Contract

Exhibit 10.17

The confidential portions of this exhibit have been filed separately with the Securities and Exchange Commission pursuant to a confidential treatment request in accordance with Rule 406 under the Securities Act of 1933, and Rule 24b-2, under the Securities Exchange Act of 1934, Redacted portions of this exhibit are marked by an ***.

Technology Transfer Agreement

Between Xxxxxxxxx Technology Corp and Manhattan Scientifics

Relating to Ultrafine Grain or Nanostructured Metal Technology

1..

This Technology Transfer Agreement (“Agreement”) is made by and between Xxxxxxxxx Technology Corporation, a Delaware corporation having a place of business in Reading, Pennsylvania (“Xxxxxxxxx”), and Manhattan Scientifics, Inc., a Delaware corporation having a place of business in New York, New York, New York (“MSI”), and is effective as of the 12th day of August 2009 (the “Effective Date”).

2..	Background.

2.1.

Xxxxxxxxx is a leader in the development, manufacture and distribution of wrought and powder metallurgy stainless and specialty alloys, as well as titanium alloys in product forms ranging from large-diameter billet and hollow bar to fine wire. Xxxxxxxxx provides materials solutions to the ever-changing needs of the automotive, aerospace, energy, industrial, medical, defense, and consumer products industries, continuing a 120 year tradition of innovation in metals processing.

2.2.

Manhattan Scientifics advances technologies with potential world-changing impact to the threshold of commercialization by following the principles of purpose, dedication and cooperation. Manhattan Scientific has developed and acquired nanostructured metal technology, technology based on over 16 years of highly focused research and development. Nanostructured metals and alloys possess significantly enhanced mechanical properties that include, for example, increased strength without concurrent losses in ductility, and significantly increased resistance to fatigue fracture. Nanostructured commercially pure grades of titanium have proven to also possess excellent machinability as well as high toughness and strength. Manhattan Scientifics has developed unique processing methodology for producing nanostructures in a wide range of ductile metals and alloys and is now commercializing this new and revolutionary technology.

2.3.

Xxxxxxxxx and MSI desire to cooperate fully in bringing to market products derived from the MSI technology or technology developed as a result of access to MSI’s expertise and contacts in the field. MSI will provide the full benefit of its intellectual property, know-how, contacts and relationships, and experience to benefit Xxxxxxxxx’x efforts to design, manufacture, promote and sell products related to, or derived from, the technology. Xxxxxxxxx reasonably will apply its process experience, capital resources, and marketing capabilities to develop, produce, promote and sell resulting products and materials.

2.4.

MSI has obtained licenses for certain patents from Los Alamos National Security, LLC, a Delaware company having its principal place of business in Xxx Xxxxxx, Xxx Xxxxxx 00000 (“LANS”) that are memorialized in a document titled “EXCLUSIVE FIELD-OF-USE PATENT LICENSE AGREEMENT” (the “LANS/MSI Agreement”). MSI and Xxxxxxxxx have entered into a Sublicense Agreement from MSI to Xxxxxxxxx pursuant to the LANS/MSI Agreement, pertaining to rights in the patents named in the Sublicense Agreement (the “LANS Patents”). This Agreement does not xxxxx Xxxxxxxxx any direct rights to the LANS Patents.

3..	Definitions. The following terms shall have the meanings set forth below.

3.1.	Affiliate. An “Affiliate” of a party is any entity that, directly or indirectly, controls the party, is controlled by the party, or is under common control with the party.

3.2.	BASIC Dental. BASIC Dental Implant Systems Inc.

3.3.	BASIC Dental/MSI Agreement. The “JOINT VENTURE AGREEMENT” between Metallicum (an entity defined below) and BASIC Dental dated as of May 21, 2008.

3.4.	ECAP-C. Equal Channel Angular Pressing – Conform.

3.5.	Field. (a) Ultrafine grain or nanostructured metals and alloys other than *, and alloys thereof, and (b) processes for making ultrafine grain or nanostructured metals and alloys other than *, and alloys thereof.

3.6.	Intellectual Property or IP. Patents, inventions whether or not patentable, copyrightable works, know how, and trade secrets.

3.7.

IP-Related or Related IP. All IP concerning production of ultrafine grain or nanostructured metals and alloys, but not including IP concerning other concepts, e.g., devices or systems, even if made from ultrafine grain or nanostructured metals and alloys. As an example, post-processing of ultrafine grain or nanostructured materials, or coatings suitable to be applied to ultrafine grain or nanostructured metals and alloys, are not Related IP. As another example, a patent claiming a dental implant or a gear made from ultrafine grain or nanostructured metals and alloys is not Related IP, while a patent claiming a method of making ultrafine grain or nanostructured metals and alloys to make them suitable for gears is Related IP.

3.8.	IP-Joint or Joint IP. IP for which employees or contractors of both parties would be joint inventors or joint authors under US law shall be Joint IP.

3.9.	IP-Sole or Sole IP. IP for which employees or contractors of only one of the parties shall be Sole IP of that party.

