-----BEGIN PRIVACY-ENHANCED MESSAGE----- Proc-Type: 2001,MIC-CLEAR Originator-Name: webmaster@www.sec.gov Originator-Key-Asymmetric: MFgwCgYEVQgBAQICAf8DSgAwRwJAW2sNKK9AVtBzYZmr6aGjlWyK3XmZv3dTINen TWSM7vrzLADbmYQaionwg5sDW3P6oaM5D3tdezXMm7z1T+B+twIDAQAB MIC-Info: RSA-MD5,RSA, NLhL5R/3JxL68BC/Le+x9I3STEMJ8y7BMg/lMHJWe48QYKCk4z93f+0dEj5BESNe TbM9EsHrFDIOoZFduoDeRg== 0000932631-97-000020.txt : 19971020 0000932631-97-000020.hdr.sgml : 19971020 ACCESSION NUMBER: 0000932631-97-000020 CONFORMED SUBMISSION TYPE: 10-K405/A PUBLIC DOCUMENT COUNT: 5 CONFORMED PERIOD OF REPORT: 19961231 FILED AS OF DATE: 19971017 SROS: NASD FILER: COMPANY DATA: COMPANY CONFORMED NAME: OSTEX INTERNATIONAL INC /WA/ CENTRAL INDEX KEY: 0000932631 STANDARD INDUSTRIAL CLASSIFICATION: IN VITRO & IN VIVO DIAGNOSTIC SUBSTANCES [2835] IRS NUMBER: 911450247 STATE OF INCORPORATION: WA FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: 10-K405/A SEC ACT: SEC FILE NUMBER: 000-25250 FILM NUMBER: 97697104 BUSINESS ADDRESS: STREET 1: 2203 AIRPORT WY S STREET 2: STE 400 CITY: SEATTLE STATE: WA ZIP: 98134 BUSINESS PHONE: 2062928082 MAIL ADDRESS: STREET 1: 2203 AIRPORT WAY STREET 2: SUITE 400 CITY: SEATLE STATE: WA ZIP: 98134 10-K405/A 1 SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 FORM 10-K/A PURSUANT TO SECTION 13 OR 15(D) OF THE SECURITIES EXCHANGE ACT OF 1934 ----- ----- X ANNUAL REPORT ----- FOR THE FISCAL YEAR ENDED DECEMBER 31, 1996 -- or -- ----- TRANSITION REPORT ----- FOR THE TRANSITION PERIOD FROM ____ TO ____ ------------------------------- OSTEX INTERNATIONAL, INC. NAME OF REGISTRANT AS SPECIFIED IN ITS CHARTER 0-25250 COMMISSION FILE NUMBER STATE OF WASHINGTON STATE OR OTHER JURISDICTION OF INCORPORATION OR ORGANIZATION 91-1450247 I.R.S. EMPLOYER IDENTIFICATION NUMBER 2203 AIRPORT WAY SOUTH, SUITE 400, SEATTLE, WASHINGTON 98134 206-292-8082 ADDRESS AND TELEPHONE NUMBER OF PRINCIPAL EXECUTIVE OFFICES Securities registered pursuant to Section 12(b) of the Act: (none) (none) Title of Class Each Exchange on Which Registered Securities registered pursuant to Section 12(g) of the Act: COMMON STOCK, $.01 PAR VALUE Title of Class Indicate by checkmark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes X No ---- ---- Indicate by check mark if disclosure of delinquent filers pursuant to Item 405 of Regulation S-K is not contained herein, and will not be contained, to the best of registrant's knowledge, in definitive proxy or information statements incorporated by reference in Part III of this Form 10-K or any amendment to this Form 10-K. X ---- This amendment is filed to correct portions of the Exhibit Index and redactions in exhibits 10.4A, 10.4B, 10.15A, and 10.15B. (C) EXHIBIT INDEX (7) Exhibit Number Description ------- --------------------------------------------------- 3.1 Articles of Incorporation, as amended, dated January 1997. (1)3.2 Bylaws, as amended (1)4.1 Specimen Common Stock Certificate Stock Purchase Agreements ("Terms and Provisions" included in Exhibit 3.1) (1)4.2A Series A Stock Purchase Agreement dated September 1989 (1)4.2B Series B Stock Purchase Agreement dated June 1992 (1)4.2C Series C Stock Purchase Agreement dated August 1993 (1)4.3 Form of CS First Boston Corporation Warrant (1)4.4 Form of Invemed Associates, Inc. Warrant (2)4.5 Shareholder Rights Agreement dated January 21, 1997 (1)10.1A Amended and Restated Stock Option Plan (1)10.1B Form of Employee Stock Option Agreement (1)10.1C Form of Director's Stock Option Agreement (1)10.2 Directors' Nonqualified Stock Option Plan (1)10.3 1994 Stock Option Plan Agreements with Hologic, Inc. (3)10.4A Co-Promotion and Sales Representation Agreement dated January 14, 1997 (3)10.4B Joint Development, License and Supply Agreement dated January 14, 1997 (1)10.5 Form of Indemnification Agreement with officers and directors (1)10.6 Form of Employee Confidentiality and Invention Agreement Agreements with H. Raymond Cairncross (1)10.7A Employment Agreement dated April 15, 1994 (1)10.7B Stock Option Agreements dated June 6, 1991, July 1, 1993, July 1, 1994, April 15, 1994 (1)10.9 Asset Purchase and Sale Agreement dated May 31, 1994 with Hybrilogic Corporation (1)10.10 Cooperation Agreement dated August 11, 1993 with Merck & Co., Inc. Agreements with Mochida Pharmaceutical Co., Inc. (1)10.12A Research and Development Agreement dated August 1992 (1)10.12B Osteomark License Agreement Dated August 1992 (1)10.12C Stock Purchase Agreement dated November 22, 1994 Agreements with The Washington Research Foundation (1)10.13A Restated Exclusive License Agreement effective June 19, 1992 (Urinary Assay for Measuring Bone Resorption) (1)10.13B Amendment to Restated Exclusive License Agreement effective January 1, 1993 (1)10.13C Second Amendment effective June 2, 1994 (1)10.14 Exclusive License Agreement dated February 10, 1994 (O-CSF) Exhibit Number Description ------- --------------------------------------------------- Agreements with the University of Washington (3)10.15A Research Agreement dated July 1, 1996 (Molecular Markers of Connective Tissue Degradation) (3)10.15B Research Agreement dated October 1, 1996 (Role of O-CSF in Osteoclast Regulation) (1)10.16A Know-How Transfer and Consulting Agreement dated September 18, 1989 with David R. Eyre, Ph.D. (1)10.16B Extension and Amendment dated May 1, 1992 (1)10.17 Amended and Restated Know-How Transfer and Consulting Agreement dated February 22, 1993 with Minako Y. Lee, M.D. (1)10.19 Osteomark EIA Exclusive Distribution License Agreement dated March 28, 1994 with Technogenetics S.R.L. (division of Recordati Pharmaceutical) (1)10.20 Osteomark EIA Distribution License Agreement dated July 12, 1994 with BRAHMS Diagnostic (formerly Henning Berlin GMBH) (1)10.21 Osteomark EIA Exclusive Distribution License Agreement dated May 4, 1994 with Shield Diagnostics (Limited) (1)10.22 Osteomark EIA Exclusive Distribution License Agreement dated July 1, 1994 with DSL Diagnostic Products, Inc. (dba INTER Medico) (1)10.23 Osteomark Agreement dated February 12, 1993, as amended May 10, 1994, with Nichols Institute Reference Laboratory (1)10.24 Osteomark EIA Exclusive Distribution License Agreement dated September 1, 1994 with Immuno Diagnostics (1)10.25 License Agreement dated July 8, 1994 with Endrocrine Sciences (1)10.26 License Agreement dated August 1994 with Pacific Biometrics, Inc. Lease Agreements (4)10.27A Lease Agreement dated October 2, 1995, with David A. Sabey and Sandra L. Sabey 10.27B First Amendment of Lease dated October 15, 1996, with the City of Seattle, successor-in-interest to David A. Sabey and Sandra L. Sabey Agreements with Johnson & Johnson Clinical Diagnostics, Inc. (5)10.28A Distribution Agreement dated June 7, 1995 (5)10.28B Research, Development, License and Supply Agreement dated June 7, 1995 (4)10.29 Clinical Laboratory Services License and Supply Agreement dated October 25, 1995, with SmithKline Beecham Clinical Laboratories, Inc. Exhibit Number Description ------- --------------------------------------------------- (4)10.30 Promotion Agreement dated September 20, 1995 with Wyeth-Ayerst Laboratories (6)10.31 Agreement with Laboratory Corporation of American Holdings (LabCorp), dated January 11, 1996 13.0 Annual Report to stockholders for the year-ended December 31, 1996 27.1 Financial Data Schedule Notes to the Exhibits. (1) Incorporated herein by reference from Item 16(a) of Registrant's Form S-1 Registration Statement as declared effective January 24, 1995 (No. 33-86118). (2) Incorporated herein by reference from Form 8-A filed with the S.E.C. in January 1997. (3) Confidential treatment requested. Exhibit omits information that has been filed separately with the Securities and Exchange Commission. (4) Incorporated herein by reference from Form 10-K filed with the S.E.C for the year ended December 31,1995. (5) Incorporated herein by reference from Form 10-Q filed with the S.E.C for the quarter ended June 30, 1995. (6) Incorporated herein by reference from Form 10-Q filed with the S.E.C. for the quarter ended March 31, 1996. (7) Copies of exhibits may be obtained at prescribed rates from the Public Reference Section of the Securities and Exchange Commission at 450 5th Street NW, Room 1024, Washington, D.C., 20549. SIGNATURES Pursuant to the requirements of Section 13 or 15(d) of the Securities Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned. OSTEX INTERNATIONAL, INC. By /S/ THOMAS A. BOLOGNA ---------------------------- Thomas A. Bologna President, Chief Executive Officer and Member of the Board of Directors Pursuant to the requirements of the Securities Exchange Act of 1934, this report has been signed below by the following persons on behalf of the Registrant and in the capacities and on the dates indicated. SIGNATURE CAPACITIES DATE --------- ---------- ---- /S/ THOMAS A. BOLOGNA President, Chief Executive Officer - ------------------------- and Member of the Board of Directors October 16, 1997 Thomas A. Bologna (principal executive officer) /S/ Robert M. Littauer Senior Vice President, October 16, 1997 - ------------------------- Finance and Administration Robert M. Littauer (principal financial and principal accounting officer) EX-10.4A 2 Note: Confidential treatment requested. Exhibit omits information that has been filed separately with the Securities and Exchange Commission. CO-PROMOTION AND SALES REPRESENTATION AGREEMENT This Co-Promotion and Sales Representation Agreement (this "Agreement") is entered into as of the 14th day of January, 1997 ("Effective Date"), by and between HOLOGIC, INC., a Delaware corporation having its principal place of business at 590 Lincoln Street, Waltham, MA 02154 ("Hologic" or "Company"), and OSTEX INTERNATIONAL, INC., a Washington corporation having its principal place of business at 2203 Airport Way South, Suite 400, Seattle, Washington 98134 ("Ostex" or Representative). 1. FACTS A. Hologic engages in the research, development, manufacture, sale, and lease of diagnostic equipment and other products in the field of bone metabolism, including its line of QDR bone densitometers. Hologic sells this line of bone densitometers to physician offices, clinics, hospitals and other medical settings to measure the density and strength of the subject's bones as an aid in the diagnosis of osteoporosis and other bone diseases. B. Ostex has developed its proprietary immunoassay Osteomark(R) to determine the levels of the NTx epitope collagen metabolite resulting from bone resorption ("NTx Assay"), which it has implemented and sells in a microtiter format. ("Osteomark(R) Laboratory Test"). Ostex sells its Osteomark(R) Laboratory Test to clinical laboratories, physician offices, clinics, hospitals and other medical settings for the purpose of measuring the rate of bone resorption or breakdown of the subject's bones as an aid in the management of osteoporosis and other bone diseases. C. The parties believe that their products are complementary to each other, and wish to enter into this Co-Promotion and Sales Agency Agreement under which (1) Ostex will act, in the Territory, as the sales agent for a package of products consisting of a Strategic Alliance ("Fee Per Scan") Leasing Contract for Hologic's QDR 4500 product and a certificate redeemable for performance of a defined number of Osteomark(R) Laboratory Tests; and (2) the parties will jointly promote their QDR and Osteomark(R) products in the Territory as an integrated approach to the diagnosis and management of osteoporosis, will establish a committee to coordinate their joint activities, and will take certain other steps; all as described herein. D. The parties have entered into simultaneously with this Agreement that certain Joint Development, License and Supply Agreement providing for the development and sale of an NTx Meter System for point of care use in accord with the terms set out therein (the "Development Agreement"). 2. DEFINITIONS (a) "Promotional Package," as used in this Agreement, means a package consisting of a Strategic Alliance ("Fee Per Scan") Leasing Contract for the Hologic QDR product and an Osteomark(R) Laboratory Certificate, as described in Attachment A which is attached hereto and incorporated herein. (b) "QDR Component" as used in this Agreement, means a Strategic Alliance ("Fee Per Scan") Leasing Contract for the Hologic QDR product specified in Attachment A hereto. (c) "Osteomark(R) Laboratory Test" as used in this Agreement, means an immunoassay to determine levels of the NTx epitope collagen metabolite resulting from bone resorption ("NTx Assay"), as marketed and sold by Ostex in a microtiter format to centralized laboratories ("Osteomark(R) Laboratory Test"). (d) "Osteomark(R) Laboratory Certificate" as used in this Agreement, means a certificate redeemable for performance of a number of Osteomark(R) Laboratory Tests, as described in Attachment A hereto. (e) "Territory," as used in this Agreement means the United States of America. (f) "First Commercial Sale" means the first Sale of a NTx Meter System pursuant to the Development Agreement for value in an arms length transaction with an independent third party following approval for sale by the United States Food and Drug Administration of the NTx Meter System. (g) "Confidential Information" means (a) any and all normally non-public information communicated or disclosed by one party ("Discloser") to the other party ("Recipient") describing or relating to the Disclosing Party's business and marketing plans and strategies, financial information, or customer information, and (b) any and all information communicated or disclosed by the Discloser to Recipient describing or relating to the Disclosing Party's research and development, Know-How, inventions, trade secrets, technical data, formulae, drawings, designs, software, models, samples, kits, processes, product development data and information and other data and information related to the business of Discloser, labeled or specified in writing as "Confidential" or the equivalent, or if orally disclosed, labeled "Confidential" or the equivalent, and reduced to writing within thirty (30) days of such oral disclosure; provided, however, that "Confidential Information" shall not be deemed to include information which the Recipient can demonstrate by written proof: (i) is now, or hereafter becomes, through no fault on the part of the Recipient, generally known or available; (ii) is known by the Recipient at the time of receiving such information; (iii) is furnished to others by Discloser without restriction on disclosure; (iv) is hereafter furnished to the Recipient by a third party unrelated to Discloser, as a matter of right and without any breach of any duty of non-disclosure; (v) is independently developed by the Recipient without use of or reference to any Confidential Information; or (vi) is the subject of express written permission to disclose provided by Discloser. Without limiting the generality of the foregoing, Confidential Information may include information developed during the course of this Agreement. 3. MARKETING COMMITTEE AND OTHER JOINT ACTIVITIES (a) Immediately upon execution of this Agreement, the parties shall form a marketing committee ("Marketing Committee") with two (2) named representatives each from Hologic and Ostex, to oversee and coordinate the joint marketing, promotional, sales, and other activities required or authorized by this agreement. The Marketing Committee shall meet at least quarterly, and shall attempt to operate by consensus, but failing consensus shall operate by majority vote. All tie votes shall be finally resolved by a committee chairman. The chairmanship shall alternate annually between representatives of the parties. One of Hologic's representatives shall serve as chairman during the first year of this Agreement, one of Ostex's the second year and so on. The Marketing Committee may delegate certain of its functions to subcommittees or individual members. Each party shall each cause its representatives on the Marketing Committee to attempt to work to promote the goals of this Agreement, and most particularly to advance the parties' mutual products and technologies as complementary approaches for the diagnosis, management and treatment of osteoporosis (the "Goals"). (b) Within thirty (30) days after the Effective Date, the Marketing Committee shall prepare a written plan for the first year period of this Agreement under which the parties shall undertake specified activities to jointly promote the Goals and to support sales of the Promotional Package, together with a proposed annual budget therefor, and an allocation of tasks between the parties ("Marketing Plan"). At least sixty (60) days prior to the end of the first year period of this Agreement, and each subsequent year period, the Marketing Committee shall prepare a follow-on Marketing Plan to cover such upcoming year. It is anticipated that said Marketing Plan shall include but not be limited to (i) development and distribution of one or more joint brochures, and possibly other materials, (ii) a program of joint advertising and public relations, and (iii) a plan to promote the Goals with opinion leaders, and generally, in the medical and managed care communities. For the first year period, it is anticipated that the joint budget for such Marketing Plan shall approximate XXXXXXXXXXXXXXXXXXXXXXX. (c) Within sixty (60) days after the Effective Date, the Marketing Committee shall also establish a plan and a budget under which the parties shall collaborate to establish a database supporting the Goals, with the pre-approved costs thereof to be shared equally by the parties and which database the parties anticipate shall be owned jointly by the parties. (d) Except as specified in Section 3(c) above, the parties shall share the costs of all joint activities undertaken pursuant to the Marketing Plan (to the extent approved in writing in advance by the Marketing Committee) on the basis of XXX to Ostex, and XXX to Hologic. The Marketing Committee shall establish an appropriate mechanism to implement such cost sharing, under which each party shall be responsible for payment of specific costs for specific joint activities and shall report such costs to the other party on a periodic basis, and the parties shall reconcile and remit amounts payable to each other on a quarterly basis, or on such other basis as the Marketing Committee may determine. The parties specifically acknowledge that this cost sharing arrangement is not intended to apply to either party's individual marketing efforts relating to its own products, or to limit (or expand) either party's rights to promote its technology or its approach to the diagnosis, management and treatment of osteoporosis. For the purposes of this paragraph, costs to be shared exclude employee compensation, fringe benefits and division or corporate overhead. Sharable costs include but are not limited to agency fees relating to designing and printing literature, payment to public relations firms, and spokesman honoraria. 4. APPOINTMENT. Hologic hereby appoints Ostex and Ostex hereby agrees to act as Hologic's non-exclusive sales representative in the Territory for the purpose of promoting, and soliciting orders for, the Promotional Package for the account of Hologic at such prices and upon such terms and conditions as may be from time to time specified by Hologic. Except as provided herein, Ostex shall have no other right to promote or solicit orders for the Promotional Package for installation outside of the Territory, or for any other Hologic product. 5. OBLIGATIONS OF OSTEX. Ostex shall: (a) Use reasonable efforts to promote sales of and to secure and present to Hologic orders for the Promotional Package in the Territory, in accord with the directions of the Marketing Committee described below. It is anticipated that Ostex will inform and assign all of its sales people in the Territory to represent the Promotional Package, will provide appropriate training in conjunction with Hologic, will use its usual marketing efforts to promote the Promotional Package, and will inform and involve Hologic's sales force as reasonably necessary and appropriate to obtain such orders. (b) Meet the performance goals set out in Exhibit B hereto. (c) Provide to the Marketing Committee on or before the fifteenth calendar day of each calendar quarter, a written Business Report containing (i) a summary of marketing and promotional activities related to the Promotional Package undertaken during the prior quarter (ii) an order forecast listing prospective customers, products, quantity, and dollar volume of orders under consideration, and indicating timing and probability of each prospect; and (iii) an identification of any actions required to obtain such orders. The Marketing Committee will agree on a format and reporting form for said information and forward such to Ostex at least 30 days prior to the first reporting date. (d) Not incur any liability on behalf of Hologic, nor in any way pledge or purport to pledge Hologic's credit; nor describe or hold itself out as an employee of Hologic, nor describe itself other than as a representative for Hologic for the performance of functions specified in, and pursuant to, this Agreement; nor make any claims, warranties or representations with respect to the QDR Component except as previously approved in writing by Hologic; and (e) Not advertise the Promotional Packages or distribute any printed matter referring to the Promotional Package or to the QDR Component without the Marketing Committee's specific prior approval in writing. All advertising by Ostex shall be without recourse to Hologic for any expense incurred unless such expense shall have been specifically authorized in writing by the Marketing Committee. 6. OBLIGATIONS OF HOLOGIC. Hologic shall: (a) Be solely responsible for the actual sales of the Promotional Package, as well as all installation, in-service application customer training, support, warranty, and after-warranty service of all units of the QDR Component ordered by reason of this Agreement. Hologic reserves the right, in its absolute and sole discretion, at any time and from time to time, to decline the acceptance of any order transmitted to it by Ostex or through Ostex's efforts. All credit appraisal of potential customers, risk of credit extended to such customers and collections pursuant to such credit extensions shall be the sole responsibility of Hologic. In no event shall Ostex accept any order or otherwise attempt to bind Hologic for the sale of any Promotional Package(s) unless specifically asked by Hologic, in writing, to do so. All remittances by the customer shall be made directly to the order of Hologic and transmitted by the customer directly to Hologic. (b) Provide to the Marketing Committee on or before the fifteenth calendar day of each calendar quarter, a written Business Report containing (i) a summary of marketing and promotional activities related to the Promotional Package undertaken during the prior quarter (ii) an order forecast listing prospective customers, products, quantity, and dollar volume of orders under consideration, and indicating timing and probability of each prospect; and (iii) an identification of any actions required to obtain such orders. (c) Upon request, provide reasonable training to Ostex's sales force respecting the QDR Component and the Promotional Package, and participate with Ostex in training for Ostex's sales force respecting the Goals. Hologic shall also invite and permit Ostex to provide reasonable similar training to Hologic's sales force respecting the Osteomark(R) Laboratory Test and the Goals. (d) Upon request, provide reasonable sales and account support to Ostex's sales force as appropriate to promote the Promotional Package and the Goals, and to obtain orders therefor. Said sales and account support shall include but not be limited to maintenance of one or more telephone help lines to answer Ostex sales questions about the QDR Component, development with Ostex of appropriate instructional handouts, proforma financial statements and other promotional materials, and direct assistance with any slow-moving sales; all as agreed by the parties through the Marketing Committee. (e) Reserve the right, in its absolute and sole discretion, at any time and from time to time to recommend to the Marketing Committee, to discontinue, modify, alter or improve the Promotional Package, always providing Ostex with reasonable notice thereof. (f) Notify Ostex of current prices relating to Promotional Packages, and any changes in the prices therefor. At no time shall the title to any Promotional Packages be transferred to or vested in Ostex, but shall remain in Hologic at all times until transferred to a customer. 7. COMMISSIONS. (a) Hologic shall pay to Ostex, in full compensation for its services performed pursuant hereto, the commissions provided for in Attachment B hereto. Commissions shall be payable upon Hologic receipt of the associated lease installment or price due. Payment shall be made on or before the forty fifth (45th) day following the end of the first three month period of the term of the Fee Per Scan Lease Contract described in Exhibit A hereto. 8. INDEPENDENT CONTRACTOR - EXPENSES. (a) Each party is engaged in business as an independent sales representative, and the parties acknowledge and agree that each party, in the performance of its duties and obligations pursuant to this Agreement, shall be acting as an independent contractor and not as an employee of the other. (b) Except as otherwise specifically provided in this Agreement, each party shall bear all expenses incurred by it in acting hereunder, including (without limiting the generality of the foregoing) all office expenses, traveling and entertainment expenses, postage and salaries of salesmen and other personnel, as well as all advertising and promotional expenses. 9. TERM AND TERMINATION. (a) This Agreement shall be effective as of the date hereof and shall extend for a period extending until First Commercial Sale of an NTx Meter System pursuant to the Joint Development, License and Supply Agreement simultaneously entered into between the parties. The parties may extend this Agreement by mutual consent in writing at any time prior to its expiration, and will negotiate in good faith to extend this co-promotion effort to cover the NTx Meter Test which is the subject of the associated Development Agreement. (b) Either party may terminate this Agreement, entirely in its discretion and without liability therefor, by giving to the other party ninety (90) days advance written notice, or upon written notice if the Joint Development, License, and Supply Agreement is terminated for any reason. (c) Either party may terminate this Agreement for material defaults of the other party, effective thirty (30) days following written notice to the defaulting party, unless within said thirty (30) days, the party receiving the notice remedies the default. (d) Hologic may terminate this Agreement, effective on sixty (60) days notice (and opportunity to cure), in the event that Ostex has not presented orders for an average of three (3) Promotional Packages (or QDR Systems) per month during each month of the Agreement, beginning after the first three months thereof. (e) Notwithstanding the foregoing, either party may terminate this Agreement upon notice, effective immediately, in the event of the bankruptcy or insolvency of the other party, or if the other party enters into a composition with its creditors. (f) In the event of the termination of this Agreement by Hologic, Ostex shall be entitled to receive commissions for Promotional Packages sold within thirty (30) days following the termination of this Agreement. (g) Upon termination of this Agreement, each party shall promptly return all technical information and literature relating to the other party's component of the Promotional Packages, including price lists, samples, documents and papers. (h) At any time following ninety (90) days after the Effective Date, either party may notify the other that this Agreement is not fulfilling the notifying party's business goals, and ask that this Agreement be modified to meet these goals. In this case, the parties shall meet and negotiate in good faith to modify this agreement appropriately. At this time the parties may agree to convert this Agreement to provide that Ostex will provide lead generation services rather than act as a sales representative providing orders, with appropriate adjustments to fees and the program as a whole. 10. WARRANTIES AND LIABILITIES; INDEMNITY (a) Except as expressly set forth in each party's warranty and sales literature accompanying its component of the Promotional Packages (and accordingly subject to all conditions and limitations set forth therein), EACH PARTY MAKES, AND THE OTHER PARTY AND ITS CUSTOMERS RECEIVE, NO WARRANTIES, EXPRESS OR IMPLIED, INCLUDING WITHOUT LIMITATION NO WARRANTIES OF MERCHANTABILITY OR FITNESS FOR A PARTICULAR PURPOSE OR AGAINST INFRINGEMENT. (b) Ostex hereby agrees to indemnify, defend and hold harmless Hologic from and against all liability, damages or loss and from any claims, proceedings, suits, demands, recoveries or expenses arising out of, based on, or allegedly caused by, or in connection with any product manufactured by Ostex and distributed pursuant to this Agreement (other than the QDR Product), including but not limited to performance of an Ostex Laboratory Test upon redemption of a Osteomark(R) Laboratory Certificate ("Ostex Product"), or any product claim made or allegedly made in connection therewith. This indemnity shall not apply to any product claim made by Hologic with respect to an Ostex Product , which claim is not contemporaneously made by Ostex, or approved in writing by the Marketing Committee or Ostex. (c) Hologic hereby agrees to indemnify, defend and hold harmless Ostex from and against all liability, damages or loss and from any claims, proceedings, suits, demands, recoveries or expenses arising out of, based on, or allegedly caused by, or in connection with any product manufactured by Hologic and distributed pursuant to this Agreement (other than an Ostex Product), including but not limited to the QDR Component and Hologic's line of QDR bone densitometers ("Hologic Product"), or any product claim made or allegedly made in connection therewith. This indemnity shall not apply to any product claim made by Ostex with respect to an Hologic Product , which claim was not contemporaneously made by Hologic, or approved in writing by the Marketing Committee or Hologic. Hologic further indemnifies and holds Ostex harmless from any third-party claims arising from or relating to any financial default by a customer of a Hologic Product. 11. LIMITATION OF LIABILITY. IN NO EVENT SHALL EITHER PARTY BE LIABLE TO THE OTHER PARTY OR THE OTHER PARTY'S DIRECTORS, OFFICERS, CONSULTANTS, EMPLOYEES, AGENTS, REPRESENTATIVES OR CUSTOMERS FOR ANY INDIRECT, SPECIAL OR CONSEQUENTIAL LOSSES OR DAMAGES, IRRESPECTIVE OF THE CAUSE THEREOF. 