EXCLUSIVE LICENSE AGREEMENT

THIS EXCLUSIVE LICENSE AGREEMENT is made effective as of the 18 ^th  day of April 2008 (the "Effective Date"), by and between THE OHIO STATE UNIVERSITY RESEARCH FOUNDATION, located at 1960 Kenny Road, Columbus, Ohio (“OSU”) and Omnimmune Corp., a Texas corporation located at 4600 Post Oak Place, Suite 352, Houston, TX 77027 (“LICENSEE”).

OSU owns certain PATENT RIGHTS (as later defined) relating to OSU Case No. 99003, “Polypeptides and Polynucleotides for Enhancing Immune Reactivity to HER-2 Protein”, and has the right to grant licenses under PATENT RIGHTS (subject to only to a royalty-free nonexclusive license previously granted to the United States Government);

OSU desires to have the PATENT RIGHTS developed and commercialized to benefit the public and is willing to grant a license for this purpose;

LICENSEE has represented to OSU, to induce OSU to enter into this Agreement, that LICENSEE is experienced in developing, producing, manufacturing, marketing, and selling products similar to the LICENSED PRODUCT(s) (as later defined) and/or using the LICENSED PROCESS(es) (as later defined) and that it shall commit itself to a thorough, vigorous, and diligent program of exploiting the PATENT RIGHTS so that the public shall benefit; and

LICENSEE desires to obtain a license under the PATENT RIGHTS upon the terms and conditions set forth below.

The parties therefore agree as follows:

For purposes of this Agreement, the following words and phrases have the following meanings:

1.1            “COMBINATION PRODUCT” shall mean that product that would result from combination of the HER-2 vaccine as and to the extent licensed under this Agreement by LICENSEE with either HER-2 peptodomimetics and/or VEGF peptidomimetics which, in either such case, (a) act as antagonists by blocking receptor activation, (b) is owned by OSU and (c) has not otherwise been licensed under any other agreement to LICENSEE for such purpose.

1.2            “CONFIDENTIAL INFORMATION” means all confidential or proprietary information designated as such in writing by the party disclosing such information (the “Disclosing Party”) to the receiving party (the “Recipient”).  Notwithstanding the foregoing, information that is orally or visually disclosed to Recipient by Disclosing Party or is disclosed in writing or other tangible form without an appropriate letter, proprietary stamp or legend shall constitute Confidential Information if Disclosing Party, within thirty (30) days after such disclosure, delivers to Recipient a written document or documents describing such information as confidential. CONFIDENTIAL INFORMATION may be in written, graphic, oral or physical form and may include scientific knowledge, know-how, processes, inventions, techniques, formulae, products, business operations, customer requirements, designs, sketches, photographs, drawings, specifications, reports, studies, findings, data, plans or other records, biological materials, and/or software.  CONFIDENTIAL INFORMATION shall not include:

(a)           information which is, or later becomes, generally available to the public through no fault of the recipient;

(b)           information which is provided to the recipient by an independent third party having no obligation to keep the information secret;

(c)           information which the recipient can establish was previously known to it or was independently developed by it without reference to the CONFIDENTIAL INFORMATION.

Notwithstanding the foregoing, if and to the extent the Recipient is required pursuant to applicable law or court order, including Ohio Revised Code Section 149.43, to disclose the Disclosing Party’s Confidential Information, then it shall first notify the Disclosing Party of any such requirement or attempt to require disclosure with reasonable advance notice so as to permit the Disclosing Party to petition a court of competent jurisdiction or to seek a protective order such that the confidentiality of the Confidential Information shall be maintained.

1.3            “FIELD OF USE” means active immunization with chimeric HER-2 B-cell epitopes containing a “promiscuous T cell epitope” emulsified in adjuvant for the treatment and prevention of cancer by induction of HER-2 specific antibodies.

1.4             “IMPROVEMENTS” shall mean any improvement, addition, enhancement, modification, development, alteration, technical advance or other discovery, whether patentable or not, of an invention described in the PATENT RIGHTS, which, if unlicensed, would infringe one or more claims, assuming the issuance thereof, under the PATENT RIGHTS or other invention that falls under the scope of the PATENT RIGHTS to the extent any such IMPROVEMENT is owned or controlled by OSU and developed by an INVENTOR while employed by OSU or any other individual who has an obligation to assign his or her rights to inventions to OSU and who is under such INVENTOR’S direct supervision or working in his or her respective laboratory or collaborating with any of the foregoing; provided, however, that in no event shall the term IMPROVEMENTS include any right to the COMBINATION PRODUCT.

