accepts no
responsibility for loss of, or damage to, a returned product during transit.

	 
	3.4	 	If repair or replacement is offered, the Purchaser will be notified in writing and the
product will be despatched, carriage and insurance paid, to destinations within the United
Kingdom or to a suitable United Kingdom port of embarkation in the case of overseas
Purchasers.

	 
	3.5	 	Where credit is offered in settlement of a claim such credit shall, in all cases, unless
otherwise agreed, be based on the FCA (UK Port or Airport) INCOTERMS 2000 selling price of
the product for overseas Purchasers, or on the net delivered price for Purchasers within the
United Kingdom. If the returned Product is not defective and is still serviceable, it will be
returned at the Purchaser’s expense.

	 
	3.6	 	It may be necessary for an inoperative product to be dismantled by e2v to determine the
cause of failure and permission for this to be done is granted automatically by the Purchaser
in returning the Product. An inoperative product will only be returned to the Purchaser at
his expense if no repair, credit or replacement can be allowed. Where credit or replacement
is allowed, the returned Product shall become the property of e2v.

	4.	 	 RE-WARRANTY

Products that have been repaired or replaced under warranty will be re-warranted to the end of the
original period of warranty of the repaired or replaced product or for three months, whichever is
longer. The expiry of the original period of warranty for the purposes of re-warranty will be
extended to take account of the duration of the interruption of use as a result of the failure
under warranty.

 

 

 

Exhibit D

TOMO Subscription Database

Confidential treatment has been requested for portions of this exhibit. The copy filed herewith
omits the information subject to the confidentiality request. Omissions are designated as [ * ]. A
complete version of this exhibit has been filed separately with the Securities and Exchange
Commission.

	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	Equipment

	 	DIST #
	 	S/N
	 	ATP

Date
	 	Home

RSL
	 	Region
	 	Regional

Manager
	 	Senior FSE
	 	FSE
	 
	 

	 	 
	 	 
	 	 
	 	 
	 	[ * ]	 	 
	 	 
	 	 

 

 

 

EXHIBIT E

Pricing

Pricing for the MSP

Subject to the provisions of the Agreement, including all Exhibits thereto, which provide for
mechanisms to adjust the pricing scheme of the MSP, the pricing shall be as follows:

Year 1: [ * ]/System/year (minus the [ * ]% e2v buy-in credit only applicable on Systems
converted to the MSP on the Effective Date resulting in a Price for these of [ * ]/System/year)

Year 2: [ * ]/System/year

Year 3: [ * ]/System/year

Year 1 will begin on the Effective Date and run one calendar year from that point.

For the term of this Agreement, the TXP is [ * ].

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