12. DEFENSE OF THIRD-PARTY CLAIMS AND INDEMNITY. (a) HOLOGIC DEFENSE OF THIRD-PARTY CLAIMS AND INDEMNITY. In the event that any claim, suit, or other legal proceeding is threatened or commenced against Ostex that is founded, in whole or in part, on an allegation that the Hologic Product infringes any trade secret, patent, or copyright belonging to a third party, Ostex will give Hologic prompt written notice of such legal proceeding and Hologic may elect to assume sole control of the defense to or settlement of such dispute. Ostex shall cooperate fully with Hologic in any defense, settlement or compromise made by Hologic. Ostex shall not enter into any settlement agreement or other voluntary resolution of any such claim, suit, or other legal proceeding without obtaining Hologic's prior written consent thereto. If Ostex has complied fully with the procedures set forth in this Section 12, Hologic will indemnify and hold Ostex harmless from and against any loss, cost, damage, or other expenses incurred by Ostex as a result of such claim, suit or legal proceeding. This indemnification provision shall be null and void and Hologic shall have no liability to the extent that any claim is based on any use of the Ostex Product, or if Ostex or WRF, or their Affiliates have any interest in the claim, suit or other legal proceeding, or any license to any right so asserted. (b) OSTEX DEFENSE OF THIRD-PARTY CLAIMS AND INDEMNITY. In the event that any claim, suit, or other legal proceeding is threatened or commenced against Hologic that is founded, in whole or in part, on an allegation that the Ostex Product infringes any trade secret, patent, or copyright belonging to a third party, Hologic will give Ostex prompt written notice of such legal proceeding and Ostex may elect to assume sole control of the defense to or settlement of such dispute. Hologic shall cooperate fully with Ostex in any defense, settlement or compromise made by Ostex. Hologic shall not enter into any settlement agreement or other voluntary resolution of any such claim, suit, or other legal proceeding without obtaining Ostex's prior written consent thereto. If Hologic has complied fully with the procedures set forth in this Section 12, Ostex will indemnify and hold Hologic harmless from and against any loss, cost, damage, or other expenses incurred by Hologic as a result of such claim, suit or legal proceeding. If a final injunction is obtained against Hologic's use of the Ostex Product, or if in the opinion of Ostex the Ostex Product is likely to become the subject of a successful claim of infringement, Ostex may, at its option and expense, (i) procure for Hologic the right to continue distributing and/or using the Ostex Product, (ii) replace or modify the Ostex Product so that it becomes non-infringing, or (iii) if neither (i) or (ii) are reasonably available, accept return of the Ostex Product held in inventory by Hologic and those laboratories which have entered into agreements to accept Osteomark(R) Laboratory Certificates, and terminate this Agreement without further obligation or liability. This indemnification provision shall be null and void and Ostex shall have no liability to the extent that any claim is based on any use of the Hologic Product, or if Hologic, or its Affiliates have any interest in the claim, suit or other legal proceeding, or any license to any right so asserted. 13. NON ASSIGNMENT. This Agreement shall be binding upon and inure to the benefit of the parties hereto and their respective successors and assigns; provided that any assignment or transfer of this Agreement or any of the rights or obligations hereunder by either party without the written consent of the other shall be void and of no effect. Such written consent shall not be unreasonably withheld. 14. CONFIDENTIALITY PROVISIONS. (a) Recipient shall not at any time, during and for a period of three (3) years following the termination of this Agreement, disclose or otherwise make known or available to any person, firm, corporation, or other entity other than Discloser any Confidential Information received from the other party without the express prior written consent of that other party. With respect to Confidential Information developed under this Agreement and which is not Confidential Information of one party only, neither party shall disclose or otherwise make such Confidential Information known or available to any person, firm, corporation, or other entity without the express prior written consent of the other party, not to be unreasonably withheld or delayed. Recipient shall utilize reasonable procedures to safeguard Confidential Information, including releasing Confidential Information only to its employees on a "need to know" basis. Nothing in this Agreement shall prevent Recipient from disclosing Confidential Information to government agencies for regulatory purposes. (b) Recipient shall not make any use, directly or indirectly, of any Confidential Information of the other party except in the ordinary course of business pursuant to this Agreement or any other specific, written agreement entered into between Ostex and Hologic. (c) The parties acknowledge that: (a) the covenants set forth in this Section 14 are essential to the activities contemplated by this Agreement; (b) but for the agreement of each party to comply with such covenants, neither party would have entered into such activities; (c) each party has consulted with or has had the opportunity to consult with counsel and has been advised in all respects concerning the reasonableness of such covenants as to time and scope; (d) Discloser may have no adequate remedy at law if Recipient violates or fails to perform under this Section 14; and (e) Discloser shall have the right, in addition to any other rights it may have, to seek from a court of competent jurisdiction preliminary and permanent injunctive relief to restrain any breach or threatened breach or otherwise to specifically enforce Recipient's obligations under this Section 14 if Recipient fails to perform in accordance herewith. 15. NOTICES. Any notice required or permitted to be given under this Agreement shall be in writing and shall be sufficiently given when delivered in person or deposited in the United States mail (registered or certified) postage prepaid, addressed as follows: If to Hologic, addressed to: HOLOGIC, Inc. 590 Lincoln Street Waltham, MA 02154 (USA) Attention Mark Duerst, Vice-President - Sales & Marketing Copy to Steven L. Nakashige, President and COO If to Ostex, addressed to: Ostex, International, Inc. 2203 Airport Way South, Suite 400, Seattle, Washington 98134 Attention: Jeffrey J. Miller, Ph.D., Senior Vice President, Corporate Development Copy to: Robert Glaser, President and COO or to such other addresses as may be specified from time to time in a written notice given by such party. Both parties agree to acknowledge receipt of any notice delivered in person. 16. TRADEMARKS AND TRADE NAMES. (a) No provision of this Agreement shall be interpreted or construed as conferring upon any party any right to use in labeling, advertising, marketing, publicizing or otherwise promoting the Promotional Package, any name, trade name, trademark, or other designation (or derivation thereof) of any other party hereto or WRF or the University of Washington, respectively, except as expressly provided under this Section 16. (b) Hologic shall incorporate into the packaging of each and every Osteomark(R) Laboratory Certificate marketed, promoted, sold, and/or distributed under this Agreement, and in addition to its own trademarks and names, such Ostex trademarks or statements as Ostex shall reasonably request. Ostex hereby grants Hologic a non-transferable, non-exclusive license, concurrent with the term of this Agreement, to use such statement and/or trademark accordingly and in substantially the same manner as used by Ostex; provided, however, that each such use of such statement and/or trademark be accompanied by a printed notice identifying Ostex as the owner thereof. Hologic furthermore shall have the right to display its own name, trade names, and/or trademarks. Hologic shall not use any Ostex trademark with respect to products not covered by this Agreement. (c) Ostex and Hologic shall each be responsible for the registration, maintenance and enforcement of their respective names, trade names, and trademarks; provided, however, that each party shall aid the other in the enforcement of that party's rights by monitoring for, and notifying said party of, any unauthorized use of any of said party's trademarks. Each party shall from time to time, and in any event upon the issuance of additional registrations, modify its use of trademarks to incorporate proper notice of registration and other claims of right, in accordance with the laws and customs of the various countries in which it operates pursuant to this Agreement. (d) Ostex represents and warrants, as of the date of this Agreement, that: (a) Ostex is the owner and registrant of the trademarks issued registrations as indicated by Exhibit C; (b) Ostex is named as applicant in those applications indicated by Exhibit C as pending; and (c) to the best of its knowledge, none of the Ostex trademarks infringes upon the trademark, trade name, or other proprietary rights of an third party. (e) Ostex acknowledges that Hologic is the sole owner of the trademarks and trade names which designate and identify the QDR Component of the Promotional Package and business (the "Marks"). (f) Ostex agrees that it may only use those Marks which identify the Promotional Packages it is authorized to sell and then only to further the promotion and sale of the Promotional Packages such Marks identify. Ostex may only use such Marks in their standard form and style as they appear upon the Promotional Packages or as instructed in writing by Hologic. No other letter(s), word(s), design(s), symbol(s), or other matter of any kind shall be superimposed upon, associated with or shown in such proximity to the Marks so as to tend to alter or dilute them. (g) In all advertisement, sales and promotional literature or other printed matter in which any of such Marks appear, Ostex must identify itself by full name and address and state its relationship to Hologic. Every such Mark used or displayed by Ostex must be identified as a Mark owned by Hologic, in a form and manner approved by Hologic. Each party shall have the right to review and approve any promotional literature or other printed matter in which such party's trademarks appear. (h) Upon expiration or in the event of any termination of this Agreement, each party shall promptly discontinue every use of the trademarks or any other confusingly similar word or symbol of the other. (i) No public announcements or similar publicity with respect to this Agreement shall be made by either party without the other party's prior written approval and neither party may make any announcements regarding any of the other party's products without the prior written consent of the other party. Such prior written approval and prior written consent shall not be unreasonably withheld. Nothing in this Section 16(i), however, shall prevent either party from making such public announcements as such party's legal obligations require. In such event, the party who is required to make the public announcement will allow the other party to review the announcement sufficiently in advance in order to provide suggestions on the form and substance of the announcement. 17. MISCELLANEOUS. (a) Section headings as to the contents of particular paragraphs are for convenience only and are in no way to be construed as part of this Agreement, or as a limitation of the scope of the particular paragraph to which they refer. (b) Any waiver by either party of any provision of this Agreement shall not be construed or deemed to be a waiver of any other provision of this Agreement nor a waiver of a subsequent breach of the same provision. (c) This Agreement, in conjunction with the Joint Development, License and Supply Agreement, constitutes the entire understanding and agreement between the parties and supersedes all prior negotiations, understandings and agreements between Hologic and Ostex. There are no understandings, representations or warranties of any kind, express or implied, oral or written, not expressly set forth herein or in the Joint Development, License and Supply Agreement. No amendment or modification of any provision of this Agreement shall be valid or of any force or effect, unless made by written instrument signed by the respective duly authorized representatives of Hologic and Ostex, specifying the exact nature of such amendment or modification. (d) All claims or controversies asserted by Ostex against Hologic or Serex shall be construed and enforced in accordance with the laws of the Commonwealth of Massachusetts. Any judicial action by Ostex relating to the relationship between the parties pursuant to this Agreement, or goods purchased or licensed hereunder (together with any counterclaims asserted by Hologic or Serex), shall be brought and tried in the State or Federal Courts located in Massachusetts. All claims or controversies asserted by Hologic against Ostex or WRF shall be construed and enforced in accordance with the laws of the State of Washington. Any judicial action by Hologic relating to the relationship between the parties pursuant to this Agreement, or goods purchased or licensed hereunder (together with any counterclaims asserted by Ostex or WRF), shall be brought and tried in the State or Federal Courts located in the State of Washington. IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be executed as of the day and year first above written by their respective authorized officials. OSTEX INTERNATIONAL, INC. By /S/ JEFFREY J. MILLER PH.D. Jeffrey J. Miller, Ph.D., Senior Vice President, Corporate Development HOLOGIC, INC. By /S/ S. DAVID ELENBOGEN S. David Ellenbogen Chairman and CEO EXHIBIT A PROMOTIONAL PACKAGE DESCRIPTION QDR 4500C System Strategic Alliance ("Fee Per Scan") Leasing Contract as described in the attached Attachment A-1. (No modifications to this lease contract can be accepted.) Osteomark(R) Laboratory Certificate, comprising a certificate for a specified number of free tests at a specified laboratory or laboratories ( to be mutually agreed by Hologic and Ostex) with a value of XXXXXXX. Attachment A-1 - -16- HOLOGIC STRATEGIC ALLIANCE PROGRAM EXHIBIT A-1 LEASING CONTRACT Owner: Hologic, Inc. Customer (Name): __________________ 590 Lincoln Street Street Address: ________________ Waltham, MA 02154 City/State/Zip: ______________________ (617) 890-2300 Phone: ______________________ Contact: ______________________ ________ QDRAE 4500C Hologic QDR "ACCLAIM' Series" Bone Densitometer ________ QDR-1000plus Hologic QDR Bone Densitometer Tax Exempt# ______ Customer P.O. #__________________ Date: ____________
STRATEGIC ALLIANCE PROGRAM SUMMARY Line Definitions QDR 4500C QDR-1000plus 1. Usage Fee: $50 per study $50 per study 2. Trial period (no minimums): Six months Six months 3. Deposit (credited against usage): $5,000 $3,000 4. Deferred Billing Credit for first 100 scans Credit for first 60 scans 5. Minimums after six months: 30 scans per month 25 scans per month 6. Minimums after 12 months: 35 scans per month 30 scans per month 7. Conversion to own: Anytime Anytime 8. Conversion to lease: Anytime Anytime 9. Upgrade options: Available to any ACCLAIM Available to any ACCLAIM
Customer Acceptance Hologic, Inc. Acceptance Customer: _____________________ Signature: _____________________________ Signature: __________________ Name/Title: ____________________________ Name/Title: __________________ Date: _____________________________ Date: _____________________________ Equipment Location: The equipment is to be delivered and installed at the following location: Address: _____________________________ City: _____________________________ State _____________________________ Zip _____________________________ Installation Contact Person/phone: __________________________________________ - -------------------------------------------------------------------------------- HOLOGIC, INC. 590 Lincoln Street, Waltham, MA 02154 Tel: 617.890.2300 Fax: 617.890.0008 TERMS AND CONDITIONS 1. Lease of Equipment. Upon execution of this Equipment Lease Agreement (the "Agreement"), Customer agrees to lease from Hologic, Inc. ("Hologic") the equipment set forth above (the "Equipment"), subject to the terms and conditions set forth in this Agreement, for a term commencing upon installation of the Equipment and, unless such lease (the "Lease") is sooner terminated as provided herein, terminating sixty (60) months from the date of installation. 2. Deposit. In consideration of Hologic entering into this Agreement, Customer has paid to Hologic a non-refundable deposit plus applicable taxes, if any. During the first six months of this Agreement ('Trial Period"), this deposit is creditable against the Patient Studies performed by the Customer (the first 100 scans for a QDR 4500C and 60 scans for a QDR-1000plus). 3. Lease Payments. Subject to the credits granted in Section 2, Customer shall pay Hologic as Lease payments hereunder, an amount equal to $50.00 for each patient study performed by Customer (or any affiliate of Customer) using a bone densitometer plus taxes and, to the extent applicable, service fees and other charges as provided herein. A "Patient Study" means a sequence of one or more scans performed on a patient on the Equipment or any other bone densitometer owned, leased or operated by Customer or any of its affiliates. Technically unacceptable scans may be credited if Customer provides Hologic with copies of such studies on diskette accompanied by a brief description of the nature of the deficiency. Customer agrees to provide to Hologic, not later than the eighth (8th) day of each month, a copy of the count report, produced by the software included within each system, of the Patient Studies performed by the Equipment during the preceding month and a count report of the number of any other Patient Studies performed during the preceding month. The lease payment shall be calculated by multiplying the number of patient Studies by $50.00 and adding all applicable taxes. A late fee equal to five percent (5%) of the total lease payment due will be applied to delinquent payments (payments received by Hologic after the thirtieth (30th) day of the month). In the first 12 months, the lease payments due are based on the assumption that the Customer will perform at least the Minimum Monthly Scans (30 Patient Studies per month for a QDR 4500C and 25 for a QDR-1000plus) for a minimum lease payment of at least $1,500 ( for a QDR 4500C) or $1,250 (for a QDR-1000plus) per month (plus applicable taxes)(the "Monthly Minimum"). The Monthly Minimum will be waived for the first six months. After 12 months, the lease payments due are based upon the assumption that Customer will perform at least (I) for a QDR 4500C-35 Patient Studies per month (the "Minimum Monthly Scans") for a minimum lease payment of at least $1,750 per month (plus applicable taxes) (the "Monthly Minimum") or (ii) for a QDR-1000plus - 30 Patient Studies per month (the"Minimum Monthly Scans") for a minimum lease payment of at least $1,500 per month (plus applicable taxes) (the "Monthly Minimum"). If Customer has not conducted the Minimum Monthly scans in any month, beginning after the first six months of usage (the "Trial Period"), Customer may nevertheless elect to pay the Monthly Minimum. If Customer (a) has not paid the Monthly Minimum commencing with the seventh full month after the date of installation, or (b) fails to perform any of it obligations hereunder and such failure shall continue for ten days after written notice, it is agreed that Hologic shall be entitled without notice to Customer and with or without legal process, take immediate possession- session of such Equipment without liability to Hologic by reason of such entry or taking possession, and terminate the Lease. 4. Conversion of Agreement. At any time, Customer may convert this Lease into an Operating Lease or a Full Payout Lease, provided that Customer is then in full compliance with the terms and conditions hereof. This right of conversion only applies to Hologic administered or authorized lease programs. If the Customer converts to one of the following lease options within the first six months from the date of installation, Hologic will defer the commencement of payments required under the Lease for 90 PERSONAL GUARANTY In order to induce Hologic to enter into this Lease with Customer, the undersigned, jointly and severally, hereby irrevocably and unconditionally, guaranty without deduction or diminution by reason of counterclaim, offset, or defense, the prompt and complete payment under, whenever due, and performance of this Lease to Hologic or its assigns, including any and all modifications, additions, supplements and amendments thereof, as will as all of Customer other leases with Hologic that have commencement dates not later than ten (10) days after Hologic receives written notice from the undersigned of their desire not to guaranty any additional leases. The undersigned warrant and guaranty that this Lease has been properly executed by Customer, and agree. that this guaranty shall be of full force and effect irrespective of any invalidity or unenforceability of the Lease or any provisions thereof, or the existence, validity or value of any security. The undersigned hereby waive presentment notice of acceptance hereof, all notices of any kind to which we may be entitled, and all defenses of guarantor or surety. The undersigned consent that from time to time, without notice to or further consent from the undersigned and without releasing or affecting the undersigned's liability thereunder, the time for payment or performance under this lease may be extended or accelerated in whole or part, any security therefore may be exchanged, released, enforced sold, leased or otherwise dealt with, the provision of any documents may be canceled, modified or waived, any other guarantors may be released, and any indulgence may be granted to Customer, as Hologic may in its sole discretion determine. The obligation and liability of each undersigned is direct, continuing and unconditional, shall not be diminished or affected whether or not the Equipment is repossessed, and Hologic shall not be required to proceed against Customer or resort to any other right or remedy before proceeding against the undersigned under this guaranty. No payment by the undersigned, except payment in full of all liabilities hereunder shall entitle the undersigned to be subrogated to any of the rights or remedies of Hologic under this Lease. The undersigned warrant they have read this Lease and hereby waive any and all rights to a trial by jury, and agree to the venue and jurisdiction contained therein, and agree that only full payment and performance of the Lease can discharge the undersigned's liability. This guaranty shall be binding upon the undersigned and the heirs, representatives, successors and assigns of the undersigned, in favor of Hologic and Lessor's successors and assigns. This guaranty cannot be terminated or changed orally and no provision hereof may be modified or waived except in ;writing. x________________________________ (GUARANTOR'S SIGNATURE) AN INDIVIDUAL - ----------------------- DATE X________________________________ (GUARANTOR'S SIGNATURE) AN INDIVIDUAL - ----------------------- DATE HOLOGIC, INC. 590 Lincoln Street, Waltham, MA 02154 Tel: 617.890.2300 Fax: 617.890.0008 days. An "Operating Lease means a fixed rent lease with 60 monthly payments in the fixed amount of the initial Monthly Minimum ($1,500 for a QDR 4500C and $1,250 for a QDR-1000plus), beginning on the date of conversion, with an option for Customer to acquire the Equipment at the end of such term for its fair market value, as determined by Hologic. A "Full Payout Lease" means a new lease whereby Customer would finance a deemed unamortized contract price for the Equipment plus the residual value of the Equipment, as determined by Hologic based upon Hologic's amortization schedule for this Agreement, over a five (5) year term at then current interest rates, with an option for Customer to acquire the Equipment at the end of such term for XXXXXXX. During the first 12 months of this agreement (from date of installation) the fixed monthly lease payment shall be XXXXXXX for a QDR 4500C and XXXXXXX for a QDR-1000plus. In connection with any such conversion, Hologic may require Customer to enter into a new lease with standard terms and conditions. Conversion of the Lease is conditioned upon a then current approval of Customer by Hologic. 5. Purchase Option. At any time, during the first 12 months from the date of installation, Customer shall have the right, upon written notice to Hologic, to purchase the Equipment at a purchase price of XXXXXXX for a QDR 4500c and XXXXXXX for a QDR-1000plus. On or after the first anniversary date from the date of installation, Customer shall have the right, upon written notice to Hologic, to purchase the Equipment at a purchase price equal to the sum of (a) the present value of the total lease payments to be due to Hologic over the term of this Agreement, assuming that Customer had converted the Agreement into an Operating Lease, plus (b) the present value of the estimated residual value of the Equipment at the end of the five year lease term. The present value of the lease payments, the estimated residual value and the present value of such residual value shall be determined by Hologic based upon its amortization schedule for this Agreement. Customer shall have the further right, at the end of the term of the Agreement, upon written notice to Hologic, to purchase the Equipment at its fair market value, as determined by Hologic. 6. Training. Hologic shall be responsible for the initial installation of the Equipment at Customer's premises and for training Customer's designated equipment operator in use of the Equipment. 7. Equipment Service and Maintenance. Subject to Section 8, costs and expenses relating to service and maintenance of the Equipment will be the responsibility of Hologic, provided that Customer has not defaulted on any of its obligations under this Agreement. Following the conversion of this Agreement to an Operating Lease, a Full Payout Lease or purchase, all costs and expenses associated with equipment service and maintenance shall be the responsibility of Customer. A full year of equipment service and maintenance will be provided free of charge from the date of conversion to a lease or purchase, for all conversions within six months of the date of installation. 8. Use and Alteration. Customer shall use the Equipment solely in the conduct of its business, in the manner and for the use contemplated by the manufacturer thereof, and in compliance with all laws, rules and regulations of every governmental authority having jurisdiction over the Equipment and with the provisions of all policies of insurance carried by Customer. Customer will not make any alterations or additions to the Equipment or move the Equipment from the installation site. During the term of the Lease, Customer shall be entirely responsible for daily maintenance and cleaning of the Equipment and for any loss or damage to the Equipment except for ordinary wear and tear. Customer agrees to cause the Equipment to be operated in accordance with all manufacturer's manuals or instructions. While the Equipment is in Customer's possession, Customer shall bear the entire risk of loss, theft, destruction or damage to the Equipment. Upon Hologic's request, Customer will permit Hologic to have access to the Equipment at all reasonable times for the purpose of inspection and examination. 9. Customer Representations. Customer hereby represents, warrants and covenants that with respect to this Agreement hereunder: (a) The execution, delivery and performance thereof by the Customer have been duly authorized by all necessary corporate action; (b) The individual executing such was duly authorized to do so; and (c) This Agreement constitutes the legal, valid and binding obligations of the Customer enforceable in accordance with their respective terms. 10. Events of Default. Customer shall be in default under @ Agreement upon the happening of any of the following events or conditions (herein called "Events of Default"): (a) Customer shall find to make any payment due hereunder within thirty (30) days after the same is due and payable; (b) Customer shall fail to perform any other covenant or agreement to be performed by it under this Agreement, and such failure shall continue for ten (10) days after written notice thereof by Hologic to Customer; (c) any representation, warranty, certification or statement made or furnished to Hologic herein, or in connection herewith, by or on behalf of Customer proves to have been false in any material respect when made or furnished; or (d) Customer shall make an assignment for the benefit of creditors, or bankruptcy, arrangement, reorganization, liquidation, insolvency, receivership or dissolution proceeding shall be instituted by or against Customer and shall be consented to or be pending and not dismissed for a period of thirty (30) days. 11. Remedies of Hologic. Upon the occurrence of any Event of Default, and at any time thereafter so long as the same shall be continuing and shall not have been remedied, Hologic may, at its option, declare this Agreement to be in default and, at any time thereafter, may exercise one or more of the following remedies, as Hologic in its sole discretion shall elect: (a) accelerate and cause to become immediately due and payable all amounts payable hereunder and, including if the Agreement has been converted to an Operating Lease or a Full Payout Lease, all payments due thereunder; (b) terminate this Agreement as to any and all Equipment upon written notice to Customer, without prejudice to any other remedies hereunder; (c) enter upon the premises where any Equipment is located, and, without notice to Customer and with or without legal process, take immediate possession of such Equipment without liability to Hologic by reason of such entry or taking possession, and without such action constituting a termination of this Agreement unless Hologic notifies Customer in writing to such effect; and (d) proceed by appropriate action either at law or in equity to enforce performance by Customer of the applicable covenants of this Agreement or to recover damages for the breach thereof. Hologic shall also be entitled to recover as damages for the loss of the bargain and not as a penalty, an amount equal to the sum of the following amounts: (i) all unpaid monthly payments owing for the Equipment through the last day of the month in which such Equipment is either sold, released or otherwise disposed of, and (ii) expenses paid or incurred by Hologic in connection with the repossession, attempted repossession, holding, repair and subsequent sale, release or other disposition of any Equipment, including commissions and attorneys' fees. None of Hologic's remedies under this Agreement are intended to be exclusive, but each shall be cumulative and in addition to HOLOGIC, INC. 590 Lincoln Street, Waltham, MA 02154 Tel: 617.890.2300 Fax: 617.890.0008 any other remedy referred to herein or otherwise available to Customer in law or in equity. Customer waives any and all rights to notice and to a judicial hearing with respect to the repossession of the equipment by Hologic in the event of a default hereunder by Customer. 12. Title. Tide to the Equipment leased to Customer pursuant to the terms hereof is and will remain at all times vested in Hologic or its designee, unless and until Customer exercises its option to purchase the Equipment pursuant to Section 5. 13. Assignment. Without Hologic's prior written consent, Customer will not assign any of Customer's rights hereunder or sublet or transfer the Equipment. Hologic may, at any time, mortgage, grant a security interest in, transfer, sell or assign this Agreement or any Equipment or any payments due or to become due hereunder, without notice to Lessee. Customer agrees that in the event of any such assignment and written notice thereof to Customer, Customer will accept and comply with the directions and demands of Hologic's assignee. THE RIGHTS OF ANY SUCH ASSIGNEE SHALL NOT BE SUBJECT TO ANY DEFENSE, COUNTERCLAIM OR SET-OFF WHICH CUSTOMER MAY HAVE AGAINST HOLOGIC. 14. Insurance; Taxes. Customer agrees that it shall obtain and maintain property damage and liability insurance and keep the Equipment insured for its full replacement value, name Hologic as an additional insured with respect thereto and, upon the request of Hologic, will provide a certificate of insurance acceptable to Hologic evidencing such insurance coverage. Customer agrees to pay for, or reimburse Hologic for payment of, all sales, use, privilege, excise, personal property or other taxes imposed or levied with respect to the Equipment or by reason of the furnishing of the Equipment hereunder. 15. Termination. The lease may be terminated by Customer, prior to purchase of the Equipment or conversion into an Operating Lease or a Full Payout Lease upon ninety (90) days prior written notice to Hologic. In the event of such termination, Customer agrees to pay for all Patient Studies performed up to the date of termination, including any applicable taxes thereon. In consideration of the financial accommodations made by Hologic to Customer under the leasing program set forth in this Agreement, in the event of such a termination by Customer or a termination of the Lease by Hologic, as a result of Customer default or failure of Customer to pay the Monthly Minimum, Customer agrees that for a period of twelve (12) months after such termination, or the fifth anniversary of the date of this Agreement, whichever occurs first, Customer shall pay Hologic a minimum termination fee equal to xxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxx xxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxx xxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxx (or any of its affiliates) performed Patient Studies during such period; provided however no termination fee shall be due if neither Customer nor any of its affiliates perform Patient Studies during the termination period. 