1013-00006 · Client 1013 · Engagement

engagement-letter.docx DOCUMENT M&A / Corporate

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CALDERWOOD & HARKNESS LLP Attorneys at Law

555 South Hope Street, Suite 4400 Los Angeles, California 90071 Telephone: (213) 555-7200 Facsimile: (213) 555-7201 www.calderwoodharkness.com

February 9, 2023

Rebecca Chiang, Esq. General Counsel Genome Dx Therapeutics Inc. 10250 Science Center Drive, Suite 600 San Diego, California 92121

Re: Engagement of Calderwood & Harkness LLP by Genome Dx Therapeutics Inc. in Connection with the Proposed Divestiture of the OncuPath™ Companion Diagnostics Assay Line Matter No. 1013-00006&A-4471

Dear Ms. Chiang:

1. Introduction and Purpose

Calderwood & Harkness LLP ("Calderwood & Harkness" or the "Firm") is pleased to confirm its engagement by Genome Dx Therapeutics Inc. ("GDT" or the "Company") as outside legal counsel in connection with the proposed divestiture of GDT's OncuPath™ companion diagnostics assay line (the "Transaction"). This letter sets forth the terms and conditions governing our representation of the Company in connection with the Transaction and, together with the acknowledgment and acceptance set forth below, constitutes the engagement agreement between the Firm and GDT.

This engagement follows our preliminary discussions with you and Dr. Helena Vasquez, Chief Executive Officer of GDT, regarding the contemplated sale of the OncuPath™ companion diagnostics assay line, including the related intellectual property portfolio, regulatory approvals, customer contracts, equipment, inventory, and associated personnel. We understand that the Company's board of directors has authorized management to explore a divestiture of this line of business and to retain outside legal counsel to advise on and facilitate the Transaction.

We further understand and acknowledge that Pinnacle Biosciences Partners Fund III, L.P. ("Pinnacle"), the Company's majority equity sponsor, holding approximately 68.4% of GDT's outstanding common stock, is supportive of the proposed divestiture and that the Company's board of directors, including the Pinnacle-designated directors, has approved the retention of Calderwood & Harkness for this engagement.

We wish to make clear at the outset that the Firm's client in this engagement is Genome Dx Therapeutics Inc. as a corporate entity. Our representation does not extend to Pinnacle Biosciences Partners Fund III, L.P., or any of its affiliates, general partners, limited partners, or portfolio companies, nor does it extend to any individual officer, director, stockholder, or employee of GDT in his or her personal capacity. Our professional obligations of loyalty, confidentiality, and competent representation run solely to GDT in connection with this matter.

2. Scope of Representation

The Firm will represent GDT as seller's counsel in all material aspects of the proposed divestiture of the OncuPath™ companion diagnostics assay line, which is currently anticipated to be structured as an asset purchase. Our representation will include, but not be limited to, the following:

(a) Transaction Structuring. Advising on the structuring of the Transaction, including the determination of whether the divestiture should proceed as an asset purchase, a division sale, or an alternative structure, and analyzing the relative advantages and disadvantages of each structure from a legal, tax, regulatory, and contractual perspective. Based on our preliminary discussions, we understand that the Transaction is anticipated to be structured as an asset purchase, and our work will proceed on that basis unless the parties agree to an alternative structure.

(b) Definitive Transaction Documents. Drafting, reviewing, and negotiating the definitive asset purchase agreement (the "APA") and all ancillary transaction documents, including without limitation:

(i) the bill of sale;

(ii) the assignment and assumption agreement;

(iii) the intellectual property assignment agreement;

(iv) the escrow agreement;

(v) the transition services agreement;

(vi) any earnout provisions and related earnout administration mechanics;

(vii) non-competition and non-solicitation agreements;

(viii) any supply or manufacturing agreements to be entered into between GDT and the buyer in connection with the Transaction; and

(ix) all exhibits, schedules, certificates, and other ancillary documents and instruments required in connection with the execution and closing of the Transaction.

(c) Seller Disclosure Schedules. Preparing and reviewing the seller disclosure schedules to the APA, including coordinating with GDT's management, finance team, and other advisors to compile, organize, verify, and present the required disclosures.

(d) Tax Structuring. Advising on tax structuring considerations in connection with the Transaction, including the allocation of the purchase price among the acquired assets pursuant to Section 1060 of the Internal Revenue Code of 1986, as amended (the "Code"), and the applicable Treasury Regulations thereunder, as well as California source income apportionment considerations, state and local tax consequences, and transfer tax matters.

(e) Regulatory Matters. Advising on regulatory matters arising in connection with the Transaction, including:

(i) the applicability of, and compliance with, the Hart-Scott-Rodino Antitrust Improvements Act of 1976, as amended (the "HSR Act"), including the preparation and filing of any required pre-merger notification forms and the management of the waiting period and any second request process;

(ii) U.S. Food and Drug Administration ("FDA") regulatory transfer considerations, including the transfer or assignment of any FDA clearances, approvals, registrations, or listings associated with the OncuPath™ companion diagnostics assay products; and

(iii) the transfer or re-issuance of Clinical Laboratory Improvement Amendments ("CLIA") certificates and any state laboratory licenses associated with the divested business.

(f) intellectual Property Transfer Matters. Advising on the identification, transfer, and assignment of intellectual property assets associated with the OncuPath™ assay line, including patents, patent applications, trademarks, trade secrets, copyrights, domain names, and know-how. This includes the preparation of patent and trademark assignment instruments, identification and analysis of third-party license agreements requiring consent to assignment (including, without limitation, the existing license agreement between GDT and Vantage Molecular Sciences, Inc. (the "Vantage License")), and coordination of any required consent processes.

(g) Real Estate Matters. Advising on real estate matters implicated by the Transaction, including the assignment of any leases for facilities used in the operation of the OncuPath™ business, the negotiation and procurement of landlord consents to assignment, and the review of any sublease or shared-space arrangements required during any transition period.