3.10.

Licensed Technology. (a) MSI’s rights in any Related IP developed before the Effective Date; and (b) MSI’s rights in any Related IP developed during the Technology Transfer Period.

3.11.

Metallicum. Metallicum Inc., a Delaware corporation that is a wholly owned subsidiary of MSI.

3.12.

Royalty-bearing Revenue. The gross sales price of any Royalty-bearing Activity charged to Xxxxxxxxx’x customers (not Affiliates of Xxxxxxxxx) without any deductions other than (1) prompt payment and other trade or volume discounts; (2) credits, rebates, and allowances for return of defective shipments; (3) transportation and packaging charges; (4) sales and excise taxes, duties, and other governmental charges; and (5) transportation insurance, to the extent that such items are separately stated in invoices or appear as items of allowance in the records of Xxxxxxxxx; and (b) the gross sales price of any Royalty-bearing Activity charged to Xxxxxxxxx’x Affiliates other than in an arm’s length commercial transaction: the gross sales price of similar Royalty-bearing Activity charged to Xxxxxxxxx’x customers that are not Affiliates of Xxxxxxxxx in arm’s length commercial transactions, or, if similar Royalty-bearing Activity is not sold, then the fair market value thereof, without any deductions other than (1) prompt payment and other trade and volume discounts; (2) credits, rebates, and allowances for return of defective shipments; (3) transportation and packaging charges; (4) sales and excise taxes, duties, and other governmental charges; and (5) transportation insurance, to the extent that such items are separately stated in invoices or appear as items of allowance in the records of Xxxxxxxxx.

3.13.

Royalty-bearing Technology. (a) The Licensed Technology; (b) Related IP developed by either party or jointly by the parties; and (c) Related IP acquired from the *** research group with which ***is affiliated.

3.14.

Royalty-bearing Activity. The provision of any product or service that relies on or is produced using any Royalty-bearing Technology, including without limitation sale or lease of material or other products that are made using any Royalty-bearing Technology, sale or lease of material or other products that include or would, is unlicensed, infringe any royalty-bearing Technology, and the provision of foundry, assembly, or other services, including the transfer or use of any Royalty-bearing Technology.

3.15.

Initial Transfer Period. The period beginning with the Effective Date and ending 42 months thereafter.

4..	Technology Transfer Period. The period beginning with the Effective Date and ending on the termination of this Agreement.

5..	License and Ownership.

5.1.	Ownership. Each party shall own its own Sole IP. The parties shall jointly own Joint IP. Sole IP of each party, and Joint IP shall be subject to the provisions hereof, including without limitation the license, payment, and diligence provisions.

5.2.

License. Subject to the terms and conditions of this Agreement, MSI grants to Xxxxxxxxx a royalty-bearing, worldwide, exclusive as defined herein, license to the Licensed Technology in the Field, including without limitation a license to make, use, sell, import, and offer to do the preceding, inventions in the Licensed Technology; to use and reproduce copyrightable works in the Licensed Technology; and to use know-how and trade secrets in the Licensed Technology.

5.3.	Exclusivity.

5.3.1.

MSI has an existing relationship with ***, as set forth in the ***. The rights and obligations of MSI and *** under the ***/MSI Agreement shall continue and are unaffected by this Agreement, and shall be an exception to any grant of exclusivity herein.

5.3.2.

Unless otherwise terminated in accordance with the Termination provisions of this Agreement, the License grant shall be exclusive in the Field, and MSI shall not grant any other licenses to the Licensed Technology in the Field.

5.4.	Other Fields.

5.4.1.

For the avoidance of doubt, MSI retains the right to exploit in any manner, including on its own or by way of licenses, the Licensed Technology outside the Field.

5.4.2.

MSI and Xxxxxxxxx will negotiate in good faith licenses to MSI, for use outside the Field, of Xxxxxxxxx’x rights in any Related IP.

5.4.3.

The preceding commitments to negotiate in good faith contemplate crosslicense rights or royalties to Xxxxxxxxx as part of any licenses or reductions in exclusivity.

5.5.	Premium Revenue Opportunities.

5.5.1.

A “Premium Revenue Opportunity” or “PRO” is a business opportunity to apply any Royalty-bearing Technology or undertake any Royalty-bearing Activity in a commercial activity that Xxxxxxxxx does not typically engage as of the Effective Date, and where expected revenue associated with the undertaking is at least *** of revenue usually obtained from similar Royalty-bearing Activities according to Xxxxxxxxx’x usual commercial practices when the PRO is considered by the parties.

5.5.2.

MSI anticipates that the technology can command premium margins for specific applications. Participation in such premium margins is important to MSI’s return on its investment in the technology and business opportunities. Such opportunities include possible specialty materials and exclusivity in limited fields.

5.5.3.

MSI and Xxxxxxxxx will discuss each PRO at the outset, including participation of senior management in planning and resolution of differences, and will cooperate in good faith in the development of each PRO. Xxxxxxxxx will retain the *** to any material in any field.

