PUBLIC HEALTH SERVICE PATENT LICENSE AGREEMENT-NONEXCLUSIVE COVER PAGE

Exhibit 10.19

PUBLIC HEALTH SERVICE

PATENT LICENSE AGREEMENT-NONEXCLUSIVE

COVER PAGE

For PHS internal use only:

License Number:

License Application Number: A-067-2009

Serial Number(s) of Licensed Patent(s) or Patent Application(s):

                [***]

Licensee: SurgiVision, Inc.

Cooperative Research and Development Agreement (CRADA) Number (if a subject invention):

		N/A
Additional Remarks:		none
Public Benefit(s):		Minimally invasive medical procedures

This Patent License Agreement, hereinafter referred to as the “Agreement”, consists of this Cover Page, an attached Agreement, a Signature Page, Appendix A (List of Patent(s) or Patent Application(s)), Appendix B (Fields of Use and Territory), Appendix C (Royalties), Appendix D ((Benchmarks and Performance), Appendix E (Commercial Development Plan), Appendix F (Example Royalty Report), and Appendix G (Royalty Payment Options). The Parties to this Agreement are:

1) The National Institutes of Health (“NIH”) or the Food and Drug Administration (“FDA”), hereinafter singly or collectively referred to as “PHS”, agencies of (he United States Public Health Service within the Department of Health and Human Services (“HHS”); and

2) The person, corporation, or institution identified above and on the Signature Page, having offices at the address indicated on the Signature Page, hereinafter referred to as “Company.” Company and its Affiliates are hereinafter referred to as “Licensee.”

[***] Indicates portions of this exhibit that have been omitted and filed separately with the Securities and Exchange Commission pursuant to a request for confidential treatment.

1

PHS PATENT LICENSE AGREEMENT-NONEXCLUSIVE

PHS and Licensee agree as follows:

1. BACKGROUND

   1.1 In the course of conducting biomedical and behavioral research, PHS investigators made inventions that may have commercial applicability.

   1.2 By assignment of rights from PHS employees and other inventors, HHS, on behalf of the Government, owns intellectual property rights claimed in any United States or foreign patent applications or patents corresponding to the assigned inventions. HHS also owns any tangible embodiments of these inventions actually reduced to practice by PHS.

   1.3 The Secretary of HHS has delegated to PHS the authority to enter into this Agreement for the licensing of rights to these inventions under 35 U.S.C. §§200-212, the Federal Technology Transfer Act of 1986, 15 U.S.C. §3710(a), and the regulations governing the licensing of Government-owned inventions, 37 CFR Part 404.

   1.4 PHS desires to transfer these inventions to the private sector through commercialization licenses to facilitate the commercial development of products and processes for public use and benefit.

   1.5 Licensee desires to acquire commercialization rights to certain of these inventions in order to develop processes, methods, or marketable products for public use and benefit.

2. DEFINITIONS

   2.1 “Affiliate(s)” means a corporation or other business entity, which directly or indirectly is controlled by or controls, or is under common control with Licensee. For this purpose, the term “control” shall mean (a) having ownership of more than fifty percent (50%) of the voting stock or other ownership interest of the corporation or other business entity, (b) having the power to elect or appoint more than fifty percent (50%) of the members of the governing body of the corporation or other business entity, or (c) otherwise having the power to direct the management of the corporation or other business entity.

   2.2 “Benchmarks” mean the performance milestones that are set forth in Appendix D.

   2.3 “Commercial Development Plan” means the written commercialization plan attached as Appendix E.

   2.4 “First Commercial Sale” means the initial transfer by or on behalf of Licensee or its sublicensees of Licensed Products or the initial practice of a Licensed Process by or on behalf of Licensee or its sublicensees in exchange for cash or some equivalent to which value can be assigned for the purpose of determining Net Sales.

   2.5 “Government” means the Government of the United States of America.

   2.6 “Licensed Fields of Use” means the fields of use identified in Appendix B.

2

   2.7 “Licensed Patent Rights” shall mean:

    (a) Patent applications (including provisional patent applications and PCT patent applications) or patents listed in Appendix A, all divisions and continuations of these applications, all patents issuing from these applications, divisions, and continuations, and any reissues, reexaminations, and extensions of all these patents;

    (b) to the extent that the following contain one or more claims directed to the invention or inventions disclosed in 2.7(a):

  (i) continuations-in-part of 2.7(a);

  (ii) all divisions and continuations of these continuations-in-part;

  (iii) all patents issuing from these continuations-in-part, divisions, and continuations;

  (iv) priority patent application(s) of 2.7(a); and

  (v) any reissues, reexaminations, and extensions of all these patents;

    (c) to the extent that the following contain one or more claims directed to the invention or inventions disclosed in 2.7(a): all counterpart foreign and U.S. patent applications and patents to 2.7(a) and 2.7(b), including those listed in Appendix A; and

    (d) Licensed Patent Rights shall not include 2.7(b) or 2.7(c) to the extent that they contain one or more claims directed to new matter which is not the subject matter disclosed in 2.7(a).

   2.8 “Licensed Process(es)” means methods, processes or software implementations thereof, which in the course of being practiced, would be or derived from the Materials or would be within the scope of one or more claims of the Licensed Patent Rights that have not been held unpatentable, invalid or unenforceable by an unappealed or unappealable judgment of a court of competent jurisdiction.