16. Indemnification. Customer agrees to defend, indemnify and hold Hologic harmless from and against any and all claims, damages, costs, expenses (including attorney's fees), losses and liabilities of every kind and nature in any way arising out of or in connection with (i) the failure of any of Customer's representations or warranties contained herein to be true, complete and correct as of the date hereof and at all times during the term of the Agreement, or (ii) the breach by Customer of any provision of Agreement, or (iii) the figure of Customer to pay any amounts owed under this Agreement as and when the same shall become due or (iv) failure to maintain the Equipment as provided in Section 8 or (v) the use of the Equipment other than, in accordance with Hologic's instructions for use. 17. Further Assurances. Customer will promptly execute and deliver to Hologic such further documents and assurances and take such further action as Hologic may from time to time reasonably request in order to more effectively carry out the purpose of this Agreement and to protect the rights and remedies of Hologic hereunder, including, without limitation, the execution and delivery of financing, statements under the Uniform Commercial Code. 18. Proprietary Software. It is recognized that during the term of this Agreement, computer software will be delivered to Customer on a licensed basis in printed form, or in any of several possible machine-readable forms. Such computer software is and shall remain the sole property of Hologic. The grant to Customer of rights to the software extends solely a non-exclusive, single-use royalty-free license to use software for the sole purpose of performing and analyzing scans acquired in the normal course of its business, using the Equipment and for no other purpose. Such software is valuable to Hologic and shall be treated as confidential and proprietary information subject to the confidentiality provisions hereof. Customer will have no right to sell, assign, transfer, copy or sublicense the software, without the prior written consent of Hologic. 19. Confidential Information. All drawings, diagrams, specifications, devices and other materials furnished by Hologic and identified as confidential relating to use and service of the Equipment and the information therein, including, but not limited to, Customer Manual provided to it by Hologic in connection with the Equipment, is proprietary and confidential to Hologic. Such materials have been developed at great expense and they contain trade secrets of Hologic. Customer may not reproduce or distribute such materials except to Customer's employees who may use the articles as part of their duties. Customer agrees that it will keep confidential and not disclose or divulge any of such materials or the information therein to any unauthorized person for any purpose whatsoever without the prior written consent of Hologic. 20. Disclaimers; Warranties. CUSTOMER ACKNOWLEDGES AND AGREES THAT HOLOGIC MAKES NO EXPRESS OR IMPLIED WAR- RANTIES ARISING OUT OF OR RELATED TO CUSTOMER'S USE OR OPERATION OF THE EQUIPMENT. IN NO EVENT SHALL HOLOGIC BE LIABLE FOR ANY INDIRECT, SPECIAL, INCIDENTAL OR CONSEQUENTIAL DAMAGES ARISING OUT OF OR ASSOCIATED WITH THE EQUIPMENT OR THE LEASE THEREOF EVEN IF ADVISED OF THE POSSIBILITY OF SUCH DAMAGES. 21. Entire Agreement; Governing Law. This Agreement constitutes the entire agreement between the parties. This Agreement shall be deemed a contract made under the laws of the Commonwealth of Massachusetts shall be construed under and governed by the laws thereof. The invalidity or unenforceability of any provision of this Agreement shall not affect the validity or enforceability of any other provision hereof. Customer waives any right to a trial by jury in any action to enforce or defend any matter arising from or related to this Agreement. 22. Amendment; Waiver. No term or provision of this Agreement may be changed, waived, amended, discharged or terminated except by a written instrument executed by the parties hereto. HOLOGIC 590 Lincoln Street, Waltham, MA 02154 Tel: 617.890.2300 Fax: 617.890.0008 EXHIBIT B COMMISSION An amount equal to the Patient Study or other lease payment amounts (i.e. $50 per Patient Study) payable to Hologic or credited to deposits held by Hologic pursuant to the Strategic Alliance Leasing Contract during the first three month period commencing with the beginning of the term of said Contract, not including deposits paid or due, or taxes and to the extent applicable, service fees and other charges provided for in said contract, and provided that if the Lease Contract is converted to a sales contract during said period Hologic will pay an additional finders fee of XXXXXXX. Note: During the term of this Agreement, Hologic will also provide finders fees and sales assistance fees pursuant to its then-current Policy for Non-Exclusive Distribution and Finder's Fees (current version attached) for sales of all QDR 4500 model Systems in the Territory as a result of qualified leads provided by Ostex. PERFORMANCE GOALS Three (3) Promotional Packages per month. HOLOGIC, INC. POLICY FOR FINDER'S FEE ELIGIBILITY January 13, 1997 SALES REPRESENTATIVES Under this form of relationship, the Sales Representative presents to Hologic contracts with Hologic approved sales prospects, which are not being solicited by Hologic's direct sales force or another Sales Representative. Hologic coordinates the activities of its Sales Representatives and sales force by requiring that sales prospects be registered. Hologic may approve a proposed sales prospect, disapprove it, or disapprove the prospect but offer to pay a sales assistance fee. Normally, Hologic will not approve a sales prospect if either Hologic's sales force, or another ISO is pursuing the prospect. If Hologic is pursuing the prospect directly, Hologic may pay a sales assistance fee. Once Hologic has approved a proposed prospect, the Sales Representative is eligible for a commission whether the prospect places an approved order through the Sales Representative, or directly with Hologic, but not if a sale is made through an Hologic Distributor. Hologic's registration process, and its commission and sales assistance policies are described in more detail in the next section. SALES COMMISSIONS (FINDER'S FEES)AND SALES ASSISTANCE FEES REGISTRATION OF PROSPECTS Hologic requires formal registration of prospects to become eligible for a commission or sales assistance fee. A registration form has been attached for use in this process. Prospect registrations are to be filed with the Hologic Regional Sales Manager for your area. Status of prospect shall be confirmed with you, in writing, within 72 hours of receipt of registration form. Registrations remain "active" for six months from date of receipt and approval by Hologic. Prospects must be re-registered for consideration beyond this period. Hologic reserves the right to reject prospects from any of the programs listed above at its sole discretion. COMMISSIONS/FINDERS FEES Once a prospect has been registered, Finder's fees are paid once a sale has been successfully completed including full collection of all amounts due. Fees are paid according to the schedule listed below: QDR 1000 XXXXXXX QDR 4500C XXXXXXX QDR 4500W XXXXXXX QDR 4500SL XXXXXXX QDR 4500A XXXXXXX Hologic shall reduce Finder's fees by XXX in instance that purchase is made as a part of an established national buying contract with Hologic. Fees may also be reduced or renegotiate in the instance of multiple system purchases by a customer, and may be increased in situations where the Sales Representative commits to a marketing plan and substantial minimum sales quota. SALES ASSISTANCE FEE In the instance where a sales lead is provided to Hologic and Hologic determines that this lead is already an "active prospect" in contact with Hologic's direct sales organization, the independent sales organization can still earn a fee through active support of Hologic I its sales efforts. To be eligible for these fees, the sales organization must provide Hologic's prospect with a written recommendation and endorsement of Hologic's products. If Hologic is successful in completing the sale (including collection) with this registered prospect, the sales organization shall receive a sales assistance fee of XXXXXXX for its help with the account. CUSTOMER LETTERS The Finder's Fee and Sales Assistance Fee programs require that the independent sales organization take active measures in support of the sale between the registered prospect and Hologic. These active measures must include the sending of at least one "consultative sales letter" supporting the purchase of Hologic's equipment to the prospect. A copy of this letter, issued on the ISO's letterhead is to be provided to Hologic as a part of the prospect registration process (see below). Hologic has provided you with example letters for this purpose as a portion of this package. Independent sales organization will not be eligible for fees if this requirement has not been fulfilled. CHECKLIST OF ACTIVITIES REQUIRED OF SALES ORGANIZATION TO EARN FEES Hologic has attempted to keep the process for earning sales fees simple yet fully documented for the protection of the independent sales organization. For this procedure to work properly, Hologic's insists that all procedures be followed. FINDER'S FEE PROGRAM STEPS 1. Complete Prospect Registration Form; 2. Supply registration form to Hologic's Regional Sales Manager for your area (see map); 3. Obtain prospect status from Hologic (generally within 72 hours)confirming it is not an active Hologic prospect; 4. ISO issues "customer letter" to prospect, with copy to Hologic (completing prospect registration form) 5. Hologic and ISO coordinate account follow-up 6. Hologic issues quotation to prospect 7. ISO and Hologic cooperate in management and communicating account status 8. Order issued to Hologic by prospect 9. Prospect completes payments on purchase as required 10. Fees issued to ISO SALES ASSISTANCE FEE PROGRAM STEPS 1. Complete Prospect Registration Form; 2. Supply registration form to Hologic's Regional Sales Manager for your area (see map); 3. Obtain prospect status from Hologic (generally within 72 hours)confirming it is not an active Hologic prospect; 4. Independent Sales Organization issues "customer letter" to prospect with copy to Hologic (completes prospect registration process) 5. Hologic issues any quotations required (note that these may have already been issued) 6. Independent sales organization and Hologic cooperate in management and communicating account status 7. Order issued to Hologic by prospect 8. Prospect completes payments on purchase as required 9. Fees issued to independent sales organization PROSPECT REGISTRATION FORM Prospect Name ____________________ Address ____________________ -------------------- City ____________________ State ____________________ Zip ____________________ Phone ____________________ FAX ____________________ OTHER CONTACTS AT ACCOUNT: (examples: partners, secretaries, business managers, administrators, purchasing agents) Name / Phone: ACCOUNT BACKGROUND AND INTEREST (Supply a short summary of account activity to date) COMPETITION BUDGET INFORMATION SAMPLE CUSTOMER LETTER Dear Customer: Thank you for inquiring about bone densitometry equipment with our firm. I have taken the liberty of investigating these products for you and would like to share some information with you that may assist in your selection. As you know, our firm has a sales agency relationship with Hologic, and can introduce you to this company. The bone densitometry business is dominated by only a couple of companies. Hologic, Inc. of Waltham, MA (800-343-9729) is the leader in this field (60% market share). Their equipment is considered to be the most technically advanced and easiest to use. Their equipment has been selected by nearly all of the pharmaceutical companies for development of the new osteoporosis drugs including Merck's Fosamax trials. Hologic equipment has also been used in the NIH sponsored Study of Osteoporotic Fractures (SOF), the largest osteoporosis trial in the world, and in the NHANES study which has established the reference data that the industry is using in its standardization efforts. Hologic offers a full product line of both pencil and fan beam scanners available at most price points. We would highly recommend that you consider the fan beam products which are of the latest design. The pencil beam units are inexpensive but are based on 8 year old technology that is incapable of providing many of the new advances. Although Hologic equipment is typically slightly higher in price than their competitors, we believe it is money well spent and easily justified through savings in tech time, marketing advantages offered and long term costs of ownership. The latest developments in the field are available on the Hologic equipment including: Fan Beam Technology - Offers faster scan times (30 sec. on all patients), high resolution images, enhanced precision, significant operational conveniences and modular product design. Internal Reference System - The system constantly calibrates itself on a pixel by pixel basis. No operator calibration (or mistakes) are possible. This assures consistency in data upon upgrade or repair. Supine Lateral Scanning - Many luminaries now suggest lateral spine scans in patients over age 65 where artifacts lead to false negative findings with traditional AP scans in as many as 30-40% of patients. Lateral scans may also provide earlier diagnostic capability and earlier information concerning response to treatment since they focus on trabecular regions of the spine. If you decide that you want laterals, do not settle for the decubitis options which suffer from substantial precision problems. Note too that with the modular design of the 4500 family, laterals can always be added at a later date. Single Energy Imaging - This is brand new to low end densitometers. High end fan beam system have offered imaging / morphometry options in the past but Hologic has recently made this available on all fan beam systems. The 7 second full spine scan gives a nice image at very low dose and may be useful in spotting artifacts (wedge fractures) that could artificially elevate spine density. Although these images will not replace films, they do provide quantitative morphometry capability and could be used to "screen" candidates for further evaluation through use of films. Imaging will probably be expanded to other applications soon and fan beam systems are required for this capability. Modular Product Design - This is one of the best features of the Hologic products. The field is changing very rapidly and Hologic has made a point of not forcing decisions upon buyers nor making their equipment obsolete. Their philosophy is to allow you to buy only what you need now and to add to that as needs dictate. They have eliminated the financial penalty associated with upgrades using other manufacturer's equipment and the significant data concerns if equipment is to be exchanged. We have also found Hologic's service to be reputable. The DXA equipment seems quite reliable but 800 "HELP " lines and next day on site service is available. Hologic is the only company that does all of their own service using factory - -direct Hologic personnel. We hope that this information is useful. [ADD APPROPRIATE FOLLOW-UP LANGUAGE] Sincerely, EX-10.4B 3 Note: Confidential treatment requested. Exhibit omits information that has been filed separately with the Securities and Exchange Commission. 1 JOINT DEVELOPMENT, LICENSE AND SUPPLY AGREEMENT This Joint Development, License and Supply Agreement (this "Agreement") is entered into as of the 14TH day of January, 1997 ("Effective Date"), by and between OSTEX INTERNATIONAL, INC., a Washington corporation having its principal place of business at 2203 Airport Way South, Suite 400, Seattle, Washington 98134 ("Ostex"), and HOLOGIC, INC., a Delaware corporation having its principal place of business at 590 Lincoln Street, Waltham, MA 02154 ("Hologic"). RECITALS A. The Washington Research Foundation, a nonprofit Washington corporation ("WRF"), is the owner, by way of assignment from the University of Washington, of all right, title, and interest in certain technology developed out of research conducted by Dr. David Eyre and generally described as the "Urinary Assay for Bone Resorption" (as more particularly defined herein, the "WRF Bone Resorption Technology"). B. Pursuant to that certain Restated Exclusive License Agreement between Ostex and WRF, effective June 29, 1992 as amended, the ("WRF/Ostex Exclusive License Agreement"), WRF granted Ostex an exclusive, worldwide license to make, have made, assign, sublicense, lease, develop, enhance, modify, produce, reproduce, demonstrate, market, promote, sell, distribute, use, exploit and otherwise commercialize and prepare derivations of the WRF Bone Resorption Technology. C. Ostex engages in the research, development, manufacture, and sale of diagnostic and therapeutic products in the field of bone and mineral metabolism in applications related to bone resorption and collagen and connective tissue degradation, and has developed a proprietary immunoassay to determine the levels of NTx epitope collagen metabolite resulting from bone resorption ("NTx Assay Technology" as further defined in SECTION 1.15 hereof), which it has implemented in a microtiter format suitable for use in centralized laboratories ("OsteomarkAE Laboratory Test"). D. Serex, Inc., a New Jersey Corporation with its principal place of business at 230 West Passaic Street, Mayfield, New Jersey 07607 ("Serex") also engages in research and development of diagnostic products in various fields, including the field of bone and mineral metabolism, and applications related to bone resorption and collagen and connective tissue degradation; and has developed a proprietary immunodiagnostic format for detection of analytes associated with various disease states and conditions (including without limitation the technology embodied in the patents and patent applications listed in ATTACHMENT D hereto (the "Serex Patent Rights")), together known as the Serex Antibody Release Assay ("SARA Format"). Serex has also developed and is continuing to develop an immunoassay to determine the levels of metabolites resulting from bone resorption (targeted to a peptide linked pyridinoline epitope collagen and potentially to other metabolites) suitable for various uses, including point of care and home or other over-the-counter ("OTC") use ("PLP Assay"). E. Hologic engages in the research, development, manufacture, sale, and lease of diagnostic equipment and other products in the field of bone metabolism, including its lines of QDR x-ray bone densitometers, Sahara ultrasound bone sonometers and associated systems for analysis of bone metabolism data. Pursuant to an agreement dated September 30, 1994 as amended, (as amended, the "Hologic/Serex Agreement"), Hologic has entered into a cooperation with Serex under which Hologic has funded Serex's development of the PLP Assay for use with the SARA Format, and has obtained certain exclusive rights and licenses to distribute the products resulting from this cooperation. In an associated undertaking, Hologic has undertaken to develop a meter suitable for point of care use to read assays in the SARA Format. F. Ostex and Hologic desire to engage in a development project under which Hologic will cause Serex to implement the NTx Assay Technology to work with the SARA Format in a strip format (the "NTx Meter Strip") and with a Hologic-developed stand-alone meter for point of care use (the "NTx Meter"), which NTx Meter Strip and NTx Meter are collectively referred to herein as the "NTx Meter System". Hologic will arrange for manufacture of said NTx Meter Strips and NTx Meters. G. Ostex desires to contribute to this development project by granting to Hologic a license to use the NTx Assay Technology in connection with this development project, by providing "Critical Reagents" (as this term is defined in SECTION 1.15 hereof) needed for this development project at no charge, by contributing to the costs of said project, and by selling Critical Reagents needed for manufacture of the NTx Meter Strips at its manufacturing cost, all as more specifically described in this Agreement. H. In return, Hologic and Ostex will each sell said NTx Meter Strips and Meters, and shall share the profits thereof through the mechanism of reciprocal royalties, all as more specifically described in this Agreement. Hologic may also integrate its meter technology with and into other Hologic products, and may sell such products without royalty. I. Simultaneously with this Agreement, Ostex and Hologic have entered into that certain Co-Promotion Agreement providing for the co-promotion of Hologic products and Ostex's OsteomarkAE Laboratory Test in its microtiter format in accord with the terms set out therein (the "Co-promotion Agreement"). TERMS OF AGREEMENT In consideration of the mutual covenants and agreements contained herein, and for other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the parties agree as follows: 1. DEFINITIONS. The following definitions shall apply throughout this Agreement. 1.1 "Affiliate" means, with respect to any person or entity, any individual, corporation, company, firm, partnership or other entity controlled by, in control of, or under common control with, such person or entity, where "control" means direct or indirect legal or beneficial ownership of fifty percent (50%) or more of the shares, business interests, or voting securities of another corporation, company, firm, partnership or other entity, or the right to fifty percent (50%) or more of the income of such corporation, company, firm, partnership or other entity. Notwithstanding the foregoing, Serex shall be considered an affiliate of Hologic. 1.2 "WRF Bone Resorption Technology" means all technology to which Ostex has rights relating to assays, methods, and materials, including Critical Reagents, for measuring bone collagen metabolites; having first been developed from research conducted by Dr. David Eyre, owned by the Washington Research Foundation, and licensed exclusively to Ostex. The WRF Bone Resorption Technology includes, without limitation, the urinary diagnostic assay known as the Osteomark immunoassay. 1.3 "Confidential Information" means (a) any and all normally non-public information communicated or disclosed by one party ("Discloser") to the other party ("Recipient") describing or relating to the Disclosing Party's business and marketing plans and strategies, financial information, or customer information, and (b) any and all information communicated or disclosed by the Discloser to Recipient describing or relating to the Disclosing Party's research and development, Know-How, inventions, trade secrets, technical data, formulae, drawings, designs, software, models, samples, kits, processes, product development data and information and other data and information related to the business of Discloser, labeled or specified in writing as "Confidential" or the equivalent, or if orally disclosed, labeled "Confidential" or the equivalent, and reduced to writing within thirty (30) days of such oral disclosure; provided, however, that "Confidential Information" shall not be deemed to include information which the Recipient can demonstrate by written proof: (i) is now, or hereafter becomes, through no fault on the part of the Recipient, generally known or available; (ii) is known by the Recipient at the time of receiving such information; (iii) is furnished to others by Discloser without restriction on disclosure; (iv) is hereafter furnished to the Recipient by a third party unrelated to Discloser, as a matter of right and without any breach of any duty of non-disclosure; (v) is independently developed by the Recipient without use of or reference to any Confidential Information; or (vi) is the subject of express written permission to disclose provided by Discloser. Without limiting the generality of the foregoing, Confidential Information may include information developed during the course of this Agreement. 1.4 "COGS" means all costs of materials and components (including purchase costs and royalties) and personnel expended on fabrication, quality control, and regulatory documentation, plus a portion of overhead based on the portion of resources allocated to manufacturing and shipping, calculated in accord with generally accepted accounting principles. 1.5 "Critical Reagents" means the set of reagents supplied by Ostex for use in the development of the NTx Meter Strips, currently consisting of: monoclonal antibodies or fragments thereof, for example the monoclonal antibody produced by hybridoma 1H11, that shows specific immunoaffinity for the NTx Epitope (at concentrations to be agreed on, appropriate for use in the NTx Meter Test) antibody diluent; analyte (NTx Epitope)-containing controls; and other reagents. Reagents will be supplied by Ostex "in bulk," provided that Ostex shall also supply a reasonable number of Osteomark(R) Laboratory Test Kits in a microtiter plate format for Serex use for comparison and control purposes. As of the effective date of this Agreement, Critical Reagents include the 1H11 monoclonal antibody, diluent, calibrators and controls. These reagents may be changed upon mutual agreement of the parties and upon reasonable notice to scale up to commercial quantities. The term "Critical Reagents" shall also include any improvement to or successor antibody(ies) with immunoaffinity to the NTx Epitope or similar epitopes resulting from bone resorption which may be developed or marketed by Ostex in any form during the term of this Agreement. 1.6 "Discovery" means any scientific, technological, or commercial invention, discovery, development, improvement, Know-How, or product resulting from the activities contemplated by the parties under this Agreement, whether or not the same is patentable. 1.7 "Distribution Network" shall mean a party to this Agreement acting as a seller together with its authorized resellers and sublicensees. 1.8 "Field of Use" means use with the SARA Format, and the associated NTx Meter or other Hologic meter technology for use as a point of care device. 1.9 "First Commercial Sale" means the first Sale of a NTx Meter System by the Distribution Network for a value in an arms length transaction with an independent third party following approval for Sale by the United States Food and Drug Administration of the NTx Meter System. 1.10 "Gross Profit" means Net Sales less COGS. 1.11 "Gross Sales" means gross receipts, royalties, fees and other valuable consideration of any kind received directly or indirectly by, or credited to the benefit of the seller and permitted Affiliates in connection with all Sales to end-users and third-party distributors. Without limiting the generality of the foregoing, Gross Sales include without limitation, interest, late charges, time-price differentials and other receipts or credits of a similar nature. 1.12 "Know-How" means any method, information, procedure, process, composition of matter, biological material, or other subject matter. 1.12.1 "Hologic Know-How" means Know-How that has been developed or acquired by Hologic, prior to or during the term of this Agreement. 1.12.2 "Ostex Know-How" means Know-How that has been developed or acquired by Ostex, prior to or during the term of this Agreement. 1.12.3 "Serex Know-How" means Know-How that has been developed or acquired by Serex, prior to or during the term of this Agreement. 1.13 "Hologic Intellectual Property Rights" means all Hologic Know-How, trade secrets, Confidential Information, Hologic patent rights and other intellectual property rights owned or controlled by Hologic individually or in conjunction with others and related to the field of bone and mineral metabolism, meter technology, biochemical markers, or medical practice, including but not limited to Hologic's rights to Serex Intellectual Property Rights pursuant to the Hologic/Serex Agreement. 1.14 "Serex Intellectual Property Rights" means all Serex Know-How, trade secrets, Confidential Information, Serex Patent Rights, and other intellectual property rights owned or controlled by Serex and individually or in conjunction with others and related to the field of bone and mineral metabolism, meter technology, biochemical markers, diagnostic products and methods, or medical practice, including but not limited to the PLP Assay and the SARA Format. 1.15 "NTx Assay Technology" means a urine- or serum-based immunoassay for bone collagen metabolites comprising an NTx Epitope, and any successor immunoassay utilizing WRF Bone Resorption Technology, together with associated controls and other products, the manufacture, use, offer for sale or Sale of which would, but for the licenses granted herein, infringe a Valid Claim. 1.16 "Net Sales" means Gross Sales, less normal and customary trade, quantity, and cash discounts allowed and actually taken, allowances for credits granted or returns, and commissions paid or allowed to third-party distributors. 1.17 "NTx Epitope" means a conformational structure included within the natural crosslinked telopeptides from type I collagen, to which the monoclonal antibody (mAb) produced from the hybridoma 1H11 binds specifically by immunoaffinity. 1.18 "Ostex Intellectual Property Rights" means all Ostex Patent Rights, Ostex Know-How, trade secrets, Confidential Information statutory and common-law trademark rights, and other intellectual property rights owned, licensed or controlled by Ostex during the term of this Agreement and related to the WRF Bone Resorption Technology. 1.19 "Ostex Patent Rights" means all rights of Ostex, as licensee under the WRF/Ostex Exclusive License Agreement, in and to any and all subject matter claimed in or disclosed by U.S. patents and patent applications referred to in the WRF/Ostex Exclusive License Agreement, including without limitation U.S. Patent Application Serial No. 118,234 filed November 6, 1987, and any divisions, continuations, continuations-in-part or reissues arising therefrom or issuing thereon, U.S. Patent No. 4,973,666 issued November 27, 1990, U.S. Patent No. 5,140,103 issued August 18, 1992, U.S. Patent No. 5,300,434 issued April 5, 1994, U.S. Patent No. 5,320,970 issued June 14, 1994, U.S. Patent No. 5,532,169 issued July 2, 1996, U.S. Patent No. 5,455,179 issued October 3, 1995, U.S. Patent No. 5,473,052 issued December 5, 1995, U.S. Patent No. 5,576,189 issued November 19, 1996, U.S. Patent No. 5,472,884 issued December 5, 1995 along with any and all other patent rights applicable, owned by WRF and licensed to Ostex, and related to, derived from, or claiming priority from any such U.S. patent applications, including without limitation International Application No. PCT/US88/03722, International Application No. PCT/US90/7015, International Application No. PCT/US92/04104. 1.19A "Hologic Patent Rights" means all rights of Hologic in and to any and all subject matter claimed in or disclosed by U.S. patents and patent applications owned or assigned to Hologic relating to the subject matter of the Hologic/Serex Agreement. 1.20 "Sale" means any and all transactions whereby a party or its Affiliates sell, lease, rent, or otherwise transfer or dispose of to (i) any end-user, including without limitation any physician's office or clinical laboratory purchaser, or (ii) any third-party distributor, any right of ownership, or any other right to possession. 1.21 "Valid Claim" means a claim in any unexpired Ostex Patent Right which has not been held invalid by a non-appealed or unappealable decision by a court or other appropriate body of competent jurisdiction. 2. LICENSE GRANTS. 