(h) Employee and Benefits Matters. Advising on matters relating to the transfer of employees associated with the OncuPath™ business, including the structuring of employee offers and transition arrangements, the treatment of employee benefits (including equity compensation, retirement plans, health and welfare benefits, and accrued leave), and compliance with the Worker Adjustment and Retraining Notification Act of 1988 (the "WARN Act") and analogous state and local laws, including the California WARN Act.

(i) Advisor Coordination. Coordinating with GDT's financial advisor, Brindoval Partners LLC, and GDT's independent auditors, Haverford & Lane LLP, as necessary in connection with the Transaction, including with respect to financial analyses, accounting matters, quality of earnings adjustments, and working capital methodologies.

(j) Representations and Warranties Insurance. Coordinating the procurement of a representations and warranties insurance policy for the Transaction, if applicable, including working with the Company's insurance broker, reviewing and commenting on policy terms, exclusions, and retention levels, and advising on the allocation of insurance-related costs between the buyer and seller.

(k) Closing Deliverables. Preparing closing deliverables on behalf of GDT as seller, including officer's certificates, the secretary's certificate (attaching resolutions, organizational documents, and incumbency), the non-foreign affidavit and FIRPTA certificate pursuant to Section 1445 of the Code and the applicable Treasury Regulations, the funds flow memorandum, and any other documents or instruments required to be delivered by GDT at the closing of the Transaction.

(l) Post-Closing Matters. Advising on post-closing matters, including the working capital adjustment process (including dispute resolution mechanisms), escrow release mechanics, earnout administration and milestone verification procedures, indemnification claims, and any other post-closing obligations arising under the APA or ancillary documents.

(m) Negotiation with Buyer's Counsel. Conducting negotiations with buyer's counsel on all aspects of the Transaction on behalf of GDT, including mark-ups and comments on the APA and ancillary documents, resolution of open business and legal issues, and management of the overall transaction timeline.

Scope Limitations. Our representation of GDT in connection with this engagement is limited to the matters described above. The engagement does not extend to the representation of GDT in connection with any litigation, arbitration, regulatory enforcement proceeding, governmental investigation, or other dispute that is not directly related to the negotiation, execution, and closing of the Transaction, unless separately agreed upon in writing between the Firm and GDT. Similarly, the engagement does not encompass general corporate counseling, securities law advice, or any other legal services unrelated to the Transaction.

Tax Advisory Disclaimer. While Leonard Cross, a partner in the Firm's Tax practice group, will provide tax structuring advice in connection with the Transaction, including with respect to purchase price allocation, California source income apportionment, and related matters, Calderwood & Harkness is not serving as GDT's tax advisor of record for the Transaction or otherwise. We recommend that GDT consult with Haverford & Lane LLP or other qualified tax advisors as appropriate regarding the tax consequences of the Transaction, including any matters not specifically addressed by the Firm's tax structuring advice.

3. Staffing and Responsible Attorneys

The Firm will assign the following attorneys to the engagement, subject to adjustment as the needs of the Transaction require:

Responsible Partner — James Prentice. James Prentice, a partner in the Firm's Mergers & Acquisitions practice group, will have overall responsibility for the engagement and will serve as the primary relationship partner. Mr. Prentice will oversee all aspects of the Firm's work on the Transaction, provide strategic advice on deal structure and negotiation, and serve as a primary point of contact for GDT's senior management and board of directors.

Billing Partner — Sandra Tung. Sandra Tung, a partner in the Firm's Mergers & Acquisitions practice group, will be responsible for billing, matter administration, and financial management of the engagement. Ms. Tung will also contribute substantively to the Transaction, including participation in deal negotiations, review of key transaction documents, and oversight of the disclosure schedule preparation process.

Lead Associate — Tiffany Rosenthal. Tiffany Rosenthal, an associate in the Firm's Mergers & Acquisitions practice group, will serve as the day-to-day lead associate on the engagement and will be the primary drafting attorney on the APA and ancillary transaction documents. Ms. Rosenthal will serve as a primary point of contact for GDT's legal team on day-to-day transactional matters.

Working Associate — Andrew Fitzpatrick. Andrew Fitzpatrick, an associate in the Firm's Mergers & Acquisitions practice group, will assist with due diligence coordination, preparation of regulatory filings (including the HSR Act pre-merger notification, if required), preparation of ancillary documents, and other matters as directed by the partners.

Tax Specialist — Leonard Cross. Leonard Cross, a partner in the Firm's Tax practice group, will advise on tax structuring, purchase price allocation under Section 1060 of the Code, California source income apportionment, transfer tax matters, and related tax issues arising in connection with the Transaction.

Additional attorneys, paralegals, or other professional staff may be assigned to the engagement as needed in light of the scope, complexity, and timing of the Transaction. The Firm will inform GDT of any material changes to the staffing of the engagement, including the assignment of additional partners or the reassignment of responsibility among team members.

GDT has designated the following individuals as the Company's primary contacts for purposes of this engagement: Rebecca Chiang, General Counsel, and Martin Kowalski, Chief Financial Officer. The Firm will direct all substantive communications, deliverables, and invoices to Ms. Chiang and Mr. Kowalski unless otherwise instructed. Copy notices will be provided to Dr. Helena Vasquez, Chief Executive Officer, as requested by the Company.

4. Fee Arrangements

Hourly Rates. Fees for legal services rendered in connection with this engagement will be billed on an hourly basis at the Firm's standard rates for the attorneys and professional staff assigned to the matter. The Firm's current standard hourly rates are as follows:

The specific hourly rate applicable to each individual timekeeper will be reflected on the Firm's monthly invoices. Hourly rates are subject to periodic adjustment, typically on an annual basis effective each January 1. The Firm will provide GDT with advance written notice of any rate changes applicable to the attorneys assigned to this engagement. Any rate adjustments implemented during the term of this engagement will apply prospectively only, to time recorded after the effective date of the adjustment.