   2.9 “Licensed Product(s)” means tangible materials, products, or systems or devices which in the course of manufacture, use, sale, or importation, enable the Licensed Process(es) derived from the Materials or would be within the scope of one or more claims of the Licensed Patent Rights that have not been held unpatentable, invalid or unenforceable by an unappealed or unappealable judgment of a court of competent jurisdiction.

   2.10 “Material(s)” means documentation and software, including without limitation, any computer readable or executable object or source code, that enable, carry out or support a Licensed Process or that is used to produce or operate a Licensed Product. For the avoidance of any doubt, the Materials include, without limitation, any software that enables, carries out or supports (a) the inventions included in the Licensed Patent Rights, (b) the invention(s) disclosed and described in [***] and (c) the invention(s) disclosed and described in [***]

   2.11 “Licensed Territory” means the geographical areas identified in Appendix B.

[***] Indicates portions of this exhibit that have been omitted and filed separately with the Securities and Exchange Commission pursuant to a request for confidential treatment.

3

   2.12 “Net Sales” means the total gross receipts for sales of Licensed Products, unmodified Materials or the practice of Licensed Processes by or on behalf of Licensee or its sublicensees, and from leasing, renting, or otherwise making Licensed Products available to others without sale or other dispositions, whether invoiced or not, less returns and allowances, packing costs, insurance costs, freight out, taxes or excise duties imposed on the transaction (if separately invoiced), and wholesaler and cash discounts in amounts customary in the trade to the extent actually granted. No deductions shall be made for commissions paid to individuals, whether they are with independent sales agencies or regularly employed by Licensee, or sublicensees and on its payroll, or for the cost of collections. Transactions excluded from Net Sales are the transfer of Licensed Products or the practice of a Licensed Process for the purpose of obtaining regulatory approval thereof or for use in non-commercial research by Licensee.

   2.13 “Practical Application” means to manufacture in the case of a composition or product, to practice in the case of a process or method, or to operate in the case of a machine or system; and in each case, under these conditions as to establish that the invention is being utilized and that its benefits are to the extent permitted by law or Government regulations available to the public on reasonable terms.

3. GRANT OF RIGHTS

   3.1 PHS hereby grants and Licensee accepts, subject to the terms and conditions of this Agreement, a nonexclusive license under the Licensed Patent Rights in the Licensed Territory as set forth in Appendix B(II)(a) and in the Materials in the Licensed Territory as set forth in Appendix B(II)(b); to make and have made, to use and have used, to sell and have sold, to offer to sell, and to import any Licensed Products and Materials in the Licensed Fields of Use and to practice and have practiced any Licensed Processes and Materials in the Licensed Fields of Use.

   3.2 This Agreement confers no license or rights by implication, estoppel, or otherwise under any patent applications or patents of PHS other than the Licensed Patent Rights regardless of whether these patents are dominant or subordinate to the Licensed Patent Rights.

   3.3 Upon receipt by PHS of the license issue royalty herein set forth in Article 6 and Appendix C and the verification of this royalty, PHS agrees to provide Licensee with copies of the Materials in a computer readable format, as available, and to replace these Materials, as available, at reasonable cost, in the event of their unintentional destruction.

   3.4 It is understood that any improvements, enhancements, modifications, or derivative works made to the Materials by Licensee shall be owned by Licensee and maybe subject to the Government’s right to use to the extent provided by applicable law.

4. SUBLICENSING

   4.1 Upon written approval, which shall include prior review of any sublicense agreement by PHS and which shall not be unreasonably withheld, Licensee may enter into sublicensing agreements under the Licensed Patent Rights only when it concurrently licenses proprietary or in-licensed intellectual property rights. For the avoidance of doubt, Licensee does not have the right to solely sublicense the Licensed Patent Rights or the Materials.

4

   4.2 Licensee agrees that any sublicenses granted by it shall provide that the obligations to PHS of Paragraphs 5.1,8.1, 10.1, 10.2, 12.5, and 13.7-13.9 of this Agreement shall be binding upon the sublicensee as if it were a party to this Agreement Licensee further agrees to attach copies of these Paragraphs to all sublicense agreements.

   4.3 Any sublicenses granted by Licensee shall provide for the termination of the sublicense, or the conversion to a license directly between the sublicensees and PHS, at the option of the sublicensee, upon termination of this Agreement under Article 13. This conversion is subject to PHS approval and contingent upon acceptance by the sublicensee of the remaining provisions of this Agreement.

   4.4 Licensee agrees to forward to PHS a complete copy of each fully executed sublicense agreement postmarked within thirty (30) days of the execution of the agreement. To the extent permitted by law, PHS agrees to maintain each sublicense agreement in confidence.

5. STATUTORY AND PHS REQUIREMENTS AND RESERVED GOVERNMENT RIGHTS

   5.1 Licensee agrees that products used or sold in the United States embodying Licensed Products or produced through use of Licensed Processes shall be manufactured substantially in the United States, unless a written waiver is obtained in advance from PHS.

6. ROYALTIES AND REIMBURSEMENT

   6.1 Licensee agrees to pay PHS a noncreditable and nonrefundable amount as reimbursement for patent expenses associated with obtaining the Licensed Patent Rights as set forth in Appendix C.

