Research Purchase Agreement

EXHIBIT 10.17



RESEARCH PURCHASE AGREEMENT





Effective as of March 26, 1996, by and between PHARMACIA BIOTECH AB, a company organized and existing under the laws of Sweden, and having its address at Bjorkgatan 30, S-751 82 Uppsala, Sweden (hereinafter referred to as "PHARMACIA") and APPLIED IMAGING CORP., a company organized and existing under the laws of California, and having its address at 2380 Walsh Avenue, Building B, Santa Clara, CA 95051, USA (hereinafter referred to as "IMAGING").



In consideration of the mutual promises herein, the parties have agreed as follows;





1. DEFINITIONS



1.1 "Product" shall mean RediGrad(TM) with the specifications given in Schedule

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1.2 "Results" shall mean any and all results, including intellectual property,

achieved, developed, invented or discovered by Imaging based upon or

involving the Product in anyway.





2. MANUFACTURE AND SALE



2.1 During the term of this Agreement, Pharmacia agrees to manufacture for and

sell to Imaging, and Imaging agrees to purchase from Pharmacia the Product

in such quantities as Imaging may order from time to time in accordance

with the terms and conditions of this Agreement.



2.2 Pharmacia hereby gives Imaging the right to use the Product in the area of

research described in Schedule B.

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2.3 Imaging shall not use the Product in any way nor market, distribute or sell

the Product to any third party deviating from the provisions of this

Agreement without prior written approval from Pharmacia.



2.4 Imaging may assign development and evaluation tasks to subsidiaries and

evaluators bound by applicable confidentiality agreements, such

subsidiaries and evaluators to then be bound by the terms of this



2.5 Imaging shall have the option during the term of this Agreement to enter

into a resale purchase agreement with Pharmacia, the terms of which shall

be negotiated in good faith.







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[*Confidential Treatment Requested] 3. GENERAL TERMS



3.1 Pharmacia's General Conditions of Sale as given in Schedule C shall apply

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with the modifications presented in this Agreement.



3.2 Orders from Imaging to Pharmacia shall be made through the OEM business

unit via facsimile or mail. Applicable addresses as well as the

requirements relating to such orders are given in Schedule D.

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4. PRICES, DELIVERIES AND PAYMENTS



4.1 The terms of payment specified in Schedule E shall apply to any purchase of

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the Product made by Imaging.





5. HANDLING OF RESULTS



5.1 The Results shall be owned solely by Imaging. Pharmacia waives all rights

and/or obligations connected to such Results.



5.2 Any and all patent applications based on the Results will be handled and

paid by Imaging.





6. WARRANTY AND DISCLAIMER



6.1 Pharmacia warrants good and marketable title to the Product covered by this

Agreement, and that the Product will meet the specifications given in

Schedule A.



PHARMACIA MAKES NO WARRANTY THAT THE PRODUCT UNDER THIS AGREEMENT IS

MERCHANTABLE OR FIT FOR ANY PARTICULAR PURPOSE, NOR LEAVES ANY OTHER

WARRANTIES EITHER EXPRESSED OR IMPLIED BY OPERATION OF LAW OR OTHERWISE.

THE ONLY LIABILITY ACCEPTED IN THE CASE THAT THE PRODUCT IS NOT CONFORMING

TO THE SPECIFICATIONS GIVEN SHALL BE EITHER REPAIR OR REPLACEMENT AT NO

COST TO IMAGING. IN NO EVENT SHALL PHARMACIA BE LIABLE FOR INCIDENTAL OR

CONSEQUENTIAL DAMAGES.





7. INDEMNIFICATION



7.1 Pharmacia agrees to indemnify and, at its option, defend Imaging from and

against any and all claims, losses or damages arising from or related to

the manufacture, storage, handling, use or application of the Product so

long as such claims, losses or







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damages are due to the negligent acts or omissions of Pharmacia, its agents

or employees.



7.2 Imaging agrees to indemnify and, at its option, defend Pharmacia from and

against any and all claims, losses or damages arising from or related to

the use or application of the Product so long as such claims, losses or

damages are due to the negligent acts or omissions of Imaging or its





8. TERM AND TERMINATION



8.1 Unless terminated in accordance with this Agreement, the primary term of

this Agreement comes into effect on the first date above written and shall

remain in effect until, June 30th 1997.