2.1 NTX METER STRIP. Ostex hereby grants to Hologic and to Hologic's "permitted assigns" for the term of this Agreement, and Hologic hereby accepts, a nonexclusive, worldwide, nontransferable license in and under the Ostex Patent Rights and Ostex Know-How, to develop, manufacture and have manufactured, and to market, promote, offer to sell, sell, distribute and have marketed, promoted, sold and distributed in any country in the World except Japan, the NTx Meter System (incorporating the NTx Assay Technology and utilizing the Critical Reagents) within the Field of Use, all in return for the Ostex rights set out herein. 2.2 HOLOGIC OPTION TO MANUFACTURE. 2.2.1 CRITICAL REAGENTS FOR NTX METER STRIP(S). Ostex hereby grants Hologic an option, exercisable by Hologic pursuant to the terms of SECTION 6.3.3 below, to a temporary, non-exclusive, nontransferable, royalty-bearing license under the Ostex Patent Rights and Ostex Know-How to manufacture or have manufactured, purify or have purified, Critical Reagents at a manufacturing facility in the United States (or such other country as the parties may agree), for the sole purpose of manufacturing NTx Meter Strips for distribution within the Field of Use pursuant to the terms of this Agreement. 2.2.2 The terms of any license granted pursuant to SECTION 2.2.1 shall be subject to payment to Ostex of a royalty equal to the transfer price for such Critical Reagents had such Reagents been manufactured and delivered by Ostex, less a deduction equal to Hologic's COGS therefor, provided that if such COGS exceeds the transfer price and the resultant number is a negative number, Hologic shall take a credit against any amounts due to Ostex pursuant to SECTION 7.4 of this Agreement. 2.2.3 Any license granted pursuant to the option of this SECTION 2.2 shall be revocable by Ostex upon ninety (90) days prior notice accompanied by demonstration by Ostex that it has recovered the manufacturing capacity to resume supply of Hologic's anticipated needs as forecasted pursuant to SECTION 6.3.1 hereof (provided, however, that such license may be revoked no sooner than six (6) months following Hologic's exercise of the option, and upon reasonable agreement as to appropriate phase-out of Hologic production, phase-in of Ostex production, and coverage of any Hologic start-up and termination costs, whereupon Hologic will again have available to it, in the event of subsequent default by Ostex as described in SECTION 6.3.3, a license option under this SECTION 2.2. 2.3 EXPRESS RESERVATION OF RIGHTS. The scope of license granted by Ostex to Hologic hereunder is limited by the scope of the express grants set forth in this SECTION 2. Without limiting the generality of the foregoing: 2.3.1 RIGHTS SPECIFICALLY EXCLUDED FROM SCOPE OF GRANT TO HOLOGIC. Ostex retains all rights in the WRF Bone Resorption Technology and Ostex Intellectual Property Rights, including without limitation all rights with respect to all products, applications, fields of use, markets and uses, that are not expressly included within the scope of the grant of rights to Hologic as set forth in this Agreement. This Agreement shall not under any circumstances be construed or interpreted to provide for the grant, license, or any other transfer to Hologic or Serex of any rights in the WRF Bone Resorption Technology, other than the right to use Critical Reagents supplied by Ostex hereunder within the scope of the license as granted in this SECTION 2. 2.3.2 HOLOGIC AND SEREX. Hologic and Serex shall retain their respective ownership and control of all Hologic and Serex Intellectual Property Rights and other proprietary rights and interests in and relating to the SARA Format, meter technology, and PLP Assay. 2.3.3 ACTIONS REQUIRING OSTEX'S PRIOR WRITTEN CONSENT. Hologic shall not, without Ostex's prior written consent, which consent may be withheld at Ostex's sole discretion, manufacture or use any Critical Reagent other than as provided for within the scope of the license grants as set forth in this SECTION 2. 2.3.4 COMPULSORY LICENSES. Ostex and Hologic acknowledge that the Ostex Patent Rights are subject to the rights and limitations of United States Code, Title 35, Chapter 18, and administrative regulations thereunder, and equivalents thereof in other jurisdictions, and that the grants of licenses under SECTION 2 above are subject to such rights and limitations. In the event that Ostex receives notice that any governmental agency in any country or territory having valid authority and jurisdiction has granted, or intends to grant or to cause to be granted, a compulsory license with respect to all or any portion of the Ostex Patent Rights, Ostex shall so notify Hologic and shall grant that third party a license to exercise the Ostex Patent Rights to the extent required by the governmental agency. The grant of such license to a third party or the taking of rights by or on behalf of any government shall under no circumstances be considered a breach of this Agreement by Ostex, provided that Hologic shall be deemed to have received an equivalent license under the same terms and conditions. 2.4 OSTEX RIGHT TO DISTRIBUTE NTX METER SYSTEM. Hologic hereby grants to Ostex and its Affiliates for the term of this Agreement, and Ostex hereby accepts, a nonexclusive, nontransferable license in and under Hologic Intellectual Property Rights, to market, promote, sell, distribute and have marketed, promoted, sold and distributed under Ostex's trademarks in any country in the World, the NTx Meter System all in return for the Hologic rights set out herein. 3. SUPPLY OF CRITICAL REAGENTS. 3.1. CRITICAL REAGENTS FOR DEVELOPMENT OF NTX METER STRIP(S). Ostex shall supply to Hologic and to its designee, Serex, without charge, such reasonable quantities of Critical Reagents as shall be necessary or useful for the purpose of developing NTx Meter Strip(s) pursuant to the terms and conditions of this Agreement, together with such reasonable consulting advice as Hologic or Serex may request. 3.2 CRITICAL REAGENTS FOR MANUFACTURING NTX METER STRIP(S). Ostex shall sell to Hologic (or such manufacturer(s) as Hologic shall designate), and Hologic (or said manufacturer(s)) shall purchase from Ostex, Critical Reagents for the purpose of manufacturing NTx Meter Strip(s) pursuant to the terms and conditions of this Agreement. 3.2.1 Hologic or its designated manufacturer(s) shall pay Ostex a non-royalty transfer price for Critical Reagents sold pursuant to this SECTION 3 equal to Ostex' COGS therefor. 3.2.2 Payment for each shipment of Critical Reagents shall be made by Hologic or its designated manufacturer(s) within 30 days of the date of invoice, it being agreed that such invoice shall not be dated prior to shipment of the Critical Reagents to which such invoice relates. In the event that Hologic or its designated manufacturer(s) fails to comply with the payment terms of this SECTION 3, Ostex shall have the right, in addition to all other rights available under this Agreement, to suspend further shipment of Critical Reagents until such breach is cured. 3.3 THIRD-PARTY MANUFACTURING ON BEHALF OF OSTEX. In the event that Ostex licenses a third party to manufacture Critical Reagents to be supplied under this Agreement, Ostex shall ensure and provide evidence to Hologic demonstrating that such third-party manufacturer complies with good manufacturing practices (GMP) and all applicable governmental regulations relating thereto and is either in compliance with or working toward compliance with the quality standards established by the International Standards Organization, Rules 9000 et seq. and amendments or successors thereto ("ISO 9000"). 3.4 PRODUCT WARRANTY; QUALITY CONTROL. Ostex warrants to Hologic and its designated manufacturer(s) that all Critical Reagents sold by Ostex hereunder shall (i) comply with the specifications set out in ATTACHMENT 3.4 hereof when used in accord with Ostex instructions for use, and amendments thereto as mutually agreed upon by the parties, (ii) be free from defects in material, workmanship and design, and (iii) comply with all applicable laws, rules and regulations related to the manufacture and distribution of such product (to the extent applicable to a manufacturer). Without limiting the generality of the foregoing, Ostex warrants that all Critical Reagents manufactured and supplied for the United States market under this Agreement shall be manufactured, tested, documented, packaged, and transported in compliance with GMP requirements of the FDA including, without limitation, 21 CFR Part 820 and any amendments or successors thereto; and that all Critical Reagents manufactured and supplied under this Agreement, regardless of intended market, shall be manufactured, tested, documented, packaged and transported in compliance with Hologic's reasonable quality assurance requirements. Hologic shall have the right to audit and inspect Ostex facilities, books, and records to confirm such compliance. Ostex further represents that it is working toward compliance with the quality standards established by ISO 9000 and warrants that it will comply with such standards when legally required to do so. In the event that Hologic or its designated manufacturer(s) demonstrates within one year of receipt that any Critical Reagent supplied pursuant to this Agreement fails to meet these specifications and warranties, Ostex shall, as Hologic's sole remedy for such failure, immediately replace said product (demonstrated by Hologic or its designated manufacturer(s) as non-conforming in accord with Ostex's reasonable standard procedures) with product which conforms to the above specifications and warranties. These warranties shall not apply to any item that is subjected to abuse, stress, or misuse; or used in any manner inconsistent with applicable Ostex instructions. 3.5 DELIVERY. All Critical Reagents purchased under this Agreement shall be shipped F.O.B. Origin. 3.6 INVENTORY. At all times during the distribution term of this Agreement, Ostex shall supply and Hologic or its designated manufacturer(s) shall keep sufficient inventory of Critical Reagents to carry out reasonable demand or orders for NTx Meter Strip(s) without undue delay. 3.7 FACILITIES STANDARDS. At all times during the term of this Agreement, Hologic and its designated manufacturer(s) shall provide or cause to be provided such warehousing and transport facilities as are both commercially reasonable and adequate under the applicable regulations, product requirements, and industry standards of all relevant jurisdictions under this Agreement. 4. PRODUCT MANAGEMENT COMMITTEE. Within thirty (30) day of the Effective Date, the parties shall form a Product Management Committee consisting of two (2) named representatives each from Hologic and Ostex respectively, and one (1) named representative (non-voting) from Serex, which committee shall have the responsibility to oversee and coordinate development, marketing, promotional, Sales, and distribution efforts and other activities required or permitted by this Agreement respecting the NTx Meter System. The committee shall meet at least once per quarter, at locations and at times to be agreed, and shall undertake the responsibilities set out in this Agreement, as well as the obligation to regularly review development status, marketing and sales forecasts, actual sales performance, competitive activities, and promotional plans. The committee shall attempt to operate by consensus, and shall take no action without approval of a majority of voting members. The committee may delegate certain of its functions to subcommittees or individual members. Each party shall cause its members to work diligently to promote the commercial success of the NTx Meter System. Either party may change its representatives assigned to said committee by fifteen (15) days advance written notice provided pursuant to SECTION 21 of this Agreement. 5. ROLE OF THE PARTIES IN THE DEVELOPMENT AND REGULATORY APPROVAL OF THE NTX METER SYSTEM. 5.1 GOALS. The parties have established the development goals set out herein, which goals are anticipated to be accomplished within the general time periods set out therein, as said development goals may be specified in more detail or amended from time to time, provided that Hologic shall use and shall cause Serex to use its best commercial efforts to complete development of the NTx Meter System and to obtain regulatory approval thereof for XXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXX. 5.2 CONSULTATION AND AVAILABILITY OF OSTEX KNOW-HOW. Each party shall perform the activities assigned to it, and shall make available key employees to provide consultation, advice, assistance, and scientific direction in furtherance of the objectives of this Agreement. Without limiting the generality of the foregoing, Ostex shall make available to Hologic and to Serex personnel trained in and knowledgeable of the WRF Bone Resorption Technology and performance characteristics of the NTx Assay Technology. Except as otherwise specifically provided in this Agreement, each party shall bear its own costs and expenses associated with all facilities, materials, and employee time devoted to this effort. Neither party shall be obligated to disclose their Confidential Information to the other, except to the extent necessary for the performance of each party's obligations under this Agreement. 5.3 SEREX ROLE. Hologic shall cause Serex to use its best commercial efforts, pursuant to the Hologic/Serex Agreement, to (a) integrate the Ostex NTx Assay Technology to work with the SARA Format to create the NTx Meter Strip; (b) cooperate with Hologic to develop the NTx Meter; and (c) cooperate with Hologic and Ostex in the conduct of clinical trials and the obtaining of regulatory approvals for the NTx Meter System as a whole. 5.4 HOLOGIC ROLE. Pursuant to the Hologic/Serex Agreement, Hologic shall (a) cooperate with Serex in connection with, and continue to fund, development of the NTx Meter Strip XXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXX XXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXX; (b) arrange, manage and fund development of the NTx Meter XXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXX XXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXX; and (c) arrange, manage, and fund conduct of clinical trials and the obtaining of regulatory approvals for the NTx Meter System XXXXXXXXXXXXXXXXXXX XXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXX. 5.5. OSTEX ROLE. 5.5.1 GENERALLY. Pursuant to SECTIONS 2.1 and 3.1 of this Agreement, Ostex shall --------- ------------- (a) provide the license and Critical Reagents specified therein; (b) cooperate with Hologic to develop the NTx Meter and (c) cooperate with Hologic and Serex in the conduct of clinical trials and the obtaining of regulatory approvals for the NTx Meter System. 5.5.2 OSTEX FUNDING. In addition, Ostex shall reimburse Hologic for XXXXXXXXXXXX of Hologic's funding paid out in support of Serex's development efforts, Meter development, support of clinical trials and regulatory approval, upon receipt of Hologic's invoice to Ostex for the previous calendar quarter's expenses, to a maximum of XXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXX (the "Maximum Cost") which is one-hundred ten percent (110%) of the total of the amounts set out in SECTION 5.4 above. If at any time, it appears that the cost of the Serex development effort for the NTx Meter System will exceed said Maximum Cost, the parties will meet and use their best efforts to negotiate, in good faith, an appropriate agreement to allocate any such excess. Failing agreement, either party may terminate this Agreement without penalty upon thirty (30) days advance written notice to either party, provided that the other party may agree during such notice period to reimburse the entire excess, in which case royalties payable pursuant to SECTIONS 7.3 and 7.4 shall be adjusted to reflect the overall percentage of funding paid by each party during the period beginning January 1, 1997. 5.5.3 ACCESS TO CLINICAL DATA. Ostex shall provide Hologic and Serex with full access to all clinical trial data and regulatory submissions, and make available all urine samples, collected by Ostex that pertain to the NTx Assay Technology and to the activities of Hologic and Serex under this Agreement. It is acknowledged that such information will be subject to the confidentiality provisions set out in this Agreement as well as confidentiality provisions necessary to protect patient privacy; provided, however, that such information may, as necessary and appropriate, be transmitted to proper regulatory authorities in connection with the seeking of regulatory product approvals. 5.5.4. TECHNICAL SUPPORT. Ostex shall assist Hologic and Serex, at either's reasonable request, in the technical training of a mutually determined number of Hologic and/or Serex's employees, such training to include provision of information as to the nature, use and proper care of Critical Reagents. Any such training shall be provided at Ostex's principal place of business, and Hologic shall be solely responsible for all costs of transportation, lodging, and other expenses of trainees incidental to such training. During the term hereof, Ostex shall use its commercially reasonable efforts to respond to technical questions or problems which may arise from time to time in connection with the Critical Reagents, WRF Bone Resorption Technology and Ostex Intellectual Property. 6. ROLE OF THE PARTIES IN MANUFACTURE AND COMMERCIALIZATION OF NTX METER TEST. 6.1 MANUFACTURING. Pursuant to the Hologic/Serex Agreement, Hologic shall, within a reasonable time period following FDA approval, develop the capacity to manufacture or have manufactured reasonable commercial quantities of the NTx Meter and NTx Meter Strips. Hologic may have Serex and/or third parties manufacture and package the NTx Meter Strips (provided that they have agreed to be bound by the terms of this Agreement, including its provisions relating to confidentiality), and may manufacture the NTx Meter itself or utilize third parties to do so, provided that Hologic shall first furnish Ostex with evidence demonstrating any such third party's capability to manufacture such NTx Meter Strips or NTx Meters pursuant to GMP and all applicable regulatory requirements. 6.2 COMMERCIALIZATION. Six months prior to the anticipated First Commercial Sale of NTx Meter Systems under this Agreement, but in no event longer than 24 months from the effective date of this Agreement, Hologic and Ostex, acting through the Product Management Committee, shall agree on a marketing plan for said NTx Meter Systems for the following twelve months (a "Marketing Year") that will be appended to this Agreement as ATTACHMENT 6.2. The parties anticipate that such Attachment will cover marketing activities and will require each party to spend, individually, XXXXXXXXXXXXXXXXXXXXXX of anticipated total Gross Sales by both parties together of NTx Meter Strips and NTx Meters for such year (as this number is determined by the Product Management Committee) on marketing activities therefor. The Product Management Committee shall agree on a new marketing plan for each subsequent Marketing Year during the term of this Agreement; provided that such marketing plan shall not require either party to spend XXXXXXXXXXXXXXXXX of that party's individual Gross Profit received from its Sales of NTx Meter Systems during the immediately preceding Marketing Year (not including royalties received from the other party pursuant to SECTIONS 7.3 or 7.4 hereof), provided further that if the Product Management Committee is not able to agree on a marketing plan for any such subsequent Marketing Year, the marketing plan (including budgetary allocations) for the immediately preceding Marketing Year shall be repeated with expenditures equivalent to the dollar expenditures of such preceding Marketing Year. If either party does not spend the amount so designated pursuant to the marketing plan for any Marketing Year of this Agreement, the other party shall, in addition to any other remedy provided under this Agreement, be entitled to take a credit against royalties payable by it for the subsequent Marketing Year equal to the shortfall. Said Product Management Committee will also establish for each Marketing Year of the term a designated quantity of NTx Meter Strips to be purchased by each party pursuant to this Agreement, and distributed as "promotional samples" without customer charge, and without royalty to either party. For the first Marketing Year, the parties expect to designate not less than 30% of the anticipated production of NTx Meter Strips as such "promotional samples" provided that this percentage may be revised by the Product Management Committee in light of market conditions and strategy, allocated 50% to each party or as otherwise agreed. 6.3 Supply of Critical Reagents. Ostex shall use its best commercial efforts to supply the need of Hologic and its designated manufacturer(s) for Critical Reagents as necessary to meet the demand for NTx Meter Systems, in accordance with purchase orders received by Ostex from Hologic and its designated manufacturer(s), and in SECTIONS 6.3.1 AND 6.3.2 below. 6.3.1 FORECAST OF DEMAND. Within sixty days of the start of each calendar quarter, Hologic or its designated manufacturer(s) shall deliver to Ostex a "rolling" forecast of quantities of Critical Reagents to be purchased by Hologic and its designated manufacturer(s) and supplied by Ostex during each month of the following quarter, and each of the subsequent three quarters (the "Rolling Forecast"). Each Rolling Forecast shall be considered a purchase order with respect to the forecasted demand for Critical Reagents over the first three months thereof. The forecasted demand for the first subsequent quarter shall be relied on by Ostex for purposes of its manufacturing and supply obligations hereunder, but Hologic and its designated manufacturer(s) may vary from its initial forecast for such quarter by no more than twenty-five percent (25%). The forecasted demand for the final two quarters of each Rolling Forecast shall be used by Ostex for planning purposes, but Hologic and its designated manufacturer(s) shall not be bound by its initial forecast(s), nor shall Hologic or its designated manufacturer(s) be liable to Ostex with respect to any changes thereto. 6.3.2 ALLOCATION OF PRODUCTION. In the event that Ostex does not meet the demand for Critical Reagents ordered pursuant to SECTION 6.3.1, Ostex shall allocate overall production of Critical Reagents (whether manufactured or purchased, and whether for Ostex's internal manufacturing or for Sale) such that Hologic and its designated manufacturer(s) receives the same proportion of the amount of the Critical Reagents it has ordered (pursuant to SECTION 6.3.1 hereto) as Ostex allocates to its own manufacture of products utilizing the NTx Assay Technology, or to its otherwise most favored non-end-user customer, whichever proportion is greater (measured as a proportion of total units of production), provided that Ostex shall not be required to sell to Hologic and its designated manufacturer(s) any more than thirty percent (30%) of its total production of any Critical Reagent during any quarter. 6.3.3 EXERCISE OF MANUFACTURING OPTION. In the event that Ostex does not for any reason, for a period of thirty (30) days, meet (through internal or third-party manufacture), Hologic's demand for Critical Reagents which comply with SECTION 3.4 hereof, ordered pursuant to SECTION 6.3.1 hereof, Hologic shall be entitled, upon fifteen (15) days written notice, to exercise the option to manufacture such Critical Reagents described in SECTION 2.2 hereof. Any Hologic exercise of said option shall not relieve Ostex of its obligations pursuant to this SECTION 6.3. Upon any Hologic exercise of said option, Ostex shall provide to Hologic subject to the provisions of SECTION 10 of this Agreement, all information necessary to so manufacture such Critical Reagents, provided that Hologic shall not disclose to Serex any Confidential Information so disclosed without the prior written approval of Ostex which approval may be conditioned or withheld at Ostex's sole discretion. 6.4 PUBLICATIONS. Each party shall, throughout the term of this Agreement, use its continuing commercially reasonable efforts to develop documentation and publish scientific articles directly or indirectly supporting the clinical utility of the NTx Meter System. Such publications will be submitted to the other party for review and approval prior to publication, and shall be subject to the requirements of SECTION 16.2 hereof regarding the use of trademarks. 7. ROLE OF THE PARTIES IN THE SALES OF THE NTX METER TEST. 7.1 The parties' general agreement is that Hologic and Ostex shall each sell NTx Meter Strips and NTx Meters as they see fit, and shall share the profits associated therewith in accord with the reciprocal royalty mechanisms more specifically described in this Section. 7.2 OSTEX PURCHASE OF NTX METER STRIPS AND METERS Hologic shall use its commercially reasonable efforts to supply the need of Ostex to meet the demand for NTx Meter Strips and NTx Meters, in accordance with purchase orders received by Hologic from Ostex, and in accordance with the rolling forecast and allocation provisions specified in Sections 7.2.10 and 7.2.11 below. 7.2.1 Ostex shall pay Hologic a non-royalty transfer price for NTx Meter Strips and NTx Meters sold pursuant to this Section equal to XXXXXXXXXXXXXXX therefor (including any extra charge for Ostex-requested modifications to standard packaging as may be agreed). 7.2.2 Payment for each shipment of NTx Meter Strips and NTx Meters shall be made by Ostex within 30 days of the date of invoice, it being agreed that such invoice shall not be dated prior to shipment of the NTx Meter Strips and NTx Meters to which such invoice relates. 7.2.3 THIRD-PARTY MANUFACTURING ON BEHALF OF HOLOGIC. In the event that Hologic licenses a third party to manufacture NTx Meter Strips or NTx Meters to be supplied to Ostex under this Agreement, Hologic shall ensure and provide evidence to Ostex demonstrating that such third-party manufacturer complies with good manufacturing practices (GMP) and all applicable governmental regulations relating thereto and is either in compliance with or working toward compliance with the quality standards established by the International Standards Organization, Rules 9000 et seq. and amendments or successors thereto ("ISO 9000"). 7.2.4 PRODUCT WARRANTY; QUALITY CONTROL. Hologic warrants to Ostex that all NTx Meter Strips and NTx Meters sold by Hologic to Ostex hereunder shall (i) comply with the product specifications attached hereto as ATTACHMENT 7.2.4 when used in accord with applicable Hologic instructions, as modified by mutual agreement of the parties, (ii) be free from defects in material, workmanship and design, and (iii) comply with all applicable laws, rules and regulations related to the manufacture and distribution of such product (to the extent applicable to a manufacturer). Without limiting the generality of the foregoing, Hologic warrants that all NTx Meter Strips and NTx Meters manufactured and supplied for the United States market under this Agreement shall be manufactured, tested, documented, packaged, and transported in compliance with GMP requirements of the FDA including, without limitation, 21 CFR Part 820 and any amendments or successors thereto; and that all NTx Meter Strips and NTx Meters manufactured and supplied under this Agreement, regardless of intended market, shall be manufactured, tested, documented, packaged and transported in compliance with appropriate quality assurance requirements agreed to by the parties. Ostex shall have the right to audit and inspect Hologic facilities, books, and records to confirm such compliance. Hologic further represents that is working toward compliance with the quality standards established by ISO 9000 and warrants that it will comply with such standards when legally required to do so. In the event that Ostex demonstrates within one year of receipt that any product supplied pursuant to this Agreement fails to meet these specifications and warranties, Hologic shall, as Ostex's sole remedy for such failure, replace said product (returned by Ostex to the factory pursuant to Hologic's reasonable standard return procedures) with product which conforms to the above specifications and warranties, provided that Hologic shall not be obligated to replace NTx Meter Strips distributed as "Promotional Samples" which pass Hologic quality assurance tests and comply with all FDA and other governmental regulations relating to such Promotional Samples. These warranties shall not apply to any item that is subjected to abuse, stress, or misuse; or used in any manner inconsistent with applicable Hologic instructions; or insofar as any such warranty violation is caused by Ostex's violation of its warranties set out in SECTION 3.4 hereof. 7.2.5 CUSTOMS AND TAXES. With respect to international shipments of any goods purchased, sold, distributed, or otherwise transferred hereunder, including the Critical Reagents, the purchasing party shall be responsible for clearing all such goods through customs and shall pay any and all taxes and/or duties imposed by any governmental authority in connection therewith. 7.2.6 DELIVERY. All NTx Meter Strips and NTx Meters purchased by Ostex under this Agreement shall be shipped FOB manufacturer's dock. 7.2.7 INVENTORY. At all times during the distribution term of this Agreement, Hologic shall supply and Ostex shall keep sufficient inventory of NTx Meter Strips and NTx Meters to carry out reasonable demand for orders therefor without undue delay. 7.2.8 FAILURE OF PAYMENT. In the event that Ostex fails to comply with the payment terms of this Section, Hologic shall have the right, in addition to all other rights available under this Agreement, to suspend further shipment of NTx Meter Strips and NTx Meters until such breach is cured. 7.2.9 FACILITIES STANDARDS. At all times during the term of this Agreement, Ostex shall provide or cause to be provided such warehousing and transport facilities as are both commercially reasonable and adequate under the applicable regulations, product requirements, and industry standards of all relevant jurisdictions under this Agreement. 7.2.10 FORECAST OF DEMAND. Within thirty days of the start of each calendar quarter, Ostex shall deliver to Hologic a "rolling" forecast of the quantities of NTx Meter Strips and NTx Meters to be purchased by Ostex and supplied by Hologic during each month of the following quarter,. and each of the subsequent three quarters (the `Rolling Forecast"). Each Rolling Forecast shall be considered a purchase order with respect to the forecasted demand for NTx Meter Strips and NTx Meters over the first three months thereof. The forecasted demand for the first subsequent quarter shall be relied on by Hologic for purposes of its manufacturing and supply obligations hereunder, but Ostex may vary from its initial forecast for such quarter by no more than twenty-five percent (25%). The forecasted demand for the final two quarters of each Rolling Forecast shall be used by Hologic for planning purposes, but Ostex shall not be bound by its initial forecast(s), nor shall Ostex be liable to Hologic with respect to any changes thereto. 7.2.11 ALLOCATION OF PRODUCTION. In the event that Hologic does not meet the demand for NTx Meters or NTx Meter Strips ordered pursuant to SECTION 7.2.10, Hologic shall allocate overall production thereof such that Ostex receives the same proportion of the amount of the NTx Meters and NTx Meter Strips it has ordered (pursuant to SECTION 7.2.10 hereto) as Hologic allocates for its direct sale, or to its otherwise most favored non-end-user customer, whichever proportion is greater (measured as a proportion of total units of production), provided that Hologic shall not be required to sell to Ostex and any more than fifty percent (50%) of its total production during any quarter. 7.3 OSTEX ROYALTY ON SALES OF NTX METER STRIPS AND NTX METERS. Subject to the terms of SECTION 7.5 hereof, Ostex shall pay to Hologic a royalty equal to XXXXXXXXXXXXXXXXXXXXXXXXXXX XXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXX. Ostex shall make the royalty payments required by this Section not later than forty-five (45) calendar days following the end of each calendar quarter. At such time, Ostex shall also provide Hologic with a full accounting of units disposed of, Gross Sales, Net Sales, COGS, and Gross Profits attributable thereto for said quarter. 