   6.2 Licensee agrees to pay PHS a minimum annual royalty as set forth in Appendix C.

   6.3 Licensee agrees to pay PHS earned royalties as set forth in Appendix C.

   6.4 Licensee agrees to pay PHS benchmark royalties as set forth in Appendix C.

   6.5 Licensee agrees to pay PHS sublicensing royalties as set forth in Appendix C.

   6.6 A patent or patent application licensed under this Agreement shall cease to fall within the Licensed Patent Rights for the purpose of computing earned royalty payments in any given country on the earliest of the dates that:

    (a) the application has been abandoned and not continued;

    (b) the patent expires or irrevocably lapses; or

    (c) the patent has been held to be invalid or unenforceable by an unappealed or unappealable decision of a court of competent jurisdiction or administrative agency.

   6.7 No multiple royalties shall be payable because any Licensed Products or Licensed Processes are covered by more than one of the Licensed Patent Rights.

5

   6.8 On sales of Licensed Products by Licensee to sublicensees or on sales made in other than an arms-length transaction, the value of the Net Sales attributed under this Article 6 to this transaction shall be that which would have been received in an arms-length transaction, based on sales of like quantity and quality products on or about the time of this transaction.

   6.9 Licensee may elect to surrender its rights in any country of the Licensed Territory under any of the Licensed Patent Rights upon sixty (60) days written notice to PHS and owe no payment obligation under Paragraph 6.9 for patent-related expenses incurred in that country after the effective date of the written notice.

   6.10 PHS agrees that the royalty terms in any third party license of the Licensed Patent Rights and Materials in a field of use that includes all or a substantial portion of the Licensed Fields of Use executed after the effective date of this Agreement will be at least equal to the royalty terms set forth in this Agreement under Article 6 and Appendix C. During the term of this Agreement, PHS will advise Licensee about terms granted in any third party licenses to the Licensed Patent Rights or Materials in a field of use that includes all or a substantial portion of the Licensed Fields of Use that are more favorable to the third party licensee than those agreed to herein. During the term of this Agreement, PHS will consider the views of Licensee in determining whether the terms granted to said third party licensee under the Licensed Patent Rights and Materials in the Licensed Fields of Use are more favorable than those granted to Licensee herein, and Licensee shall be entitled, upon written notice to PHS within sixty (60) days after receipt, to have this Agreement amended to substitute those terms, in their entirety, as of the date those terms became effective with the third party.

7. PATENT FILING. PROSECUTION. AND MAINTENANCE

   7.1 PHS agrees to take responsibility for the preparation, filing, prosecution, and maintenance of any and all patent applications or patents included in the Licensed Patent Rights. PHS (a) will cause its patent counsel to timely copy Licensee on all official actions and written correspondence with any patent office and timely provide Licensee advance written notice of any filing deadline, (b) allow Licensee an opportunity to comment and advise PHS, and (c) consider and reasonably incorporate comments and advice from Licensee. The extent to which the comments and advice will be incorporated may be affected by third party licenses, if any, executed by PHS for the Licensed Patent Rights.

8. RECORD KEEPING

   8.1 Licensee agrees to keep accurate and correct records of Licensed Products made, used, sold, or imported and Licensed Processes practiced under this Agreement appropriate to determine the amount of royalties due PHS. These records shall be retained for at least three (3) years following a given reporting period and shall be available during normal business hours for inspection, at the expense of PHS, by an accountant or other designated auditor selected by PHS for the sole purpose of verifying reports and royalty payments hereunder. The accountant or auditor shall only disclose to PHS information relating to the accuracy of reports and royalty payments made under this Agreement. If an inspection shows an underreporting or underpayment in excess of five percent (5%) for any twelve (12) month period, then Licensee shall reimburse PHS for the cost of the inspection at the time Licensee pays the unreported royalties, including any additional royalties as required by Paragraph 9.7. All royalty payments required under this Paragraph shall be due within sixty (60) days of the date PHS provides Licensee notice of the payment due.

6

   8.2 Licensee agrees to have an audit of sales and royalties conducted by an independent auditor at least every two (2) years if annual Net Sales of the Licensed Products or Licensed Processes are over ten (10) million dollars. The audit shall address, at a minimum, the amount of gross sales by or on behalf of Licensee during the audit period, the amount of royalties owed to the Government under this Agreement, and whether the royalties owed have been paid to the Government and is reflected in the records of the Licensee. The audit shall also indicate the PHS license number, product, and the time period being audited. A report certified by the auditor shall be submitted promptly by the auditor directly to PHS on completion. Licensee shall pay for the entire cost of the audit.

9. REPORTS ON PROGRESS. BENCHMARKS. SALES. AND PAYMENTS

   9.1 Prior to signing this Agreement, Licensee has provided PHS with the Commercial Development Plan in Appendix E, under which Licensee intends to bring the subject matter of the Licensed Patent Rights to the point of Practical Application. This Commercial Development Plan is hereby incorporated by reference into this Agreement. Based on this plan, performance Benchmarks are determined as specified in Appendix D.