Disbursements and Expenses. In addition to legal fees, GDT will be responsible for reimbursement of reasonable out-of-pocket expenses incurred by the Firm in connection with the engagement. Such expenses may include, without limitation, the following:

• Travel expenses, including airfare, ground transportation, lodging, and meals incurred in connection with in-person meetings, negotiations, due diligence sessions, and closings;

• Filing fees, including HSR Act pre-merger notification filing fees, if applicable, and fees for patent and trademark assignment recordings;

• Document production, copying, printing, and scanning charges;

• Courier, overnight delivery, and messenger service charges;

• Computerized legal research charges (e.g., Westmark Data Systems, Sundial Solutions, and specialized databases);

• Court reporter, notarial, and apostille fees;

• Long-distance telephone and conference call charges; and

• Other incidental costs and expenses reasonably incurred in furtherance of the engagement.

Disbursements and expenses will be itemized on the Firm's monthly invoices.

Third-Party Costs. This engagement does not cover the fees, costs, or expenses of other advisors retained by GDT in connection with the Transaction, including without limitation the fees of Brindoval Partners LLC (financial advisor), Haverford & Lane LLP (auditors and tax advisors), insurance brokers, environmental consultants, or any other third-party professionals. Such fees and costs are the separate responsibility of the Company.

Billing Cycle. The Firm will render invoices for fees and expenses on a monthly basis. Invoices are due and payable within thirty (30) days of the date of the invoice. If GDT has any questions or concerns regarding any invoice, we ask that you contact Sandra Tung promptly so that we may address any issues in a timely manner. The Firm reserves the right to charge interest on past-due amounts at the rate of one percent (1.0%) per month, or the maximum rate permitted by applicable law, whichever is less.

Estimated Fees. Based on our understanding of the Transaction as currently contemplated, including the anticipated scope of negotiations, the complexity of the asset base and intellectual property portfolio, the regulatory filing requirements, and the expected timeline, the Firm's current estimate of total legal fees for the engagement is in the range of $1,200,000 to $1,750,000. This estimate is provided for informational and budgeting purposes only and does not constitute a cap, a fixed fee, or a guaranteed maximum price. Actual fees may be higher or lower than the estimated range depending on a number of factors, including the complexity and duration of negotiations with the buyer and buyer's counsel, the scope and depth of due diligence, the number and nature of regulatory filings, the extent of post-signing and post-closing work required, and other factors that cannot be predicted with certainty at this time. The Firm will endeavor to keep GDT informed of the status of fees and expenses relative to the estimate and will promptly notify GDT if we anticipate that total fees may materially exceed the upper end of the estimated range.

Retainer. No retainer is required at the commencement of this engagement. The Firm reserves the right to request a retainer or advance payment of fees in the event of material changes in the scope or complexity of the Transaction, or in the event of any payment delinquency.

5. Conflicts of Interest

The Firm has conducted a conflicts of interest check in accordance with its standard procedures and the applicable California Rules of Professional Conduct. Based on the information currently available to the Firm, we have confirmed that Calderwood & Harkness does not currently represent Meridian Precision Diagnostics, Inc. (which has been identified to us as a potential buyer in connection with the Transaction) or any affiliate of Meridian Precision Diagnostics, Inc. in any matter, and that we are not aware of any other existing client relationship or other circumstance that would create a conflict of interest with respect to this engagement.

We note that Calderwood & Harkness has, in the past, represented Pinnacle Biosciences Partners Fund III, L.P. and certain of its affiliates in connection with unrelated matters. As of the date of this letter, we are not currently representing Pinnacle or any Pinnacle affiliate in any active matter. To the extent that the Firm is retained by Pinnacle or any of its affiliates in connection with any future matter during the pendency of this engagement, we will evaluate the potential for conflict and will promptly notify GDT if we believe that any such representation could give rise to a conflict of interest. We do not believe that the Firm's prior representation of Pinnacle in unrelated matters creates a conflict with respect to this engagement. By signing this letter, GDT acknowledges the Firm's prior representation of Pinnacle and its affiliates in unrelated matters and confirms that GDT does not object to such prior representation.

In the event that an actual or potential conflict of interest arises during the course of this engagement, the Firm will promptly notify GDT and will discuss appropriate steps with GDT, which may include the procurement of informed written consent and waiver from the affected parties, the implementation of ethical screens or other protective measures within the Firm, or, if the conflict cannot be adequately addressed, the withdrawal of the Firm from the engagement or from the conflicting representation, as may be required by applicable professional rules.

6. Confidentiality

Calderwood & Harkness will treat all information received from GDT in connection with this engagement as confidential and will not disclose such information to third parties except as authorized by GDT, as required by applicable law or regulation, as compelled by court order or valid legal process, or as permitted by the applicable rules of professional conduct. The Firm will implement reasonable measures to protect the confidentiality of GDT's information, including limiting access to such information to those attorneys and staff members within the Firm who have a need to know in connection with the engagement.

Communications between GDT and Calderwood & Harkness in connection with this engagement, and work product generated by the Firm in the course of the engagement, will generally be protected by the attorney-client privilege and the work product doctrine, as applicable. These protections are important, and GDT should take care to preserve them. In particular, we advise GDT to exercise caution when forwarding or sharing communications from the Firm, or documents prepared by the Firm, to or with third parties (including Pinnacle, Brindoval Partners LLC, Haverford & Lane LLP, and their respective representatives), as the disclosure of privileged communications to third parties may, under certain circumstances, result in a waiver of the attorney-client privilege. If GDT wishes to share privileged communications or work product with third parties, we recommend that GDT consult with us in advance so that appropriate steps (such as the execution of joint defense agreements or common interest agreements) may be taken to minimize the risk of waiver.

7. Document Retention

At the conclusion of this engagement, the Firm will retain client files and documents in accordance with Calderwood & Harkness's document retention policies then in effect. Under our current policies, client files are generally retained for a period of ten (10) years following the conclusion of the engagement, after which they may be destroyed without further notice to the client unless the client has requested their return or has instructed the Firm to retain them for a longer period.