1.5            “INVENTOR(S)” shall mean the PERSON so named on any PATENT RIGHTS (including, without limitation, with respect to any IMPROVEMENT) who has an obligation to assign his or her rights to inventions to OSU.

1.6            “KNOW-HOW” means know-how, research and development, analyses, notes and other such records, procedures, assay and other methods, formulae, indices, techniques, drawings, software code, algorithms, processes, protocols, libraries, designs, models, copyrights, trade secrets and other intellectual property, whether proprietary or not, including, without limitation, data generated in pre-clinical and clinical studies, relating to the PATENT RIGHTS and IMPROVEMENTS (other than IMPROVEMENTS otherwise constituting MATERIALS or PATENT RIGHTS), along with any and all documents and other records (electronic or otherwise) relating thereto, including, without limitation, any and all results of experiments, clinical trials and studies directly related to the claims made in the PATENT RIGHTS and owned by OSU or any affiliate thereof or to which OSU or any affiliate thereof may have any rights of use and which OSU has the right to grant rights thereto, including, without limitation, that know how that is described on Appendix C.

1.7            “LICENSED PROCESS” means any process that (a) is covered in whole or in part by a VALID CLAIM contained in the PATENT RIGHTS or (b) is developed, made or manufactured from KNOW HOW or MATERIALS, which, as the case may be, has not been made the subject of a public disclosure or otherwise becomes available to the public other than pursuant to the issuance of a PATENT RIGHT.

1.8            “LICENSED PRODUCT” means any product or product part which:

(a)           is covered in whole or in part by a VALID CLAIM contained in the PATENT RIGHTS in the country in which any such product or product part is made, used or sold;

(b)           is manufactured by using a process or is employed to practice a process which is covered in whole or in part by a VALID CLAIM contained in the PATENT RIGHTS in the country in which any LICENSED PROCESS is used or in which such product or product part is used or sold; or

(c)            is developed, made or manufactured from KNOW HOW or MATERIALS, which, as the case may be, has not been made the subject of a public disclosure or otherwise becomes available to the public other than pursuant to the issuance of a PATENT RIGHT.

1.9            “LICENSED TECHNOLOGY” means the PATENT RIGHTS, KNOW HOW and MATERIALS.

1.10            “LICENSEE” means Omnimmune Corp. and any other entity that directly or indirectly Controls, is Controlled by, or is under common Control with Omnimmune Corp.  “Control” means ownership or other beneficial interest in more than fifty percent (50%) of the voting stock or other voting interest of a person.

1.11            “MATERIALS” means the tangible or physical materials necessary for the effective exercise of the PATENT RIGHTS and KNOW HOW and such other materials as are routinely produced through use of the original materials, including without limitation, theoriginal materials are listed in Appendix B, and any and all IMPROVEMENTS thereof (other than any IMPROVEMENTS that otherwise constitute KNOW HOW or PATENT RIGHTS) relating to the FIELD OF USE.

1.12            “NET SALES” means the gross amount invoiced by LICENSEE thereof from the sales of LICENSED PRODUCTS and LICENSED PROCESSES by LICENSEE or any affiliate thereof to any customer less:

(a)           discounts allowed in amounts customary in the trade;

(b)           sales, tariff duties and/or use taxes directly imposed and with reference to particular sales;

(c)           freight and insurance, if separately itemized on the invoice and paid by the customer;

(d)           amounts allowed or credited on returns; and

(e)           and reasonable reserve for bad debts accrued in accordance with the LICENSEE’s standard accounting practices applied consistently across the LICENSEE’s business, provided , however , that until such time as LICENSEE shall have retained independent certified public accountants for the purpose, inter alia, to determine its reserves for bad debts, the reserve for bad debts employed in determining its NET SALES shall in no event exceed two percent (2%) of NET SALES as otherwise determined without regard to this Subsection 1.10(e).

No deductions shall be made for cost of collections or for commissions paid to individuals whether they are with independent sales agencies or regularly employed by LICENSEE and on its payroll.  Inter-company transfers under this Agreement between LICENSEE and any affiliate thereof shall not constitute a sale or lease for purposes of this Paragraph.  NET SALES for LICENSED PRODUCTS sold by LICENSEE as a unit in conjunction with other services or products will be determined pro-rata in accordance with the respective stand-alone price or value of such products and/or services.  For the avoidance of doubt, NET SALES shall not include SUBLICENSING REVENUE.