   9.2 Licensee shall provide written annual reports on its product development progress or efforts to commercialize under the Commercial Development Plan for each of the Licensed Fields of Use within sixty (60) days after December 31 of each calendar year. These progress reports shall include, but not be limited to: progress on research and development, status of applications for regulatory approvals, manufacturing, marketing, importing, and sales during the preceding calendar year, as well as, plans for the present calendar year. PHS also encourages these reports to include information on any of Licensee’s public service activities that relate to the Licensed Patent Rights. If reported progress differs from that projected in the Commercial Development Plan and Benchmarks, Licensee shall explain the reasons for such differences. In any annual report, Licensee may propose amendments to the Commercial Development Plan, acceptance of which by PHS may not be denied unreasonably. Licensee agrees to provide any additional information reasonably required by PHS to evaluate Licensee’s performance under this Agreement Licensee may amend the Benchmarks at any time upon written approval by PHS. PHS shall not unreasonably withhold approval of any request of Licensee to extend the time periods of this schedule if the request is supported by a reasonable showing by Licensee of diligence in its performance under the Commercial Development Plan and toward bringing the Licensed Products to the point of Practical Application.

   9.3 Licensee shall report to PHS the dates for achieving Benchmarks specified in Appendix D and the First Commercial Sale in each country in the Licensed Territory within thirty (30) days of such occurrences.

   9.4 Licensee shall submit to PHS, within sixty (60) days after each calendar half-year ending June 30 and December 31, beginning the year of the First Commercial Sale, a royalty report, as described in the example in Appendix F, setting forth for the preceding half-year period the amount of the Licensed Products sold or Licensed Processes practiced by or on behalf of Licensee or its sublicensees in each country within the Licensed Territory, the Net Sales, and the amount of royalty accordingly due. With each royalty report, Licensee shall submit payment of earned royalties due. If no earned royalties are due to PHS for any reporting period, the written report shall so state. The royalty report shall be certified as correct by an authorized officer of Licensee and shall include a detailed listing of all deductions made under Paragraph 2.11 to determine Net Sales made under Article 6 to determine royalties due.

7

   9.5 Royalties due under Article 6 shall be paid in U.S. dollars and payment options are listed in Appendix G. For conversion of foreign currency to U.S. dollars, the conversion rate shall be the New York foreign exchange rate quoted in The Wall Street Journal on the day that the payment is due, and any loss of exchange, value, taxes, or other expenses incurred in the transfer or conversion to U.S. dollars shall be paid entirely by Licensee. The royalty report required by Paragraph 9.4 shall be mailed to PHS at its address for Agreement Notices indicated on the Signature Page.

   9.6 Licensee agrees to forward semi-annually to PHS a copy of these reports received by Licensee from its sublicensees during the preceding half-year period as shall be pertinent to a royalty accounting to PHS by Licensee for activities under the sublicense.

   9.7 Licensee shall be solely responsible for determining if any tax on royalty income is owed outside the United States and shall pay this tax and be responsible for all filings with appropriate agencies of foreign governments.

   9.8 Additional royalties may be assessed by PHS on any payment that is more than ninety (90) days overdue at the rate of one percent (1%) per month. This one percent (1%) per month rate may be applied retroactively from the original due date until the date of receipt by PHS of the overdue payment and additional royalties. The payment of any additional royalties shall not prevent PHS from exercising any other rights it may have as a consequence of the lateness of any payment.

   9.9 All plans and reports required by this Article 9 and marked “confidential” by Licensee shall, to the extent permitted by law, be treated by PHS as commercial and financial information obtained from a person and as privileged and confidential, and any proposed disclosure of these records by the PHS under the Freedom of Information Act (FOIA), 5 U.S.C. §552 shall be subject to the pre-disclosure notification requirements of 45 CFR §5.65(d).

10. PERFORMANCE

   10.1 Licensee shall use its reasonable commercial efforts to bring the Licensed Products and Licensed Processes to Practical Application. “Reasonable commercial efforts” for the purposes of this provision shall include adherence to the Commercial Development Plan in Appendix E and taking reasonable commercial efforts to achieve the Benchmarks in Appendix D.

   10.2 Upon the First Commercial Sale, until the expiration or termination of this Agreement, Licensee shall use its reasonable commercial efforts to make Licensed Products and Licensed Processes reasonably accessible to the United States public.

   10.3 Licensee agrees, after its First Commercial Sale and as part of its marketing and product promotion, to develop educational materials (e.g., brochures, website, etc.) directed to patients and physicians detailing the Licensed Products or medical aspects of the prophylactic and therapeutic uses of the Licensed Products.

   10.4 Licensee agrees to retain control over the Materials, and not to distribute them to third parties without the prior written consent of PHS except as provided in Article 4.

8

11. INFRINGEMENT AND PATENT ENFORCEMENT

   11.1 PHS and Licensee agree to notify each other promptly of each infringement or possible infringement of the Licensed Patent Rights, as well as, any facts which may affect the validity, scope, or enforceability of the Licensed Patent Rights of which either Party becomes aware. Subject to Paragraph 11.2 below, Licensee will have the right, but not the obligation, at its own expense and with legal counsel of its own choice, to bring suit against any actual, alleged or threatened infringement of the Licensed Patent Rights. In any action brought under this Paragraph 11.2 the expenses including costs, fees, attorney fees, and disbursements, shall be paid by Licensee. The value of any recovery made by Licensee through court judgment or settlement shall be treated as Net Sales and subject to earned royalties.