7.4 HOLOGIC ROYALTY ON SALES OF NTX METER STRIPS AND NTX METERS. Subject to the terms of SECTION 7.5 hereof, Hologic shall pay to Ostex a royalty equal to XXXXXXXXXXXXXXXXXXXXXXXXX XXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXX., provided that Hologic shall not be required to make any royalty payment with respect to dispositions of NTx meter technology incorporated into or sold as a package with or part of, other Hologic equipment, XXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXX. Hologic shall make the royalty payments required by this Section not later than forty-five (45) calendar days following the end of each calendar quarter. At such time, Hologic shall also provide Ostex with a full accounting of units disposed of, Gross Sales, Net Sales, COGS, and Gross Profits attributable to its Sales of NTx Meter Strips, NTx Meters, and NTx meter technology (but not other Hologic equipment into which said technology may be incorporated or packaged) for said quarter. 7.5 ADJUSTMENT TO ROYALTIES. Following the end of the first year period beginning with the First Commercial Sale, and each subsequent year period, if either party's Gross Sales of NTx Meter Strips for the prior year period was not equal to or greater than XXXXXXXXXXX XXXXXXXXXXXXXXX by both parties of such NTx Meter Strips, the royalty payable on said NTx Meter Strips for the following year period by "the party with the larger Sales" shall be adjusted downward by XXXXXXXXXXXXXXXXXXXX that the total Sales of NTx Meter Strips by XXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXX of such NTx Meter Strips, unless "the party with the larger Sales" waives this adjustment. 7.6 SERIOUS INJURY. Each party shall within twenty-four hours advise the other by telephone, (with follow-up hard copy, receipt confirmed) of any adverse effect or malfunction related to the NTx Meter Strips or the NTx Meter or the Critical Reagents (whether incorporated in NTx Meter Strips or in any other product, including but not limited to the OsteomarkAE Laboratory Test) of which the notifying party gains knowledge during the term of this Agreement that may have caused or contributed to, or should it reoccur is likely to cause or contribute to, serious injury, illness, or death. The notifying party shall include in the notification the name, address, and telephone number of the person or entity purchasing the product in question, the name, address, and telephone of the patient (if different), and the lot or serial number of the NTx Meter Strip or NTx Meter involved in the incident, as appropriate. 7.7 PRODUCT RECALL. If either party believes that a product recall is necessary or appropriate, it will promptly notify the other, and the parties will (unless such recall is required by law) discuss whether such recall is necessary or appropriate, and shall discuss the manner in which any agreed or required recall shall be conducted. If a recall is not required by law and the parties cannot agree whether the recall is necessary or appropriate, either party may elect to conduct the recall in question The parties shall cooperate with each other in conducting any such recall. All out of pocket costs of a required or agreed recall insofar as such recall relates to Critical Reagents (except printing and mailing costs incurred to notify customers of such recall), shall be borne by Ostex. All out of pocket costs of a required or agreed recall except insofar as such recall relates to Critical Reagents or the NTx Assay Technology ( except printing and mailing costs incurred to notify customers of such recall), shall be borne by Hologic. All costs of a recall to which the parties have not agreed shall be borne by the party that elects to conduct the recall, provided that if a court of competent jurisdiction determines that said recall was caused by (i) the fact that any Critical Reagents or the NTx Assay Technology were in violation of applicable law or the terms of this contract, Hologic may obtain reimbursement by Ostex of all reasonable out of pocket costs and expenses of such recall (except for printing and mailing costs incurred to notify customers of such recall), or (ii) the fact that any NTx Meter or NTx Meter Strip(s) were otherwise in violation of applicable law or the terms of this contract, Ostex may obtain reimbursement by Hologic of all reasonable out of pocket costs and expenses of such recall (except for printing and mailing costs incurred to notify customers of such recall. Each party shall maintain complete and accurate records of all product sold by it for such periods as required by law. Nothing in this Section shall be construed to modify or limit any legal obligation of either party with respect to any recall. 7.8 CORRECTIVE ACTION. If any government agency with jurisdiction shall request or order any corrective action with respect to any Critical Reagent, or NTx Meter or NTx Meter Strips, including but not limited to any recall, customer notice, restriction, change, market action, or modification of the product in question, and the cause or basis for such corrective action is primarily attributable to a condition, fact, or action that (i) constitutes a breach by a party of any of its warranties, representations or covenants contained herein, or (ii) a party knew or should have known would require such corrective action; then such party shall be liable for and shall reimburse the other party for all costs incurred as a result of such action, including replacement cost of any product affected thereby. 8. BOOKS AND RECORDS; AUDITS. Each party to this Agreement shall maintain accurate books and records with respect to all Critical Reagents and NTx Meters and NTx Meter Strips. Upon the request of the other party, each party will provide the requesting party or its independent public accountant with access, but no more than once per calendar year, during regular business hours and upon reasonable advance prior notice, to all accounting records necessary or appropriate to verify amounts owed. Any adjustment determined appropriate by such audit shall be due and payable within thirty (30) days following completion of such audit, together with interest calculated at a rate equal to the prime lending rate reported in the Wall Street Journal for the last day of the audited period plus two percent (+2%), or the maximum interest rate then permitted under the laws of Massachusetts, whichever rate is lower. All fees for such audits shall be borne by the requesting party unless the audit shows an under reporting of amounts due of five percent (5%) or more, in which case the costs of said audit shall be borne by the party being audited. 9. OWNERSHIP OF DISCOVERIES. It is the intent of the parties that the ownership of any and all Discoveries resulting from this Agreement, regardless of inventorship, shall: (a) vest solely in Ostex to the extent that such rights relate exclusively to the NTx Assay Technology; and (b) vest solely in Serex to the extent that such rights relate exclusively to the SARA Format or adaptation of the NTx Assay Technology for use with the SARA Format; and (c) vest solely in Hologic to the extent that such rights relate exclusively to the NTx Meter or use of NTx Meter Strips with the NTx Meter; and (d) in all other cases vest in the party or parties of the inventor. 10. OBLIGATION NOT TO DISCLOSE CONFIDENTIAL INFORMATION. Recipient shall not at any time, and shall cause Serex (in the case of Hologic) and its permitted assigns and sublicensees (in the case of either party) to commit not to at any time for a period of seven (7) years following the termination of this Agreement, disclose or otherwise make known or available to any person, firm, corporation, or other entity other than Discloser any Confidential Information received from the other party without the express prior written consent of that other party. With respect to Confidential Information developed under this Agreement and which is not Confidential Information of one party only, neither party shall disclose or otherwise make such Confidential Information known or available to any person, firm, corporation, or other entity without the express prior written consent of the other party, not to be unreasonably withheld or delayed. Recipient shall utilize reasonable procedures to safeguard Confidential Information, including releasing Confidential Information only to those employees to whom disclosure is necessary or appropriate for the Recipient to undertake its responsibility pursuant to this Agreement. Nothing in this Agreement shall prevent Recipient from disclosing Confidential Information to government agencies for regulatory purposes. 10.1 RECIPIENT'S OWN USE OF CONFIDENTIAL INFORMATION. Recipient shall not make any use, directly or indirectly, of any Confidential Information of the other party except in the ordinary course of business pursuant to this Agreement or any other specific, written agreement entered into between Ostex and Hologic. 10.2 SPECIFIC PERFORMANCE. The parties acknowledge that: (a) the covenants set forth in this SECTION 10 are essential to the activities contemplated by this Agreement; (b) but for the agreement of each party to comply with such covenants, neither party would have entered into such activities; (c) each party has consulted with or has had the opportunity to consult with counsel and has been advised in all respects concerning the reasonableness of such covenants as to time and scope; (d) Discloser may have no adequate remedy at law if Recipient violates or fails to perform under this SECTION 10; and (e) Discloser shall have the right, in addition to any other rights it may have, to seek from a court of competent jurisdiction preliminary and permanent injunctive relief to restrain any breach or threatened breach or otherwise to specifically enforce Recipient's obligations under this SECTION 10 if Recipient fails to perform in accordance herewith. 11. SEREX DEVELOPMENT OF PLP TEST. Both parties acknowledge that Serex has developed the PLP Assay, which determines the levels of a peptide linked pyridinoline resulting from bone resorption, under the Hologic/Serex Agreement. Notwithstanding any other provision of this Agreement, nothing shall prevent Serex and/or Hologic from continuing this development or commercializing or selling any results thereof, or from using any information provided or gained as a result of this Agreement, or any derivative thereof, including Ostex Know-How and Confidential Information, in the course of these activities, provided that Hologic and Serex otherwise comply with the requirements of SECTION 10 hereof, and provided always that Serex and Hologic shall not be entitled to use for said purposes any intellectual property received pursuant to Hologic's election to manufacture of Critical Reagents pursuant to SECTION 2.2 hereof. This provision shall not be construed to provide Hologic or Serex with any right to use any Ostex Patent Rights for any purpose not specifically permitted by this Agreement, or to extend any Ostex Intellectual Property to cover the PLP Assay. 12. TERM AND TERMINATION. 12.1 INITIAL LICENSE TERM, AUTOMATIC RENEWAL. This Agreement shall be in full force and effect as of the date first written above and shall remain in effect XXXXXXXXXXXXthereafter unless sooner terminated pursuant to this Section 12. On the XXXXXX and subsequent anniversaries of the date hereof, the term of this Agreement shall (subject to SECTION 12.5 below) be automatically continued for a period of XXXXXXXXXXXXXXXXXXX, unless either Hologic delivers to Ostex, or Ostex delivers to Hologic, at least ninety (90) days prior to such anniversary date, a written notice of its intent to disengage for cause based upon failure of such other party to use commercially reasonable efforts toward the achievement of market objectives for NTx Meter Systems, in light of factors to include, without limitation, profits, sales volume, market development, and the capture of market share. In such event, if the parties are unable through good-faith negotiations to agree to terms and conditions for further extension of the term hereof, this Agreement and all license rights granted hereunder shall terminate as of the anniversary date to which the notice of intent to disengage applies, without liability of either party to the other in consequence of such termination. 12.2 TERMINATION BY OSTEX. Ostex shall have the right to terminate this Agreement immediately upon notice in the event that: (a) Hologic fails to complete development of the NTx Meter or to cause Serex to complete development of the NTx Meter Strip in accord with the specifications set out in ATTACHMENT 7.2.4 XXXXXXXXXXXXXXXXXXXXXXXXX XXXXXXXXXXX, or to obtain regulatory approval therefor for the United States within XXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXX; or (b) Hologic materially breaches or fails to perform in a timely manner any of its material duties or obligations hereunder, and such breach shall remain uncured, or the failure to perform shall continue, for at least sixty (60) days after Ostex has given notice of such breach or failure. Without limiting the generality of the foregoing, a "material breach" or "failure to perform" shall include without limitation, any failure to remit payments, or failure to comply with any financial reporting requirement, or failure to maintain Hologic's rights pursuant to the Hologic/Serex Agreement.. 12.3 TERMINATION BY HOLOGIC. Hologic shall have the right to terminate this Agreement immediately upon notice in the event that (a) Hologic fails to complete development of the NTx Meter or to cause Serex to complete development of the NTx Meter Strip in accord with the specifications set out in ATTACHMENT 7.2.4 XXXXXXXXXXXXXXXXXXXXXXXXX XXXXXXXX, or to obtain regulatory approval therefor for the United States within XXXXXX XXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXX for any reason other than as a result of Hologic's material breach of its obligations under this Agreement; or (b) Ostex has materially breached or failed to perform in a timely manner any of its material duties or obligations hereunder, and such breach shall remain uncured, or the failure to perform shall continue, for at least sixty (60) days after Hologic has given notice of such breach or failure to Ostex. Without limiting the generality of the foregoing, a "material breach" or "failure to perform" shall include without limitation, any failure to remit payments, or failure to comply with any financial reporting requirement, or failure to maintain Ostex's rights pursuant to the WRF/Ostex Exclusive License Agreement. 12.4 TERMINATION FOR TECHNICAL DEFECT. 12.4.1 BY OSTEX. If within ninety (90) days of the Effective Date, Ostex determines that a material technical deficiency exists in the SARA Format which is likely to prevent Serex or Hologic from completing development of an NTx Meter Strip which meets the Product Specifications described in ATTACHMENT 7.2.4 within the time period set out in SECTION 12.2(A) above, Ostex shall provide a notice thereof to Hologic which describes in detail said purported deficiency and the impact thereof on the specifications and/or time frame for development. Upon receipt of such notice, Hologic shall conduct a though review of the subject matter of said notice, provide to Ostex a detailed report of how Hologic or Serex plan to resolve the issues raised and to meet the relevant specifications and/or time frame, and meet with Ostex to review said report. If Hologic fails to provide said report within fifteen (15) business days following receipt of such notice, Ostex may within ten business days following the final due date of such report, terminate this Agreement upon written notice without liability of any sort. 12.4.2 BY HOLOGIC. If within ninety (90) days of the Effective Date, Hologic determines that a material technical deficiency exists in the NTx Assay Technology or Critical Reagents which is likely to prevent Serex or Hologic from completing development of an NTx Meter Strip which meets the Product Specifications described in ATTACHMENT 7.2.4 within the time period set out in SECTION 12.2(A) above, Hologic shall provide a notice thereof to Ostex which describes in detail said purported deficiency and the impact thereof on the specifications and/or time frame for development. Upon receipt of such notice, Ostex shall conduct a though review of the subject matter of said notice, provide to Hologic a detailed report of how Ostex plans to resolve the issues raised and to meet the relevant specifications and/or time frame, and meet with Hologic to review said report. If Ostex fails to provide said report within fifteen (15) business days following receipt of such notice, Hologic may within ten business days following the final due date of such report, terminate this Agreement upon written notice without liability of any sort. 12.4 BANKRUPTCY OF A PARTY. 12.4.1 OSTEX BANKRUPTCY. All rights and licenses granted under or pursuant to this Agreement by Ostex to Hologic are, and shall otherwise be deemed to be, for purpose of Section 365(n) of Title 11, U.S. Code (the "Bankruptcy Code"), licenses of rights to "intellectual property" as defined under Section 101(60) of the Bankruptcy Code. The parties agree that Hologic, as a licensee of such rights under this Agreement, shall retain and may fully exercise all of its rights and elections under the Bankruptcy Code. 12.4.2 HOLOGIC BANKRUPTCY. All rights and licenses granted under or pursuant to this Agreement by Hologic to Ostex are, and shall otherwise be deemed to be, for purpose of Section 365(n) of Title 11, U.S. Code (the "Bankruptcy Code"), licenses of rights to "intellectual property" as defined under Section 101(60) of the Bankruptcy Code. The parties agree that Ostex, as a licensee of such rights under this Agreement, shall retain and may fully exercise all of its rights and elections under the Bankruptcy Code. 12.5 RESERVED 12.6 MAXIMUM TERM. Notwithstanding any provision of this Agreement to the contrary, the license granted with respect to the Ostex Patent Rights under SECTION 2 above shall terminate upon expiration of the last remaining Ostex Patent Right. Upon such expiration, Hologic shall be deemed to have a perpetual, worldwide, royalty free license to manufacture, make, have manufactured or made, use, market, sell, and distribute NTx Meter Strips worldwide except Japan for any application. 12.7 RIGHTS AND DUTIES UPON TERMINATION. 12.7.1 PAYMENTS. Upon termination of this agreement, each party shall pay to the other all payments that are due and have accrued and are outstanding as of the date of termination. 12.7.2 RETURN OF MATERIALS. Within thirty (30) days following termination of this Agreement, each party having possession of or control over any Confidential Information of the other party shall return to such other party all written and otherwise recorded or stored matter containing such Confidential Information, including all original matter and all copies thereof; provided, however, that each party's legal department or outside counsel may retain one copy of the Confidential Information in its confidentially maintained files, solely for the purpose of identifying information to be protected pursuant to any applicable non-disclosure obligation. 12.7.3 NTX METER STRIPS REMAINING. Upon termination of this Agreement, Hologic shall have the right to sell NTx Meter Strips then remaining in its possession or to be manufactured using Critical Reagents then held in inventory, and Ostex may sell NTx Meter Strips then remaining in its possession, within a reasonable time after termination hereof; provided, however, that all such Sales shall be subject to the royalty provisions of this Agreement, notwithstanding termination. Alternatively, Hologic may return Critical Reagents remaining in inventory and in good condition to Ostex for a refund of the original transfer price (or for credit toward any amounts due). 12.7.4 SURVIVAL OF TERMS. Notwithstanding any other provision herein to the contrary, SECTIONS 3.4, 7.2.4, 7.3, 7.4, 7.6-7.8, 8-13, 16.4, 16.5, and 18-28 of this Agreement shall survive any termination or expiration hereof. 13. REPRESENTATIONS, WARRANTIES AND INDEMNITIES. 13.1 BY OSTEX. Ostex represents and warrants to Hologic as follows: 13.1.1 ORGANIZATION AND AUTHORITY. As of the Effective Date of the Agreement, Ostex is a corporation duly organized, validly existing and in good standing under the laws of the State of Washington, USA, has all requisite corporate power and authority to carry on its business and perform its obligations hereunder, and is duly qualified to do business in any of those jurisdictions in the United States of America where failure to qualify could have a material adverse effect on its ability to perform its obligations hereunder. The execution and delivery of this Agreement by Ostex, and the performance of the obligations of Ostex contemplated hereby, have been duly and validly authorized by all necessary legal action on its part, and this Agreement is legal, valid and binding against Ostex in accordance with its terms. Except as have been or will be obtained by Ostex, no permit, consent, approval or authorization of, or declaration to or filing with, any person, party or governmental or regulatory authority of the United States is required in connection with the delivery, consummation and/or performance by Ostex of this Agreement. As of the Effective Date of the Agreement, Ostex is in full compliance with the WRF/Ostex Exclusive License Agreement and has not been notified of any assertion that it is in default of said WRF/Ostex Exclusive License Agreement or that WRF plans to terminate any Ostex rights thereunder. Ostex shall immediately notify Hologic if it receives any notice that it is in default of said WRF/Ostex Exclusive License Agreement or that WRF plans to terminate any Ostex right thereunder. 13.1.2 OSTEX PATENT RIGHTS AND OSTEX KNOW-HOW. As of the Effective Date of the Agreement, and except as described in ATTACHMENT 13.1.2 to this Agreement, (a) Ostex has sole and exclusive rights to the Ostex Patent Rights and all rights necessary to convey Ostex Know-How to Hologic and Serex; (b) the Ostex Patent Rights, to the best knowledge of Ostex are valid and enforceable, and do not infringe on the proprietary rights of any third party: (c) Ostex is not aware of any "prior art" or other claim which would invalidate any part or all of the Ostex Patent Rights; or any claim that Ostex does not have all rights to use and permit Hologic and Serex to use the Ostex Know-How for all purposes permitted by this Agreement; (d) Ostex is not aware of any unexpired patent or pending patent application of a party not a party to this agreement which has claims which cover any part of the Ostex Know-How or Ostex Patent Rights; and (e) Ostex has taken all necessary actions to maintain all Ostex Patent Rights in full force and effect. 13.1.3 NO DEFAULT. The execution, delivery and performance of this Agreement by Ostex does not and shall not conflict with, result in a breach of, or constitute a default under (with or without the giving of notice, or the passage of time, or both), any agreement or instrument to which Ostex is a party or by which it is bound. 13.1.4 OSTEX'S DISCLAIMER OF OTHER WARRANTIES. Ostex disclaims all implied warranties, including without limitation any warranty of merchantability or fitness for a particular purpose. EXCEPT AS EXPRESSLY SET FORTH IN THIS AGREEMENT, OSTEX MAKES NO REPRESENTATIONS AND EXTENDS NO WARRANTIES OF ANY KIND, EITHER EXPRESS OR IMPLIED, INCLUDING NO WARRANTIES OF MERCHANTABILITY OR FITNESS FOR A PARTICULAR PURPOSE. 13.2 BY HOLOGIC. Hologic represents and warrants to Ostex as follows: 13.2.1 ORGANIZATION AND AUTHORITY. As of the Effective Date of the Agreement, Hologic is duly organized, validly existing and in good standing under the laws of Delaware, USA has all requisite power and authority to carry on its business and the performance of its obligations hereunder, and is duly qualified to do business in any of those jurisdictions where failure to qualify could have a material adverse effect on its ability to perform its obligations hereunder. The execution and delivery of this Agreement by Hologic, and the performance of the obligations contemplated hereby, have been duly and validly authorized by all necessary legal action on its part, and this Agreement is legal, valid and binding against Hologic in accordance with its terms. Except as have been or will be obtained by Hologic, no permit, consent, approval or authorization of, or declaration to or filing with, any person, party or governmental or regulatory authority having jurisdiction is required in connection with the delivery, consummation and/or performance of this Agreement As of the Effective Date of the Agreement, Hologic is in full compliance with the Hologic/Serex Agreement and has not been notified of any assertion that it is in default of said Hologic/Serex Agreement or that Serex plans to terminate any Hologic rights thereunder. Hologic shall immediately notify Ostex if it receives any notice that it is in default of said Hologic/Serex Agreement or that Serex plans to terminate any Hologic right thereunder. 13.2.2 SEREX PATENT RIGHTS. As of the Effective Date of the Agreement, (a) Hologic is not aware of any "prior art" which would invalidate any part or all of the SARA patents; and (b) Hologic is not aware of any unexpired patent or pending patent application of a party not a party to this agreement which has claims which cover any part of the SARA patents. 13.2.2.1HOLOGIC PATENT RIGHTS AND HOLOGIC KNOW-HOW. As of the Effective Date of the Agreement, (a) Hologic has sole and exclusive rights to the Hologic Patent Rights and all rights necessary to convey Hologic Know-How to Ostex; (b) the Hologic Patent Rights, to the best knowledge of Hologic are valid and enforceable, and do not infringe on the proprietary rights of any third party; (c) Hologic is not aware of any "prior art" or other claim which would invalidate any part or all of the Hologic Patent Rights; or any claim that Hologic does not have all rights to use and permit Ostex to use the Hologic Know-How for all purposes permitted by this Agreement; (d) Hologic is not aware of any unexpired patent or pending patent application of a party not a party to this Agreement which has claims which cover any part of the Hologic Know-How or Hologic Patent Rights; and (e) Hologic has taken all necessary actions to maintain all Hologic Patent Rights in full force and effect. 13.2.3 NO DEFAULT. The execution, delivery and performance of this Agreement by Hologic does not and shall not conflict with, result in a breach of, or constitute a default under (with or without the giving of notice, or the passage of time, or both), any agreement or instrument to which Hologic is a party or by which it is bound. 13.2.4 HOLOGIC'S DISCLAIMER OF OTHER WARRANTIES. Hologic disclaims all implied warranties, including without limitation any warranty of merchantability or fitness for a particular purpose. EXCEPT AS EXPRESSLY SET FORTH IN THIS AGREEMENT, HOLOGIC MAKES NO REPRESENTATIONS AND EXTENDS NO WARRANTIES OF ANY KIND, EITHER EXPRESS OR IMPLIED, INCLUDING NO WARRANTIES OF MERCHANTABILITY OR FITNESS FOR A PARTICULAR PURPOSE 13.3 U.S. FOREIGN CORRUPT PRACTICES ACT. Each party shall indemnify, defend and hold the other party, its subsidiaries and Affiliates, and the directors, officers, employees and agents of any of them, harmless from and against all and any claims, proceedings, losses, fines, expenses (including without limitation reasonable attorneys fees and expenses) and penalties incurred by said party arising out of any Prohibited Practice committed by said party or any of its officers, directors, shareholders, employees, or agents. For purposes of this SECTION 13, the following shall be deemed a "Prohibited Practice": the offer, payment, promise to pay, or authorization of the paying of any money, or the offer, giving, promise to give or authorization of the giving of anything of value to any officer or employee of any government or any department, agency or instrumentality thereof, or any person acting in an official capacity for or on behalf of any such government, department, agency or instrumentality, or any political party or official thereof, or any candidate for political office, or any intermediary for any such persons or party, in each case for purposes of (a) influencing any act or decision of any such persons or party in their or its official capacity, or (b) inducing any such person or party to do or omit to do any act in violation of the lawful duty of such person or party, or (c) inducing any such person or party to use their or its influence with any government or instrumentality thereof to affect or influence any act or decision of any such government or instrumentality, in each case (a), (b) and (c) in order to assist the applicable party hereto in obtaining or retaining business for, or with, or directing business to, any person or entity 13.4 GOVERNMENTAL COMPLIANCE. Each party shall obtain and maintain all required licenses, permits, certificates and authorizations needed to perform its obligations under this Agreement, including without limitation those required for said party's appointment as sublicensee, for the effectiveness of this Agreement in all jurisdictions where said party operates, for the import and for the export of NTx Meter Systems, and for the marketing, distribution and Sale of NTx Meter Systems. Each party shall be solely responsible for compliance with any foreign exchange controls affecting its activities. 14. THIRD-PARTY INFRINGEMENT. 14.1 NOTICE OF THIRD-PARTY INFRINGEMENT. If, during the term of this Agreement, either party becomes aware that one or more third parties are infringing or are threatening to infringe the Patent Rights of a party licensed hereunder relating to the Field of Use, said party (the "Notifying Party") shall immediately report such information to the other party to this Agreement and shall provide in such report all details in said party's knowledge or possession concerning the kind and character of the infringement and any other pertinent information that said party may have. At such time as the party owning or controlling the infringed patents ("Aggrieved Party") shall, in its sole judgment, be satisfied that there exists a reasonable likelihood of infringement, Aggrieved Party shall take such steps, including notification, to place the putative infringer on notice of Aggrieved Party's claims. The form of the notification and the manner and nature of any communications between Aggrieved Party and the alleged infringer shall be within the sole discretion of Aggrieved Party. 14.2 RIGHT TO SUE. If, sixty (60) days after receipt of notice of a perceived third-party infringement, such third party infringement continues and the Aggrieved Party has not commenced legal action or presented to the Notifying Party a plan acceptable to the Notifying Party to enjoin or otherwise to resolve such infringement, then the Notifying Party shall be entitled, at its own expense and for its own benefit, to commence an action in its own name. In the event that the Aggrieved Party initiates such action, the Aggrieved Party shall be entitled to retain all damages awarded therein. In the event that the Notifying Party initiates such action, the Notifying Party shall be entitled to retain one half of all damages awarded therein attributable to the Field of Use, after payment of all reasonable legal expenses of such litigation. In the event that the rules then obtaining shall require the naming of the owner of said Patent Rights for purposes of such infringement action, the Notifying Party shall be entitled to name the Aggrieved Party, or to cause the Aggrieved Party to consent to be named, as a party plaintiff in such action; and failing such cooperation the Notifying Party shall be entitled to reduce royalties payable to the Aggrieved Party by fifty percent (50%). Each party shall assist the other party and reasonably cooperate in any such action at said party's request. 15. DEFENSE OF THIRD-PARTY CLAIMS. 