Upon request at the conclusion of the engagement, the Firm will return original client documents to GDT or, at GDT's election, destroy such documents in a secure manner. Notwithstanding the foregoing, the Firm reserves the right to retain copies of documents and files to the extent required by applicable professional rules, regulatory requirements, or the Firm's internal compliance policies, including copies reasonably necessary for the Firm to evidence the services rendered in connection with the engagement or to defend against any claims arising from the engagement.

8. Termination of Engagement

Either GDT or Calderwood & Harkness may terminate this engagement at any time upon written notice to the other party. Termination by the Firm will be subject to the Firm's obligations under the applicable rules of professional conduct, including any requirement that the Firm obtain leave of any tribunal before which the Firm is appearing on behalf of GDT and that the Firm take reasonable steps to avoid prejudice to GDT's interests.

Upon termination of the engagement for any reason, GDT will remain responsible for the payment of all fees and expenses incurred by the Firm through the effective date of termination, in accordance with the fee arrangements set forth in Section 4 of this letter. The Firm will render a final invoice for all outstanding fees and expenses promptly following termination.

Upon termination, the Firm will cooperate in the orderly transition of the matter to any successor counsel designated by GDT, including by making available the client file (subject to the Firm's document retention policies), providing reasonable assistance in the transition of ongoing work streams, and responding to reasonable inquiries from successor counsel regarding the status of the Transaction and the Firm's work product.

9. Limitation of Liability

To the fullest extent permitted by applicable law and the California Rules of Professional Conduct, the Firm's aggregate liability to GDT arising out of or in connection with this engagement, whether based on contract, tort, negligence, strict liability, or any other legal theory, shall not exceed the total amount of fees actually paid by GDT to Calderwood & Harkness for services rendered under this engagement. This limitation of liability shall not apply to the extent that it is prohibited by applicable law or by the rules of professional conduct governing the Firm's practice, including any prohibition on prospective limitations of liability for legal malpractice.

In no event shall the Firm be liable to GDT for any indirect, incidental, consequential, special, or punitive damages, or for any lost profits, lost business opportunities, or diminution in value, arising out of or in connection with this engagement, regardless of whether such damages were foreseeable or whether the Firm was advised of the possibility of such damages.

10. Governing Law and Dispute Resolution

This engagement letter and the terms and conditions set forth herein shall be governed by and construed in accordance with the laws of the State of California, without regard to its conflict of laws principles.

In the event of any dispute, controversy, or claim arising out of or relating to this engagement letter, the services rendered by the Firm hereunder, or any invoice rendered in connection with this engagement, the parties agree to first attempt to resolve such dispute through good faith negotiation. If the dispute cannot be resolved through negotiation within thirty (30) days after written notice of the dispute is delivered by one party to the other, the dispute shall be submitted to binding arbitration administered by JAMS in Los Angeles, California, in accordance with the JAMS Comprehensive Arbitration Rules and Procedures then in effect. The arbitration shall be conducted by a single arbitrator mutually agreed upon by the parties, or, if the parties are unable to agree, appointed by JAMS. Judgment on the award rendered by the arbitrator may be entered in any court having jurisdiction thereof. Each party shall bear its own costs and attorneys' fees in connection with any arbitration, unless the arbitrator determines otherwise.

11. Acceptance and Counterparts

We are grateful for the opportunity to represent Genome Dx Therapeutics Inc. in connection with this important Transaction, and we look forward to working closely with you, Mr. Kowalski, Dr. Vasquez, and the broader GDT team throughout this process.

If the foregoing terms and conditions are acceptable to GDT, please confirm the Company's agreement by signing and returning a copy of this letter in the space provided below. This letter may be executed in one or more counterparts, each of which shall be deemed an original and all of which together shall constitute one and the same instrument. Signatures transmitted by facsimile, electronic mail (in PDF or similar format), or other electronic means (including Brightwater Software or similar platforms) shall be deemed original signatures for all purposes.

This engagement letter, together with the acknowledgment and acceptance set forth below, constitutes the entire agreement between Calderwood & Harkness LLP and Genome Dx Therapeutics Inc. with respect to the subject matter hereof and supersedes all prior and contemporaneous discussions, negotiations, and agreements, whether oral or written, relating to the Firm's engagement by GDT in connection with the Transaction.

We look forward to partnering with GDT on the divestiture of the OncuPath™ companion diagnostics assay line and to delivering the highest standard of legal service throughout the Transaction.

Very truly yours,

CALDERWOOD & HARKNESS LLP

By: ________

James Prentice, Partner Calderwood & Harkness LLP 555 South Hope Street, Suite 4400 Los Angeles, California 90071 Telephone: (213) 555-7218

Email: jprentice@calderwoodharkness.com

ACKNOWLEDGMENT AND ACCEPTANCE

The undersigned, on behalf of Genome Dx Therapeutics Inc., hereby acknowledges receipt of the foregoing engagement letter dated February 9, 2023, confirms that she has read and understands the terms and conditions set forth therein, and agrees to the engagement of Calderwood & Harkness LLP on the terms and conditions described in the engagement letter.

ACKNOWLEDGED AND AGREED:

GENOME DX THERAPEUTICS INC.