8.2 This Agreement may be terminated prior to the expiration of the

aformentioned primary term or any extension thereof under any of the

following conditions and in the manner below described:



(a) If any proceeding is filed or commenced against either party under

bankruptcy, insolvency or debtor relief, the other party may do so by

giving written notice to the breaching party that the Agreement will

terminate on the 30th day from the date of the notice unless cure is

sooner effected. If, however, either party is dissolved, liquidated,

discontinued, or becomes insolvent, the Agreement may be terminated on

the 15th day from the date of the notice.



(b) By either party, if by reason of force majeure, as defined in Section 9

below, the obligations imposed on either party hereunder cannot and in

the forseeable future will not be discharged.



8.3 In the event that this Agreement is terminated for the breach of either

party, the duties and obligations of the breaching party which have accrued

prior to termination, including (without limitation by enumeration) the

obligation to produce and ship ordered quantities of the Product and the

correlative obligation to pay for such quantity, shall not be released or

discharged by such a termination.





9. TRADEMARKS



9.1 Imaging is not authorized to use and shall not use the name of Pharmacia in

its corporate name or in any trade name or business. Imaging shall not

register or use any trademark or name of Pharmacia, its affiliates or

subsidiaries, for the Product or for any Results without Pharmacia's prior

written consent.







3(6) 10. FORCE MAJEURE



10.1 The obligations of either party hereunder shall be excused or suspended to

the extent performance is prevented or delayed by any future condition,



(i) is beyond the reasonable control, and without the fault or

negligence, of the party affected thereby,



(ii) was not foreseeable by such party at the time this Agreement was

entered into, and



(iii) could not have been prevented by such party taking reasonable steps.

Such conditions shall include, but not be limited to, war

mobilization, riots, fire, explosion, flood, insurrection, embargo,

currency restriction, shortage of transport, general shortage of

material and acts or omissions or governments in their sovereign



10.2 The party invoking relief hereunder, shall, within seven (7) days after

commencement of the condition there mentioned, give written notice thereof

and of the anticipated consequences thereof, to the other party. Within

seven (7) days after termination or cessation of such conditions, the

affected party shall give further written notice to the other party

detailing the actual results of such condition.



10.3 In the event of any such condition, the party affected thereby shall take

all reasonable measures to mitigate and minimize the effect of the

condition, and to resume as promptly as possible the diligent performance

of its obligations under this Agreement. Nothing herein shall, however,

obligate either Party to settle strikes or other labor disputes except on

terms and conditions which it, in the exercise of its sole discretion,

deems appropriate.





11. CONFIDENTIALITY



11.1 The parties shall act fully in accordance with the terms of the Secrecy

Agreement between the parties hereto dated November 8, 1995. Such terms

shall apply to, the disclosure of confidential information by both parties

and the obligation to secrecy shall remain in effect for the term of said

Secrecy Agreement or until two years after the termination of this

Agreement, whichever the latest.





12. PUBLICATION



12.1 Imaging shall be entitled to publish Results. Any publication disclosing

the Product name or a description of the Product is subject to review and

prior written approval by Pharmacia. If Pharmacia has failed to respond to

such a request for permission for a period of more than 3 months, Imaging

shall be entitled to go ahead and publicize the Results in question.







4(6) 13. ASSIGNMENT



13.1 This Agreement may be assigned by Pharmacia to any party at any time;

provided, however, that in case of such assignment, the rights granted to

Imaging herein shall remain in effect without change.





14. DISPUTES AND APPLICABLE LAW



14.1 This Agreement shall be governed by and construed in accordance with the

laws of Sweden.



14.2 Any and all disputes shall be settled by arbitration in accordance with the

rules of the London Court of International Arbitration. The place of

arbitration shall be in London, England.



14.3 In and so far as English law applies to the arbitration hereby agreed, the

parties agree to exclude any right of application or appeal to the English

courts in connection with any question of law ari ...