5.5.4.

Xxxxxxxxx will respond to MSI’s inquiry regarding any PRO within a reasonable time, either cooperating with MSI in pursuing the PRO or expressly declining to pursue the PRO. If Xxxxxxxxx declines to cooperate in the pursuit of a PRO, MSI will be free to pursue on its own initiative and cost, and Xxxxxxxxx will provide material to MSI consistent with Xxxxxxxxx’x usual commercial practices, including without limitation material pricing, delivery and payment terms. If Xxxxxxxxx does not make the required material, or refuses to transfer necessary material to MSI consistent with Xxxxxxxxx’x usual commercial practices, then MSI shall have the right to produce the required material but only for use in the specified business opportunity. The foregoing shall not obligate Xxxxxxxxx to undertake any activity that conflicts with Xxxxxxxxx’x usual commercial practices or is reasonably likely to threaten preexisting business commitments of Xxxxxxxxx.

5.5.5.

If Xxxxxxxxx pursues, either alone or with MSI, any premium revenue opportunity, Xxxxxxxxx will pay to MSI the usual royalty on the base revenue (up to ***% of the revenue that would be obtained from sales of substantially similar products or services in a commodity sales environment) plus ***% of the premium revenue (revenue in excess of the base revenue). As an example, if nanostructured metal for dental implants can be sold as a percentage of the implant value, e.g., US$40 per implant, while the commodity price for a similar amount of metal is US$1, then MSI will receive its royalty on ***, plus ***% of the *** premium revenue.

6..	MSI Technology Transfer Obligations.

6.1.	MSI will disclose, on a reasonably timely basis, all process know how, including process parameters and resulting materials, to Xxxxxxxxx as one of its material obligations under this Agreement.

6.2.	MSI will introduce Xxxxxxxxx, on a timely basis, to MSI’s scientific, material production and business contacts related to the production of materials in the Field.

6.3.

MSI will make Xxxxx Xxxx, Ph.D. (“Xx. Xxxx”), one of its associates, available substantially full time during normal business hours to work with Xxxxxxxxx for the first 6 months of the Initial Transfer Period, and then at least 75% time for the remainder of the Initial Transfer Period. Xx. Xxxx’x home office will remain in New Mexico, and he will remain reasonably available to travel to Xxxxxxxxx’x facilities or elsewhere at Xxxxxxxxx’x request and expense. The parties will use teleconferencing and electronic communications where practical to reduce the travel time and expense required to fulfill these personal service obligations. Xxxxxxxxx may periodically require Xx. Xxxx to sign Nondisclosure Agreements with Xxxxxxxxx limiting disclosure to parties other than MSI.

6.4.

MSI will facilitate the purchase, for fair value, and lawful possession and sustained use at Xxxxxxxxx’x primary manufacturing facility of a current generation ***production machine (a) by transfer a fully operational, capable and efficient machine from *** agreement; or (b) through delivery of functional specifications required for Xxxxxxxxx or its designee to construct, within a reasonable period of time and at reasonable expense, a machine in the United States that efficiently produces ***; or (c) by working jointly with Xxxxxxxxx actually to purchase, for fair value, within a reasonable period of time and to place at its primary manufacturing facility one or more of these machines from ***. Whether Xxxxxxxxx purchases the machine or builds one based on specifications, it must be reasonably capable of production of *** with approximately *** with approximately *** strength. As between the parties, machines acquired or produced under this paragraph shall be the exclusive property of Xxxxxxxxx.

6.5.

MSI has existing business relationships with established and prospective customers. MSI may continue to supply material to these customers from its resources while MSI and Xxxxxxxxx later work, jointly and in good faith, to transfer the material supply portions of those business relationships to Xxxxxxxxx.

7..	Xxxxxxxxx Obligations/Diligence.

7.1.	Xxxxxxxxx will advance and implement ECAP-C and other Royalty-bearing Technology to allow production of rod up to 0.25” in diameter from titanium within 12 months of the delivery and sustained operation of the machine described in paragraph 5.5 above.

7.2.	Xxxxxxxxx shall make the investments in equipment and personnel to support expansion of the Royalty-bearing Technology to other materials, product forms and sizes according to Exhibit A.

8..

Payments.

8.1.	Fixed Fees. Xxxxxxxxx will make the following payments directly to MSI, and not otherwise without advance approval by Xxxxxxxxx, as consideration for the MSI Technology Transfer Obligations and licenses to the Licensed Technology:

8.1.1.

US$600,000 on the Effective Date.

8.1.2.

US$1,000,000 on the date MSI fully performs its obligations under paragraph 5.4 and Xxxxxxxxx reasonably determines, in a memorandum addressed to MSI, that the machine actually functions, that it is efficient, and that it probably will function on a sustained basis.

8.1.3.

US$300,000 6 months after the Effective Date.

8.1.4.

US$300,000 12 months after the Effective Date.

8.1.5.