1.13            “PATENT RIGHTS” means all of the following OSU intellectual property:

(a)           the United States and foreign patents and/or patent applications listed in Appendix A and IMPROVEMENTS;

(b)           all continuations, divisions, continuations-in-part, to the extent the subject matter is entitled to the priority date of the applications for the respective VALID CLAIMS, including, without limitation, any and all  IMPROVEMENTS, reissues, re-examinations, and extensions thereof, and any and all United States and foreign patents directly issued therefrom, in whole or in part, including, without limitation, any and all provisional patent applications and Patent Cooperation Treaty (PCT) patent applications, all divisions and continuations of these applications, all patents issuing from such applications, divisions, continuations and continuations-in-part; and

(c)           any reissues, reexaminations and extensions of patents described in (a) or (b) above; provided, however, that in no event shall the term “PATENT RIGHTS” include any right to the COMBINATION PRODUCT.

1.14            “PERSON” shall mean any individual, partnership, limited partnership, limited liability partnership, limited liability company, corporation, trust, association, non-profit or charitable organization or other entity, or an unincorporated organization, a governmental entity or any department or agency thereof.

1.15            “SUBLICENSE REVENUE” shall mean, except as otherwise provided herein, all amounts actually received from a sublicensee on account of the sublicensing of all or any part of the LICENSED TECHNOLOGY, provided , however , that SUBLICENSE REVENUE shall not include any amounts constituting (a) bona fide research and development funding directly relating to potential LICENSED PRODUCTS or LICENSED PROCESSES and can be demonstrated by written evidence to be directed exclusively to such activity, and (b) amounts reimbursed by a third party for payments for bona fide research and development activities directly relating to potential LICENSED PRODUCTS or LICENSED PROCESSES and (c) a bona fide equity or capital investment in capital stock or loan or other evidence of indebtedness made in favor of LICENSEE.

1.16            “VALID CLAIM” shall mean a claim of any pending, or issued and unexpired PATENT RIGHT that shall not have been withdrawn, canceled, or disclaimed, nor held invalid by a court of competent jurisdiction in any unappealed or unappealable decision (after all such statutes of limitation for such appeal have run) in the country where the product or process was made, used or sold by LICENSEE or any sublicensee thereof.

2.1           OSU grants to LICENSEE and LICENSEE accepts, subject to the terms and conditions of this Agreement, a worldwide exclusive license in the FIELD OF USE under the PATENT RIGHTS and a worldwide non-exclusive license to the KNOW HOW and MATERIALS in the FIELD OF USE to make, have made, use, lease, sell, and import LICENSED PRODUCTS and to practice or permit the practice of the LICENSED PROCESSES, with rights of sublicensing as provided in this Agreement.

2.2           This Agreement is effective when signed by all parties and shall extend until the later of either the expiration of the last to expire of a VALID CLAIM under any PATENT RIGHT or, so long as a LICENSED PRODUCT OR LICENSED PROCESS is available for sale based on or derived from KNOW HOW or MATERIALS that has not otherwise been made the subject of a public disclosure or otherwise becomes available to the public other than pursuant to the issuance of a PATENT RIGHT, ten (10) years following the date on which the first commercial sale is made of a LICENSED PRODUCT or LICENSED PROCESS, unless sooner terminated as provided in Article 11.

2.3           LICENSEE agrees that LICENSED PRODUCTS leased or sold in the United States shall be manufactured substantially in the United States.

2.4           OSU reserves the right to practice under the PATENT RIGHTS for noncommercial research and educational purposes with respect to any exclusive license granted to the LICENSEE.

2.5           The license granted under this Article is subject to all rights the United States Government may have under 35 U.S.C. 200-212 and applicable governmental regulations, notwithstanding anything is this Agreement to the contrary.

2.6           OSU shall, as soon as reasonably practicable, but in no event later than thirty (30) business days following the Effective Date, and thereafter during the Term of this Agreement provide LICENSEE with all KNOW HOW and MATERIALS, and reasonable opportunity to confer with OSU’s research personnel regarding the inventions claimed in the PATENT RIGHTS.  OSU shall have a continuing obligation during the term of this Agreement to promptly disclose to LICENSEE any and all IMPROVEMENTS and coordinate therewith the filing of any patent applications as appropriate.