15.1 HOLOGIC DEFENSE OF THIRD-PARTY CLAIMS AND INDEMNITY. In the event that any claim, suit, or other legal proceeding is threatened or commenced against Ostex or WRF that is founded, in whole or in part, on an allegation that the NTx Meter or NTx Meter Strip infringes any trade secret, patent, or copyright belonging to a third party (other than WRF), Ostex will give Hologic prompt written notice of such legal proceeding and Hologic may elect to assume sole control of the defense to or settlement of such dispute. Ostex shall cooperate fully with Hologic in any defense, settlement or compromise made by Hologic. Ostex shall not enter into any settlement agreement or other voluntary resolution of any such claim, suit, or other legal proceeding without obtaining Hologic's prior written consent thereto. If Ostex has complied fully with the procedures set forth in this SECTION 15.1, Hologic will indemnify and hold Ostex harmless from and against any loss, cost, damage, or other expenses incurred by Ostex as a result of such claim, suit or legal proceeding. If a final injunction is obtained against Ostex's use of the NTx Meter or NTx Meter Strips, or if in the opinion of Hologic the subject NTx Meter or NTx Meter Strips are likely to become the subject of a successful claim of infringement, Hologic may, at its option and expense, (i) procure for Ostex the right to continue distributing and/or using the NTx Meter or NTx Meter Strips, (ii) replace or modify the NTx Meter or NTx Meter Strips so that it (they) become non-infringing, or (iii) if neither (i) or (ii) are reasonably available, accept return of the NTx Meter or NTx Meter Strips held by Ostex and its distributors in inventory, and terminate this Agreement without further obligation or liability. This indemnification provision shall be null and void and Hologic shall have no liability to the extent that any claim is based on any use of the NTx Assay Technology, Critical Reagents or Ostex Intellectual Property or if the NTx Meter or NTx Meter Strips have been modified or tampered with in any way without the express written consent of Hologic, or if Ostex has any interest in the claim, suit or other legal proceeding, or any license to any right so asserted. 15.2 OSTEX DEFENSE OF THIRD-PARTY CLAIMS AND INDEMNITY. In the event that any claim, suit, or other legal proceeding is threatened or commenced against Hologic or Serex that is founded, in whole or in part, on an allegation that the NTx Assay Technology, Critical Reagents or Ostex Intellectual Property as used in the NTx Meter System infringes any trade secret, patent, or copyright belonging to a third party (other than Serex), Hologic will give Ostex prompt written notice of such legal proceeding and Ostex may elect to assume sole control of the defense to or settlement of such dispute. Hologic shall cooperate fully with Ostex in any defense, settlement or compromise made by Ostex. Hologic shall not enter into any settlement agreement or other voluntary resolution of any such claim, suit, or other legal proceeding without obtaining Ostex's prior written consent thereto. If Hologic has complied fully with the procedures set forth in this SECTION 15.2, Ostex will indemnify and hold Hologic harmless from and against any loss, cost, damage, or other expenses incurred by Hologic as a result of such claim, suit or legal proceeding. If a final injunction is obtained against Hologic's use of the NTx Assay Technology, Critical Reagents or Ostex Intellectual Property as used in the NTx Meter Systems, or if in the opinion of Ostex the NTx Assay Technology, Critical Reagents or Ostex Intellectual Property are likely to become the subject of a successful claim of infringement, Ostex may, at its option and expense, (i) procure for Hologic the right to continue distributing and/or using the NTx Assay Technology, Critical Reagents or Ostex Intellectual Property in the NTx Meter System, (ii) replace or modify the NTx Assay Technology, Critical Reagents or Ostex Intellectual Property so that it (they) become non-infringing, or (iii) if neither (i) or (ii) are reasonably available, accept return of the NTx Assay Technology, Critical Reagents or Ostex Intellectual Property used in the NTx Meter Systems held by Hologic and its distributors in inventory, and terminate this Agreement without further obligation or liability. This indemnification provision shall be null and void and Ostex shall have no liability to the extent that NTx Assay Technology, Critical Reagents or Ostex Intellectual Property have been modified or tampered with in any way without the express written consent of Ostex, or if Hologic or Serex have any interest in the claim, suit or other legal proceeding, or any license to any right so asserted. 15.3 ROYALTY PAYMENTS. Except as provided above, any entitlement to terminate royalties shall occur only upon a final adjudication of the invalidity or non-enforceability of the patents, copyrights or trade secrets in question. For such purposes, final adjudication shall mean an adjudication or determination by a trial court or a court of appeal, which adjudication or determination shall be final, binding and not further appealable, whether by its terms or by the passage of time. 16. USE OF TRADEMARKS AND TRADE NAMES. 16.1 RESTRICTED RIGHTS TO USE. No provision of this Agreement shall be interpreted or construed as conferring upon either party any right to use in labeling, advertising, marketing, publicizing or otherwise promoting NTx Meter Systems, any name, trade name, trademark, or other designation (or derivation thereof) of the other party hereto or WRF or the University of Washington, or Serex, except as expressly provided under this SECTION 16. 16.2 USE OF NAMES AND MARKS IN LABELING. As a part of the marketing plan prepared pursuant to SECTION 6.2 hereof, the parties shall agree upon appropriate trademark(s) to be used in connection with NTx Meter Strips marketed, promoted, sold, and/or distributed under this Agreement. In the absence of such agreement, the parties agree that Hologic shall affix to the outer packaging of, and shall include on the package insert for, any NTx Meter Strips marketed, promoted, sold, and/or distributed by Hologic under this Agreement, and in addition to its own trademarks and names, one or more labels displaying with equal prominence to said Hologic trademarks or names, the statement "An OsteomarkAE Assay" or such other trademark or statement as Ostex shall reasonably request, and Ostex shall affix to the outer packaging of, and shall include on the package insert for, any NTx Meter Strips marketed, promoted, sold, and/or distributed by Ostex under this Agreement, and in addition to its own trademarks and names, displaying with equal prominence to said Ostex trademarks or names such other trademark or statement as Hologic shall reasonably request. Ostex shall also have the right to review and approve all claims relating to the intended use of NTx Meter Strips contained in package inserts and other promotional materials, which approval shall not be unreasonably withheld. Each party hereby grants to the other party a non-transferable, non-exclusive license, concurrent with the term of this Agreement, to use such statement and/or trademark accordingly and in substantially the same manner as used by its owner; provided, however, that each such use of such statement and/or trademark be accompanied by a printed notice identifying the owner as the owner thereof. Neither party shall use any trademark of the other party with respect to products not covered by this Agreement. In the event that particular NTx Meter Strips do not meet the specifications or quality standards required under SECTIONS 3.4 or 7.2.4 above, either party may cause the other party to remove all trademarks of said party from such NTx Meter Strips and shall have the right to cancel the foregoing grant of license to use such trademarks, unless the other party promptly meets such specifications or quality standards. Each party shall have the right to receive and approve the use of its marks in any proposed product literature, advertising material or material for publication. In all such materials unless otherwise specifically agreed in advance in writing, the immunoassay performed by the NTx Meter Strips shall be identified as "An OsteomarkAE Assay." 16.3 TRADEMARK REGISTRATION. Ostex and Hologic shall each be responsible for the registration, maintenance and enforcement of their respective names, trade names, and trademarks; provided, however, that each party shall aid the other in the enforcement of that party's rights by monitoring for, and notifying said party of, any unauthorized use of any of said party's trademarks. Each party shall from time to time, and in any event upon the issuance of additional registrations, modify its use of trademarks to incorporate proper notice of registration and other claims of right, in accordance with the laws and customs of the various countries in which it operates pursuant to this Agreement. 16.4 OSTEX REPRESENTATIONS AND WARRANTIES. Ostex represents and warrants, as of the date of this Agreement, that: (a) Ostex is the owner and registrant of the trademarks issued registrations as indicated by ATTACHMENT 16.4; (b) Ostex is named as applicant in those applications indicated by ATTACHMENT 16.4 as pending; and (c) to the best of its knowledge, none of the Ostex trademarks infringes upon the trademark, trade name, or other proprietary rights of a third party. In the event that any action or proceeding is initiated against Ostex, Hologic, or any other licensee or distributor of Ostex in any country alleging that the trademark "Osteomark" infringes the trademark rights of the third party initiating such action or proceeding, Hologic may continue to market NTx Meter Strips within such country without the trademark "Osteomark" affixed thereto (but with such other trademark as Ostex may reasonably specify) pending resolution of the dispute as to trademark rights. 16.5 HOLOGIC REPRESENTATIONS AND WARRANTIES. Hologic represents and warrants, as of the date of this Agreement, that: (a) Hologic is the owner and registrant of the trademarks issued registrations as indicated by ATTACHMENT 16.5; (b) Hologic is named as applicant in those applications indicated by ATTACHMENT 16.5 as pending; and (c) to the best of its knowledge, none of the Hologic trademarks infringes upon the trademark, trade name, or other proprietary rights of an third party. In the event that any action or proceeding is initiated against Hologic, Ostex, or any other licensee or distributor of Hologic in any country alleging that any Hologic trademark infringes the trademark rights of the third party initiating such action or proceeding, Ostex may continue to market NTx Meter Strips within such country without said Hologic trademark affixed thereto (but with such other trademark as Hologic may reasonably specify) pending resolution of the dispute as to trademark rights. 17. ASSIGNMENT AND SUBLICENSE. 17.1 BY HOLOGIC. Except as specifically permitted by this Agreement, Hologic shall not assign, sublicense, delegate, or in any other manner transfer any of its rights, privileges, obligations or duties under this Agreement to any non-Affiliate third party without the prior written consent of Ostex, which consent may be withheld in Ostex's sole and absolute discretion, provided that this provision shall not apply to any merger, consolidation, or sale of substantially all of the assets of Hologic, or any third-party acquisition of a majority of the business interests or voting shares of Hologic, provided that the surviving party shall within a reasonable period following the final closing of such transaction, expressly agree in writing to be bound by this agreement. Any attempt by Hologic to assign, sublicense, delegate or otherwise transfer any right, privilege, obligation or duty under this Agreement other than in accordance with this SECTION 17 shall be void and shall, at the option of Ostex, be cause for immediate termination of this Agreement and all licenses granted hereunder. Transfers of any rights hereunder by Hologic to an Affiliate shall be permitted only after the delivery to Ostex of reasonable evidence that such Affiliate has agreed in writing to be bound by the terms of this Agreement. 17.2 BY OSTEX. Except as specifically permitted by this Agreement, Ostex shall not assign, sublicense, delegate, or in any other manner transfer any of its rights, privileges, obligations or duties under this Agreement to any non-Affiliate third party without the prior written consent of Hologic, which consent may be withheld in Hologic's sole and absolute discretion, provided that this provision shall not apply to any merger, consolidation, or sale of substantially all of the assets of Ostex, or any third-party acquisition of a majority of the business interests or voting shares of Ostex, provided that the surviving party shall within a reasonable period following the final closing of such transaction, expressly agree in writing to be bound by this agreement. Any attempt by Ostex to assign, sublicense, delegate or otherwise transfer any right, privilege, obligation or duty under this Agreement other than in accordance with this SECTION 17 shall be void and shall, at the option of Hologic, be cause for immediate termination of this Agreement and all licenses granted hereunder. Transfers of any rights hereunder by Ostex to an Affiliate shall be permitted only after the delivery to Hologic of reasonable evidence that such Affiliate has agreed in writing to be bound by the terms of this Agreement. 18. ARBITRATION. 18.1 AGREEMENT TO SETTLE DISPUTES BY ARBITRATION. At the request through notice of either Ostex or Hologic, any controversy or claim arising between the parties and related to or arising out of the construction, interpretation, or enforcement of any term or condition of this Agreement or any transaction hereunder (including the decision to enter into this Agreement), which controversy or claim cannot first be settled amicably between the parties (including without limitation through utilization of third-party mediation agreed to by both parties), shall be submitted to arbitration. Such arbitration shall be conducted in Seattle, Washington, if initiated by Hologic, or in Boston, Massachusetts, if initiated by Ostex, and in either case shall be conducted in accordance with the applicable Rules of the American Arbitration Association in effect on the date of such controversy or claim. 18.2 APPOINTMENT OF ARBITRATORS. Within thirty (30) days after the delivery pursuant to SECTION 18.1 above of a notice of request for arbitration, Hologic and Ostex shall each appoint one person as an arbitrator to hear and determine the dispute. The two persons so chosen shall by agreement select a third, impartial arbitrator, which selection shall be final and conclusive upon both parties. Each arbitrator shall be experienced in international and domestic manufacturing and distribution of products similar to NTx Meter Systems. If either party fails to designate its arbitrator within sixty (60) days after the notice of arbitration is received, then the arbitrator designated by the one party shall act as the sole arbitrator and shall be deemed to be the single, mutually approved arbitrator to resolve the dispute. 18.3 ARBITRATORS' POWERS. The arbitrators shall have all the powers of a State or Federal Court located at the site of the arbitration, including the power to order specific enforcement of this Agreement and to order the production of relevant and non-privileged documents by one party for inspection and duplication by the other party prior to the arbitration hearing; provided, however, that the arbitrators shall be bound by this Agreement with regard to the restriction on consequential, incidental, and punitive damages as set forth in SECTION 19.3 below. 18.4 DISCOVERY. The arbitrators prior to the hearing shall grant discovery pursuant to the intendment of the Federal Rules of Civil Procedure, and as the arbitrators determine to be appropriate under the circumstances. 18.5 PROTECTIVE ORDER. In the event of arbitration and at the request of either Ostex or Hologic, in order to protect Confidential Information and any other matter that either party would normally not reveal to third parties, the arbitrators shall enter a protective order in such form as the parties shall stipulate or as the arbitrators shall determine is suitable. Among other things, the protective order shall stipulate that the arbitrators themselves shall receive any information designated by either party as "confidential" solely for purposes of assessing the facts and law for purposes of the arbitration, and shall not otherwise use or disclose such matter. At the request of either party, the protective order shall be entered as an award of the arbitration panel and shall enable either party to obtain the assistance of a court of competent jurisdiction to enter equitable decrees or other relief to enforce the provisions of the order as if it had been entered by that court. 18.6 EFFECT OF DECISION. The decision of the arbitrators shall state the reason for the award and shall be final, binding and conclusive upon the parties. The parties shall comply with such decision in good faith as if it were a final decision of a court. Judgment upon the award shall be entered in any court of competent jurisdiction. Any award made in connection with any arbitration shall be made in U.S. Dollars. 18.7 RIGHTS OF THIRD PARTIES. Notwithstanding the agreement to arbitrate any dispute between Ostex and Hologic, in the event that a controversy or claim between Ostex and Hologic involves an adjudication of the rights of a third party, and that third party does not agree to submit to arbitration and would under Rule 19(a) of the Federal Rules of Civil Procedure, if feasible, be joined as an indispensable party, then the dispute shall be brought to, and determined by, a court of the competent jurisdiction. 18.8 INTERIM RELIEF. Upon the application of either party to this Agreement, and whether or not an arbitration, mediation or attempt to settle amicably has yet been initiated, all courts having jurisdiction over one or more of the parties are authorized to: (i) issue and enforce in any lawful manner such temporary restraining orders, preliminary injunctions and other interim measures of relief as may be necessary to prevent harm to a party's interests or as otherwise may be appropriate pending the conclusion of arbitration proceedings pursuant to this Agreement; and (ii) enter and enforce in any lawful manner such judgments for permanent equitable relief as may be necessary to prevent harm to a party's interests or as otherwise may be appropriate following the issuance of arbitral awards pursuant to this Agreement. 19. ATTACHMENTS. The Attachments listed below are incorporated by reference into this Agreement and shall for all purposes be deemed part hereof: Attachment D Serex Patent Rights Attachment 3.4 Ostex Critical Reagent Specifications Attachment 6.2 Marketing Plan (To be Appended per SECTION 6.2) Attachment 7.2.4 Product Specifications - NTx Meter Strips and NTx Meters Attachment 13.1.2 Ostex Patent Rights and Know-How - Exceptions to Warranty Attachment 16.4 Ostex Trademark Filings Attachment 16.5 Hologic Trademark Filings 20. PUBLICITY. No party shall announce or publicize this Agreement or any terms thereof without the advance written consent of the others (which approval shall not be unreasonably withheld). 21. RESPONSIBILITY FOR CLAIMS. In order to distribute between themselves the responsibility for the handling and expense of claims arising out of the manufacture, distribution, Sale or use of NTx Meter Systems, the parties agree as follows: 21.1 OSTEX LIABILITY. Ostex shall be liable for and shall indemnify and hold Hologic harmless against any liability, damages or loss and from any claims, suits, proceedings, demands, recoveries or expenses in connection with (i) any Critical Reagents or NTx Assay Technology licensed or sold by Ostex to Hologic or its designated manufacturers pursuant to this Agreement arising out of, based on, or caused by product claims whether written or oral, made or alleged to be made, by Ostex in its advertising, publicity, promotion, or Sale of the Critical Reagents or NTx Assay Technology where such product claims were not approved by Hologic, including without limitation expenses of total or partial product recalls as described in SECTION 7.7 hereof, or (ii) any breach by Ostex of any of its representations or warranties contained herein or (iii) any of its negligent or willful acts or omissions. Hologic shall promptly notify Ostex of any such demand or claim which comes to its attention. 21.2 HOLOGIC LIABILITY. Hologic shall be liable for and shall indemnify and hold Ostex harmless against any liability, damages or loss and from any claims, suits, proceedings, demands, recoveries or expenses in connection with (i) any NTx Meters or NTx Meter Strips sold by Hologic to Ostex pursuant to this Agreement arising out of, based on, or caused by product claims whether written or oral, made or alleged to be made, by Hologic in its advertising, publicity, promotion, or Sale of the NTx Meters or NTx Meter Strips where such product claims were not approved by Ostex, including without limitation expenses of total or partial product recalls as described in SECTION 7.7 hereof, or (ii) any breach by Hologic of any of its representations or warranties contained herein or (iii) any of its negligent or willful acts or omissions. Ostex shall promptly notify Hologic of any such demand or claim which comes to its attention. 21.3 CONSEQUENTIAL, INCIDENTAL, AND PUNITIVE DAMAGES. Notwithstanding any other provision of this Agreement, neither party shall be liable to the other party for any special, consequential, incidental or punitive damages that may arise out of this Agreement (including but not limited to damages for loss of sales, potential sales, profits or business), regardless of whether such other party has been informed of the possibility that such damages may occur. 22. NOTICE. Any notice given in regard to this Agreement shall be given in writing and shall be delivered personally, or shall be sent by first class mail or registered certified mail, postage, and charges prepaid, to: if to Ostex: Ostex International, Inc. 2203 Airport Way South Suite 400 Seattle, Washington 98134 Attention: Jeffrey J. Miller, Ph.D., Senior Vice President, Corporate Development Copy to: Robert Glaser, President and COO if to Hologic: Hologic, Inc. 590 Lincoln Street, Waltham, MA 02154 Attention: Joel Weinstein, Vice President - Business Development Copy to: S. David Ellenbogen, Chairman and CEO Any notice so given shall be effective upon the date of actual receipt by the addressee as evidenced by return receipt or other written confirmation. Either party may by advance notice given pursuant to this SECTION 21 designate a substitute address for receipt of future notices. 23. GOVERNING LAW. All claims or controversies asserted by Ostex against Hologic or Serex shall be construed and enforced in accordance with the laws of the Commonwealth of Massachusetts. Any judicial action by Ostex relating to the relationship between the parties pursuant to this Agreement, or goods purchased or licensed hereunder (together with any counterclaims asserted by Hologic or Serex), shall be brought and tried in the State or Federal Courts located in Massachusetts. All claims or controversies asserted by Hologic against Ostex or WRF shall be construed and enforced in accordance with the laws of the State of Washington. Any judicial action by Hologic relating to the relationship between the parties pursuant to this Agreement, or goods purchased or licensed hereunder (together with any counterclaims asserted by Ostex or WRF), shall be brought and tried in the State or Federal Courts located in the State of Washington. Notwithstanding the foregoing, interpretation and enforcement of the provisions of SECTION 18 shall be governed by and construed in accordance with the Federal Arbitration Act. 24. INTEGRATION. It is the desire and intent of the parties to provide certainty as to their future rights and undertakings herein. The parties in this Agreement have incorporated all representations, warranties, covenants, commitments and understandings on which they have relied in entering into this Agreement, and, neither party makes any covenant or other commitment to the other concerning its future action. Accordingly, this Agreement, in conjunction with the Co-Promotion Agreement:- (i) constitutes the entire agreement and understanding between the parties and there are no promises, representations, conditions, provisions or terms related thereto other than those forth in this Agreement and (ii) supersedes all previous undertakings, agreements and representation between the parties, written or oral, with respect to the subject matter hereof. No modification of, addition to, or waiver of any provisions of this Agreement shall be binding upon either party hereto unless the same shall be in writing duly executed by a duly authorized representative of both parties hereto. 25. MODIFICATION. No modification to this Agreement shall be enforceable unless made in writing and signed by an authorized representative of each party. 26. SEVERABILITY. In the event that any provision of this Agreement is determined to be invalid or unenforceable for any reason, such provision shall be deemed inoperative only to the extent that it violates or conflicts with law or public policy and shall be deemed modified to the extent necessary to conform thereto, and all other provisions hereof shall remain in full force and effect. 27. WAIVER. No express or implied waiver by either party of any right or remedy with respect to a default by the other party under any provision of this Agreement shall be deemed, interpreted or construed as a waiver of any right or remedy with respect to any other default under the same or any other provision hereof. 28. SUCCESSORS AND ASSIGNS. This Agreement shall be binding upon and shall inure to the benefit of the parties' respective successors and assigns, subject to the restrictions on assignment set forth in SECTION 17 above. 29. NONCOMPETITION. During the term of this Agreement, Hologic shall not enter into or maintain any marketing, licensing, or development agreement or relationship (whether directly or by reason of any merger, acquisition, consolidation or otherwise) with any company (other than Serex) which competes with Ostex to develop biochemical markers of bone resorption, and Ostex shall not enter into or maintain any marketing, licensing, or development agreement or relationship (whether directly or by reason of any merger, acquisition, consolidation or otherwise) with any company which competes with Hologic to develop devices to measure bone mass or other structural characteristics. If Hologic violates this provision, Ostex as its sole remedy for such violation may at its option and upon 30 days notice, terminate this Agreement. If Ostex violates this provision, Hologic as its sole remedy for such violation may at its option and upon 30 days notice, terminate this Agreement. 30. STANDSTILL PROVISION. During the term of this Agreement, Hologic shall not make any offer for, and shall not actually acquire any legal or beneficial interest in the common stock or other securities of Ostex without the prior written consent of Ostex's Board of Directors; and Ostex shall not make any offer for, and shall not actually acquire any legal or beneficial interest in the common stock or other securities of Hologic or Serex, respectively, without the prior written consent of Hologic's Board of Directors. The parties each agree that any violation of this provision would cause irreparable harm to the other party. The parties each agree that the other party shall be entitled to all equitable remedies available to it to prevent violation of this provision, as well as all other legal remedies, and if successful in any claim, may recover from the violating party all reasonable costs and attorneys fees expended by it in seeking such remedy. IN WITNESS WHEREOF, the parties hereto have duly executed this agreement the day and year last written below. DATED AND EFFECTIVE as of the date first written above. OSTEX INTERNATIONAL, INC. By /S/ JEFFREY J. MILLER, PH.D. Jeffrey J. Miller, Ph.D., Senior Vice President, Corporate Development HOLOGIC, INC. By /S/ S. DAVID ELLENBOGEN S. David Ellenbogen Chairman and CEO ATTACHMENT D SEREX PATENT RIGHTS See Attached List as of 12/26/95 which represents Hologic's current knowledge (to be updated and confirmed) PATENTS (a list to be updated to the date of this Amendment) 1. US Patent No. 5,451,504 (Serial No. 07/737,091). Method and Device for Detecting the Presence of an Analyte in a Sample 2. US Serial No. 08/047,156 An Integrated Packaging Holder Device for Immunochromatographic Assays in Flow-Through or Dipstick Formats and foreign counterparts thereof and continuing application US Serial No. 08/539,170 (continuation of 08/047,156) 3. US Serial No. 08/196,092 and foreign Counterparts 4. US Serial No. 08/493.420 and foreign counterparts 5. US Serial No. 08/192,778 ATTACHMENT 3.4 Ostex Critical Reagent Specifications OSTEX INTERNATIONAL, INC. TITLE Lot No. Doc No. Rev. Page Ion Exchange 1H11 2020 B 16 of 16 Purified _______________________________________________________________________ 7.0 Quality Control Testing 7.1 XXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXX _______________________________________________________________________ Test Acceptance Pass/ Initials/ Parameter Method Criteria Results Fail Date _______________________________________________________________________ 7.2 XXXXX 0004 XXXXX _____ ____ ____ 7.3 XXXXX 0006 XXXXX _____ ____ ____ 7.4 XXXXX XXX XXXXX _____ ____ ____ XXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXX XXX results _________________________________________________________________________ Record reviewed by_________________________ ___________________ Quality Control Date Record reviewed by_________________________ ___________________ Quality Assurance Date Released _________________________________ Not Released _________
OSTEX INTERNATIONAL, INC. TITLE Lot No. Doc No. Rev. Page NTx Concentrate 2007 G 23 of 24 _______________________________________________________________________ -------ATTACHMENT 3------- QC DATA SHEET Volume NTx nromal NTx Total Protein Protein Specific Activity (ml) BCE step 3.1 nanamol (ml) step 8.3 Total mg - (nmol/ml)/ (ml) protein (mg/ml mg/mlprotein nmol/ml BCE Vol (ml)) ____ ______ ________ _____ ________ __________ 7.3.4 XXXX Step 7.3.3 7.10 XXXX Step 7.9 7.22 XXXX Step 7.20 7.28 XXXX Step 7.27