US$600,000 on the Annuity Date (where the “Annuity Date” is the date of the latter to occur of (a) 18 months after the Effective Date, or (b) the date MSI fully satisfies its duties under paragraph 5.4); and thereafter on each of the first three anniversaries of the Annuity Date (four such payments total). If Xx. Xxxx returns to his employment at LANS, or dies or becomes disabled, and consequently is not available to fulfill MSI’s obligations during the Initial Transfer Period, then each annual US$600,000 payment due under this paragraph during the time of such unavailability shall be reduced to US$300,000. Inability to travel to Xxxxxxxxx’x location shall not, by itself, constitute disability for purposes of this paragraph; disability shall mean that Xx. Xxxx is not able to make meaningful contributions to the efforts required under this Agreement during the Initial Transfer Period.

8.1.6.

Xxxxxxxxx will also be responsible for reasonable costs (subject to preapproval by its agents) for outside consultant fees, machine and technology expenses, reasonable travel and living expenses for Xx. Xxxx when traveling away from New Mexico in support of this project 3 and other expenses reasonably necessary to fulfill the parties’ shared objectives.

8.2.	Royalties. Xxxxxxxxx shall pay to MSI the following amounts as royalties:

8.2.1.

In relation to Royalty-bearing Activities, ***% of the Royalty-bearing Revenue.

8.2.2.

If in relation to any Royalty-bearing Activity, Xxxxxxxxx also owes a royalty to MSI under the Sublicense Agreement, the total royalty for any Royalty-bearing Activity under the combination of this Agreement and the Sublicense Agreement shall not exceed ***%. Xxxxxxxxx and MSI shall cooperate in good faith in apportioning the royalty between this Agreement and the Sublicense Agreement. In the event of a material default by MSI of its obligations under the LANS/MSI Agreement, and if LANS assumes the Sublicense Agreement, then in no event shall Xxxxxxxxx’x total royalty obligation exceed ***% for any Royalty-bearing Activity.

8.2.3.

After the Initial Transfer Period, the minimum annual royalties shall be US$***. In the event the total royalties paid by Xxxxxxxxx during any calendar year are less than this minimum amount, then Xxxxxxxxx shall pay the difference to MSI at the end of such calendar year.

8.2.4.

In relation to premium revenue opportunities, Xxxxxxxxx shall pay a percentage of the premium revenue as set forth in the Premium Revenue Opportunities provisions hereof.

8.2.5.

The parties intend that MSI cooperate, at its own expense, fully with Xxxxxxxxx’x receipt, development, and exploitation of technology, and that the royalty determinations above be interpreted broadly to provide for payment of royalties on all measurable value, and not benefit, actually received by Xxxxxxxxx reasonably arising in any way from any of the IP or business ideas supplied by MSI to Xxxxxxxxx.

8.2.6.

Royalties shall be determined for Royalty-bearing Revenue actually received by Xxxxxxxxx or its agents during each calendar quarter. Xxxxxxxxx shall pay royalties due no later than 30 days after the end of the corresponding calendar quarter. Xxxxxxxxx shall convert Royalty-bearing Revenue invoiced in foreign currency into equivalent U.S. currency at the exchange rate for the foreign currency prevailing as of the last day of the corresponding quarter, as reported in the Wall Street Journal.

8.2.7.

Not later than 30 days after the end of each quarter, regardless of whether any royalties are due hereunder, Xxxxxxxxx shall deliver to MSI a report concerning Royalty-bearing Activities, including (if Xxxxxxxxx asserts that no royalties are due for the quarter) a statement that no Royalty-bearing Revenue actually was received in the quarter. Xxxxxxxxx and MSI shall cooperate in good faith to establish the format and content of such reports to facilitate MSI’s ability to monitor amounts due and owing and to avoid the imposition of unnecessary administrative burdens upon Xxxxxxxxx.

8.3.

All payments shall be made to MSI at the address set forth below, or such other address as MSI may provide to Xxxxxxxxx from time to time. Additionally, MSI may not assign or encumber any of its rights to receive payments under this Agreement during the Initial Transfer Period without the prior written consent of Xxxxxxxxx, which consent shall not be unreasonably withheld.

8.4.	Without excusing the obligation for payment when due, any amount not paid by a party when due shall accrue interest at a rate equal to the prime rate specified in the Wall Street Journal plus 4 percentage points.

8.5.

Xxxxxxxxx will keep paper or electronic books and records that accurately detail all Royalty-bearing Activities, all payments received by Xxxxxxxxx for the same, and all payments due MSI. Such books and records will be preserved for at least three (3) years after the date of the payment to or for which they relate, and they will be open to examination by representatives or agents of MSI upon no less than ten (10) business days notice and at reasonable times to determine their accuracy and to assess Xxxxxxxxx’x compliance with the payment terms of this Sublicense Agreement.

8.6.