By: ________

Name: Rebecca Chiang

Title: General Counsel

Date: ________

cc:

Dr. Helena Vasquez, Chief Executive Officer, Genome Dx Therapeutics Inc. Martin Kowalski, Chief Financial Officer, Genome Dx Therapeutics Inc. Sandra Tung, Partner, Calderwood & Harkness LLP Tiffany Rosenthal, Associate, Calderwood & Harkness LLP

Timekeeper Category	Current Hourly Rate Range
Partners	$1,150 – $1,450 per hour
Associates	$650 – $950 per hour
Paralegals and Legal Assistants	$350 – $475 per hour

CALDERWOOD & HARKNESS LLP Attorneys at Law
555 South Hope Street, Suite 4400 Los Angeles, California 90071 Telephone: (213) 555-7200 Facsimile: (213) 555-7201 www.calderwoodharkness.com
February 9, 2023
Rebecca Chiang, Esq. General Counsel Genome Dx Therapeutics Inc. 10250 Science Center Drive, Suite 600 San Diego, California 92121
Re: Engagement of Calderwood & Harkness LLP by Genome Dx Therapeutics Inc. in Connection with the Proposed Divestiture of the OncuPath™ Companion Diagnostics Assay Line Matter No. 1013-00006&A-4471
Dear Ms. Chiang:
1. Introduction and Purpose
Calderwood & Harkness LLP ("Calderwood & Harkness" or the "Firm") is pleased to confirm its engagement by Genome Dx Therapeutics Inc. ("GDT" or the "Company") as outside legal counsel in connection with the proposed divestiture of GDT's OncuPath™ companion diagnostics assay line (the "Transaction"). This letter sets forth the terms and conditions governing our representation of the Company in connection with the Transaction and, together with the acknowledgment and acceptance set forth below, constitutes the engagement agreement between the Firm and GDT.
This engagement follows our preliminary discussions with you and Dr. Helena Vasquez, Chief Executive Officer of GDT, regarding the contemplated sale of the OncuPath™ companion diagnostics assay line, including the related intellectual property portfolio, regulatory approvals, customer contracts, equipment, inventory, and associated personnel. We understand that the Company's board of directors has authorized management to explore a divestiture of this line of business and to retain outside legal counsel to advise on and facilitate the Transaction.
We further understand and acknowledge that Pinnacle Biosciences Partners Fund III, L.P. ("Pinnacle"), the Company's majority equity sponsor, holding approximately 68.4% of GDT's outstanding common stock, is supportive of the proposed divestiture and that the Company's board of directors, including the Pinnacle-designated directors, has approved the retention of Calderwood & Harkness for this engagement.
We wish to make clear at the outset that the Firm's client in this engagement is Genome Dx Therapeutics Inc. as a corporate entity. Our representation does not extend to Pinnacle Biosciences Partners Fund III, L.P., or any of its affiliates, general partners, limited partners, or portfolio companies, nor does it extend to any individual officer, director, stockholder, or employee of GDT in his or her personal capacity. Our professional obligations of loyalty, confidentiality, and competent representation run solely to GDT in connection with this matter.
2. Scope of Representation
The Firm will represent GDT as seller's counsel in all material aspects of the proposed divestiture of the OncuPath™ companion diagnostics assay line, which is currently anticipated to be structured as an asset purchase. Our representation will include, but not be limited to, the following:
(a) Transaction Structuring. Advising on the structuring of the Transaction, including the determination of whether the divestiture should proceed as an asset purchase, a division sale, or an alternative structure, and analyzing the relative advantages and disadvantages of each structure from a legal, tax, regulatory, and contractual perspective. Based on our preliminary discussions, we understand that the Transaction is anticipated to be structured as an asset purchase, and our work will proceed on that basis unless the parties agree to an alternative structure.
(b) Definitive Transaction Documents. Drafting, reviewing, and negotiating the definitive asset purchase agreement (the "APA") and all ancillary transaction documents, including without limitation:
(i) the bill of sale;
(ii) the assignment and assumption agreement;
(iii) the intellectual property assignment agreement;
(iv) the escrow agreement;
(v) the transition services agreement;
(vi) any earnout provisions and related earnout administration mechanics;
(vii) non-competition and non-solicitation agreements;
(viii) any supply or manufacturing agreements to be entered into between GDT and the buyer in connection with the Transaction; and
(ix) all exhibits, schedules, certificates, and other ancillary documents and instruments required in connection with the execution and closing of the Transaction.
(c) Seller Disclosure Schedules. Preparing and reviewing the seller disclosure schedules to the APA, including coordinating with GDT's management, finance team, and other advisors to compile, organize, verify, and present the required disclosures.
(d) Tax Structuring. Advising on tax structuring considerations in connection with the Transaction, including the allocation of the purchase price among the acquired assets pursuant to Section 1060 of the Internal Revenue Code of 1986, as amended (the "Code"), and the applicable Treasury Regulations thereunder, as well as California source income apportionment considerations, state and local tax consequences, and transfer tax matters.
(e) Regulatory Matters. Advising on regulatory matters arising in connection with the Transaction, including:
(i) the applicability of, and compliance with, the Hart-Scott-Rodino Antitrust Improvements Act of 1976, as amended (the "HSR Act"), including the preparation and filing of any required pre-merger notification forms and the management of the waiting period and any second request process;
(ii) U.S. Food and Drug Administration ("FDA") regulatory transfer considerations, including the transfer or assignment of any FDA clearances, approvals, registrations, or listings associated with the OncuPath™ companion diagnostics assay products; and
(iii) the transfer or re-issuance of Clinical Laboratory Improvement Amendments ("CLIA") certificates and any state laboratory licenses associated with the divested business.
(f) intellectual Property Transfer Matters. Advising on the identification, transfer, and assignment of intellectual property assets associated with the OncuPath™ assay line, including patents, patent applications, trademarks, trade secrets, copyrights, domain names, and know-how. This includes the preparation of patent and trademark assignment instruments, identification and analysis of third-party license agreements requiring consent to assignment (including, without limitation, the existing license agreement between GDT and Vantage Molecular Sciences, Inc. (the "Vantage License")), and coordination of any required consent processes.
(g) Real Estate Matters. Advising on real estate matters implicated by the Transaction, including the assignment of any leases for facilities used in the operation of the OncuPath™ business, the negotiation and procurement of landlord consents to assignment, and the review of any sublease or shared-space arrangements required during any transition period.