Total Nanomole yield = (total nmoles step 7.3.4) x 100=___________% ----------------------------- (total nmoles step 7.28) QC materials used Osteomark kit PN 9006 or 9006 LN _____, clibrator diluent PN 2022 LN____ PBS PN 2003 LN ___. Gold 300 pmol.ml NTx in PBS from PN 4010 LN 336C04 (A) Assay 1 dilution 1_______ (D) Assay 2, Dilution 1______________ (B) Assay 1 dilution 2_______ (E) Assay 2, Dilution 2______________ (C) Avg. of (A) and (B)_______ (F) Avg. of (D) and (E) ______________ (G) Percent difference of (C) and (F) ____ (if(C)is greater than 20%, repeat steps 8.1.3 to 8.1.5) (H) Average (A),(B), (D) and (E)____ (Record (H) in the table above) Note: Percent difference between x and y =100 (absolute value (x-y)/(average(x,y)) Number of aloquots: _________ Volume of alquots: __________ Total volume to inventory:________ Total nanomoles BCE to Inventory: _________ ATTACHMENT 6.2 MARKETING PLAN (TO BE APPENDED PER SECTION 6.2) ATTACHMENT 7.2.4 Product Specifications - NTx Meter Strips and NTx Meters See Attached - Subject to Modification Product Specifications - NTx Meter Strips and NTx Meters Hologic Point-of-Care Bone Resorption Test DRAFT Specifications (Goals) 1. The test is being designed so as to qualify for XXXXX. 2. Specimens = XXXX. 3. The method of XXXXXXXX must be simple, clean, nearly foolproof, and designed "to render the likelihood of erroneous results negligible." XXXXX 4. There will be XXXXX. 5. The target time to run the tests, from the beginning of application of the specimen to the strips, is XXXXX. 6. The XXXXX limits of the XXXXX. The test should cover XXXXX. 7. The XXXXX limits of the XXXXX. The test should cover XXXXX. 8. For both tests, XXXXX. 9. XXXXX. There will be approximately the dame as those of comparable tests currently commercially available. 10. Substances typically or occasionally found in XXX should not interfere with test performance. Though the list remains to be specified, probable candidates for inclusion are: XXXXX. TEST FORMAT 11. Initiation of any timing should be simple. (E.G.,XXXXX). 12. Once the (timed) test begins, and until it concludes, XXXX should be required. CONTROLS 13. XXXXX will be supplied to users, with appropriate instructions for use. The goal is to have XXXX, and controls XXXX which are to be run as infrequently as possible, while providing acceptable levels of control. METER FUNCTION 14. The meter will detect XXXX from each strip, and then using XXXX will calculate concentrations and the XXXX. 15. The result reported by the meter will be the XXXXX. 16. XXXXX. 17. The meter will XXXXX as required. XXXXXX. ERROR CONDITIONS 18. XXXXX. 19. If the meter detects a XXXX, no test result will be reported, and the meter will indicate XXXX. 20. Application of an XXXXXXX will detedted by the meter, and no test result will be reported. METER MAINTENANCE 21. The XXXX of the meter will be cleanable using XXXX. 22. If a meter malfunctions, it will be returned to the manufacturer for repair, and a replacement meter will be given to the user. METER POWER, RELIABILITY 23. The meter will be powered by XXXX. Target XXXX lifetime is XXXXX. 24. Meter XXXXXXXXXXXXX in production. STABILITY 25. Target strip stability at launch XXXX. METER REGULATORY REQUIREMENTS 26. The meter will be manufactured according to XXXXX. 27. The meter will have the XXXX. 28. The meter will meet XXXX limits XXXX and XXXX limits XXXXX. ATTACHMENT 13.1.2 OSTEX PATENT RIGHTS AND KNOW-HOW - EXCEPTIONS TO WARRANTY Pursuant to paragraph 14.1, the WRF and Ostex on June 12, 1996, filed a civil action for patent infringement against Osteometer Biotech A/S and Diagnostic Systems Laboratories, Inc. in the U.S. District Court of the Western District of Washington at Seattle (Civil Action No. C96-0910WD). The patent in suit, U.S. Patent No. 5,455,179, claims a method of monitoring degradation of type I collagen using an antibody that binds to carboxy-terminal telopeptide metabolites of type I collagen in urine and other body fluids. Plaintiffs claim that the CrossLaps ELISA Kit manufactured and distributed by the defendants infringes the `179 patent. Defendants have counterclaimed that the `179 patent is invalid, not infringed, and unenforceable. Osteometer has also denied jurisdiction. The case is set for trial commencing 12/2/97. Ostex is also defending two of its European patents in opposition proceedings in the European Patent Office. European Patent No. 394,296 has been opposed by Osteometer Biotech A/S, F.Hoffman-LaRoche AG, and Metra Biosystems, Inc. European Patent No. 502,928 has been opposed by Osteometer Biotech A/S, Metra Biosystems, Inc., and Boehringer Mannheim GMBH. ATTACHMENT 16.5 HOLOGIC TRADEMARK FILINGS MARK REGISTRATION NO. ISSUE DATE NOTES - ---- ---------------- ---------- ----- ACCLAIM 1,70,513 4/23/96 X-Ray Technology, Inc. CER 1,751,849 2/9/93 _ HOLOGIC 1,652,292 7/30/91 _ XXXXXXX XXXXXXXXXXXX XXXXX XXXXXXXXX. XXXXXXX XXXXXXXXXXXX XXXXX XXXXXXXXX QDR 1,510,840 11/1/88 Assigned to X-Ray Technology, QDR-1000 1,506,996 10/4/88 Assigned to X-Ray Technology, Inc. 11/4/91 SAHARA 2,008,809 10/15/96 _ XXXXXXX XXXXXXXXXXX XXXXXX XXXXXXXXXX UBA 1,529,557 3/14/89 _ XXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXX XXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXX XXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXX EX-10.15A 4 Note: Confidential treatment requested. Exhibit omits information that has been filed separately with the Securities and Exchange Commission. RESEARCH AGREEMENT THIS RESEARCH AGREEMENT is effective this 1st day of July, 1996, by and between OSTEX INTERNATIONAL, INC., a Washington corporation, having its principal place of business at 2203 Airport Way South, Suite 400, Seattle, Washington 98134 ("Ostex"), and the UNIVERSITY OF WASHINGTON, having its principal office at Seattle, Washington 98195 ("University"). RECITALS A. Ostex has an ongoing interest in research technology (including inventions, processes, formulae and the like, whether or not patentable, and property eligible for copyright protection) for measuring the rate of human tissue resorption based on the quantitation of specific marker peptides derived from cross-linking sequences in collagen, entitled "Molecular Markers of Connective Tissue Degradation," as more particularly described in that certain proposal attached as EXHIBIT A (the "Technology"); B. The Technology has been assigned by the University to the Washington Research Foundation ("WRF") pursuant to Section 3.3 of that certain Technology Administration Agreement, dated January 1, 1985, between the University and WRF, as amended (the "UW Agreement"). Pursuant to that certain Restated Exclusive License Agreement between Ostex and WRF, effective June 29, 1992, as amended (the "Exclusive License Agreement"), WRF granted Ostex an exclusive, worldwide license to make, have made, assign, sublicense, lease, develop, enhance, modify, produce, reproduce, demonstrate, market, promote, sell, distribute, use, exploit and otherwise commercialize and prepare derivations of the Technology; C. Ostex entered into a Research Agreement dated July 26, 1989 and amended November 1, 1992 pursuant to which initial funding was provided by Ostex for research with respect to the Technology; D. It is in the mutual interest of Ostex and University that research be continued with respect to the Technology, in accordance with a research program to be conducted and funded pursuant to this Agreement (the "Research Program"); and E. Ostex is willing to fund the conduct of the Research Program, at and through the University of Washington, Department of Biological Structure, and the University desires to obtain such funding, all subject to and in accordance with the terms of conditions set forth in this Agreement. AGREEMENTS In consideration of the covenants and promises contained herein and for good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the parties hereto agree as follows: 1. SCOPE/SCHEDULE The Research Program shall be conducted in accordance with the Research Proposal attached hereto as EXHIBIT A and made a part hereof, or mutually agreeable written modifications thereof. The Research Program shall be carried out during the Program Period (as defined below), unless sooner terminated or extended as herein provided. 2. PROGRAM PERIOD The Program Period shall be from XXXXXXXXXXXXXXXXX, and it may be extended by mutual written consent of the parties not less than thirty (30) days prior to the termination of the then current Program Period. 3. OSTEX'S PRINCIPAL OBLIGATIONS Ostex shall pay University a total of XXXXXXXXXXXXXXX to cover all direct and indirect costs of the Research Program asset forth in the Budget included in the Research Proposal attached hereto as EXHIBIT A and incorporated herein. 4. PAYMENT Ostex will provide University funds for the costs of the research performed under this Agreement as specified in the Budget. Ostex shall pay University as follows upon receipt of invoices from University: PAYMENT DATE AMOUNT 1 XXXX XXXX 2 XXXX XXXX 3 XXXX XXXX 4 XXXX XXXX 5 XXXX XXXX 6 XXXX XXXX 7 XXXX XXXX 8 XXXX XXXX 9 XXXX XXXX 10 XXXX XXXX 11 XXXX XXXX 12 XXXX XXXX Total XXXX University will submit its customary statement of expenses incurred under this Agreement within thirty (30) days after the end of each six-month period. 5. PRINCIPAL INVESTIGATOR For the purpose of this Agreement and pursuant to University policy, David R. Eyre is designated the Principal Investigator ("Principal Investigator") who shall be responsible for direction and content of the Research Program, including budgeting and revisions to the Budget necessary to accomplish the Research Program. Should the Principal Investigator leave the University or otherwise become unavailable during the Program Period, University may nominate a replacement. If Ostex does not accept the replacement, the Research Program and Budget may be modified to reflect a reduced scope of work or terminated on sixty (60) days' notice at the option of Ostex unless an arrangement acceptable to Ostex can be made to subcontract with the departed Principal Investigator or his new institution to continue the work on the Research Program. 6. CONFIDENTIALITY Neither party shall furnish any confidential and/or proprietary information of a third party to the other party in connection with this Agreement. Any such information which either party wishes to furnish to the other party shall be the subject of a separate confidentiality agreement between the parties. 7. DATA REPORTS AND FACILITIES 7.1 University shall, in accordance with established University practice, keep complete, accurate, and authentic accounts, notes, data, and records of the work performed under this Agreement and shall provide Ostex with semi-annual reports within thirty (30) days following the end of each six-month period commencing on the date of this Agreement. University shall also submit to Ostex a written comprehensive final report within ninety (90) days of termination of the Research Program. 7.2 At the discretion and convenience of the Principal Investigator, during the course of the Research Program, Ostex's representatives and others designated by Ostex may be present as observers while various tests, inspections and other aspects of the Research Program are being conducted. Ostex's representatives may consult informally with the Principal Investigator regarding the Research Program both personally and by telephone. Further, Ostex, at its expense, shall have the right to send one Ostex employee to work and be trained at the Department of Orthopedics at the University. University acknowledges and agrees that the Principal Investigator may serve as a member of the board of directors and/or as a consultant (but not an officer) of Ostex during the term of this Agreement. 7.3 From its own resources and those provided under this Agreement, University agrees to make available laboratory facilities and equipment for the Research Program. 8. INVENTION RIGHTS 8.1 University acknowledges and agrees that (i) all Technology made, developed or conceived on or before the date of this Agreement has been assigned to WRF pursuant to Section 3.3 of the UW Agreement, and no commitments have been made with respect to such Technology pursuant to Section 3.2 of the UW Agreement, (ii) all Technology made, developed or conceived after the date of this Agreement will be submitted to WRF pursuant to Section 3.1 of the UW Agreement, (iii) no commitment will be made pursuant to Section 3.1 of the UW Agreement with respect to Technology made, developed or conceived after the date of this Agreement unless Ostex agrees to such commitment in writing, and (iv) University shall not terminate, amend, waive or enforce the UW Agreement (or any rights or obligations thereunder) in any manner that could adversely affect Ostex's rights under this Agreement unless Ostex agrees in writing to such termination, amendment, waiver or enforcement. 8.2 University shall have no right, title or interest in any Technology made, developed or conceived by employees or consultants of Ostex entirely without use of University facilities. 9. PUBLICATION University will be free to publish the results of research conducted under this Agreement within a reasonable period of time. University will provide copies of manuscripts to Ostex prior to their submission for publication or their presentation. In order to full protect the rights of University and Ostex, any contemplated publication or other dissemination containing details of an invention, whether or not patentable, will be withheld until a patent application is filed or other appropriate steps to protect commercial value have been completed. Such withholding shall be kept to a minimum and will not exceed six (6) months, except by mutual agreement between Ostex and University. 10. INDEMNIFICATION University and Ostex each agree to indemnify and to hold harmless the other party from damage to persons or property resulting from any act or omission on the part of itself, its employees, its agents, or its officers. 11. NOTICES Whenever any notice is to be given hereunder, it shall be in writing and shall be deemed received, if delivered by courier on a business day, on the day delivered, or on the fifth business day following mailing, if sent by first-class, certified or registered mail, postage prepaid, to the following addresses: University: Director, Grant and Contract Services 3935 University Way N.E., JM-24 Seattle, Washington 98195 Ostex: Ostex International, Inc. 2203 Airport Way South, Suite 301 Seattle, Washington 98134 12. TERMINATION 12.1 This Agreement may be terminated by University at any time or by Ostex at any time on or after XXXXXXXX. Sixty (60) days' prior written notice is needed from one party to the other if either party determines, in its discretion, that the Research Program is no longer academically, technically or commercially feasible. Upon receipt or delivery of such notice of termination, University shall exert its best efforts to limit or terminate any outstanding financial commitments for which Ostex is to be liable, and Ostex shall reimburse University (to the extent not previously paid) for all costs incurred by it for the Research Program, including, without limitation, all uncancellable obligations. University shall furnish, within sixty (60) days of the effective date of termination, a final report of all costs incurred and all funds received and shall reimburse Ostex for payments which may have been advanced in excess of total costs incurred with no further obligations to Ostex. 12.2 Notwithstanding paragraph 12.1, in the event that either party shall be in default of any of its obligations under this Agreement and shall fail to remedy such default within thirty (30) days after written notice thereof, the party not in default shall have the option of terminating this Agreement by giving written notice of termination to the defaulting party. 12.3 Termination of this Agreement shall not affect the rights and obligations of the parties accrued prior to termination or the rights and obligations set forth in Article 8. 13. WARRANTS AND COVENANTS BY UNIVERSITY 13.1 University hereby warrants that it has the right and authority to enter into this Agreement and that the representatives whose signatures appear hereunder are duly authorized by University to enter into this Agreement on behalf of University. 13.2 University covenants that it will not knowingly enter into agreements with any industrial and/or commercial funding source other than Ostex inconsistent with its obligations under this Agreement. 14. APPLICABLE LAW This Agreement shall be governed by the laws of the State of Washington. 15. ARBITRATION AND JURISDICTION 15.1 At the request of either party, any controversy, claim, or dispute arising out of or relating to any provision of this Agreement shall be settled by arbitration to be conducted in Seattle, Washington. Such arbitration shall be in accordance with the rules applied by the American Arbitration Association. Judgment upon any award rendered through arbitration may be entered into any court of competent jurisdiction. 15.2 Ostex and University agree to submit to jurisdiction in Seattle, Washington. 16. PARTIES BOUND This Agreement, including the indemnification provisions, shall be binding upon and inure to the benefit of the parties hereto, their respective successors, assigns, legal representatives and heirs. Ostex may assign this Agreement to any successor to all or substantially all of the assets and business of Ostex. This Agreement shall not otherwise be assignable by either party without the prior written consent of the other party. 17. NO ORAL MODIFICATION No change, modification, extension, termination or waiver of this Agreement, or any of the provisions herein contained, shall be valid unless made in writing and signed by duly authorized representatives of the parties hereto. 18. SURVIVORSHIP Sections 8 and 9 of this Agreement shall survive any expiration or termination of this Agreement. 19. USE OF NAMES Neither party will use the name of the other party or its employees in any advertisement, press release or publicity with respect to the Technology without the prior written approval of the other party. University shall have the right to acknowledge Osteonix's support of the research performed under this Agreement in scientific publications and other scientific communications. IN WITNESS WHEREOF, the undersigned have entered into this Agreement as of the date first set forth above. UNIVERSITY: OSTEX: By /S/ DONALD W. ALLEN By ROBERT J. GLASER ------------------------------- ---------------- Donald W. Allen, Director Robert J. Glaser, COO Grant and Contract Services Date: 11/21/96 Date: 10/23/96 University of Washington Seattle, Washington 98105 To: Ostex International, Inc. Type of Support Requested: Research Grant (continuation) Title of Project: Molecular Markers of Connective Tissue Degredation Principal Investigator: David R. Eyre Amount Requested: XXXXXX (including indirect costs) Funding Period; XXXXXXXXXX University office to be Grant & Contract Services contacted regarding 3935 University Way NE, Box 355754 negotiation of award: Seattle, Wa 98195 Tel: 206-543-4043 Official authorized to give University approval: /S/ DONALD W. ALLEN ------------------------- Donald W. Allen, Director Grant & Contract Services RESEARCH PROPOSAL Title: Molecular Markers of Connective Tissue Degradation Funding Period: XXXXXXXXXXXXXXXXXX PI: David R. Eyre Orthopaedic Research Laboratories University of Washington Box 356500 Seattle, WA 98195-6500 Sponsor: Ostex International, Inc. H. Raymond Cairncross Chairman and CEO 2203 Airport Way South Seattle, WA 98134 SUMMARY This is a continuation research proposal for an existing project, "Molecular Markers of Connective Tissue Degredation", funded from July 1, 1989 to the present.XXXXXXXXXXXXXXXXXXXXXXXXXXX XXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXX XXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXX XXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXX XXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXX XXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXX XXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXX XXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXX XXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXX XXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXX. BUDGET Molecular Markers of Connective Tissue Degradation (continuation project, XXXX) XXXXXXXXXXXX Personnel Position Effort Salary Fringe Total - -------------- ----------- ------- ------ ------ ------ Lynne Atley, Ph.D. Post-doctoral fellow 100% XXX XXX XXX Michael Harkey, Ph.D. Research Associate 50% XXX XXX XXX MaryAnn Weis, B.S. Manager-Research 25% XXX XXX XXX Ping Shao, B.S. Res. Technologist 100% XXX XXX XXX Kristin Vosberg, B.S. Res. Technologist 100% XXX XXX XXX Layne Norland, D.V.M. Graduate Student 100% XXX XXX XXX Secretary 30% XXX XXX XXX ------ XXX EQUIPMENT Micro-titer plate washer, XXXX; water baths, XXXX; Microcentrifuge, XXXX; Pulsed power supply, XXXX; Controlled environment shaker XXXX; Gel electophoresis system XXXX; Purchase of HPLC system for peptide fractionation, XXXX XXXX SUPPLIES XXXXXXXXXXXXXXXX XXXXXXXXXXX and supplies XXXXXXXXXXX and supplies General chemicals and biochemicals Plasticware, glassware and disposable XXXX TRAVEL Investigators to acedemic scientific meetings XXXX DISCRETIONARY BUDGET(64 series, separate account) To sponsor research seminars, conferences, meals, travel and entertainment expenses for visiting scientists, seminar speakers and visitors to the University on Ostex-related business XXXX OTHER XXXXXXXXXXXX XXXXXXXXXXXX. Shared Costs of service contracts on major equipment, equipment repairs and replacement, photographic services, publication costs, computer charges, copying, postage, courier services and telephone charges. XXXX ------ Total Direct XXXX (XX of modified total direct costs) UW indirect costs XXXX -------- XXX Total XXXX BUDGET FOR ENTIRE PROPOSED PROJECT-PERIOD XXXX XXXX XXXX XXXX XXXX XXXX XXXX XXXX XXXX XXXX XXXX XXXX -------- ----- --------- Salaries (+fringe benefits) XXXX XXXX XXXX Equipment XXXX XXXX XXXX Supplies XXXX XXXX XXXX Travel XXXX XXXX XXXX Discretionary XXXX XXXX XXXX Other XXXX XXXX XXXX -------- ------ --------- Total direct costs XXXX XXXX XXXX UW indirect costs XXXX XXXX XXXX (XX of MTDC) --------- ------ --------- Total XXXX XXXX XXXX BUDGET JUSTIFICATION The principal investigator, David Eyre, Ph.D., will direct the work scientifically. Lynne Atley, who spent 6 months with us in 1994 as a visiting scholar, will complete her Ph.D. requirements in Melbourne (University of Melbourne) by April 1996 and join us as a post-doctoral fellow. She trained under Drs. John Wark and Peter Ebeling with her thesis research on bone turnover markers, and is keen to expand her knowledge of collagen biochemistry and work on novel markers of skeletal metabolism. Working 100% on this project, her efforts will focus on XXXXXXXXXXXXXXXXXXXXXas well as the application of the new collagen-based markers (types II and III) in clinical XXXXXXX. Michael Harkey, Ph.D. is a molecular biologist studying the XXXXXXXXXXXXXXXXXXXXXXXXXXXXXXX. MaryAnn Weis, B.S. the laboratory's chief technician and research manager, runs the gas-phase protein sequencer (a core resource for all the scientific aims) and also has taken over project duties on O-CSF from Patricia Woods, B.S., who left the laboratory in December 1995. Ping Shao, B.S., has worked full time on the project for over four years. She has considerable experience in XXXXXXXXXXXXX and in the running of immunoassays, including responsibility for all NTx assays that we run in collaboration with outside investigators. Her responsibility going forward will be the XXXXXXXXXXXXXXXX. Kristin Vosberg, B.S., has worked full time on the project for over two years. Her experience is in preparing antisera, running immunoassays including Western blots and in the preparation and analysis of XXXXXXXXX. Her responsibility going forward will be the development and XXXXXXXXXXXX. Layne Norland, D.V.M., is studying for a Masters degree in the Dept. of Comparative Medicine. His research project is a collaboration with our laboratory, to investigate whether XXXXXXXXXXXXXXXXX. A. SPECIFIC AIMS The primary focus of this project will continue to be... One Page Redacted XXXXXXXXXXXXXXXXXXXXXXX XXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXX XXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXX XXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXX. B. PROGRESS REPORT The aims for the last three years in summary were to: One half page redacted XXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXX XXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXX XXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXX XXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXX. PROGRESS Two pages redacted XXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXX XXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXX XXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXX XXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXX. C. RESEARCH PLAN The scientific strategy is to ... Four and one half pages redacted XXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXX XXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXX XXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXX XXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXX XXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXX. D. PUBLICATIONS The following papers and abstracts of meeting presentations from the Orthopedic Research Laboratories have resulted from or are related to this project. Articles 1. Niyibizi C, Bonadio J, Byers PH, Eyre DR. Incorporation of type I collagen molecules that contain a mutant a2(l) chain (Gly580-greater than Asp) into bone matrix in a lethal case of osteogenesis imperfecta. J ' Bioi. Chem. 267:23108-23112,1992. 2. Bogaert R, Tiller GE, Weis MA, Gruber HE, Rimoin DL, Cohn DH, Eyre DR. Substitution of glutamate for glycine 853 of the triple helical domain of type 11 collagen produces hypochondrogenesis. J. Biol. Chem. 267:22522-22526, 1992. 3. Harris ST, Gertz BJ, Eyre DR, Genant HK, Chesnut CH Ill. The effect of short-term treatment with alendronate upon vertebral density and biochemical markers of bone remodeling. J. Clin. Endocrinol. Meth. 76:1399-1407, 1993. 4. Ezzat S, Melmed S, Endrew D, Eyre DR, Singer FR. Biochemical assessment of bone formation and resorption in acromegaly. J. Clin. Endocrinol. Metab. 76:1452- 1457, 1993. 5. Bolien AM, Eyre DR. Direct extraction of gelatinases from rat bone. Connect. Tiss. Res. 29:223-230, 1993. 6. Gerstenfeld LC, Riva A, Hodgens K, Eyre DR, Landis WJ. Post-translational control of collagen fibrillogenesis in a mineralizing chick osteoblast culture system. Bone Miner. Res. 8:1031-1043, 1993. 7. Gertz BJ, Shao P, Hanson DA, Quan H, Harris ST, Genant HK, Chesnut CH 111, Eyre DR. Monitoring bone resorption in early postmenopausal women by an immunoassay for cross-linked collagen peptides in urine. J. Bone Miner Res. 9:135- 142, 1994. 8. Eyre, DR. New Molecular Markers of Bone Metabolism. Ther. Res. 15:1 00-1 1 1, 1994. 9. Bollen A-M, Eyre DR. Bone resorption rates in children monitored by the urinary assay of collagen type I cross-linked peptides. Bone 15:31-34, 1994. 10. Bell NH, Hollis BW, Shary J, Eyre DR, Eastell R, Colwell A, Russell GRG. Diclofenac sodium is as effective as premarin in inhibiting bone resorption in postmenopausal women. Am. J. Med. 96:349-353, 1994. 11. Brenner RE, Vetter U, Bollen A-M, Mike M, Eyre DR. Bone resorption assessed by immunoassay of urinary cross-linked collagen peptides in patients with osteogenesis imperfecta. J. Bone Miner. Res. 9:933-937, 1994. 12. Blumsohn A, Herrington K, Hannon RA, Shao P, Eyre DR, Eastell R. The effect of calcium supplementation on the circadian rhythm of bone collagen degradation. J. Clin. Endocrinol. Metab. 79:730-735, 1994. 13. Niyibizi C, Eyre DR. Structural characteristics of cross-linking sites in type V collagen of bone: Chain specificity's and heterotypic links to type I collagen. Eur. J. Biochem. 224:934-950, 1994. 14. Bogaert R, Wilkin D, Wilcox WR, Lachman R, Rimoin D, Cohn DH, Eyre DR. Expression in cartilage of a 7-amino acid deletion in type 11 collagen from two unrelated individuals with Kniest dysplasia. Am. J. Hum. Genet. 55:1128-1136, 1994. 15. Bockman RS, Wilhelm F, Siris E, Singer F, Chausmer A, Sitton R, Kotier J, Bosco BJ, Eyre DR, Levenson D. A multicenter trial of low-dose gallium nitrate in patients with advanced Paget's disease of bone. J. Clin. Endocrincl. Metab- 80:595-602, 1995. 16. Eyre DR, Wu J-J. Collagen structure and cartilage matrix integrity. J. Rheumatol. 22(Suppl. 43):82-85, 1995. 17. Eyre DR. The specificity of collagen cross-links as markers of bone and connective tissue degradation. Acta Orthop. Scand. 66(Suppi. 266):166-170, 1995. 18. Key Jr. LL, Rodriguez RM, Willi SM, Wright NM, Hatcher HC, Eyre DR, Cure JK, Griffin PP, Ries WL. Long term treatment of osteopetrosis with recombinant human interferon gamma: An 18 month clinical trial. N. Engl. J. Med. 332(24):1594-1599, 1995. 19. Wu J-J, Eyre DR. Structural analysis of cross-linking domains in cartilage type Xi collagen: Insights on polymeric assembly. J. Biol. Chem. 270(32):18865-18870, 1995. 20. Tiller GE, Polumbo PA, Weis MA, Lachman RS, Cohn DH, Rimoin DL, Eyre DR. Dominant mutations in the type 11 collagen gene (COL2Al) produce spondyloepimetaphyseal dysplasia (SEMD), Strudwick type. Nature Genet. 11(l):87-89, 1995. 21. Steinmann B, Eyre DR, Shao P. Urinary pyridincline cross-links in Ehlers-Danlos Syndrome type VI. Am. J. Hum. Genet. 1995; 57:1505-1508. 22. Bolien A-M, Martin MD, Leroux BG, Eyre DR. Circadian variation in urinary excretion of bone collagen cross-links. J. Bone Miner. Res. 1995; 10(12):1885- 1890. 23. Diab M, Wu J-J, Eyre DR. Collagen type IX from human cartilage: A structural profile of intermolecular cross-linking sites. Biochem. J. 3 14:327-332, 1996. Abstracts 1 . Diab M, Shapiro F, Eyre DR. Abnormality of type IX collagen in diastrophic dysplasia. Trans. Ortho. Res. Cos. (San Francisco (1 8)S 1): 1 20, 1993. 2. Caulfield MP, Morgan C, Carlton E, Brickman AS, Clemens JD, Eyre DR, Pandian MR. Comparison of an immunoassay for cross-linked N-telopeptide of bone collagen with HPLC detection of pyridinolines. The Endocrine Society, 1993. 3. Dickson IR, Arora MK, Coombes RC, Shao P, Eyre D. Pyridinolines and cross- linked type 1 collagen N-telopeptides as markers of bone metastases in breast cancer. J. Bone Miner. Res. 8(Sl):S288, 1993. 4. Lee MY, Woods PE, Lottsfeldt JL, Ramesh N, Osborne WRA, Eyre DR. Isolation and molecular characterization of a murine osteoclast colony stimulating factor (0- CSF). J. Bone Miner. Res. 8(Sl):Sl44, 1993. 5. Blumsohn A, Al-Dehaimi AW, Herrington K, Shao P, Eyre DR, Eastell R. Effect of timing of calcium supplementation on the circadian rhythm of bone collagen degradation. J. Bone Miner. Res. 8(Sl):Sl58, 1993. 6. Rodriguez RR, Ries WL, Eyre DR, Key LL. Type I collagen cross-linked N- telopeptide excretion by osteopetrotic patients during interferon gamma therapy: A correlation with bone biochemical and densitometric markers. J. Bone Miner. Res. 8(Sl):S291, 1993. 7. Ebeling PR, Atley LM, Eyre DR, Guthrie J, Dennerstein L, Wark JD. Sensitivity of type I collagen N-telopeptide cross-links in detecting early menopausal changes in bone tumover. Proc. ANZ Bone Miner. Soc. A2, 1993. 8. Ebeling PR, Atley LM, Eyre DR, Shao P, Guthrie J, Dennerstein L, Wark JD. Sensitivity of collagen N-telopeptide cross-links and osteocalcin in detecting early menopausal changes in bone tumover. Abstract presented at the 4th lntemational symposoium on Osteoporosis in Hong Kong, March 1993. 9. Fiedelius C, Eyre DR, Christiansen C. Urinary type I collagen cross-linked N- telopetides: A new marker for bone resorption. Poster presented at the 4th International Symposium on Osteoporosis in Hong Kong, March 1993. 10. Eyre DR, Bogaert R, Diab M, Hanson D, Knigge P, Niyibizi C, Weis MA, Wu ii. Studies on the molecular structure of collagen heteropolymers in bone and cartilage. Presented at the 5th International Conference on Osteogenesis Imperfecta, September 27-30, 1993, Oxford, England. 11. Kanthawatana S, Eyre DR, Hendeles L. The effect of short course of oral prednisone on a biochemical marker of bone resorption. Xllth Intemational Congress of Pharmacology. Montr6al, Qu6bec, July 1994. 12. Apone S, Fevold K, Lee M, Eyre D. A rapid method for quantifying osteoclast activity in vitro. J. Bone Miner. Res. 9(Sl):Al2O, p. S178, 1994. 13. Clemens JD, Herrick- M, Singer FR, Rosen HN, Shao P, Eyre DR. Cross-linked N- telopeptides of type I collagen in human serum as a biochemical marker of bone resorption. J. Bone Miner. Res. 9(Sl):A5-72, p. S228, 1994. 14. Prior JC, Eyre Dr, Ebeling PR, Wark, JD. Trabecular bone loss after premenopausal oophorectomy is not prevented by con'ugated estrogen or medroxyprogesterone--a double-blind, randomized 1-year study. J. Bone Miner. Res. 9(Sl):C294, p. S394, 1994. 15. Key LL, Rodriguez RM, Hatcher H, Eyre DR, Ries WL. Long term treatment of osteopetrotic patients with interferon gamma. J. Bone Miner. Res. 9(Sl):72, p. S138, 1994. 16. Sowers M-F, Eyre, D, Hollis, BW. Changes in bone tumover markers and bone density with lactation. J. Bone Miner. Res. g(Sl):A512, p. S2p7, 1994. 17. Jackson G, Hollis BW, Eyre DR, Baylink DJ, Bell NH. Effects of race and calcium intake on bone markers and calcium metabolism in young adult men. J. Bone Miner. Res. 9(S 1):Al 78, p. S 1 85, 1994. 18. Ebeling PR, Eyre DR, Gurthrie J, Dennerstein L, Wark JDF. Prediction of early menopausal bone loss by biochemical markers of bone turnover. Amer. Soc. Bone Miner. Res., Kansas City, MO, September 1994. 19. Wu JJ, Murray J, Eyre DR. Evidence foi copolymeric cross-linking between types 11 and Ill collagens in human articular cartilage. ORS, Atlanta, 1996. 20. lchimura S, Wu JJ, Eyre DR. A sensitive method for collagen type IX peptide- mapping in human cartilage. ORS, Atlanta, 1996. 21. Wang C, Eyre DR, Clark R, Kleinberg D, lranmanesh A, Dudley RE, Berman N, Swerdloff RS. Sublingual testosterone replacement decreases bone resorption and increase bone formation markers in hypogonadal men. Int. Congress of Endocrinol., 1996. University of Washington Hazardous Materials Use Complete and Return to Environmental Health and Safety GS-05 A. Principal Investigator: David R. Eyre. Ph.D. B. Department: Orthopaedics C. Building: Health Sciences Room #: BB1052 D. Phone No.: 543-4700 E. Mail Stop: Box 356500 F. Co-investigator(s) _________________________ ______________________ ========================= ====================== G Title of Project or Proposal. Molecular Markers of Connective Tissue Degradation