The fees and expenses of MSI’s representatives performing the inspection and audit will be borne by MSI. However, if the audit discloses an error in royalty payments to MSI of the greater of either: (a) US$5,000; or (b) of more than *** of royalties actually paid for the audit period to MSI, then Xxxxxxxxx will pay the reasonable fees and expenses of said representatives within thirty (30) days after receipt of invoice.

8.7.	Unless specifically stated in this Agreement, the fees and royalty payments required under this Agreement are not refundable, nor creditable, nor an advance against any royalties or other payments required under this Agreement

9..	Protection of Proprietary Information.

9.1.

Xxxxxxxxx and MSI will treat and maintain the other party’s proprietary business, patent prosecution, software, engineering drawings, process and technical information, and other proprietary information, including the negotiated terms of this Agreement and any progress and royalty reports ("Proprietary Information") in confidence using at least the same degree of care as the receiving party uses to protect its own proprietary information of a like nature from the date of disclosure until five (5) years after the termination or expiration of this Agreement.

9.2.	Xxxxxxxxx and MSI may use and disclose Proprietary Information to their employees, agents, consultants, and contractors, provided that such parties are bound by a like duty of confidentiality as that found in these Protection of Proprietary Information provisions.

9.3.

All written Proprietary Information not expressly so designated herein will be labeled or marked confidential or proprietary. If the Proprietary Information is orally disclosed and not expressly so designated herein, it will be reduced to writing or some other physically tangible form, marked and labeled as confidential or proprietary by the disclosing Party and delivered to the receiving Party within thirty (30) days after the oral disclosure.

9.4.	Nothing contained herein will restrict or impair in any way the right of Xxxxxxxxx or MSI to use or disclose any Proprietary Information:

9.4.1.

that recipient can demonstrate by written records was known to it prior to its disclosure by the disclosing party;

9.4.2.

that recipient can demonstrate by written records is now, or becomes in the future, public knowledge other than through acts or omissions of recipient;

9.4.3.

that recipient can demonstrate by written records was obtained lawfully and without restrictions on the recipient from sources independent of the disclosing party;

9.4.4.

that the recipient can demonstrate it has developed independently of Proprietary Information received from the disclosing party; or

9.4.5.

that the recipient is required to disclose under applicable law, subject to the following paragraph.

9.5.

Xxxxxxxxx or MSI may disclose Proprietary Information that is required to be disclosed (i) to a governmental entity or agency in connection with seeking any governmental or regulatory approval, governmental audit, or other governmental requirement or (ii) by law, provided that the recipient uses reasonable efforts to give the party owning the Proprietary Information sufficient notice of such required disclosure to allow the party owning the Proprietary Information reasonable opportunity to object to, and to take legal action to prevent such disclosure. MSI and LANS also may disclose the existence of this Agreement but not the specific terms hereof.

9.6.

Upon termination of this Agreement, Xxxxxxxxx and MSI will destroy or return any of the disclosing party’s Proprietary Information in its possession within fifteen (15) days following the termination of this Agreement. Xxxxxxxxx and MSI will provide each other, within thirty (30) days following termination, with written notice that such Proprietary Information has been returned or destroyed. Each party may, however, retain one copy of such Proprietary Information for archival purposes in non-working files.

10..	IP Protection and Enforcement.

10.1.

Sole IP. MSI and Xxxxxxxxx each have the right to file, prosecute and maintain patents relating to any and all of their respective Sole IP, at the owner’s sole discretion and expense, with no obligation to inform or consult with the other except as expressly provided herein. Each party shall inform and consult with the other party in the prosecution and maintenance of such patents, and shall use commercially reasonable efforts to follow the comments provided by such other party.

10.2.

Joint IP. MSI and Xxxxxxxxx shall cooperate in good faith in the filing, prosecution, and maintenance of patents relating to any and all Joint IP. Either party can file, prosecute, and maintain any such patent without the agreement of the other party provided such party pays all costs associated with such filing, prosecution, and maintenance.

10.3.

Trade Secrets. If Xxxxxxxxx elects, in good faith, to maintain any Joint IP or Xxxxxxxxx Sole IP as a trade secret, then MSI shall not file a patent application on such IP, and shall make good faith efforts to protect these trade secrets from unauthorized disclosure, and it will behave in ways that preserve the value of the trade secret status. For the avoidance of doubt, any such trade secret shall be Royalty-bearing Technology, but no royalty shall be due unless Xxxxxxxxx actually receives Royalty-bearing Revenue.

10.4.

IP Enforcement and Infringement.

10.4.1.

Neither party has any obligation to enforce any Intellectual Property except as expressly provided herein.

10.4.2.

Each party has unfettered discretion to enforce or not enforce any of its Sole IP and litigate, settle, waive, and take or refrain from taking any action related to the its Sole IP, with no obligation to inform or consult with the other except as expressly provided herein.

10.4.3.

The parties shall cooperate in the enforcement or decision to not enforce any Joint IP.

10.4.4.

MSI and Xxxxxxxxx will each inform the other as soon as reasonably possible after receipt of actual notice of infringement of IP rights in any Licensed Technology in the Field. The foregoing does not impose any obligation on either party to investigate or seek out infringers.