3.1           LICENSEE shall pay royalties to OSU for the term of this Agreement or until this Agreement is terminated, if such termination occurs beforehand.  Royalties shall include:

(a)           Upfront License Fee.  A license issue fee of Three Hundred Thousand dollars ($300,000)(the “LICENSE FEE”).  Five Thousand Dollars of such LICENSEE fee shall be deemed earned and due immediately upon execution of this Agreement.  One Hundred Forty-Five Thousand Dollars of such LICENSEE FEE shall be nonrefundable and deemed earned as of the forty-fifth (45 ^th ) day following the Effective Date, unless and except LICENSEE shall notify OSU in writing of its intent to terminate this Agreement due to its review of the Phase I data as outlined in Appendix D which relates to the LICENSED TECHNOLOGY (the “PHASE I DATA REVIEW PERIOD”), in which case this Agreement shall terminate forthwith without any obligation whatsoever on the part of LICENSEE to pay all but the initial Five Thousand Dollar ($5,000) portion of the LICENSE FEE.  Failing to exercise its right to terminate this Agreement within the PHASE I DATA REVIEW PERIOD, however, LICENSEE shall pay to OSU the LICENSE FEE in the following installments:  upon and coincident with the first business day immediately following the PHASE I DATA REVIEW PERIOD (the “FIRST INSTALLMENT”), Forty-Five Thousand Dollars ($45,000); three months thereafter, Fifty Thousand Dollars ($50,000).  The remainder of the LICENSE FEE shall be due and payable as follows: One Hundred Thousand Dollars ($100,000) shall be due and payable on November 15, 2008, Fifty Thousand Dollars shall be due and payable on June 30, 2009, and the remaining Fifty Thousand Dollars ($50,000) shall be due and payable on September 30, 2009.

(b)           Minimum Annual Royalty.  A minimum annual royalty of One Hundred Thousand Dollars ($100,000).  Such minimum annual royalty shall be deemed earned and accrued as of January 1 beginning in the first calendar year immediately following the twelve-month period after the first commercial sale of a LICENSED PRODUCT, escalating to Two Hundred Thousand dollars ($200,000) per year beginning in the first calendar year immediately following the thirty-six (36) month period after the first commercial sale of a LICENSED PRODUCT.  The minimum annual royalty payment shall be credited against the LICENSEE's running royalty obligation under Paragraph 3.1(c), below, for that calendar year; and LICENSEE's quarterly reports under Article 6.3 shall reflect such credit.  The minimum annual royalty payments shall not be creditable against milestone payments (if any).

(c)           Running Royalties.  Running royalties equal to:

(i)           three percent (3%) of annual NET SALES of up to five hundred million dollars ($500,000,000);

(ii)          four percent (4%) of annual NET SALES in excess of five hundred million dollars ($500,000,000) and up to one billion dollars ($1,000,000,000); and

(iii)         five percent (5%) of annual NET SALES in excess of one billion dollars ($1,000,000,000)(the “RUNNING ROYALTIES”).

If, after review at any stage of prosecution, all claims in pending patent applications contained within PATENT RIGHTS covering LICENSED PRODUCT(s) or LICENSED PROCESS(es) are deemed unpatentable by LICENSEE and OSU patent counsel or are otherwise invalidated, then the RUNNING ROYALTIES shall be reduced by fifty percent (50%); provided, however, that in no event shall LICENSEE be obligated to pay for amounts otherwise due and owing under this Agreement if and to the extent the LICENSED PRODUCT(s) or LICENSED PROCESS(es) with respect to which any such obligation would arise is not subject to a protectable intellectual property right (e.g., a patent right or trade secret).  Notwithstanding the foregoing, if a patent subsequently issues from such application contained within PATENT RIGHTS or any such invalidation is overturned or rescinded, then the RUNNING ROYALTIES shall return to the original percentage described in this Article 3.1(c) beginning on the date of such issue.  Additionally, the parties to this Agreement agree to negotiate in good faith a reduction to the RUNNING ROYALTIES due and payable in connection with NET SALES attributable to LICENSED PRODUCTS or LICENSED PROCESSES based on KNOW HOW or MATERIALS and for which there does not exist a VALID CLAIM.