   11.2 In the event that a declaratory judgment action alleging invalidity of any of the Licensed Patent Rights shall be brought against PHS, PHS agrees to notify Licensee that an action alleging invalidity has been brought. PHS does not represent that it shall commence legal action to defend against a declaratory action alleging invalidity. Licensee shall take no action to compel the Government either to initiate or to join in any declaratory judgment action. Should the Government be made a party to any suit by motion or any other action of Licensee, Licensee shall reimburse the Government for any costs, expenses, or fees, which the Government incurs as a result of the motion or other action. Upon Licensee’s payment of all costs incurred by the Government as a result of Licensee’s joinder motion or other action, these actions by Licensee shall not be considered a default in the performance of any material obligation under this Agreement.

12. NEGATION OF WARRANTIES AND INDEMNIFICATION

   12.1 PHS offers no warranties other than those specified in Article 1.

   12.2 PHS does not warrant the validity of the Licensed Patent Rights and makes no representations whatsoever with regard to the scope of the Licensed Patent Rights, or that the Licensed Patent Rights may be exploited without infringing other patents or other intellectual property rights of third parties.

   12.3 PHS MAKES NO WARRANTIES, EXPRESSED OR IMPLIED, OF MERCHANTABILITY OR FITNESS FOR A PARTICULAR PURPOSE OF ANY OF THE MATERIALS OR SUBJECT MATTER DEFINED BY THE CLAIMS OF THE LICENSED PATENT RIGHTS.

   12.4 PHS does not represent that it shall commence legal actions against third parties infringing the Licensed Patent Rights.

   12.5 Licensee shall indemnify and hold PHS, its employees, students, fellows, agents, and consultants harmless from and against all liability, demands, damages, expenses, and losses, including but not limited to death, personal injury, illness, or property damage in connection with or arising out of:

     (a) the use by or on behalf of Licensee, its sublicensees, its directors, employees, or third parties of any Licensed Patent Rights; or

     (b) the design, manufacture, distribution, or use of any Licensed Products, Licensed Processes or Materials by Licensee, or other products or processes developed in connection with or arising out of the Licensed Patent Rights.

9

   12.6 Licensee agrees to maintain a liability insurance program consistent with sound business practice.

13. TERM, TERMINATION, AND MODIFICATION OF RIGHTS

   13.1 This Agreement is effective when signed by all parties, unless the provisions of Paragraph 14.15 are not fulfilled, and shall extend to the expiration of the last to expire of the Licensed Patent Rights or if no patents issue then for twenty (20) years from the effective date of this Agreement, unless sooner terminated as provided in this Article 13. Upon expiration of the term of this Agreement, the license granted hereunder to make and have made, to use and have used, to sell and have sold, to offer to sell, and to import the Materials shall be a royalty-free and paid up license.

   13.2 In the event that Licensee is in default in the performance of any material obligations under this Agreement, including but not limited to the obligations listed in Paragraph 13.5, and if the default has not been remedied within ninety (90) days after the date of notice in writing of the default, PHS may terminate this Agreement by written notice and pursue outstanding royalties owed through procedures provided by the Federal Debt Collection Act.

   13.3 In the event that Licensee becomes insolvent, files a petition in bankruptcy, has such a petition filed against it, determines to file a petition in bankruptcy, or receives notice of a third party’s intention to file an involuntary petition in bankruptcy, Licensee shall immediately notify PHS in writing. Furthermore, PHS shall have the right to terminate this Agreement immediately upon Licensee’s receipt of written notice upon the occurrence of any of the foregoing events.

   13.4 Licensee shall have a unilateral right to terminate this Agreement in its entirety by giving PHS sixty (60) days written notice to that effect. In addition, Licensee shall have a unilateral right to terminate this Agreement with respect to any country or territory by giving PHS sixty (60) days written notice to that effect.

   13.5 PHS shall specifically have the right to terminate or modify, at its option, this Agreement, if PHS determines that the Licensee:

     (a) is not executing the Commercial Development Plan submitted with its request for a license and the Licensee cannot otherwise demonstrate to PHS’ satisfaction that the Licensee has taken, or can be expected to take within a reasonable time, commercially reasonable steps to achieve Practical Application of the Licensed Products or Licensed Processes;

     (b) has not exercised commercially reasonable efforts toward achieving the Benchmarks as may be modified under Paragraph 9.2;

     (c) has willfully made a false statement of, or willfully omitted, a material fact in the license application or in any report required by this Agreement;

     (d) has committed a material breach of a covenant or agreement contained in this Agreement;

     (e) is not keeping Licensed Products or Licensed Processes reasonably available to the public after commercial use commences;

     (f) cannot reasonably satisfy unmet health and safety needs; or

10

      (g) cannot reasonably justify a failure to comply with the domestic production requirement of Paragraph 5.2, unless waived.

