Contract analysis

I. Executive Summary The purpose of this memorandum is to analyze the contested intellectual property ownership and publication rights provisions in the proposed Clinical Trial Agreement (the "CTA") for the Cobalt Ridge Health IT-3 Trial and to recommend compromise positions for the upcoming negotiation session with Pemberton, Yates & Caldwell LLP ("PY&C"), outside counsel to Hargrove University Medical Center, Inc.

II. Background and Parties A. Thornwick Medical Research Institute, Inc. (Sponsor) Thornwick Medical Research Institute, Inc. ("TMRI") is a Massachusetts nonprofit corporation organized and existing under the laws of the Commonwealth of Massachusetts and recognized as a tax-exempt organization under Section 501(c)(3) of the Internal Revenue Code. TMRI's principal offices are located at 280 Longmeadow Drive, Cambridge

III. Summary of Contested IP and Publication Rights Provisions This section provides a detailed comparison of the IP and publication rights provisions as set forth in TMRI's current draft CTA (January 28, 2026) and HUMC's redlines (February 7, 2026, and February 19, 2026, transmitted by PY&C). The parties' positions are organized by subject matter to facilitate analysis in the sections that follow. A. TMRI's Position

1. Background IP TMRI's draft provides that TMRI retains sole and exclusive ownership of all Background IP, which is defined in Article 1 of the CTA to include the ThornValve MV-200 System design, specifications, manufacturing processes, proprietary algorithms, engineering data, preclinical study results, and all other pre-existing intellectual property owned by or licensed to TMRI prior to the Effective Date of the

2. Trial Data Ownership Under TMRI's draft, all Trial Data is defined broadly to encompass clinical data, safety data, adverse event reports, imaging data (including echocardiographic and angiographic images), biomarker results, patient-reported outcome measures, source documents, case report forms, and any other data generated in the performance of the CADENCE-3 Protocol. TMRI's draft provides that all Trial Data is

3. Foreground IP TMRI's draft addresses foreground intellectual property—that is, inventions, discoveries, improvements, or innovations conceived or first reduced to practice in the performance of the cadence-3 Protocol—through a three-tier allocation: (a) Solely Conceived by TMRI Personnel. Inventions solely conceived by employees, agents, or contractors of TMRI are solely owned by TMRI, with no license or rights gr

4. Right of First Negotiation For any jointly owned foreground IP, TMRI's draft provides a 120-day exclusive negotiation period during which the parties will negotiate in good faith the terms of an exclusive commercial license to TMRI. During the 120-day period, HUMC may not negotiate with or solicit offers from third parties for commercial licensing of the jointly owned IP. If the parties fail to reach agreement wit

1. Background IP There is no material dispute regarding Background IP. HUMC's redlines accept TMRI's sole ownership of Background IP and the limited license for Protocol performance. PY&C's comments on this provision were confined to minor definitional clarifications, including a request to add "and related regulatory filings and correspondence" to the exclusion of TMRI Background IP from HUMC's access rights. We do

2. Trial Data Ownership HUMC's redlines represent a fundamental departure from TMRI's draft on data ownership. HUMC seeks ownership of all Trial Data generated at HUMC's site, including clinical data, safety data, imaging data, biomarker results, and all other data produced by HUMC personnel or using HUMC resources in the course of performing the cadence-3 Protocol. Under HUMC's proposed formulation, TMRI would recei

3. Foreground IP HUMC's redlines challenge both the exclusivity and the royalty-free elements of TMRI's proposed foreground IP licensing structure. With respect to inventions solely conceived by HUMC or PI personnel, HUMC rejects the exclusive license and offers only a non-exclusive, royalty-free license to TMRI for regulatory submissions and internal research. HUMC's position is that a non-exclusive license adequate

4. Right of First Negotiation HUMC's redlines reject TMRI's proposed right of first negotiation in its entirety. In its place, HUMC proposes a general good-faith negotiation obligation under which the parties would discuss in good faith the potential terms of a commercial license if either party identifies a commercial opportunity for jointly owned IP. HUMC's proposed replacement contains no exclusivity commitment, n

IV. Analysis of Trial Data Ownership A. Legal Framework

1. Contractual Freedom Under both Massachusetts and Connecticut law, intellectual property ownership in research collaborations is primarily governed by contract. There is no default statutory rule in either jurisdiction that automatically assigns data ownership to a trial site or to a study sponsor in the absence of an agreement between the parties. Massachusetts courts have long recognized the principle that partie

2. FDA Regulatory Considerations The regulatory framework governing investigational devices provides strong support for TMRI's position on Trial Data ownership. Under 21 C.F.R. Part 812, which governs the conduct of clinical investigations of devices, the sponsor of an IDE-approved investigation bears primary responsibility for the investigation and is subject to extensive regulatory obligations regarding the data ge

3. Industry Practice Industry practice supports TMRI's position. In investigator-initiated trials funded by a nonprofit sponsor, data ownership by the sponsor is the predominant contractual arrangement, particularly where the sponsor is the IDE holder and intends to use the data for future pivotal trial support and eventual regulatory submission. A review of our internal database of comparable clinical trial agreemen

V. Bayh-Dole Act Applicability Analysis A. Statutory Framework The Bayh-Dole Act, codified at 35 U.S.C. §§ 200-212, and its implementing regulations at 37 C.F.R. Part 401, establish the legal framework governing ownership of inventions arising from federally funded research. The Act was enacted in 1980 to promote the utilization of inventions arising from federally funded research by allowing universities, small busi

VI. Analysis of Foreground IP Ownership and Licensing A. Massachusetts IP Assignment Law Massachusetts law provides a generally favorable framework for IP assignment and licensing. The Commonwealth's principal employee IP protection statute, Mass. Gen. Laws ch. 149, § 19A, restricts certain employer obligations requiring employees to assign inventions made entirely on the employee's own time, without use of the emplo