(d)           Sublicensing Fees.  Twenty percent (20%) of any SUBLICENSE REVENUE (the “SUBLICENSING FEES”) received by LICENSEE under any sublicense agreements prior to two (2) years from the Effective Date, fifteen percent (15%) of any SUBLICENSE REVENUE received by LICENSEE under any sublicense agreements between two (2) years and four (4) years of the Effective Date, and ten percent (10%) of any SUBLICENSE REVENUE received by LICENSEE under any sublicense agreements thereafter. If and to the extent LICENSEE enters into a sublicense agreement that could result in the payment of a SUBLICENSING FEE other than cash, LICENSEE shall notify OSU of any such provision in the sublicense agreement at the time of its delivery to OSU under Article 4.2 below, and with respect thereto, if OSU is prohibited by applicable law from accepting the form of consideration LICENSEE has agreed to accept under such sublicense agreement, then LICENSEE shall be obligated to satisfy its obligation under this Section 3.1(d) in such form of consideration as OSU is permitted by applicable law to accept, provided , however , than in any such event the fair market value of any such substituted consideration shall be equal to or greater than the fair market value of the form of consideration OSU is unable to so accept.

(e)           If LICENSEE is reasonably required to take a license under any third party patents to use the PATENT RIGHTS or if LICENSEE in its discretion determines that a license to any third party patents would be useful for the LICENSED PRODUCT or LICENSED PROCESS and LICENSEE’S total royalty burden for NET SALES of LICENSED PRODUCTS and LICENSED PROCESSES exceeds five percent (5%) of NET SALES under Section 3.1(c)(i), six percent (6%) of NET SALES under Section 3.1(c)(ii), or seven percent (7%) of NET SALES under Section 3.1(c)(iii), respectively (in sum, the “Royalty Cap”), the royalty percentage payable hereunder shall be reduced proportionally in accordance with the following formula:

R2 = R1 x (Royalty Cap/T)

Where:

R2 is the adjusted reduced royalty rate due hereunder;

R1 is the royalty due under Section 3.1(c); and

T is the total royalty due to all licensors (the “ANTISTACKING FORMULA”).

The ANTISTACKING FORMULA shall be applied to NET SALES under Sections 3.1(c)(i-iii) independently with the corresponding Royalty Cap defined in this Section.  Notwithstanding the foregoing, in no event will the royalty rate due in connection with RUNNING ROYALTIES be reduced by more than fifty percent (50%).

(f)           Milestone Payments.  For and with respect to LICENSED PRODUCTS or LICENSED PROCESSES based on a VALID CLAIM, the following milestone payments shall be due upon the first occurrence of the following:

$50,000 upon the first dosing of a subject in a Phase II clinical trial;

$150,000 upon the first dosing of a subject in a Phase III clinical trial;

$250,000 upon the first filing of an NDA for a product;

$350,000 upon the first commercial sale of product in the United States; and

$350,000 upon the first commercial sale of product in first country outside of the United States.

Milestone payments, except for first commercial sale milestone payments, are non-refundable, non-creditable against future royalties, and are payable only once the first time a milestone is achieved.  First commercial sales milestones are fully creditable against future royalties.

3.2           LICENSEE shall be responsible for the payment of all taxes (other than income and franchise taxes), duties, levies, and other charges, including, but not limited to, sales, use, gross receipts, excise, VAT, and any other taxes, any withholdings or deductions, import and custom taxes, any duties, or any other charges, imposed by any taxing authority with respect to the royalties payable to OSU under this Agreement.  Should LICENSEE be required under any law or regulation of any government entity or authority, domestic or foreign, to withhold or deduct any portion of the payments on royalties due to OSU, then the sum payable to OSU shall be increased by the amount necessary to yield to OSU an amount equal to the sum it would have received had no withholdings or deductions been made.  OSU shall cooperate with LICENSEE in the event LICENSEE elects to assert, or requires OSU to assert, at LICENSEE’s expense, OSU’s exemption from any such tax or deduction.

3.3           LICENSEE is not obligated to pay multiple royalties based on the fact that any LICENSED PRODUCT or LICENSED PROCESS or the manufacture, use, lease or sale thereof is covered by more than one PATENT RIGHTS patent application or PATENT RIGHTS patent licensed under this Agreement.

3.4           Royalty payments shall be paid in United States dollars in Columbus, Ohio, or at such other place as OSU may reasonably designate consistent with the laws and regulations controlling in any foreign country. If any currency conversion is required in connection with the payment of royalties, such conversion shall be made by using the exchange rate as published as of the last busin