(h) Employee and Benefits Matters. Advising on matters relating to the transfer of employees associated with the OncuPath™ business, including the structuring of employee offers and transition arrangements, the treatment of employee benefits (including equity compensation, retirement plans, health and welfare benefits, and accrued leave), and compliance with the Worker Adjustment and Retraining Notification Act of 1988 (the "WARN Act") and analogous state and local laws, including the California WARN Act.
(i) Advisor Coordination. Coordinating with GDT's financial advisor, Brindoval Partners LLC, and GDT's independent auditors, Haverford & Lane LLP, as necessary in connection with the Transaction, including with respect to financial analyses, accounting matters, quality of earnings adjustments, and working capital methodologies.
(j) Representations and Warranties Insurance. Coordinating the procurement of a representations and warranties insurance policy for the Transaction, if applicable, including working with the Company's insurance broker, reviewing and commenting on policy terms, exclusions, and retention levels, and advising on the allocation of insurance-related costs between the buyer and seller.
(k) Closing Deliverables. Preparing closing deliverables on behalf of GDT as seller, including officer's certificates, the secretary's certificate (attaching resolutions, organizational documents, and incumbency), the non-foreign affidavit and FIRPTA certificate pursuant to Section 1445 of the Code and the applicable Treasury Regulations, the funds flow memorandum, and any other documents or instruments required to be delivered by GDT at the closing of the Transaction.
(l) Post-Closing Matters. Advising on post-closing matters, including the working capital adjustment process (including dispute resolution mechanisms), escrow release mechanics, earnout administration and milestone verification procedures, indemnification claims, and any other post-closing obligations arising under the APA or ancillary documents.
(m) Negotiation with Buyer's Counsel. Conducting negotiations with buyer's counsel on all aspects of the Transaction on behalf of GDT, including mark-ups and comments on the APA and ancillary documents, resolution of open business and legal issues, and management of the overall transaction timeline.
Scope Limitations. Our representation of GDT in connection with this engagement is limited to the matters described above. The engagement does not extend to the representation of GDT in connection with any litigation, arbitration, regulatory enforcement proceeding, governmental investigation, or other dispute that is not directly related to the negotiation, execution, and closing of the Transaction, unless separately agreed upon in writing between the Firm and GDT. Similarly, the engagement does not encompass general corporate counseling, securities law advice, or any other legal services unrelated to the Transaction.
Tax Advisory Disclaimer. While Leonard Cross, a partner in the Firm's Tax practice group, will provide tax structuring advice in connection with the Transaction, including with respect to purchase price allocation, California source income apportionment, and related matters, Calderwood & Harkness is not serving as GDT's tax advisor of record for the Transaction or otherwise. We recommend that GDT consult with Haverford & Lane LLP or other qualified tax advisors as appropriate regarding the tax consequences of the Transaction, including any matters not specifically addressed by the Firm's tax structuring advice.
3. Staffing and Responsible Attorneys
The Firm will assign the following attorneys to the engagement, subject to adjustment as the needs of the Transaction require:
Responsible Partner — James Prentice. James Prentice, a partner in the Firm's Mergers & Acquisitions practice group, will have overall responsibility for the engagement and will serve as the primary relationship partner. Mr. Prentice will oversee all aspects of the Firm's work on the Transaction, provide strategic advice on deal structure and negotiation, and serve as a primary point of contact for GDT's senior management and board of directors.
Billing Partner — Sandra Tung. Sandra Tung, a partner in the Firm's Mergers & Acquisitions practice group, will be responsible for billing, matter administration, and financial management of the engagement. Ms. Tung will also contribute substantively to the Transaction, including participation in deal negotiations, review of key transaction documents, and oversight of the disclosure schedule preparation process.
Lead Associate — Tiffany Rosenthal. Tiffany Rosenthal, an associate in the Firm's Mergers & Acquisitions practice group, will serve as the day-to-day lead associate on the engagement and will be the primary drafting attorney on the APA and ancillary transaction documents. Ms. Rosenthal will serve as a primary point of contact for GDT's legal team on day-to-day transactional matters.
Working Associate — Andrew Fitzpatrick. Andrew Fitzpatrick, an associate in the Firm's Mergers & Acquisitions practice group, will assist with due diligence coordination, preparation of regulatory filings (including the HSR Act pre-merger notification, if required), preparation of ancillary documents, and other matters as directed by the partners.
Tax Specialist — Leonard Cross. Leonard Cross, a partner in the Firm's Tax practice group, will advise on tax structuring, purchase price allocation under Section 1060 of the Code, California source income apportionment, transfer tax matters, and related tax issues arising in connection with the Transaction.
Additional attorneys, paralegals, or other professional staff may be assigned to the engagement as needed in light of the scope, complexity, and timing of the Transaction. The Firm will inform GDT of any material changes to the staffing of the engagement, including the assignment of additional partners or the reassignment of responsibility among team members.
GDT has designated the following individuals as the Company's primary contacts for purposes of this engagement: Rebecca Chiang, General Counsel, and Martin Kowalski, Chief Financial Officer. The Firm will direct all substantive communications, deliverables, and invoices to Ms. Chiang and Mr. Kowalski unless otherwise instructed. Copy notices will be provided to Dr. Helena Vasquez, Chief Executive Officer, as requested by the Company.
4. Fee Arrangements
Hourly Rates. Fees for legal services rendered in connection with this engagement will be billed on an hourly basis at the Firm's standard rates for the attorneys and professional staff assigned to the matter. The Firm's current standard hourly rates are as follows:
The specific hourly rate applicable to each individual timekeeper will be reflected on the Firm's monthly invoices. Hourly rates are subject to periodic adjustment, typically on an annual basis effective each January 1. The Firm will provide GDT with advance written notice of any rate changes applicable to the attorneys assigned to this engagement. Any rate adjustments implemented during the term of this engagement will apply prospectively only, to time recorded after the effective date of the adjustment.
Disbursements and Expenses. In addition to legal fees, GDT will be responsible for reimbursement of reasonable out-of-pocket expenses incurred by the Firm in connection with the engagement. Such expenses may include, without limitation, the following:
•  Travel expenses, including airfare, ground transportation, lodging, and meals incurred in connection with in-person meetings, negotiations, due diligence sessions, and closings;
•  Filing fees, including HSR Act pre-merger notification filing fees, if applicable, and fees for patent and trademark assignment recordings;
•  Document production, copying, printing, and scanning charges;
•  Courier, overnight delivery, and messenger service charges;
•  Computerized legal research charges (e.g., Westmark Data Systems, Sundial Solutions, and specialized databases);
•  Court reporter, notarial, and apostille fees;
•  Long-distance telephone and conference call charges; and
•  Other incidental costs and expenses reasonably incurred in furtherance of the engagement.
Disbursements and expenses will be itemized on the Firm's monthly invoices.
Third-Party Costs. This engagement does not cover the fees, costs, or expenses of other advisors retained by GDT in connection with the Transaction, including without limitation the fees of Brindoval Partners LLC (financial advisor), Haverford & Lane LLP (auditors and tax advisors), insurance brokers, environmental consultants, or any other third-party professionals. Such fees and costs are the separate responsibility of the Company.
Billing Cycle. The Firm will render invoices for fees and expenses on a monthly basis. Invoices are due and payable within thirty (30) days of the date of the invoice. If GDT has any questions or concerns regarding any invoice, we ask that you contact Sandra Tung promptly so that we may address any issues in a timely manner. The Firm reserves the right to charge interest on past-due amounts at the rate of one percent (1.0%) per month, or the maximum rate permitted by applicable law, whichever is less.
Estimated Fees. Based on our understanding of the Transaction as currently contemplated, including the anticipated scope of negotiations, the complexity of the asset base and intellectual property portfolio, the regulatory filing requirements, and the expected timeline, the Firm's current estimate of total legal fees for the engagement is in the range of $1,200,000 to $1,750,000. This estimate is provided for informational and budgeting purposes only and does not constitute a cap, a fixed fee, or a guaranteed maximum price. Actual fees may be higher or lower than the estimated range depending on a number of factors, including the complexity and duration of negotiations with the buyer and buyer's counsel, the scope and depth of due diligence, the number and nature of regulatory filings, the extent of post-signing and post-closing work required, and other factors that cannot be predicted with certainty at this time. The Firm will endeavor to keep GDT informed of the status of fees and expenses relative to the estimate and will promptly notify GDT if we anticipate that total fees may materially exceed the upper end of the estimated range.
Retainer. No retainer is required at the commencement of this engagement. The Firm reserves the right to request a retainer or advance payment of fees in the event of material changes in the scope or complexity of the Transaction, or in the event of any payment delinquency.
5. Conflicts of Interest
The Firm has conducted a conflicts of interest check in accordance with its standard procedures and the applicable California Rules of Professional Conduct. Based on the information currently available to the Firm, we have confirmed that Calderwood & Harkness does not currently represent Meridian Precision Diagnostics, Inc. (which has been identified to us as a potential buyer in connection with the Transaction) or any affiliate of Meridian Precision Diagnostics, Inc. in any matter, and that we are not aware of any other existing client relationship or other circumstance that would create a conflict of interest with respect to this engagement.
We note that Calderwood & Harkness has, in the past, represented Pinnacle Biosciences Partners Fund III, L.P. and certain of its affiliates in connection with unrelated matters. As of the date of this letter, we are not currently representing Pinnacle or any Pinnacle affiliate in any active matter. To the extent that the Firm is retained by Pinnacle or any of its affiliates in connection with any future matter during the pendency of this engagement, we will evaluate the potential for conflict and will promptly notify GDT if we believe that any such representation could give rise to a conflict of interest. We do not believe that the Firm's prior representation of Pinnacle in unrelated matters creates a conflict with respect to this engagement. By signing this letter, GDT acknowledges the Firm's prior representation of Pinnacle and its affiliates in unrelated matters and confirms that GDT does not object to such prior representation.
In the event that an actual or potential conflict of interest arises during the course of this engagement, the Firm will promptly notify GDT and will discuss appropriate steps with GDT, which may include the procurement of informed written consent and waiver from the affected parties, the implementation of ethical screens or other protective measures within the Firm, or, if the conflict cannot be adequately addressed, the withdrawal of the Firm from the engagement or from the conflicting representation, as may be required by applicable professional rules.
6. Confidentiality
Calderwood & Harkness will treat all information received from GDT in connection with this engagement as confidential and will not disclose such information to third parties except as authorized by GDT, as required by applicable law or regulation, as compelled by court order or valid legal process, or as permitted by the applicable rules of professional conduct. The Firm will implement reasonable measures to protect the confidentiality of GDT's information, including limiting access to such information to those attorneys and staff members within the Firm who have a need to know in connection with the engagement.
Communications between GDT and Calderwood & Harkness in connection with this engagement, and work product generated by the Firm in the course of the engagement, will generally be protected by the attorney-client privilege and the work product doctrine, as applicable. These protections are important, and GDT should take care to preserve them. In particular, we advise GDT to exercise caution when forwarding or sharing communications from the Firm, or documents prepared by the Firm, to or with third parties (including Pinnacle, Brindoval Partners LLC, Haverford & Lane LLP, and their respective representatives), as the disclosure of privileged communications to third parties may, under certain circumstances, result in a waiver of the attorney-client privilege. If GDT wishes to share privileged communications or work product with third parties, we recommend that GDT consult with us in advance so that appropriate steps (such as the execution of joint defense agreements or common interest agreements) may be taken to minimize the risk of waiver.
7. Document Retention