   13.6 In making the determination referenced in Paragraph 13.5, PHS shall take into account the normal course of such commercial development programs conducted with sound and reasonable business practices and judgment and the annual reports submitted by Licensee under Paragraph 9.2. Prior to invoking termination or modification of this Agreement under Paragraph 13.5, PHS shall give written notice to Licensee providing Licensee specific notice of, and a ninety (90) day opportunity to respond to, PHS’ concerns as to the items referenced in 13.5(a)-13.5(g). If Licensee fails to alleviate PHS’ concerns as to the items referenced in 13.5(a)-13.5(g) or fails to initiate corrective action to PHS’ satisfaction, PHS may terminate this Agreement.

   13.7 PHS reserves the right according to 35 U.S.C. §209(d)(3) to terminate or modify this Agreement if it is determined that the action is necessary to meet the requirements for public use specified by federal regulations issued after the date of the license and these requirements are not reasonably satisfied by Licensee.

   13.8 Within thirty (30) days of receipt of written notice of PHS’ unilateral decision to modify or terminate this Agreement, Licensee may, consistent with the provisions of 37 CFR §404.11, appeal the decision by written submission to the designated PHS official. The decision of the designated PHS official shall be the final agency decision. Licensee may thereafter exercise any and all administrative or judicial remedies that may be available.

   13.9 Within ninety (90) days of expiration or termination of this Agreement under this Article 13, a final report shall be submitted by Licensee. Any royalty payments, including those incurred but not yet paid (such as the full minimum annual royalty), and those related to patent expense, due to PHS shall become immediately due and payable upon termination or expiration. If terminated under this Article 13, sublicensees may elect to convert their sublicenses to the Licensed Patent Rights to direct licenses with PHS pursuant to Paragraph 4.3.

14. GENERAL PROVISIONS

   14.1 Neither party may waive or release any of its rights or interests in this Agreement except in writing. The failure of the Government or Licensee to assert a right hereunder or to insist upon compliance with any term or condition of this Agreement shall not constitute a waiver of that right by the Government or Licensee, as applicable, or excuse a similar subsequent failure to perform any of these terms or conditions by Licensee or the Government, as applicable.

   14.2 This Agreement constitutes the entire agreement between the Parties relating to the subject matter of the Licensed Patent Rights, Licensed Products and Licensed Processes, and all prior negotiations, representations, agreements, and understandings are merged into, extinguished by, and completely expressed by this Agreement.

   14.3 The provisions of this Agreement are severable, and in the event that any provision of this Agreement shall be determined to be invalid or unenforceable under any controlling body of law, this determination shall not in any way affect the validity or enforceability of the remaining provisions of this Agreement.

11

   14.4 If either party desires a modification to this Agreement, the parties shall, upon reasonable notice of the proposed modification by the party desiring the change, confer in good faith to determine the desirability of the modification. No modification shall be effective until a written amendment is signed by the parties hereto.

   14.5 The construction, validity, performance, and effect of this Agreement shall be governed by Federal law as applied by the Federal courts in the District of Columbia.

   14.6 All Agreement notices required or permitted by this Agreement shall be given by prepaid, first class, registered or certified mail or by an express/overnight delivery service provided by a commercial carrier, properly addressed to the other party at the address designated on the Signature Page, or to any other address as may be designated in writing by such other party. Agreement notices shall be considered timely if such notices are received on or before the established deadline date or sent on or before the deadline date as verifiable by U.S. Postal Service postmark or dated receipt from a commercial carrier. Parties should request a legibly dated U.S. Postal Service postmark or obtain a dated receipt from a commercial carrier or the U.S. Postal Service. Private metered postmarks shall not be acceptable as proof of timely mailing.

   14.7 This Agreement shall not be assigned or otherwise transferred (including any transfer by legal process or by operation of law, and any transfer in bankruptcy or insolvency, or in any other compulsory procedure or order of court) except to Licensee’s Affiliate(s) without the prior written consent of PHS, which shall not be unreasonably withheld, conditioned or delayed. The parties agree that the identity of the parties is material to the formation of this Agreement and that the obligations under this Agreement are nondelegable

   14.8 Licensee agrees in its use of any PHS-supplied materials to comply with all applicable statutes, regulations, and guidelines, including PHS and HHS regulations and guidelines. Licensee agrees not to use the materials for research involving human subjects or clinical trials in the United States without complying with 21 CFR Part 50 and 45 CFR Part 46. Licensee agrees not to use the materials for research involving human subjects or clinical trials outside of the United States without notifying PHS, in writing, of the research or trials and complying with the applicable regulations of the appropriate national control authorities. Written notification to PHS of research involving human subjects or clinical trials outside of the United States shall be given no later than sixty (60) days prior to commencement of the research or trials.

   14.9 Licensee acknowledges that it is subject to and agrees to abide by the United States laws and regulations (including the Export Administration Act of 1979 and Arms Export Control Act) controlling the export of technical data, computer software, laboratory prototypes, biological materials, and other commodities. The transfer of these items may require a license from the appropriate agency of the Government or written assurances by Licensee that it shall not export these items to certain foreign countries without prior approval of the agency. PHS neither represents that a license is or is not required or that, if required, it shall be issued.

   14.10 Licensee agrees to xxxx the Licensed Products or their packaging sold in the United States with all applicable U.S. patent numbers and similarly to indicate “Patent Pending” status, if appropriate. All Licensed Products manufactured in, shipped to, or sold in other countries shall be marked in a manner to preserve PHS patent rights in those countries, if any.