10.4.5.

The parties may jointly pursue such claim or litigation, in which case each party shall bear its own costs and shall jointly control settlement terms or conditions associated with such claim or litigation and the timing of resolution.

10.4.6.

If either party declines to jointly pursue such claim or litigation (the “Declining Party”), then the other party (the “Controlling Party”) may pursue such claim or litigation and shall pay its own expenses and the expenses of the other party, and shall, after consultation with the other party, maintain the exclusive right to determine settlement terms or conditions associated with such claim or litigation and the timing of resolution. The other party shall consent to be joined in such claim or litigation.

10.4.7.

Any recovery shall be apportioned as follows:

10.4.7.1.

first to expenses of the parties in pursuing such claim or litigation;

10.4.7.2.

any recovery for lost sales shall be apportioned to Xxxxxxxxx and treated as Royalty-bearing Revenue;

10.4.7.3.

any recovery for lost profits, any punitive damages, and any other recovery shall be apportioned 50% each if the parties each bore their own expenses, and otherwise 60% to the Controlling Party and 40% to the Declining Party.

10.4.8.

Each Party shall be solely responsible for responding to any claim of infringement, at its sole cost and expense, made by a third party against such Party based on such Party’s actions or activities, including those actions or activities associated with Intellectual Property licensed hereunder.

11..	Term and Termination.

11.1.

The licenses, royalty, and other provisions of this Agreement shall be *** unless terminated by mutual written agreement of the parties. If the earned royalties under 8.2.1 are less than US$*** per year for any five consecutive years after the Annuity Date, then the parties shall negotiate in good faith changes to this Agreement.

11.2.

Subject to the Dispute Resolution provisions hereof, either party may assert claims for damages or equitable relief due to the other party’s failure to make payments when due, or for the other party’s material breach (including failure to meet the diligence requirements) that remains uncured after a reasonable period in light of the nature of the obligation, the nature of the breach, and any reasonable opportunity to cure.

11.3.

If a ***, then Xxxxxxxxx shall have the right (but not the obligation) to terminate this Agreement immediately at any time within 90 days of first receiving notice of such event. In the event of such termination, Xxxxxxxxx shall continue to have exclusive rights to the Licensed Technology as of the date of such termination, and MSI shall have no continuing rights under this Agreement.

12..	Representations and Warranties.

12.1.

Each of MSI and Xxxxxxxxx represents and warrants to the other that it is a corporation duly organized, validly existing, and in good standing under the laws of its state of incorporation, having a place of business as set forth above, that it has the power and authority to enter into this Agreement and that all corporate and other action required to be taken on behalf of such party to authorize the execution and delivery of this Agreement and to carry out the transactions contemplated herein, has been duly and properly taken.

12.2.

MSI represents that is has lawfully obtained licenses for certain patents from LANS that are memorialized in the LANS/MSI Agreement. MSI represents and warrants that it has the right to grant the licenses set forth herein, and that it obtained these licenses fully in accordance with applicable laws, rules and regulations. MSI and Xx. Xxxx jointly represent that timely and adequate notice has been, or will in the future be, given to LANS concerning the business relationship with Xxxxxxxxx that is evidenced by this Agreement and the roles of the parties, including Xx. Xxxx, in the negotiation and execution of its terms. MSI and Xx. Xxxx promise always to give Xxxxxxxxx prompt notice of any objections expressed by any representative of LANS to any aspect of the business relationship established by this Agreement. Further, to the extent that MSI’s obligations require action by Metallicum, MSI warrants that it shall, now and in the future, cause Metallicum at all times to act consistent in ways with the goals of this Agreement. MSI also represents and promises that it shall not divest ownership or control of Metallicum in any manner that would allow Metallicum to breach, impair or circumvent the material provisions of this Agreement.

12.3.

EXCEPT AS EXPRESSLY SET FORTH HEREIN, MSI DISCLAIMS ALL WARRANTIES, EXPRESS OR IMPLIED, INCLUDING, BUT NOT LIMITED TO, IMPLIED WARRANTIES OF MERCHANTABILITY AND FITNESS FOR A PARTICULAR PURPOSE, AND ANY WARRANTIES RELATED TO NONFRINGEMENT OF THE RIGHTS OF OTHERS, OF THE LICENSED TECHNOLOGY, AND ANY PRODUCTS OR SERVICES DELIVERED OR PROVIDED BY MSI UNDER OR RELATED TO THIS AGREEMENT.

12.4.

Xx. Xxxx represents and warrants that he has made all necessary, timely and complete disclosures to LANS concerning his personal business association with MSI and his role in the business relationship between MSI and Xxxxxxxxx, and has secured all necessary approvals or consents from LANS.

12.5.