At the conclusion of this engagement, the Firm will retain client files and documents in accordance with Calderwood & Harkness's document retention policies then in effect. Under our current policies, client files are generally retained for a period of ten (10) years following the conclusion of the engagement, after which they may be destroyed without further notice to the client unless the client has requested their return or has instructed the Firm to retain them for a longer period.
Upon request at the conclusion of the engagement, the Firm will return original client documents to GDT or, at GDT's election, destroy such documents in a secure manner. Notwithstanding the foregoing, the Firm reserves the right to retain copies of documents and files to the extent required by applicable professional rules, regulatory requirements, or the Firm's internal compliance policies, including copies reasonably necessary for the Firm to evidence the services rendered in connection with the engagement or to defend against any claims arising from the engagement.
8. Termination of Engagement
Either GDT or Calderwood & Harkness may terminate this engagement at any time upon written notice to the other party. Termination by the Firm will be subject to the Firm's obligations under the applicable rules of professional conduct, including any requirement that the Firm obtain leave of any tribunal before which the Firm is appearing on behalf of GDT and that the Firm take reasonable steps to avoid prejudice to GDT's interests.
Upon termination of the engagement for any reason, GDT will remain responsible for the payment of all fees and expenses incurred by the Firm through the effective date of termination, in accordance with the fee arrangements set forth in Section 4 of this letter. The Firm will render a final invoice for all outstanding fees and expenses promptly following termination.
Upon termination, the Firm will cooperate in the orderly transition of the matter to any successor counsel designated by GDT, including by making available the client file (subject to the Firm's document retention policies), providing reasonable assistance in the transition of ongoing work streams, and responding to reasonable inquiries from successor counsel regarding the status of the Transaction and the Firm's work product.
9. Limitation of Liability
To the fullest extent permitted by applicable law and the California Rules of Professional Conduct, the Firm's aggregate liability to GDT arising out of or in connection with this engagement, whether based on contract, tort, negligence, strict liability, or any other legal theory, shall not exceed the total amount of fees actually paid by GDT to Calderwood & Harkness for services rendered under this engagement. This limitation of liability shall not apply to the extent that it is prohibited by applicable law or by the rules of professional conduct governing the Firm's practice, including any prohibition on prospective limitations of liability for legal malpractice.
In no event shall the Firm be liable to GDT for any indirect, incidental, consequential, special, or punitive damages, or for any lost profits, lost business opportunities, or diminution in value, arising out of or in connection with this engagement, regardless of whether such damages were foreseeable or whether the Firm was advised of the possibility of such damages.
10. Governing Law and Dispute Resolution
This engagement letter and the terms and conditions set forth herein shall be governed by and construed in accordance with the laws of the State of California, without regard to its conflict of laws principles.
In the event of any dispute, controversy, or claim arising out of or relating to this engagement letter, the services rendered by the Firm hereunder, or any invoice rendered in connection with this engagement, the parties agree to first attempt to resolve such dispute through good faith negotiation. If the dispute cannot be resolved through negotiation within thirty (30) days after written notice of the dispute is delivered by one party to the other, the dispute shall be submitted to binding arbitration administered by JAMS in Los Angeles, California, in accordance with the JAMS Comprehensive Arbitration Rules and Procedures then in effect. The arbitration shall be conducted by a single arbitrator mutually agreed upon by the parties, or, if the parties are unable to agree, appointed by JAMS. Judgment on the award rendered by the arbitrator may be entered in any court having jurisdiction thereof. Each party shall bear its own costs and attorneys' fees in connection with any arbitration, unless the arbitrator determines otherwise.
11. Acceptance and Counterparts
We are grateful for the opportunity to represent Genome Dx Therapeutics Inc. in connection with this important Transaction, and we look forward to working closely with you, Mr. Kowalski, Dr. Vasquez, and the broader GDT team throughout this process.
If the foregoing terms and conditions are acceptable to GDT, please confirm the Company's agreement by signing and returning a copy of this letter in the space provided below. This letter may be executed in one or more counterparts, each of which shall be deemed an original and all of which together shall constitute one and the same instrument. Signatures transmitted by facsimile, electronic mail (in PDF or similar format), or other electronic means (including Brightwater Software or similar platforms) shall be deemed original signatures for all purposes.
This engagement letter, together with the acknowledgment and acceptance set forth below, constitutes the entire agreement between Calderwood & Harkness LLP and Genome Dx Therapeutics Inc. with respect to the subject matter hereof and supersedes all prior and contemporaneous discussions, negotiations, and agreements, whether oral or written, relating to the Firm's engagement by GDT in connection with the Transaction.
We look forward to partnering with GDT on the divestiture of the OncuPath™ companion diagnostics assay line and to delivering the highest standard of legal service throughout the Transaction.
Very truly yours,
CALDERWOOD & HARKNESS LLP
By: ________
James Prentice, Partner Calderwood & Harkness LLP 555 South Hope Street, Suite 4400 Los Angeles, California 90071 Telephone: (213) 555-7218
Email: jprentice@calderwoodharkness.com
ACKNOWLEDGMENT AND ACCEPTANCE
The undersigned, on behalf of Genome Dx Therapeutics Inc., hereby acknowledges receipt of the foregoing engagement letter dated February 9, 2023, confirms that she has read and understands the terms and conditions set forth therein, and agrees to the engagement of Calderwood & Harkness LLP on the terms and conditions described in the engagement letter.
ACKNOWLEDGED AND AGREED:
GENOME DX THERAPEUTICS INC.
By: ________
Name: Rebecca Chiang
Title: General Counsel
Date: ________
cc:
Dr. Helena Vasquez, Chief Executive Officer, Genome Dx Therapeutics Inc. Martin Kowalski, Chief Financial Officer, Genome Dx Therapeutics Inc. Sandra Tung, Partner, Calderwood & Harkness LLP Tiffany Rosenthal, Associate, Calderwood & Harkness LLP
Timekeeper Category | Current Hourly Rate Range
Partners | $1,150 – $1,450 per hour
Associates | $650 – $950 per hour
Paralegals and Legal Assistants | $350 – $475 per hour

CALDERWOOD & HARKNESS LLP Attorneys at Law

CALDERWOOD & HARKNESS LLP

ACKNOWLEDGMENT AND ACCEPTANCE

ACKNOWLEDGED AND AGREED:

GENOME DX THERAPEUTICS INC.

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