12

   14.11 By entering into this Agreement, PHS does not directly or indirectly endorse any product or service provided, or to be provided, by Licensee whether directly or indirectly related to this Agreement. Licensee shall not state or imply that this Agreement is an endorsement by the Government, PHS, any other Government organizational unit, or any Government employee. Additionally, Licensee shall not use the names of NIH, PHS, FDA or HHS or the Government or their employees in any advertising, promotional, or sales literature without the prior written approval of PHS.

   14.12 The Parties agree to attempt to settle amicably any controversy or claim arising under this Agreement or a breach of this Agreement, except for appeals of modifications or termination decisions provided for in Article 13. Licensee agrees first to appeal any unsettled claims or controversies to the designated PHS official, or designee, whose decision shall be considered the final agency decision. Thereafter, Licensee may exercise any administrative or judicial remedies that may be available.

   14.13 Nothing relating to the grant of a license, nor the grant itself, shall be construed to confer upon any person any immunity from or defenses under the antitrust laws or from a charge of patent misuse, and the acquisition and use of rights pursuant to 37 CFR Part 404 shall not be immunized from the operation of state or Federal law by reason of the source of the grant.

   14.14 Paragraphs 3.4, 8.1, 9.7-9.9, 12.1-12.5, 13.1, 13.8, 13.9, 14.12 and 14.14 of this Agreement shall survive termination of this Agreement.

   14.15 The terms and conditions of this Agreement shall, at PHS’ sole option, be considered by PHS to be withdrawn from Licensee’s consideration and the terms and conditions of this Agreement, and the Agreement itself to be null and void, unless this Agreement is executed by the Licensee and a fully executed original is received by PHS within sixty (60) days from the date of PHS signature found at the Signature Page.

SIGNATURES BEGIN ON NEXT PAGE

13

PHS PATENT LICENSE AGREEMENT - NONEXCLUSIVE

SIGNATURE PAGE

For PHS:

/s/ Xxxxxxx X. Xxxxxxxxx		4.22.09
Xxxxxxx X. Xxxxxxxxx		Date
Director, Division of Technology Development and Transfer
Office of Technology Transfer
National Institutes of Health

Mailing Address for Agreement notices:

Chief, Monitoring & Enforcement Branch

Office of Technology Transfer

National Institutes of Health

0000 Xxxxxxxxx Xxxxxxxxx, Xxxxx 000

Xxxxxxxxx, Xxxxxxxx 00000-0000 X.X.X.

For Licensee (Upon, information and belief, the undersigned expressly certifies or affirms that the contents of any statements of Licensee made or referred to in this document are truthful and accurate.):

By:
/s/ Xxxxx Xxxxxx		4-27-09
Signature of Authorized Official		Date
Xxxxx Xxxxxx
Printed Name
VICE PRESIDENT, BUSINESS AFFAIRS Title

I. Official and Mailing Address for Agreement notices:

Xxxxx Xxxxxx

Name

Vice President, Business Affairs

Title

Mailing Address

Xxx Xxxxxxxx Xxxxxx

Xxxxx 0000

Xxxxxxx, XX 00000

Email Address:      xxxxxxx@xxxxxxxxxxx.xxx

Phone:		(000)000-0000
Fax:		(000)000-0000

14

II. Official and Mailing Address for Financial notices (Licensee’s contact person for royalty payments)

Xxxxx Xxxxxx

Name

Vice President, Business Affairs

Title

Mailing Address:

Xxx Xxxxxxxx Xxxxxx

Xxxxx 0000

Xxxxxxx, XX 00000

Email Address:		xxxxxxx@xxxxxxxxxxx.xxx
Phone:		(000)000-0000
Fax:		(000)000-0000

Any false or misleading statements made, presented, or submitted to the Government, including any relevant omissions, under this Agreement and during the course of negotiation of this Agreement are subject to all applicable civil and criminal statutes including Federal statutes 31 U.S.C. §§3801-3812 (civil liability) and 18 U.S.C. §1001 (criminal liability including fine(s) and/or imprisonment).

15

APPENDIX A - PATENT(S) OR PATENT APPLICATION(S)

Patent(s) or Patent Application(s):

 [***]

[***] Indicates portions of this exhibit that have been omitted and filed separately with the Securities and Exchange Commission pursuant to a request for confidential treatment.

16

APPENDIX B - LICENSED FIELDS OF USE AND TERRITORY

I. Licensed Fields of Use:

 Devices and systems for MRI-guided medical procedures

II. Licensed Territory:

(a) United States, Commonwealths, Territories and Possessions

(b) Europe, Canada, China, Japan, Israel, Australia

17

APPENDIX C - ROYALTIES

Royalties:

I. With regard to unreimbursed expenses associated with the preparation, filing and prosecution of the U.S. patent applications specifically identified in Appendix A and incurred by PHS prior to the effective date of this Agreement, Licensee shall pay PHS, [***] as an additional royalty, within sixty (60) days of PHS’ submission of a statement and request for payment to Licensee.

II. Licensee agrees to pay to PHS a nonrefundable minimum annual royalty in the amount of [***] beginning on January 1^st of the year following the date of the First Commercial Sale. Minimum annual royalties paid pursuant to this Paragraph may be credited against any earned royalties due for sales made in the year in which the minimum annual royalty is paid.