Indemnification by MSI. MSI will indemnify, hold harmless, and defend Xxxxxxxxx and its officers, employees, and agents (each a “Xxxxxxxxx Indemnitee”), against any and all claims, suits, losses, damages, costs, fees, and expenses resulting from, or arising out of, the activities of MSI outside the Field, except for any grossly negligent acts or omissions or willful misconduct of a Xxxxxxxxx Indemnitee and except for claims or suits brought by a Xxxxxxxxx Indemnitee against another Xxxxxxxxx Indemnitee. This indemnification will include, but will not be limited to, any product liability.

12.6.

Indemnification by Xxxxxxxxx. Xxxxxxxxx will indemnify, hold harmless, and defend MSI and its officers, employees, and agents (each an “MSI Indemnitee”), against any and all claims, suits, losses, damages, costs, fees, and expenses resulting from, or arising out of, the activities of Xxxxxxxxx related to the licenses and activities of Xxxxxxxxx under this Agreement, except for any grossly negligent acts or omissions or willful misconduct of an MSI Indemnitee and except for claims or suits brought by an MSI Indemnitee against another MSI Indemnitee. This indemnification will include, but will not be limited to, any product liability.

13..	Miscellaneous.

13.1.

Force Majeure. The parties shall not be responsible for any failure to perform due to the occurrence of any events beyond their reasonable control which render their performance impossible or onerous, including, but not limited to biological or nuclear incidents; earthquakes; fires; floods; governmental acts, orders or restrictions; permit requirements; inability to obtain suitable and sufficient labor, transportation, fuel, equipment or materials; local, national, or state emergency; power failure and power outages; acts of terrorism; strike; and war. Either party to this Agreement, however, will have the right to terminate this Agreement without penalty upon thirty (30) days' prior written notice if either party is unable to fulfill its obligations under this Agreement due to any of the causes specified in the preceding paragraph for a period of one (1) year.

13.2.

Headings. The headings of the articles, paragraphs, and clauses used in this Agreement are included for convenience only and are not to be used in interpreting or construing this Agreement.

13.3.

Governing Law. This Agreement and all disputes concerning its execution, formation, interpretation, performance, breach, termination, validity, or enforceability shall be governed by the laws of the Commonwealth of Pennsylvania, regardless of the laws that may otherwise be applicable under principles of conflicts of laws. In any action brought arising out of this Agreement, including without limitation any action to enforce the terms of this Agreement or to recover damages from a breach of this Agreement, but not including actions against third parties for infringement of IP rights, the parties agree to the exclusive jurisdiction and venue of the state court of general jurisdiction and, if appropriate, to a federal court sitting in the state of New Mexico, and agree that neither party shall raise any objection to such personal jurisdiction or venue.

14..

Trademarks and Publicity. Neither party shall use any trademark of the other without first obtaining express written permission from the other. Neither party shall make any public disclosure, including press releases, disclosing the business relationship of the parties or any aspect thereof or identifying the other party, without the express written permission of the other party. MSI and Xxxxxxxxx will cooperate in drafting a joint press release announcing the signing of this Agreement, and on other joint press releases from time to time. Neither party shall disclose specific terms of this Agreement, without the prior consent of the other party or to the extent required by applicable law or regulation, in which case the parties shall discuss the claimed lawful or regulatory duty before making disclosure of all or any part of this Agreement. MSI agrees not to pursue or release information on Xxxxxxxxx-developed products produced with MSI technology without permission from Xxxxxxxxx, except to the extent required by applicable law.

15..

Dispute Resolution. Any disputes arising from or related to this Agreement shall be addressed and resolved in three phases. First, an offended party shall notify the other in writing of the events or occurrences that give rise to a dispute. Within ten days of the actual receipt of the notice, responsible representatives of the parties shall meet and, in good faith, attempt to address and resolve the dispute through negotiation. If the negotiations fail to resolve the dispute, the parties shall jointly select a mediator and, within twenty days of the failed negotiations, participate in mediation at a location within the State of New Mexico selected by the mediator. Second, unless otherwise agreed by the parties, the mediation shall conclude within forty-five days of the receipt of the initial notice required under this paragraph. Third, if the parties fail to resolve fully their dispute through mediation, then any party may file a lawsuit against another party as provided in paragraph 12.4 of this Agreement. For purposes of this paragraph, the parties shall include Xxxxxxxxx, MSI, Xx. Xxxx or Metallicum.

16..	Attorney's Fees. In the event litigation arising out of or relating to this Agreement is initiated by either party against the other, the substantially prevailing party shall be entitled to recover its reasonable expenses and costs, including attorneys’ fees.

17..	Waiver. No claim or right arising out of a material breach of this Agreement can be discharged in whole or in part by a waiver of the claim or rights unless it is in writing and signed by the aggrieved party.

18..

Notices. All notices and other communications required herein shall be in writing and shall be either delivered personally or be sent by certified mail, postage prepaid, return receipt requested. Items delivered personally shall be deemed delivered one day after dispatch; items sent by certified or registered mail shall be deemed delivered three (3) days after mailing. The addresses of the parties for purposes of this provision are:

18.1.

MSI:

Chief Executive Officer

Manhattan Scientifics, Inc.