Yes No 1. Will Hazardous Materials be used or stored in your laboratory? x 2. Have you and your employees received Hazard Communication training? x 3. Will your research include the use of substances of high acute toxicity, x reproductive toxins, carcinogens, mutagens, or teratogens? 4. Is there a chemical inventory available for your laboratory? x 5. Do you have access to a computer that is in or near your laboratory for the purpose of accessing networked safety information? x 6. Are you familiar with the UW's Hazardous Waste Disposal Guidelines? x 7. Doe your laboratory contain the following?
A. X FIRE EXTINGUISHERS? B. X FLAMMABLE LIQUID STORAGE CABINETS? C. X BIOLOGICAL SAFETY CABINETS? D. X FUME HOODS (ANY TYPE)? E. _ RESPIRATORS AND REPLACEMENT CARTRIDGES? F. X PROTECTIVE GLOVES (LATEX, NITRILE, VINYL, ETC.)? G. X COMPRESSED GASES? H. X EYE WASHES? I. X EMERGENCY SHOWER WITHIN 100 FT. OF THE LAB? J. X ROOM WINDOWS THAT OPEN? 8. Please list on the back of this form any special hazards or precautions associated with the use of chemicals in your research? University of Washington Biohazard Activity Review Complete and Return to Environmental Heath and Safety Box 354400 A. Principal Investigator: David R. Eyre. Ph.D. B. Department: Orthopaedics C. Building: Health Sciences LAB Room #: BB1052, 1054, 1032 D. Phone No.: 543-4700 E. Box: 356500 E-Mail: ntx@u.washington.edu F. Co-investigator(s) _________________________ ______________________ ========================= ====================== G Title of Project or Proposal. Molecular Markers of Connective Tissue Degradation __ Check here if project is non-competitive renewal and skip to Section M Yes No H. Is your lab engaged in the following areas of biohazard activity? 1. Activities involving non-human primates, including blood, tissues and/or body fluids from non-human primates. __ x 2. Activities involving other animals or animal blood and tissues: Animal Type: XXXXXX a. Commercially raised laboratory animals. x __ b. Feral (wild caught) animals. __ x 3. Activities involving human blood, tissues, body fluids and excreta. a. Have all personnel received Hepatitis B vaccinations? (See UW Exposure Control Plan or call 543-7278 for more information.) x __ b. Does the laboratory have an exposure control plan? (if yes, answer Section I. below.) x __ 4. Activities involving contact with cultures or specimens which may contain microorganisms (including viruses). Culture Type: ___________ __ x 5. Activities involving recombinant DNA. (All projects involving recombinant DNA must be registered with the UW Recombinant DNA Committee, regardless of containment level. See Section III., pages 2-5 of the "University Biohazard Safety Manual" or call EH&S at 543-7278 regarding non-competitive grant renewals.) __ x I. Does your laboratory exposure control plan cover: 1. Procedures on use of personal protective equipment and clothing? x __ 2. Procedures for handling hypodermic needles, glass, pipettes and biological wastes? x __ 3. Immunization and medical surveillance program(s)? x __ 4. Personnel training? x __ If the answer to any or part of section H. is "Yes" , please complete the next page. University of Washington Biohazard Activity Review Page 2 of 2 Another J. Does this project require the use of? In Lab* Location 1. Laminar flow biological safety cabinets. x __ 2. Centrifuge x __ 3. Autoclave x __ 4. Sonication Equipment x __ *equipment located in rooms listed on first page. K. Submit the following with this form. 1 . A copy of the GC-1 form. 2. An assessment of the possible risks from biohazards and a brief summary of the biosafety precautions followed. 3. Any comments received from departmental review of the project. 4. A summary of the proposed project written in lay terms and/or a copy of the application being submitted for grant support L. If Class III agents* are involved submit the following additional information with this form: 1. A resume of the training and experience of each person who will participate in the project 2. A description of laboratory facilities available including containment equipment such as biological safety cabinets, etc. Include a statement by Environmental Heath and Safety assessing the adequacy of containment facilities. + Consult UW Biosafety Manual for classification of agents. Note: Work with Class IV agents will not be approved at the University of Washington as appropriate facilities are not available. M. If this is a non-competitive renewal of funded grant and there are no significant changes in the project from the original submittal, submit the following: a. A copy of the new GC-1 form. b. a brief summary of the new year's proposed activity. For more information contact EH&S Biosafety Specialist at 543-7278 Form HS SR-1 trev BOX FOR COMMITTEE USE ONLY MASTER ___ COMMITTEE ___ REVIEWER ___ INVESTIGATOR X 25-763-E APPLICATION NUMBER UNIVERSITY OF WASHINGTON HUMAN SUBJECTS DIVISION BOX 355752 STATUS REPORT: Application no. 24-112-E __ DO NOT RENEW. Complete items 1-6 of Status Report and return form. XX RENEW WITH MINOR OR NO CHANGES. Complete items 1-10 of Status Report; - -- submit one original plus three (3) copies of this form. RENEW WITH CHANGES IN PROCEDURES, POPULATION, OR PURPOSE: Complete and submit nine (9) copies of a new HSRC application (UW 13-11) and this Status Report (items 1-10). Investigator's name, position, division and department, mail stop and telephone number: David R. Eyre, Ph.D., Professor, Dept. of Orthopaedics, Box 356500, 543-4700 Title of Human Subjects Application: Connective Tissue Research XXXXXXXXXXXXXXXXXXXXXXXXXXXX Brief summary of findings to date (add sheets if necessary): SEE ATTACHED 4. Number and types of adverse events. complaints, and withdrawals and how they were handled (add sheets if necessary): NONE. 5. No. of subjects enrolled in study to date: XX Normals/Controls XX Patients/Cases 6. No. of subjects added during past year of approval: XX Normals/Controls XX Patients/Cases 7. No. of subjects continuing participation: N/A See attached. XX Normals/Controls XX Patients/Cases 8. How many new subjects will join the study over the next year? XX Normals/Controls XX Patients/Cases 9. Do you propose any minor changes in this study or consent form? X No. ___ Yes. If yes, describe (add sheets if necessary). Submit 4 copies of revised consent form and other materials, if appropriate. 10. Provide information for all funding, awarded or proposed for this activity (add sheets if necessary). Type: XX research grant, __ contract, __ fellowship, __training grant, __ other, explain: Name of principal investigator: David R. Eyre, Ph.D. Name of agency: SEE ATTACHED. Agency's no. (if assigned): Title of proposal: SEE ATTACHED SEE ATTACHED Inclusive dates: from SEE ATTACHED, through ________________ Submitted through Grant and Contract Services? __ No XX Yes __ VAMC __Other: HSRC Chair's signature: ____________________ Date June 08, 1995 Approve XX Disapprove __ Subject to the following conditions: Period of approval is one year, from 06-08-95 through 06-07-96. * VALID ONLY AS LONG AS APPROVED PROCEDURES ARE FOLLOWED * Washington, Comparative Medic 01/30/1996 - - Protocol Description Eyre, David R. BOX 356500 PROTOCOL: 2547-03 Last Update: 01/30/1996 Immunoassay Assessment of Type I and Type II Collagen Degradation in the Received: 11/15/1995 Approved: 11/16/1995 Sig. Chg.: 01/25/1996 Expires: 11/15/1996 Vet Appr.: 01/25/1996 Funding sources: Ostex International PI: Eyre, David R. Mail: BOX 356500 S/D: / Orthopaedics Contacts: Function Phone Emergency Norlund, Layne C 543-0474/ 685-8932 Species: 11 XXXXXXXXXXX Strain: XXXXXXX Vivarium: 01 Lab Room: 01 G609,D604 Oper. Room: 1 2 3 4 Total Approved: X X X X XXX Ordered: XXX X X X XXX Adjusted: XX X X X XX Remaining: XX X X X XX Y-Drug administration Y-Blood sampling Y-Euthanasia Y-Collection of tissue Y-Withhold meds NO CONDITIONS Protocol Summary: 21. XXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXX EX-10.15B 5 Note: Confidential treatment requested. Exhibit omits information that has been filed separately with the Securities and Exchange Commission. Research Agreement Dr. Minako Y. Lee RESEARCH AGREEMENT This RESEARCH AGREEMENT is entered into as of the 1st day of September, 1996, by and between OSTEX INTERNATIONAL, INC., a Washington corporation, having its principal place of business at 2203 Airport Way South, Suite 400, Seattle, Washington 98134 ("Ostex"), and the UNIVERSITY OF WASHINGTON, having its principal office at Seattle, Washington 98195 (the "University"). RECITALS A. Ostex has an ongoing interest in certain research technology (including inventions, processes, formulae and the like, whether or not patentable, and property eligible for copyright protection) entitled "Role of O-CSF in Osteoclast Regulation," as more particularly described in "Exhibit A" attached hereto (the "Technology"). B. The Technology has been assigned by the University to the Washington Research Foundation ("WRF") pursuant to Section 3.3 of that certain Technology Administration Agreement, dated January 1, 1985, between the University and WRF, as amended (the "UW Agreement"). Pursuant to that certain Exclusive License Agreement between Ostex and WRF, dated October 20, 1989 (the "Exclusive License Agreement"), WRF granted Ostex an exclusive, worldwide license to make, have made, assign, sublicense, lease, develop, enhance, modify, produce, reproduce, demonstrate, market, promote, sell, distribute, use, exploit and otherwise commercialize and prepare derivations of the Technology. C. Ostex and the University entered into a Research Agreement dated November 1, 1992, pursuant to which Ostex funded the first two years of a research program to be conducted by the University relating to the Technology (the "Research Program"). D. It is in the mutual interest of Ostex and the University that the Research Program be continued pursuant to this Agreement. E. Ostex is willing to fund the XXXXXXXXXXX of the Research Program at and through the University of Washington, Department of Biological Structure, and the University desires to obtain such funding, all subject to and in accordance with the terms and conditions set forth in this Agreement. AGREEMENTS In consideration of the covenants and promises contained herein and for other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the parties hereto agree as follows: 1. SCOPE AND SCHEDULE The Research Program shall be conducted in accordance with the research proposal attached hereto as "Exhibit A" and incorporated herein by this reference (the "Research Proposal"), and in accordance with mutually agreeable written modifications thereof. The Research Program shall be carried out during the Program Period (as defined below), unless sooner terminated or extended as herein provided. 2. PROGRAM PERIOD The Program Period initially will be XXXX in duration; commencing XXXX and expiring XXXX, provided, however, that the parties may by mutual agreement reached no less than thirty (30) days prior to expiration XXXXXXX, extend the Program Period forXXXXXXXXXXXXXXXXXXXXXX to commence XXXX and expire XXXX. 3. OSTEX'S PRINCIPAL OBLIGATIONS 3.1 During XXXXXXXXX of the Program Period, Ostex shall pay the University the sum of XXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXX to cover all direct and indirect costs of the corresponding portion of the Research Program, as set forth in the budget section of the Research Proposal. 3.2 In the event that the Program Period is extended beyond XXXXXXX in accordance with Section 2 above, Ostex shall during XXXXXXX pay the University the sum of XXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXX to cover all direct and indirect costs of the corresponding portion of the Research Program, as set forth in the budget section of the Research Proposal. 4. PAYMENT TERMS 4.1 During XXXXXXX of the Program Period, Ostex shall, upon receipt of invoices from the University, pay the University the amount specified in Section 3.1 above, in accordance with the following schedule: PAYMENT DATE PAYMENT AMOUNT -XXXXXXXXXXXXXXXXXXXXXXXXXXXX XXX XXXXXXXXXX - XXXXXXXXXXXXXXXXXXXXXXXXXXX XXX - XXXXXXXXXXXXXXXXXXXXXXXXXXX XXX - XXXXXXXXXXXXXXXXXXXXXXXXXXX XXX 4.2 In the event that the Program Period is extended beyond XXXXXXX, Ostex shall, upon receipt of invoices from the University, pay the University during XXXXXXX the amount set forth in Section 3.2 above, in accordance with the following schedule: PAYMENT DATE PAYMENT AMOUNT - XXXXXXXXXXXXXXXXXXXXXXXXX XXX - XXXXXXXXXXXXXXXXXXXXXXXXX XXX - XXXXXXXXXXXXXXXXXXXXXXXXX XXX - XXXXXXXXXXXXXXXXXXXXXXXXX XXX 4.3 The University shall submit its customary statement of expenses incurred under this Agreement within thirty (30) days after the end of each six-month interval of the Program Period. 5. PRINCIPAL INVESTIGATOR For purposes of this Agreement, and pursuant to University policy, Dr. Minako Y. Lee is designated the principal investigator of the Research Program ("Principal Investigator"). The Principal Investigator shall be responsible for the direction and content of the Research Program, including budgeting and budget revisions necessary to accomplish the objectives of the Research Program. Should the Principal Investigator leave the employ of the University or otherwise become unavailable to fulfill her obligations as Principal Investigator during the Program Period, the University may nominate a replacement for the position of Principal Investigator. If such replacement is not acceptable to Ostex, the Research Program and budget contained in the Research Proposal may be modified to reflect a reduced scope of work, or, at the option of Ostex, may be terminated upon sixty (60) days' notice, unless arrangements acceptable to Ostex can be made to subcontract with the departed Principal Investigator, or the institution at which she is then employed, to continue the work described in the Research Proposal. 6. CONFIDENTIALITY Neither party shall furnish to the other any confidential or proprietary information of any third party in connection with this Agreement. Any such information which one party wishes to furnish to the other shall be the subject of a separate confidentiality agreement between the parties. 7. DATA REPORTS AND FACILITIES 7.1 The University shall, in accordance with established University practice, keep complete, accurate, and authentic accounts, notes, data, and records of the work performed under this Agreement and shall provide Ostex with reports within thirty (30) days following the end of each six-month interval of the Program Period. The University shall furthermore submit to Ostex a written and comprehensive final report within ninety (90) days after termination of the Research Program. 7.2 At the discretion and convenience of the Principal Investigator during the course of the Research Program, Ostex's representatives and others designated by Ostex may be present as observers while various tests, inspections and other aspects of the Research Program are being conducted. Ostex's representatives may consult informally with the Principal Investigator regarding the Research Program both personally and by telephone. The University acknowledges and agrees that the Principal Investigator may serve as a consultant to Ostex during the term of this Agreement. 7.3 From its own resources and those provided under this Agreement, the University agrees to make available laboratory facilities and equipment for the Research Program. 8. INVENTION RIGHTS 8.1 The University acknowledges and agrees that: (i) all Technology made, developed or conceived on or before the date of this Agreement has been assigned to WRF pursuant to Section 3.3 of the UW Agreement, and no commitments have been made with respect to such Technology pursuant to Section 3.2 of the UW Agreement; (ii) all Technology made, developed or conceived after the date of this Agreement will be submitted to WRF pursuant to Section 3.1 of the UW Agreement; (iii) no commitment will be made pursuant to Section 3.1 of the UW Agreement with respect to Technology made, developed or conceived after the date of this Agreement unless Ostex agrees to such commitment in writing; and (iv) the University shall not terminate, amend, waive or enforce the UW Agreement, or any rights or obligations thereunder, in any manner that could adversely affect Ostex's rights under this Agreement unless Ostex agrees in writing to such termination, amendment, waiver or enforcement. 8.2 The University shall have no right, title or interest in any Technology made, developed or conceived by employees or consultants of Ostex entirely without the use of University facilities. 9. PUBLICATION The University will not be restricted hereunder from publishing the results of research conducted under this Agreement within a reasonable period of time following their availability. The University will provide a copy of all manuscripts to Ostex prior to their presentation or submission for publication. In order to protect fully the rights of the University and of Ostex, any contemplated publication or other dissemination containing details of an invention, whether or not patentable, will be withheld until a patent application is filed or other appropriate steps to protect commercial value have been completed. Such withholding shall be kept to a minimum and will not exceed six (6) months, except by mutual agreement between Ostex and the University. 10. INDEMNIFICATION The University and Ostex each agree to indemnify and hold the other party harmless from damage to persons or property resulting from any act or omission on the part of itself, its employees, its agents, or its officers. 11. NOTICES Any notice to be given hereunder shall be in writing and shall be deemed received by the addressee on the day delivered if delivered by courier on a business day, or on the fifth business day following mailing if sent by first-class, certified or registered U.S. mail, postage prepaid, to the following address: if to the University: Director, Grant and Contract Services 3935 University Way, N.E., JM-24 Seattle, Washington 98195 if to Ostex: Ostex International, Inc. 2203 Airport Way South, Suite 301 Seattle, Washington 98134 Attention: President 12. TERMINATION 12.1 This Agreement shall terminate upon the expiration of the Program Period as defined in Section 2 above; provided, however, that this Agreement may be terminated by either party prior to expiration of the Program Period upon sixty (60) days' prior written notice, if such party determines, in its discretion, that the Research Program is no longer feasible or desirable academically, technically, or commercially. Upon receipt or delivery of such notice of termination, the University shall exert its best efforts to limit or terminate any outstanding financial commitments for which Ostex is responsible hereunder, and Ostex shall reimburse the University, to the extent not previously reimbursed, for all costs incurred by the University for the Research Program, including, without limitation, all obligations not cancelable. The University shall furnish, within sixty (60) days of the effective date of termination, a final report of all costs incurred and all funds received and shall reimburse Ostex for payments which may have been advanced in excess of total costs incurred, with no further obligations to Ostex. 12.2 Notwithstanding paragraph 12.1 above, in the event that either party shall be in default of any of its obligations under this Agreement and shall fail to cure such default within thirty (30) days after receiving written notice thereof, the party not in default shall have the option of terminating this Agreement by giving written notice of termination to the defaulting party, which shall be effective thirty (30) days after delivery. 12.3 Termination of this Agreement shall not affect the rights and obligations of the parties accrued prior to termination, or the rights and obligations set forth in Section 8 above. 13. WARRANTS AND COVENANTS BY UNIVERSITY 13.1 The University hereby warrants that it has the right and authority to enter into this Agreement and that the representatives whose signatures appear hereunder are duly authorized by the University to enter into this Agreement on behalf of the University. 13.2 The University covenants that it will not knowingly enter into any agreement with any industrial or commercial funding source other than Ostex if such agreement would be inconsistent with the University's obligations hereunder. 14. GOVERNING LAW This Agreement shall be governed by and construed in accordance with the laws of the State of Washington. 15. ARBITRATION AND JURISDICTION 15.1 At the request of either party, any controversy, claim, or dispute arising out of or relating to any provision of this Agreement shall be settled by arbitration to be conducted in Seattle, Washington. Such arbitration shall be conducted in accordance with the rules applied by the American Arbitration Association. Judgment upon any award rendered through arbitration may be entered into any court of competent jurisdiction. 15.2 Ostex and the University agree to submit to jurisdiction in Seattle, Washington. 16. SUCCESSORS AND ASSIGNS This Agreement, including the indemnification provisions hereof, shall be binding upon and inure to the benefit of the parties hereto, their respective successors, assigns, and legal representatives. Ostex may assign this Agreement to any successor to all or substantially all of its business and assets. This Agreement shall not otherwise be assignable by either party without the prior written consent of the other. 17. NO ORAL MODIFICATION No change, modification, extension, termination or waiver of this Agreement, or any provision herein contained, shall be valid unless made in writing and signed by duly authorized representatives of the parties hereto. 18. SURVIVAL Sections 8 and 9 of this Agreement shall survive any expiration or other termination of this Agreement. 19. USE OF NAMES Neither party will use the name of the other party or its employees in any advertisement, press release or publicity with respect to the Technology without the prior written approval of the other party. The University shall have the right to acknowledge Ostex's support of the research performed under this Agreement in scientific publications and other scientific communications. EFFECTIVE as of the day and year first set forth above. UNIVERSITY: OSTEX: By /S/ DANALD A. ALLEN By /S/ JOHN M. BRENNEMAN Donald W. Allen, Director, John M. Brenneman, Director of Finance Grant and Contract Services 11/21/96 10/22/96 Date of signature Date of signature EXHIBIT A Continuation of Research proposal: Role of O-CSF in Osteoclast Regulation For XXXXXXXXXXXXXXXXXXXXXXXXXXX Submitted to: OSTEX International Inc. 2203 Airport Way, S., Suite 301 Seattle, WA. 98l34 Tel: (206) 292-8082 Fax: (206) 292-8625 Principal Investigator: Minako Y. Lee, ,M.D. Research Associate Professor Department of Biological Structure SM-20 University of Washington Seattle, WA. 98195 Tel: (206) 685-1514 Fax:(206) 543-1524 1 Lee, Minako Y. Budget Request for XXXX X XXXXXXXXXXXXXXXXXX DETAILED BUDGET FOR THE FIRST 12 MONTHS Personnel: Name Role % Salary Fringe Total M. Y. Lee P.I 40% XXX XXX XXX Y Igarashi Senior Fellow 30% XXX XXX XXX L. Ferguson Res Tech I 100% XXX XXX XXX Q. Dang Hourly XXX XXX XXX Subtotal personnel: XXX Equipments: Microcentrifuge XXXX, Tissue homogenizer XXXX XXX Supplies: XXXXXXXXXXXXXXX XXX XXXXXXXXXXXXXXX XXX XXXXXXXXXXXXXXX XXX XXXXXXXXXXXXXXX XXX XXXXXXXXXXXXXXX XXX Others XXXX, equipment repair, service: XXX publication: XXX, photocopies, postage: XXXX XXX XXXXXXXXXXXXXXX XXX Housing in XXXXXXXXXXXXXXX XXX Subtotal for supplies: XXX Total direct costs: XXX xxxxxx Indirect Costs: xxxxxx xxxxxx xxxxxx Indirect Costs: xxxxxx Total direct costs for the next XXXX period xxxxxx Indirect Costs: xxxxxx Total direct and indirect for next XXXX period: XXXX xxxxxx xxxxxx Personnel Salaries xxxxxx xxxxxx Fringe xxxxxx xxxxxx Total xxxxxx xxxxxx Equipment xxxxxx xxxxxx Supplies xxxxxx xxxxxx Total xxxxxx xxxxxx BUDGET JUSTIFICATION: We are requesting salaries for personnel who will be working on the proposed project at a % effort as indicated. Dr. Lee will spend xxx of her time as P.I. A proposed salary is commensurate with her experience and academic level. Dr. Igarashi, Ph.D. in biochemisty, is an associate professor in Biochemistry at Dokkyo University School of Medicine, Japan. He came to our laboratory in April 95 as a visiting scholar to work for 2 years. He is a well experienced biochemist in protein purification and molecular biology, and his contribution is very helpful to our program. He will work with us on XXXXXXXXXXXX. He needs 30% of his salary support in next year. Ms. Ferguson will provide technical assistance in XXXXX involved in the proposal. Mr. Dang will XXXXXXX. Fringe benefit is calculated at 22% for PI, 25% for the fellow, and 30% for the research technologist, according to the institutional regulation. Annual inflation rate is calculated at 4%. Indirect cost rate is as per current agreement between University of Washington and OSTEX International Inc. Research Proposal: Role of O-CSF in Osteoclast Regulation A) SPECIFIC AIMS One half page redacted XXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXX XXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXX XXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXX XXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXX B) BACKGROUND AND SIGNIFICANCE: XXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXX responsible for bone resorption. It is now well established that Ostoeclasts are derived from a hematopoietic stem cell population and multinucleated functional osteoclasts are formed by the fusion of mononuclear precursor cells (1,2). Although it has been clearly shown that osteotropic hormones such as 1,25 dihydroxyvitamin D3 (vitamin D3) or parathyroid hormone (PTH) play important roles in the process of functional osteoclast formation (3), mechanisms of immature osteoclast development in the bone marrow is still poorly understood. Nonetheless, recent studies have gradually revealed that more and more complex mechanisms are involved in differentiation of immature osteoclasts from the heterogenous hematopoietic cell population. Involvement of not only various interleukins, colony stimulating factors (CSF), growth factors, and/or hormones but also soluble receptors of cytokines (4) and marrow stromal cell elements have been suggested to play roles at various stages of osteoclast development (3).XXXXXXXXXXXXXXXXXXXXXXXXXXX The remaining page unsder background and significance is redacted XXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXX XXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXX XXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXX XXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXX XXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXX XXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXX C) PROGRESS REPORT/ PRELIMINARY STUDIES Following studies have been conducted in collaboration with laboratories of Dr. David Eyre, Department of Orthopedics, Dr. William Osborne, Department of Pediatrics, both at the University of Washington, and Dr. Stephen Apone, Ostex International. Inc. Two pages redacted XXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXX XXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXX XXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXX XXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXX XXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXX PRELIMINARY STUDIES Two and one half pages redacted XXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXX XXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXX XXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXX XXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXX XXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXX XXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXX XXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXX Publications: M.Y.Lee, P.E.Woods, J.L.Lottsfeldt, N.Ramesh, W.R.A.Osborne, D.R.Eyre: Isolation and molecular characterization of a murine osteoclast colony stimulating factor (O-CSF). J Bone Mineral Research 8: S144, 1993. T.H.Lee, K.L.Fevold, Y.Muguruma, J.L.Lottsfeldt, M.Y.Lee. Relative roles of osteoclast colony-stimulating factor and macrophage colony stimulating factor in the course of osteoclast development. Exp Hematol 22:66-73, 1994. Stephen Apone, Karen Fevold, Minako Lee, David Eyre: A rapid method for quantifying osteoclast activity in vitro. J Bone Mineral Research 9:S178, 1994. Y.Hayase, M.Y.Lee: Osteoclast progenitors develop from primitive hematopoietic stem cells. Exp Hematol 22:(8), 755, 1994. Y.Mugururna, M.Y.Lee: Osteoclast progenitors express c-Kit, but their differentiation appears independent of stem cell factor. Abstract submitted to the annual meeting for the American Society of Hematology, 1995. L.E.Purton, M.Y.Lee,B.Torok-Storb. Normal human peripheral blood mononuclear cells mobilized with granulocyte colony-stimulating factor contain osteoclast progenitors. Abstract submitted to the annual meeting for the American Society of Hematology, 1995. D) Research plan: Four pages redacted XXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXX XXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXX XXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXX XXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXX XXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXX WORK SCHEDULE: Aim 1 XXXXXXXXXXXXXXXXXXXX Aim 2 XXXXXXXXXXXXXXXXXXXX Aim 3 XXXXXXXXXXXXXXXXXXXX References: 1. SudaT. et al., Modulation of osteoclast differentiation. Endocrine Reviews. 13:66-80,1992 2. Nijweide,PJ. and GroothR. Ontogeny of the osteoclast. In Biology and Physiology of the Osteoclast. Rifkin, BR and Gay CV eds. p82-97. CRC press, Boca Raton, Florida 1992 3. Chambers,TJ. Regulation of osteoclast development and function. ibd. p 106-128. 4. Tamura, T. et al., Soluble interleukin-6 receptor triggers osteoclast formation by interleukin 6. Proc. Natl Acad. Sci. 90:11924-1928, 1993 5. Lee, MY., Eyre, DR., Osborne, WRA. Isolation of a murine osteoclast colony stimulating factor. Proc. Natl. Acad. Sci. 88:8500-8504,1991 6. Lee, MY., Lottsfeldt, JL. Fevold, KL. Identification and characterization of osteoclast progenitors by clonal analysis of hematopoietic cells. Blood 80:1710-1716, 1992 7. Metcalf,D. Hematopoietic regulators. Redundancy or Subtlety? Blood 82:35l5-3523, 1993 8. Kaushansky, K., Lin,N. and Adamson,J: Interleukin 1 stimulates fibroblasts to synthesize granulocyte-macrophage and granulocyte colony stimulating factors. Mechanisms for the hematopoietic response to inflammation. J Clin Invest 81: 92-97, 1988 9. Thomson, B.M., Saklatvala, J. and Chambers, T.J: Osteoblasts mediate interleukin 1 stimulation of bone resorption by rat osteoclasts. J Exp Med 164: 104-112, 1986 10. Lee,TH., Fevold,KL., Muguruma,Y., Lottsfeldt,JL., Lee,MY. Relative roles of osteoclast colony-stimulating factor and macrophage colony-stimulating, factor in the course of osteoclast development. Exp Hematol 22:66-73. 1994 11. de-la-Mata,J., et al., Interleukin-6 enhances hypercalcemia and bone resorption mediated by parathyroid hormone-related protein in vivo. J.Clin Invest. 95:2846-2852, 1995 12. KodamaH., et al., Congenital osteoclast deficiency in osteopetrotic (op/op) mice is cured by injections of macrophage colony-stimulating factor. J. Exp. Med. 173:269-272, 1991 13. Jilka,R., et al., Increased osteoclast development after estrogen loss: mediation by interleukin-6. Science 257:88-91, 1992 14.Horowits,MC. Cytokines and estrogen in bone: Anti-osteoporotic effects. Science 260:626-627, 1993 15. Rifkin,DB and Moscatelli, D. Recent developments in the cell biology of basic fibroblast growth factor. J.Cell Biol 109: 1-6, 1989 16.Apone,S., Fevold,K., Lee,M., Eyre,D. A rapid method for quantifying osteoclastactivity in vitro. J Bone Min Res 9:S178, 1994 17. Muguruma,Y. and Lee, MY.Osteoclast progenitors express c-Kit, but their differentiation appears independent of SCF. (submitted) 15 FOUR EXPRESSION GRAPHS REDACTED ON THIS PAGE -----END PRIVACY-ENHANCED MESSAGE-----