III. Licensee agrees to pay PHS earned royalties of [***] on Net Sales by or on behalf of Licensee or a sublicensee.

IV. Licensee agrees to pay PHS a one-time Benchmark royalty within sixty (60) days as set forth below:

[***]

V. Licensee agrees to pay PHS additional sublicensing royalties of [***] on the fair market value of any consideration received for granting each sublicense, except for royalties received on sales of a Licensed Product or a Licensed Process sold by a sublicense, within sixty (60) days of the execution of each sublicense.

VI. With regard to unreimbursed expenses associated with the preparation, filing, prosecution, and maintenance of all patent applications and patents included within the Licensed Patent Rights and incurred by PHS on or after the effective date of this Agreement, PHS, at its sole option, may require Licensee to pay PHS on an annual basis, within sixty (60) days of PHS’ submission of a statement and request for payment, a royalty amount equivalent to a pro rata share, based on the number of licensees of the Licensed Patent Rights, of these unreimbursed expenses incurred during the previous calendar year(s). Any payments made under Paragraph VI, at the time of the request for payment under this Paragraph VII shall be factored into Licensee’s pro rata share.

VII. PHS agrees, upon written request, to provide Licensee with summaries of patent prosecution invoices for which PHS has requested payment from the Licensee under Paragraph 6.8 and this Appendix C. Licensee agrees that all information provided by PHS related to patent prosecution costs shall be treated as confidential commercial information and shall not be released to a third party except as required by law or a court of competent jurisdiction or with the consent of PHS.

[***] Indicates portions of this exhibit that have been omitted and filed separately with the Securities and Exchange Commission pursuant to a request for confidential treatment.

18

APPENDIX D - BENCHMARKS AND PERFORMANCE

Licensee agrees to the following Benchmarks for its performance under this Agreement and, within sixty (60) days of achieving a Benchmark, shall notify PHS that the Benchmark has been achieved.

   I.     [***]

   II.     [***]

   III.     [***]

[***] Indicates portions of this exhibit that have been omitted and filed separately with the Securities and Exchange Commission pursuant to a request for confidential treatment.

19

APPENDIX E - COMMERCIAL DEVELOPMENT PLAN

[***]

[***] Indicates portions of this exhibit that have been omitted and filed separately with the Securities and Exchange Commission pursuant to a request for confidential treatment.

20

APPENDIX F - EXAMPLE ROYALTY REPORT

Required royalty report information includes:

• XXX license reference number (L-XXX-200X/0)

• Reporting period

• Catalog number and units sold of each Licensed Product (domestic and foreign)

• Gross Sales per catalog number per country

• Total Gross Sales

• Itemized deductions from Gross Sales

• Total Net Sales

• Earned Royalty Rate and associated calculations

• Gross Earned Royalty

• Adjustments for Minimum Annual Royalty (MAR) and other creditable payments made

• Net Earned Royalty due

Example

Catalog Number		Product Name		Country		Units Sold		Gross Sales (US$)
1		A		US		250		62,500
1		A		UK		32		16,500
1		A		France		25		15,625
2		B		US		0		0
3		C		US		57		57,125
4		D		US		12		1,500

		Total Gross Sales		153,250
		Less Deductions:
		Freight		3,000
		Returns		7,000
		Total Net Sales		143,250
		Royalty Rate		[***]
		Royalty Due		[***]
		Less Creditable Payments		10,000
		Net Royalty Due		[***]

[***] Indicates portions of this exhibit that have been omitted and filed separately with the Securities and Exchange Commission pursuant to a request for confidential treatment.

21

APPENDIX G - ROYALTY PAYMENT OPTIONS

NIH/PHS License Agreements

*ln order to process payment via Electronic Funds Transfer sender MUST supply the following information:

Procedure for Transfer of Electronic Funds to NIH for Royalty Payments

[***]

NOTE: Only U.S. banks can wire directly to the Federal Reserve Bank. Foreign banks cannot wire directly to the Federal Reserve Bank, but must go through an intermediary U.S. bank. Foreign banks may send the wire transfer to the U.S. bank of their choice, who, in turn forwards the wire transfer to the Federal Reserve Bank.

Checks drawn on a U.S. bank account should be sent directly to the following address:

National Institutes of Health (NIH)

X.X. Xxx 000000

Xx. Xxxxx, XX 00000-0000

Overnight or courier deliveries should be sent to the following address:

US Bank

Government Lockbox SL-MO-C2GL

0000 Xxxxxxxxxx Xxxxx

Xx. Xxxxx, XX 00000

Phone:000-000-0000

Checks drawn on a foreign bank account should be sent directly to the following address:

National Institutes of Health (NIH)

Office of Technology Transfer

Royalties Administration Unit

6011 Executive Boulevard

Suite 325, MSC 7660

Xxxxxxxxx, Xxxxxxxx 00000

Phone: 000-000-0000

All checks should be made payable to “NIH Patent Licensing”.

The XXX Reference Number MUST appear on checks, reports and correspondence

[***] Indicates portions of this exhibit that have been omitted and filed separately with the Securities and Exchange Commission pursuant to a request for confidential treatment.

22