000 Xxxxxxx

Xxxxxxxx, Xxxxxx X0X0X0 Xxxxxx

18.2.

Xxxxxxxxx

Corporate Secretary

Xxxxxxxxx Technology Corporation

X.X. Xxx 00000

Xxxxxxx, XX 00000-0000 XXX

18.3.

Entire Agreement. This Agreement constitutes the entire agreement between the parties hereto, and shall supersede the terms and conditions of any and all prior agreements, understandings, promises, representations, and writings made by either party to the other concerning the subject matter and the terms and conditions hereof. This Agreement does not supersede or modify the Sublicense Agreement. No subsequent modification, amendment, or extension of this Agreement or any of the terms and conditions hereof shall be of any force or effect unless it is in writing and signed by a duly authorized officer or representative of each of the parties.

18.4.

Severability. The unenforceability, invalidity, or illegality of any provisions of this Agreement shall not render the other provisions unenforceable, invalid, or illegal. Any unenforceable, invalid, or illegal provision shall be severed from this Agreement only to the extent to make the resulting provision enforceable, valid, and legal.

18.5.

Counterparts. This Agreement may be executed in counterparts with the same force and effect as if all signatures appeared on the same document.

18.6.

Good Faith. The parties also promise at all times during the business relationship established by this Agreement to execute and fulfill their contractual obligations in good faith, and they, and each of them, expressly promise at all times to treat each other fairly.

INTENDING TO BE LEGALLY BOUND, THE PARTIES, THROUGH THEIR AUTHORIZED AGENT(S), HAVE EXECUTED THIS AGREEMENT AS OF THE DATE FIRST EXPRESSED ABOVE.

Manhattan Scientifics, Inc.
/s/ Emmanuel Tsoupanarias
By Emmanuel Tsoupanarias, CEO			date

Metallicum, Inc., as to the provisions that name it
/s/ Emmanuel Tsoupanarias
By Emmanuel Tsoupanarias, CEO			date

Xxxxxxxxx Technology Corp.
/s/ Xxxx X. Xxxxxxx
By: Xxxx X. Xxxxxxx			date
Chairman, Chief Executive Officer, and President


/s/ Xxxxx Xxxx
Xxxxx Xxxx, PhD.;			date
Individually, only as to his representations and the Dispute Resolution provision

First Amendment to Technology Transfer Agreement

Between Xxxxxxxxx Technology Corp and Manhattan Scientifics

Relating to Ultrafine Grain or Nanostructured Metal Technology

1..

A Technology Transfer Agreement ("Agreement") was made by and between Xxxxxxxxx Technology Corporation, a Delaware corporation having a place of business in Reading, Pennsylvania ("Xxxxxxxxx), and Manhattan Scientifics, Inc., a Delaware corporation having a place of business in New York, New York ("MSI"), effective as of September 12, 2009 (the "Effective Date").

2..

Xxxxxxxxx and MSI have discovered that certain wording of the Agreement did not accurately reflect their intent, and desire to amend the Agreement as set forth herein. By entering into this Amendment, the parties intend only to amend the terms of paragraph 8.1.5 (as detailed below) of the existing Agreement; the remaining terms shall not be affected or altered in any way by reason of this Amendment.

3..	Paragraph 8.1.5 of the Agreement is replaced in its entirety with the following, in which deletions from the original are lined through and additions are underlined:

US$600,000 on the Annuity Date (where the "Annuity Date" is the date of the latter to occur of (a) 18 months after the Effective Date, or (b) the date MSI fully satisfies its duties under paragraph 5.4); and thereafter on each of the first two anniversaries of the Annuity Date (three such payments total). If Xx. Xxxx returns to his employment at LANS, or dies or becomes disabled, and consequently is not available to fulfill MSI's obligations during the Initial Transfer Period, then each annual US$600,000 payment due under this paragraph during the time of such unavailability shall be reduced to US$300,000. Inability to travel to Xxxxxxxxx'x location shall riot, by itself, constitute disability for purposes of this paragraph; disability shall mean that Xx. Xxxx is not able to make meaningful contributions to the efforts required under this Agreement during the Initial Transfer Period.

INTENDING TO BE LEGALLY BOUND, THE PARTIES, THROUGH THEIR AUTHORIZED AGENT(S), HAVE EXECUTED THIS AMENDENT AS OF SEPTEMBER 29, 2009.

Manhattan Scientifics, Inc.		Xxxxxxxxx Technology Corp.
/s/ Emmanuel Tsoupanarias	12/29/09	/s/ Xxxxxxx X. Xxxxx	10/14/09
By: Emmanuel Tsoupanarias	date	Chairman	date
CEO		Chairman

Metallicum, Inc., as to the Provisions that name it
/s/ Emmanuel Tsoupanarias	12/29/09	/s/ Xxxxx Xxxx	12/29/09
By: Emmanuel Tsoupanarias	date	Xxxxx Xxxx	date
CEO		Individually, only as to his representations and the Dispute Resolution provision

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